
    Jacob Miller, App’lt, v. The Phœnix Mutual Life Insurance Co., Resp’t.
    
    
      (Court of Appeals,
    
    
      Filed November 29, 1887.)
    
    1. Insurance (life)—Action on policy—Evidence.
    This action was brought against the insurer by the person for whose benefit insurance was effected on the life of another, in order to obtain an adjudication as to whether or not it was valid. The policy contained, among others, a provision that if any of the declarations or statements made in the application for it, and upon the faith of which it was issued, should be found in any respect untrue, then it should be void. Held, that the fact that the insured made untrue representations in regard to previous insurance in another company, not being set up in the answer, was not available to the defendant as a defense in this action.
    3. Same—When insurer estopped by statements contained in application.
    Where the application for insurance is drawn up by the agent of the insurer, and the answers to the questions contained therein, are inserted by him at his own suggestion without fraud or collusion on the part of the assured, the insurer is estopped from controverting the truth of such statements, or the interpretation which it has given to the answers actually made by the applicant, in an action upon the instrument between the parties thereto.
    3. Same—Breach of warranty—What is not sufficient to establish.
    If on the application for a policy of insurance a question is not answered, there is no warranty that there is nothing to answer. A breach of warranty, unlike fraud, may not be predicated on the suppress'on of the truth, but must be based on the affirmation of something not true.
    Appeal from a judgment of the supreme court, general term, fourth department, affirming a judgment entered upon a report of a referee.
    
      Isaac D. Garfield, for app’lt; D. O'Brien, for resp’t.
    
      
       Reversing 36 Hun, 640, mem.
      
    
   Ruger, Ch. J.

The application for the policy in suit was •signed by one Michael Dreher, was dated April 17, 1871, and contained questions, to be answered by applicant for insurance, which were therein declared to form the basis of the contract. Among others was the following:

“ When and where was the party, whose life is to be insured, born ? And it purported to be answered as follows:
“At Ruttlingen, Germany; year, 1807; month, October; day 31; age at nearest birthday, 64.”

Theaplication further stated: “It is hereby declared that the above are full and true answers to the foregoing questions, and it is acknowledged and agreed by the undersigned, that this application shall form the basis of the contract of insurance * * * and that any untrue or fraudulent, answers, any suppression of facts * * * shall and will render the policy null and void, and forfeit all payments made thereon.”

A life policy for $10,000, payable to the plaintiff, was-issued by the defendant upon this application and contained,, among other provisions, the following: “This policy is-issued and accepted by the assured upon the following express conditions and agreements: * * * If any of the declarations or statements made in the application for this policy, upon the face of which this policy is issued, shall be found in any respect untrue * * * then, and in every such case, this policy shall be null and void * * * This policy to take effect when countersigned by Johnson Miller, agent at Syracuse, N. Y.” It was countersigned by Miller and delivered to the plaintiff.

The policy acknowledged the receipt of the first premium of $938.50, and provided for the-payment of similar premiums in every year thereafter during the life of Dreher.. It was proved that the plaintiff paid the premiums for six or seven years, when he was notified by the defendant that-it would not receive any further premiums, and that it re-repudiated the contract upon the ground that the insured had made false representations in regard to his age in the application for insurance. The plaintiff duly tendered the annual premiums for a year or two after this time, but the defendant refused to accept them, asserting that the contract was void. Whereupon the plaintiff commenced this-action to obtain an adjudication as to whether the policy was a valid and existing contract enforceable against the defendant or void by reason of the alleged misrepresentation as to age.

Aside from the claim that the plaintiff had an adequate remedy at law, and could not, therefore, maintain an equitable action, the sole defense set up in the answer was-the allegation that Dreher’s representation as to his age was false and untrue, and constituted both a breach of warranty and a false representation.

The referee for ud upon evidence sufficient, as we think, to support his finding, that Dreher was, at the time of making the application, about seventy-three years old, being born in the year 1798; but he did not find that he in fact knew his age, or that the misrepresentations were fraudulently or intentionally made. He also found as a conclusion of law, “That by reason of the untrue answers made by Michael Dreher to the questions in the application to the defendant for insurance, as to where he was born and whether any application had been made to this or any other company for assurance on his life, the policy was void and inoperative, and the defendant was authorized so to regard it.”

The evidence did not show that Dreher in fact knew his age, or that any representations in regard thereto were fraudulently or intentionally made.

The fact that Dreher made untrue representations in regard to previous insurance in another company was not set up in the answer, and was not, therefore, available to the defendant as a defense to this action. The evidence in support thereof was duly objected to by the defendant, and was not only of doubtful competency to prove the fact, but was inadmissible under the pleadings. So far, therefore, as the finding of law is based upon this fact, it must fall since it was unwarranted by the circumstances of the case, and, therefore, the defendant must rest wholly upon the alleged misstatement of Dreher’s age.

The referee seems to have assumed that the written instrument was conclusive evidence of the agreement of the •parties and could not be subverted by paroi evidence showing the method by which Dreher’s signature to the application was obtained and the circumstances attending •its execution. It is undoubtedly the general rule that a written contract signed by a party thereto and containing the terms and conditions of an agreement is conclusive upon him, and that he will not be permitted to show, hi avoidance thereof , that other stipulations were made at the time of, or before, its execution, which would vary, alter or contradict the provisions of the written instrument. Neither is it generally a defense to an action founded upon such agreement, that the party did not read the contract, or was ignorant of its contents, or that it was prepared by the party claiming the benefit of it unless he also shows that his signature thereto was obtained by misrepresentation or fraud.

In the case, however, of life insurance policies, it is the settled doctrine of the modern cases, that where the application for insurance is drawn up by the agent of the insurer, and the answers to the interrogations contained therein are inserted by him at his own suggestion without fraud or collusion on the part of the assured, the insurer is estopped from controverting the truth of such statements, or the interpretation which it has given to the answers actually made by the applicant.in an action upon the instrument between the parties thereto. Plumb v. Cattaraugus Ins. Co., 18 N. Y., 392; Rowley v. Empire Ins. Co., 36 id., 550; Baker v. Home Life Ins. Co., 64 id., 648.

It is claimed by the plaintiff that this case comes within the rule above stated, and that the question in the case is, whether the undisputed evidence shows that Dreher did not in fact make any representations as to his age, but that the insertion of such statements in the application was the sole act of the defendant’s agent, he knowing that Dreher refused to make any statements in reference thereto.

With respect to the manner in which Dreher’s signature to the application was obtained, the referee has made a peculiar but somewhat restricted finding, which, although omitting many facts established by the evidence, goes far to sustain the claim made by the plaintiff that the method adopted by the agent in procuring the application estops the defendant from setting up the falsity of such answers as a breach of the contract. The finding is as follows: “At the time when said application was made, on the 17th day of April, 1871, Michael Dreher understood the English language when spoken, and spoke it himself to a very limited extent, and quite imperfectly. There were present on the occasion Johnson Miller, the agent of the defendant, the plaintiff, who understood and spoke both the German and English languages, and Michael Dreher. The questions contained in the application were propounded to Dreher by Johnson Miller, and the answers were written by him. Questions which were not understood by Dreher were explained to him by the plaintiff in the German language. In answer to the question, ‘ Where and when was the party whose life was to be insured born?’ Dreher stated the place of his birth as written in the application. The agent then said, ‘Mr. Dreher, how old are you?’ Dreher replied that he did not know his age. The agent then said, ‘Mr. Dreher, we must know your age. I cannot insure you without knowing your age. It is very important to know your age.’ Dreher then gave data from which, if true, his age could be arithmetically computed. The agent Miller, carefully and honestly and, as he believed, correctly made such computations, announced the result and entered it as it appears written in the application.”

This finding was duly excepted to by the plaintiff, and, ■ in some material respects, does not appear to be supported by the evidence, and in others, falls short of exhibiting the plain meaning and effect of the evidence produced by plaintiff. No proof, whatever, is found in the case showing that Dreher gave any data from which if true, his age could be arithmetically computed; neither did he in any way assent to any conclusion reached by the agent; nor is there any evidence from which the referee was authorized to find that Dreher understood the statements made to him by the agent; or that such questions as were not understood by Dreher, were explained to him by . the plaintiff in the German language.

The findings, when carefully analyzed, amount only to a statement that Dreher, a foreigner, substantially unacquainted with the English language, signed an application, written in that language by the defendant’s agent and compiled by him from information claimed to have been acquired from Dreher by means of communications in English, in which, after Dreher had failed to give the date of his birth and had expressly stated that he did not know his age, the agent inserted the statement that he was born in the year 1807. It seems, therefore, that the referee has held Dreher accountable for the answer inserted by the agent in the application, upon the theory that because he gave some data from which the agent inferred his ability to compute the age correctly, supplementing this inference with the opinion that he computed it correctly and entered the result, as he found it, in the application, that he was, therefore, authorized by Dreher to enter the year 1807 as the date of Dreher’s birth, in the application.

This conclusion seems to be based wholly upon the opinion of the witness and cannot be supported. An examination of the evidence given on the trial, however, removes all doubt as to who was responsible for the answer in question. That evidence, so far as our conclusions are based upon it, was given mainly by the agent of the defendant, and was wholly undisputed. He testifies that he solicited the plaintiff for insurance on the life of Dreher, his debtor, and persuaded him to go with him to Dreher’s residence, a distance of twelve miles from Syracuse, to obtain the application for such insurance; that he took blank forms for the application, with him, and filled them up according to « the best information he could get from Dreher; that Dreher was a German and understood the English language very imperfectly, and that he put most of the questions to him, not in the way they were written, but in a manner he thought he could understand. He further testified that Dreher did not state to him his age, but replied to all questions relating thereto, that he did not know it. The agent expostulated with him and told him that they must know his age, but this produced no effect upon Dreher, except a repetition of the statement that he did not know his age. The witness then said, that he obtained some data from Dreher, but what they were he did not recollect, and from them he computed his age and put it down. He said further: “I was in the habit, in my business, of estimating the ages of people by their appearance, I could guess very correctly; he made no statement as to what his age was other than as I have related. I did not read the application over to him after I had written it; of course there was an estimate about his age, but how it was got at I could not tell; it was computed and figured from what he gave.”

This witness was apparently frank and impartial in his statements, and no reason exists for claiming that he had any bias or prejudice, or for doubting the truth of his testimony. Even assuming that Dreher understood all that was said to him by the agent, and this would be a very violent assumption under the circumstances, there is not only no evidence that he gave his age, or the date of his birth, to the agent, but the evidence is positive that he uniformly refused to give it. To hold under such circumstances, that he covenanted that he was born in the year 1807, and was then sixty-four years of age, would be to reverse the meaning and effect oí his actual representation, and to hold that a statement, for which the agent alone was responsible, was made by a party who refused to make any whatever.

The most favorable construction for the defendant that can be put upon the evidence is, that Dreher refused to make any representation as to his age, but that the agent, upon what he conceived to be sufficient grounds therefor, estimated his age and inserted it in the application. There does not seem to be a single fact testified to by the witness or appearing in the case which authorized him to fix upon the year 1807 as the date of Dreher’s birth, or from which the referee could legally find that Dreher suggested any facts which warranted the conclusion inserted by the agent in the application. The only material representation in regard to age made on that occasion was clearly inferrible from the acts and conduct of the agent that he had truly ..inserted in the application the information communicated to him by Dreher, and that such information would enable the plaintiff to obtain a valid policy of insurance from the defendant.

It was also in proof by uncontradicted evidence that the defendant’s agent in fact stated to the plaintiff after the application was made, and before the payment of any premium on the policy, that “it was all right, as the old man had made no positive statement as to his age.”

We think, under the circumstances, that an estoppel in pais was fairly established, and that .the defendant is precluded from setting up the falsity of the statement with reference to age in avoidance of the policy.

The defendant was a foreign corporation, and Miller was its general agent at Syracuse, authorized to take applicatians and countersign and deliver policies and collect premiums from persons insuring their lives in such company. The knowledge of the agent was imputable to the company, and he was held out to the public by it, as _ authorized to determine what constituted a compliance with the conditions of the application, the sufficiency of the answers and the validity of the policies issued thereon, and as fully representing the company as to all matters within the apparent scope of the authority confided to him.

In this case, after having obtained from Dreher all the information that he could give, and without any supportable claim that he gave such information fraudulently or falsely, the defendant has obtained a decree that the contract of insurance was void upon the ground that Dreher’s statements were untrue, when in fact, to the knowledge of the defendant, he made no material statements whatsoever on the subject of his age, either true or untrue. We do not think such a judgment can be sustained.

It was said in Dilleber v. Home Life Ins. Co. (69 N. Y., 260) that “if a question is not answered there is no warranty that there is nothing to answer, and so in the case of partial answer the warranty cannot be extended beyond the answer. Fraud may be predicated upon the suppression of the truth, but breach of warranty must be based upon the affirmation of something not true.”

As we have before seen no fraud was proved or found, and the defense must rest upon the alleged breach of warranty alone. The rule applicable to such a case as the present is well settled in this state, and was succinctly stated in Mowry v. Rosendale (74 N. Y., 363), as follows: “ The principle that if the statements in the application relied upon as breaches of warranty are inserted by the agent of the insurers, without any collusion or fraud upon the. part of the insured, the insurer is estopped from setting up their error or falsity as breach of warranty, seems now well settled.” Baker v. Home Life Ins. Co., 64 N. Y., 648;. Maher v. Hibernia Ins. Co., 67 id., 283; Rowley v. Empire Ins. Co., 36 id., 550; Ins. Co. v. Wilkinson, 13 Wall., 222; Ins. Co. v. Mahone, 21 id., 152. To these might be added Grattan v. Metropolitan Ins. Co., (80 N. Y., 295), and Plumb v. Cattaraugus Ins. Co., (18 id., 392).

The remarks of Miller, J., of the supreme court of the United States, in the case of Ins. Co. v. Wilkinson (supra), are so pertinent to the question involved here that a quotation at length is deemed appropriate:

“In the case before us a paper is offered in evidence against the plaintiff containing a representation concerning a matter material to the contract on which the suit is brought, and it is not denied that he signed the instrument and that the representation is untrue. But the paroi testimony makes it clear beyond a question that this party did not intend to make that representation when he signed the paper, and did not know he was so doing, and, in fact, had refused to make any statement on the subject.”' After stating that when an application is prepared by the party signing it and the insurance company has acted in reliance upon its truth and issued a policy, the applicant will not be allowed to question the truth of such statement, he proceeds: “ If,, however, we suppose the party making the insurance to have been an individual, and have been present when the application was signed, and soliciting the assured to make the contract of insurance, and that the insurer himself wrote out all these representations, and was told by the plaintiff and his wife that they knew nothing at all of this particular subject of inquiry, and that they refused to make any statement about it, and yet, knowing all this, wrote the representation to suit himself, it is equally clear that for the insurer to insist that the policy is void because it contains this statement would be an act of bad faith and of the grossest injustice and dishonesty. And the reason for this is that the representation was not the statement of the plaintiff, and that the defendant knew it was not when he made the contract, and that it was made by the defendant, who procured the plaintiff’s signature thereto. It is in precisely such cases as this that courts of law in modern times have introduced the doctrine of equitable estoppels, or, as it is sometimes called, estoppel in pais”

This case was followed by the same court in Insurance Co. v. Mahone (supra), where testimony was admitted under objection to prove that the answers in an application, which it was admitted was signed by the assured, were not correctly entered by the agent. The court held it competent, saying: “ The testimony was admitted not to contradict the written warranty, but to show that it was not the warranty of Dilland, though signed by him. Prepared as it was by the company’s agent, and the answers having been made by the agent, the proposals, both questions and answers, must be regarded as the act of the company, which they cannot be permitted to set up as á warranty by the assured.” This was held to be so, although the application and answers were subsequently read over to the assured, and he then signed it.

We think the evidence in this case brings it clearly within the principle laid down in the cases cited, and that there should be a hew trial of the same.

The judgments of the courts below should be reversed, and a new trial ordered, with costs to abide the event.

All concur, except Rapallo, J., absent.  