39 So. 2d 812 | La. | 1949
Lead Opinion
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *27 Plaintiff, Marie O. Gordon, instituted this suit in the First City Court of New Orleans, Section "B", seeking to recover the sum of $192.00, the alleged face value of an industrial life insurance policy issued by defendant, Unity Life Insurance Company, Inc., on the life of Lillian Hardin, who died on August 27, 1945. The policy of insurance, in which the plaintiff was named beneficiary, was issued on May 3, 1943.
The First City Court rendered judgment for plaintiff in accordance with her prayer. On appeal to the Court of Appeal, Parish of Orleans, this judgment was reversed, and judgment was rendered in favor of defendant, *28
dismissing plaintiff's suit.
The defendant insurance company does not take the position that the insurance policy in the instant case was void or was forfeited for any reason whatsoever, but as a defense urges that the death of the insured resulted from a venereal disease, and that death from such cause was not covered by the policy but was expressly excepted therefrom. The provisions of the policy on which the defendant relies are found in Paragraph 6 thereof, as follows: "* * * Benefits will not be paid at any time for death resulting from * * * venereal diseases or from an intentional act of any person other than the Insured."
Plaintiff, on the other hand, although conceding that the insured died from a venereal disease, takes the position that, since the insured died more than one year after date of the policy, the defense urged by the insurer is not available to it because the policy became incontestable after such period under the incontestability clause. In support of this position she relies on the holding of this court in construing such a clause in the cases of Bernier v. Pacific Mut. Life Ins. Co. of California,
The incontestability clause is found in Paragraph 5 of the policy and reads thus: *29
"Incontestability. — This Policy shall be incontestable after one year from date of issue except for non-payment of premiums, and except as to the following provisions and conditions relating to misstatement of age; death resulting from disease asherein limited; accidental death; suicide; total and permanent disability, aeronautics, military and naval service." (Italics ours.)
This incontestability clause in plain terms provides that the policy shall be incontestable after one year except from "death resulting from disease as herein limited", and immediately following this provision, in the next paragraph of the policy, we find the equally clear provision that benefits will not be paid at any time for death resulting from venereal diseases. These provisions are unambiguous, certain, clear, and susceptible of only one interpretation, that is, that, if the insured dies as a result of a venereal disease, such death is not covered under the terms and provisions of the policy, which is the contract between the parties, and benefits will not be paid thereunder.
Undoubtedly the insurance company could have urged the cause of death as a valid defense in an action to recover the face amount of the policy if death had occurred as a result of venereal disease within one year from the date of the issuance of the policy, and it could urge after that period also the defense of death resulting from venereal disease because, under the paragraph immediately following the incontestability *30 clause, the benefits under the policy would not be paid at anytime for death resulting from a venereal disease. Thus it was clearly the intention of the parties that, even after the expiration of the period of one year provided in the incontestability clause, a death caused by a venereal disease was still not one covered by the terms of the policy but one expressly excepted therefrom.
Further, the incontestability clause standing alone excepts from its provisions "death resulting from disease as herein limited". This clause clearly and directly informs the insured that death resulting from certain diseases is excepted from the provisions of the incontestability clause.
Subject to the laws and statutes of this state, a policy of insurance is a voluntary contract between the parties thereto. The parties may make it on such terms, and incorporate such provisions and conditions, as they see fit to adopt, and the contract as made measures their rights. See Lado v. First Nat. Life Ins. Co.,
In our opinion, the insurance policy in the instant case in clear and unambiguous language provides that the risk — that is, death by venereal disease — is not covered by the contract. The Court of Appeal so found, and we think correctly so.
The decisions in Bernier v. Pacific Mut. Life Ins. Co. of California and Garrell v. Good Citizens Mut. Ben. Ass'n, Inc., both cited supra, relied upon by relatrix, in our opinion are not controlling here. In each of those cases, this court construed an incontestability *32 clause in an insurance policy which it considered to be ambiguous, uncertain, and not clear, and resolved the ambiguity in favor of the insured under the principle of law that insurance policies should be liberally construed in favor of the object to be accomplished, and that, in case of doubt, ambiguity, or uncertainty, the conditions and provisions should be strictly construed against the insurer. As we have seen, in the instant case no such ambiguity exists in the incontestability clause.
The respondent insurance company contends that the decisions in the two cited cases are contrary to the rule that an incontestability clause relates to the validity of the insurance contract and not to its coverage; or, stated somewhat differently, that such a clause means, as was said in Metropolitan Life Ins. Co. v. Conway,
In support of her position, relatrix relies also on a provision found in Act 140 *33 of 1938, reading as follows: "* * * Provided further, that upon and after the effective date of this Act any industrial life insurance policy issued in this State shall be incontestable after it has been in force, during the lifetime of the insured, for one year from its effective date of issue, except for nonpayment of premiums." This provision of the act cannot affect our decision in this case, for certainly it was not the intention of the Legislature by the use of such language to write into a policy of insurance a risk which was not covered by, and included in, the contract, or to rewrite, enlarge, or change a contract the terms of which are clear and free from ambiguity, as are the terms of the contract in the instant case.
For the reasons assigned, the judgment of the Court of Appeal is affirmed; relatrix to pay all costs.
O'NIELL, C. J., concurs and assigns reasons.
McCALEB, J., concurs with written reasons.
PONDER, J., absent.
Concurrence Opinion
While I concur in the decree affirming the judgment of the court of appeal in the present case, I do not see why the court should leave a doubt now about the correctness *34
of the decision which was rendered in the case of Bernier v. Pacific Mutual Life Insurance Company of California,
I quote also from pages 1083-1084 of 173 La., pages 630-631 of 139 So., from the decision in the Bernier case, as follows: "The conditions relating to military or naval service in time of war, stated substantially, were that if within five years from the date of the policy the insured should engage in military or naval service in time of war the liability of the company, in the event of the death of the insured while so engaged, or as a result thereof within six months thereafter but within the period of the war, would be limited to any outstanding dividend additions, etc. These conditions, relating to military or naval service in time of war, constituted a limitation of the so-called coverage or risk assumed, as plainly as did the conditions on which alone the insured could engage in aerial navigation, without affecting the obligation of the insurer, constitute a limitation of the coverage or risk assumed by *36
the insurer; and yet it was deemed necessary to except the conditions relating to military or naval service in time of war from the provision making the policy incontestable after one year, in order that the obligation of the insurer to pay the amount stated on the face of the policy might remain contestable after the expiration of the year, on the ground of violation of the conditions relating to military or naval service in time of war. Our opinion therefore is that, inasmuch as only the one exception was made in the provision making the policy incontestable after having been in force for a year, the intention, at least of the insured, was that there should be no other exception. If the insurance company intended to except also, from the incontestability clause, a violation of the conditions relating to aerial navigation, that exception, like the exception of violation of the conditions relating to military or naval service in time of war, should have been expressed. Article
It is plain therefore that the doctrine of the decision in Bernier v. Pacific Mutual *37 Life Insurance Company of California is not at all appropriate to the insurance policy on which the present suit was brought. Hence, as I say, there is no reason why the court in its opinion rendered in the present case should leave a doubt about the soundness of the decision rendered in Bernier v. Pacific Mutual Life Insurance Company of California.
It is my opinion also that the decision which this court rendered in the case of Garrell v. Good Citizens Mut. Ben. Ass'n,
Concurrence Opinion
While I heartily support the result in this case, I encounter difficulty in perceiving a substantial difference between the provisions of the instant policy and those of the policy considered in Garrell v. Good Citizens Mut. Ben. Ass'n,
In the Garrell case, the insured died of tuberculosis and the policy contained a provision declaring that only one-fourth of the maximum insurance would be paid if the assured died from certain specified diseases (i. e. tuberculosis) contracted within twelve months from the date of the policy. The plaintiff nevertheless insisted upon recovering *38 the face amount of $113 by reason of the incontestibility clause, which provided: "This policy shall be incontestible after two years from date except as stated in conditions and for nonpayment of Premiums." (Emphasis mine.)
After rejection of her claim by the Court of Appeal, plaintiff secured a writ of review and this court permitted a full recovery on the ground that "From our appreciation of the case of Bernier v. Pacific Mutual Life Ins. Co. of California,
It takes no more than a casual reading of the Bernier decision to exhibit the error in the above quoted reasoning — for the court did not hold in the Bernier case that all exceptions relative to forfeiture or coverage were required to be stated in the incontestibility clause. The resolution of the court was that an exclusion from coverage, while the assured was engaged in aerial navigation (not as a fare paying passenger on commercial aircraft), could not be availed of as a defense after the policy *39 had been in force for one year, in view of another clause making the policy incontestible "except for non-payment of premium or for violation of the conditions of the Policy relating to military or naval service in time of war." The court said that the condition relating to military and naval service, referred to in the incontestibility clause, was one affecting coverage and that, since it was the only condition contained in the clause, the maxim "inclusio unius est exclusio alterius" would be applied. In other words, it was decided that, where the incontestibility clause contained but one exception relating to coverage, the policy would be rendered ambiguous and inconsistent if the condition relating to death resulting from air travel be considered applicable after the policy had been in effect for over one year.
The holding in the Bernier case does not, in my opinion, provide any basis for the decision in the Garrell case. The clause considered in the Garrell case provided for incontestibility after two years "except as stated in conditions". Surely, there could be no conflict between this provision and the other conditions of the policy to which the exception referred.
So, in the case at bar, there can be no conflict or ambiguity (as the majority opinion clearly states) where the incontestibility clause refers specifically to the conditions relating to "death resulting from disease as herein limited". But to say that there is a difference between this and the Garrell case is to overlook the reality of the situation. *40 Indeed, the court has passed an opportunity to correct its erroneous conclusion in the Garrell case and supplant it with the logic and well-grounded reasoning set forth in the case at bar.
I respectfully concur in the decree.