Court Opinion

ID: 7898364
Source: CourtListenerOpinion
Date Created: 2022-09-08 21:53:53.729002+00
Date Added: 2024-06-11T16:32:10.302860
License: Public Domain

Bryan, J.,
delivered the opinion of the Court as follows when overruling the motion:
The learned counsel for the appellant have moved for a re-argument in this case. They base their motion on the supposition that the Court overlooked or disregarded certain clauses in the application for insurance. These clauses were quoted word for word in the statement prepared hy the Court, which preceded the opinion and which set forth the facts on which it was founded. The, Pennsylvania statute enacted that “whenever the application for a policy of life insurance contains a clause of warranty of the truth of the answers therein contained, no misrepresentation or untrue statement in such application made in good faith hy the applicant shall effect a forfeiture ******** unless such misrepresentation or untrue statement relate to some matter material to the risk. ” This is a most clear declaration that under the circumstances mentioned, the policy shall not he forfeited ; in other words, that it shall he a valid and binding contract. It is part of the nature and essence of the warranty that it should have the eifect stated. It is a condition on which it is permitted to have existence and operation; as much so, as if it had been written in express words on the face of the policy. The contract of insurance must he made in subordination to the statute, and must have the legal effect which the statute attributes to it, and none other. Whatever form of words may he used, the legal effect of the warranty must he such as the statute impresses upon it. It was the intention of the Legislature to prevent insurance companies from forfeiting policies hy means of warranties, as they had been previously construed, and to enforce the new construction set forth in the statute. These corporations *186manifestly have not the legal capacity to make a contract which should give a construction to a warranty in opposition to that which the law has established. And, of course, they cannot, by virtue of any agreement, acquire the competency to do what the law forbids.
It is stated in the policy that the application for insurance is made a part of the contract, and that the assured agrees that every statement and answer contained therein is-material, and warrants them “tobe full, complete and true.” And in the application, the applicant declares and agrées that every statement and answer are material to, the risk, and he warrants them all. He also states as follows: “ I also agree that if any of the answers or statements made and contained herein ****** whether made in good faith, or otherwise, are in any respect untrue, then said policy and this contract shall-be null and void, notwithstanding any statute or law to the contrary.” In other words, the statute is to he entirely overthrown and set aside; and the insurance company, under the guise of an agreement, is to acquire the power to accomplish the very result which the statute intended to prevent. Statutes would he very ineffective if they could be defeated in this way. If an untrue statement material to the risk is warranted, the policy is void; but the invalidity of the policy depends upon the fact whether the statement is material to the risk. The materiality of the statement is the indispensable condition on which the invalidity of the policy depends, and it must be established by proof. It is not competent to substitute for this proof an agreement of the parties that it should be considered material. Neither can an agreement be valid which gives an effect to a warranty, which is in defiance of the statute. The Legislature enacted a rule for the regulation of the contracts of insurance companies, which is a matter of public interest and concern. The operation of this rule does nokdepend *187on the agreement of these corporations to adopt it as a basis of their contracts; on the contrary, the rule prescribes the scope and effect of policies of insurance, and authoritatively determines the duties and obligations which arise from them.
(Decided 13th October, 1891.)
. We have discovered no reason for another argument in this case.

Motion overruled.