168 A.D. 275 | N.Y. App. Div. | 1915
All concurred.
The following is the opinion delivered at Special Term:
The action in the court below was brought to recover on a policy of life insurance in the sum of one thousand dollars issued on the life of James W. Wilson, formerly of Lewistown, Penn. The policy was issued November 11,1910. The insured
“The plaintiffs have brought an action upon a contract entered into between the deceased and the defendant. The defense is that the contract has been violated by the intestate, and hence no action can be maintained upon it. The plaintiffs are seeking to enforce the contract, and performance
The same rule was laid down in the case of Dowd v. American Fire Insurance Company (1 N. Y. Supp. 31), in which the court held that the failure of a fire insurance company to return a premium is not a waiver of the right to plead, in an action on the policy, the concealment by plaintiffs of a fact which, if true and thus concealed, would vitiate the policy, as there was no ground for rescinding the contract until the company was informed of such fact. The court says: “ When the fire occurred, the rights of the parties under the policy became fixed, and a return of the premium could not have the effect to change the status of. either party. * * * The defendant is not asserting a cause of action against the plaintiffs, or claiming anything of them, but simply defending against the enforcement of a claim under a policy of insurance which the defendant claims to be void in consequence of the concealment by the plaintiffs of a material fact, which was vital to the insurance.”
The trial court seems to have overlooked the plain distinction between a rescission which proceeds under an avoidance of the contract and a defense based on its terms, viz., a breach by the insured of his express agreement to correctly state the facts in his application. The one is a case where it is sought to rescind and set aside a contract, the other is a case where the plaintiff’s testator has failed to carry out the contract on his part and where, therefore, no cause of action has ever arisen. This distinction is recognized not only in this State but elsewhere. (Thompson v. Traveler’s Ins. Co., 11 N. Dak. 274; Georgia Home Ins. Co. v. Rosenfield, 95 Fed. Rep. 358; Austin v. Mutual Reserve Fund Life Assn., 132 id. 555; Moore v. Supreme Assembly of Royal Soc. of Good Fellows, 42 Tex. Civ. App. 366.)
It is unnecessary to decide here whether a separate action will lie for the return of the premiums paid. As to that we express no opinion. The evidence of the defendant rested
See Code Civ. Proc. §§ 834, 836.—[Rep.