Court Opinion

ID: 9445678
Source: CourtListenerOpinion
Date Created: 2023-08-03 21:36:28.430408+00
Date Added: 2024-06-11T17:30:22.706594
License: Public Domain

*902HEALY, Circuit Judge.
I dissent.
The facts before us are relatively simple. On December 6, 1952, Warren W. Lloyd signed an application for life insurance from appellee insurer on a form provided by the latter. Item 25 on the application form read: “Use this space for special requests.” Filled in thereunder was the following: “Date Policy Jan. 1, 1953.”
At the time Lloyd executed the application (December 6, 1952) he gave the insurer his note for $12.57 to' pay the first month’s premium. At the same time the insurer gave Lloyd a receipt for this payment on a form which it had prepared. The following statement appeared on the application form:
“There has been delivered to the agent the sum of $12.57 in * * * notes, on account of the first premium. (See agreements below.)
* * * * * •»
“* * * it is hereby agreed: * * * (3) That any policy issued hereon shall not take effect unless and until the policy has been delivered to the undersigned and the first premium paid during the lifetime and good health of the proposed insured (except as provided in the Receipt bearing the same number and date as this application if the entire first premium has been paid and acknowledged above and such receipt issued) in which event such policy shall be deemed effective as of the beginning of the first policy year as shown on such policy * * [Emphasis supplied.]
The insurer subsequently issued Lloyd its policy No. 1127042. In the policy it was stated that the “first policy year” began January 1, 1953, and that the policy had been “executed” January 5, 1953. The policy contained the following provision:
“Suicide: If within two years from date of issue the Insured (whether sane or insane) shall die by self-destruction, the liability of the Company shall be restricted to the amount of premiums paid hereon.”
Sometime in January of 1953 the insurer delivered the policy to Lloyd. At that time Lloyd decided to pay the premiums quarterly instead of monthly, so he gave the insurer $36.04 to cover the period from January 1 to March 31,1953. The insurer then either returned to Lloyd or destroyed the note for $12.57.
On December 21, 1954, Lloyd committed suicide.
His wife, the beneficiary, brought suit on the policy. The insurer defended on the ground of suicide within the two-year period. Each party moved for summary judgment. The motion of the insurer was granted.
The sole question here is: What was the “date of issue” referred to in the suicide clause? Neither the policy, the application, nor the receipt define this term. The insurer could have removed doubt or uncertainty by specifying in the policy what it meant by the phrase “date of issue.” Since it did not do so, the term should be construed most favorably to the beneficiary. Mutual Life Ins. Co. of New York v. Hurni Packing Co., 1923, 263 U.S. 167, 174, 44 S.Ct. 90, 68 L. Ed. 235.
My brothers confuse the term “date of issue” with the effective date of the insurer’s liability on the policy. They decide that there was no coverage prior to January 1, 1953, and they accordingly assume that the “date of issue” could not have preceded January 1. However, assuming (without deciding) that there was no liability on the policy prior to that date, I see no reason why, under the unusual circumstances of this case, the “date of issue” to which the suicide clause makes reference cannot fairly be thought to have preceded January 1, 1953. See State Mutual Life Assurance Co. v. Stapp, 7 Cir., 1934, 72 F.2d 142, 144. In that case it was held that though an insurer’s liability did not begin until January 28, 1931, a suicide on January *90327, 1933 was without the two-year suicide exclusion of policies bearing the date January 12, 1931.
The purpose of the suicide exclusion is to protect the insurer from one procuring insurance with the thought or intention of early suicide. That purpose is substantially achieved here if the exclusion runs from the date of issue of the receipt given the insured by the insurer on December 6, 1952, for the first premium payment. This construction seems to me only fair and reasonable. The insurer is in no position to complain of it since if it intended something different it could easily have used terms that would render its meaning plain. See New York Life Insurance Co. v. Noonan, 9 Cir., 1954, 215 F.2d 905.
I would reverse the judgment.