Court Opinion

ID: 9676588
Source: CourtListenerOpinion
Date Created: 2023-08-24 05:28:09.662473+00
Date Added: 2024-06-11T18:16:49.665622
License: Public Domain

Melvin Mayfield, Judge, dissenting. I respectfully suggest that the majority opinion has interpreted a legislative act contrary to its intent and contrary to the interpretation of the Arkansas Supreme Court. At the close of appellant’s evidence, the trial judge granted the insurance company’s motion for directed verdict on the specific finding that the policy was issued without the written application or consent of the insured and that the policy was therefore invalid for failure to comply with the requirement of Ark. Stat. Ann. § 66-3206 (Repl. 1980). That statute reads as follows: Application required — Life and disability insurance. — No life or disability insurance contract upon an individual, except a contract of group life insurance or of group or blanket disability insurance, shall be made or effectuated unless at the time of the making of the contract the individual insured, being of competent legal capacity to contract, applies therefor or has consented thereto in writing, except in the following cases: (1) A spouse may effectuate such insurance upon the other spouse. (2) Any person having an insurable interest in the life of a minor, or any person upon whom a minor is dependent for support and maintenance, may effectuate insurance upon the life of or pertaining to such minor. (3) The application for accident insurance procured through a vending machine licensed under section 171 [§ 66-2828] must be signed by the individual to be so insured; or if the individual to be so insured does not have legal capacity to contract the application must be signed by such individual’s parent, guardian, or other legally constituted representative. (4) Family policies may be issued insuring any two (2) or more members of a family on an application signed by either parent, a stepparent, or by a husband or wife. [Acts 1959, No. 148, § 273, p. 418.] (Emphasis added.) Focusing upon the phrase “applies therefor or has consented thereto in writing,” the majority has relied upon Cableton v. Gulf Life Insurance Co., 12 Ark. App. 257, 674 S.W.2d 951 (1984), to sustain the trial court’s action. First, I think we should give careful consideration to the evidence applicable to the issue involved. The record discloses that appellant, Ora Lee Hunt, was sitting in the living room of her house when the insurance company’s agent came to her door, stated he had just paid an insurance claim in the neighborhood, and asked if appellant had insurance. She testified the agent told her that he “would find something to fit her budget” and that he eventually “wrote me and the kids up and my husband.” She then told the agent that her sister, Dorothy Mae Jones, wanted appellant to “take out a policy on her.” The agent said he could take care of that too, and while he was sitting in appellant’s living room, she called her sister who said it was “okay.” The agent then asked appellant “a lot of questions” about the sister and, after he had filled out an application for insurance, he asked appellant to sign the sister’s name on it. Appellant asked if her husband could sign it and, upon the agent’s assurance it would be “okay,” the husband signed the sister’s name on the application. Second, we need to carefully apply the above evidence to the legislative act and to the Cableton decision relied upon by the majority. Cableton states that the act sets forth the policy of this state as demonstrated by the case of Callicott v. Dixie Life & Accident Insurance Company, 198 Ark. 69, 127 S.W.2d 620 (1939), which held that “it is against public policy to allow one person to have insurance on the life of another without the knowledge of the latter.” Cableton, 12 Ark. App. at 259. Looking at the act, we see it really does a little more than require the person insured to have “knowledge” of the insurance. Actually, the act provides that the insurance shall not be made or effectuated unless the individual insured “applies therefor or has consented thereto in writing.” Perhaps this case should have been certified to our Supreme Court under Rule 29(1 )(c), as involving the interpretation of an act of the General Assembly. However, I think it is reasonably clear that the act contemplates two situations: (1) where the individual insured “applies” for the insurance and (2) where the individual insured “has consented thereto in writing.” Under the first situation, the person insured is obtaining insurance on his own life. In Constitution Life Insurance Co. v. M.D. Thompson & Son, Inc., 251 Ark. 784, 475 S.W.2d 165 (1972), it was argued that the insured did not consent to the issuance of the policy in writing as required by Ark. Stat. Ann. § 66-3206, supra. The court said the insured’s writing of a personal check to get a cashier’s check to pay the insurance premium was a sufficient “consent in writing” to comply with the act, but the court said the insured had also accepted the company’s oral counteroffer for $10,000.00 coverage on his life, instead of the$50,000.00 applied for, and that this made an oral contract which was valid. The court reasoned “had the General Assembly intended to invalidate oral contracts for life insurance it could have done so in simple language.” It therefore seems clear that the Arkansas Supreme Court does not believe the legislature has prohibited one from making an oral contract for insurance on his own life. And, if Ark. Stat. Ann. § 66-3206 “codifies” the public policy against insuring the life of another, as Cableton states it does, it is clear that what the legislature intended to prevent was the insuring of the life of another unless the person insured “consented thereto in writing.” Thus, we should hold that the evidence presented by the appellant in this case, when considered in the light most favorable to her, was sufficient to present a question of fact on the issue of whether the insured, Dorothy Mae Jones, orally applied for the insurance on her life, as distinguished from only consenting to the issuance of the policy. However, even if it is held that Ark. Stat. Ann. § 66-3206 requires a writing by the insured (whether considered an application or consent), the evidence presented by the appellant made an issue of fact in that regard. The Constitution Life Insurance Co. v. M.D. Thompson & Son, Inc., case, supra, makes it clear that there only has to be a substantial compliance with the writing requirement. Here, we have a written application to which the insured’s name was signed by her brother-in-law. If this was authorized by the insured, I think she has made a written application. In the Missouri case of Sells v. Fireside Life Ass’n, 66 S.W.2d 955 (Mo. App. 1934), it was contended that the policy would not have been issued if the company had known that the wife had signed her husband’s name to the application without his authority or knowledge. There was evidence that he was “willing to take out the insurance,” and that he knew his wife “was going to fill out the application.” The court held that this evidence made an issue of fact for the jury “insofar as the signing of the application” was concerned. That holding was later referred to with approval by the Missouri Supreme Court, see Bryne v. Prudential Insurance Company of America, 88 S.W.2d 344 (Mo. 1935). While the case was not involved with a statutory requirement for an application in writing, it certainly supports the proposition that one can make a written application for insurance by authorizing another to sign the insured’s name for him. I believe the trial court erred in granting the insurance company’s motion for directed verdict; therefore, I dissent from the majority opinion in this case. Cooper and Jennings, JJ., join in this dissent.