Appeal from the District Court of the United States for the Northern District of Illinois, Eastern Division; Charles Edgar Woodward, Judge.
Before EVANS and KERNER, Circuit Judges, and BRIGGLE, District Judge.
Plaintiff, suing upon an alleged insurance contract, recovered judgment in the District Court for the sum of $3,481.60, after trial before the court without a jury. Defendant appeals, alleging numerous errors of law, but there are two main questions for review. The first involves a determination of what was the controlling contract between the parties; and the second, if the written contract is controlling, an interpretation of the same.
Plaintiff's original statement of claim asserted that defendant agreed orally to pay the plaintiff the sum of $200 per day from January 24 to March 4, 1938, during which time plaintiff might be prevented by reason of bodily injury or illness arising after December 30, 1937, from filling her engagements as a classical dancer while on tour in the United States; and that plaintiff was prevented from filling such engagements by bodily injury for sixteen days during such period. Defendant answered, denying any oral agreement, but alleged that by virtue of a written agreement, designated a "cover note," No. 3019, defendant insured plaintiff against injury caused by accidental means, etc., for the period indicated, against total disablement, which continuously disabled the insured from fulfilling her engagements as a classical dancer while on tour principally through the Southern States of the United States of America. Defendant's answer further alleged that plaintiff's disablement did not prevent her from fulfilling such engagements as a classical dancer. Attached to this answer as an exhibit was a copy of the alleged cover note.
After the filing of this answer, defendant, pursuant to Rule 33 of the Rules of Civil Procedure, 28 U.S.C.A. following section 723c, filed certain interrogatories some of which were designed to elicit from plaintiff information concerning her engagements and contracts of employment during the period in question. Plaintiff declined to answer such interrogatories and the District Court with plaintiff's consent entered an order under Rule 37 of the Rules of Civil Procedure, barring the plaintiff from offering any evidence at the trial of any contracts to fulfill engagements as a classical dancer, principally through the Southern States of the United States, during the designated period, and further providing that plaintiff be not allowed to support any claims based upon the existence of any such contracts or to support any defenses based upon their non-existence. After the entry of the last order, defendant filed its motion for judgment which presented at once the question of the interpretation of the written cover note, No. 3019, and more particularly the question whether she could recover without proof that she had any such engagements for the period in question.
While this motion was under advisement by the District Court, the plaintiff filed an amended complaint, alleging the oral promise as indicated in her first complaint, and asserting that defendant promised to pay for disability "defined as such disability as would prevent defendant from fulfilling her engagements as a classical dancer, while on tour in the United States regardless of whether plaintiff actually had any such engagements or not by reason of bodily injury or illness arising thereafter." Defendant answered the amended complaint denying the oral promises relied upon, again asserting the provisions of cover note, 3019, and alleging that plaintiff's disability did not disable her and prevent her from fulfilling her engagements as a classical dancer while on tour principally through the Southern States of the United States of America. In its answer, defendant also set up the provisions of cover note 3018, a separate instrument issued at the same time which covered disability for illness for the period in question. We shall not have occasion to consider cover note 3018 for it is conceded that such disability as plaintiff suffered was due to an accidental injury and not to illness. Upon these issues a trial was had before the court, and the court filed its findings of fact and conclusions of law and rendered judgment for the plaintiff.
Among other things, the court found that plaintiff, through her agent, entered into a parol agreement to effect insurance with defendant, covering the period and in the amount indicated and that such parol agreement contained no provision that insured should be required to have contracts of employment or prove her disability to perform such contracts and contained no provision that benefits were not to be payable the first two days of disability. The court also found that there was no actual or material variance between such parol agreement and the provisions of said cover notes, except that cover note 3019 contained a provision that in no event should benefits be paid thereunder for the first two days of disability, and that the language of said cover note was intended by the parties to permit a recovery "without reference to any contracts of employment or for engagements, or disability to perform under any such contracts." The court in its conclusions of law recited that the parol agreement was valid and binding on the parties and that said parol agreement to effect insurance and said parol agreement of insurance were merged in the two written cover notes, insofar as such cover notes were not actually or materially at variance therewith; that by the true meaning of said notes, plaintiff was not required to have or produce in evidence contracts of employment during the period in question.
The Contract Between the Parties.
The plaintiff was represented in all matters concerning the contract in question by her husband and agent, who had acted for her in a similar capacity for many years past and was the only witness appearing in her behalf at the trial. On December 30, 1937, he communicated with the agents of defendant, advising them that plaintiff, a professional dancer, was contemplating a tour of the Southern States of the United States, commencing January 24, 1938, and continuing through March 4, 1938, and that plaintiff desired insurance in the amount of $200 per day against all disability to her professional capacity as a performer during that period. Later, the agent of the defendant telephoned the agent of the plaintiff that such insurance had been arranged and the cover note 3019 (being the written contract relied upon by defendant) was delivered to plaintiff's agent on January 5, 1938. During these telephonic conversations no reference was made to the terms of the insurance, other than the period it was to be effective, the premium, the amount of indemnity to be paid, and the nature of the disability (accidental and illness). Cover note 3019 is the written memorandum issued by defendant, covering the accident hazard and cover note 3018, which is of relative unimportance in this proceeding, covered disability arising from illness. The plaintiff suffered an accident on January 9, 1938, falling through a skylight, sustaining injuries, the extent of which is not disclosed. On January 11, 1938, plaintiff's agent paid the premium to defendant for both of said cover notes.
Plaintiff contends that there is a variance between the parol arrangements and some of the provisions in the cover notes. Cover note 3019 provided that no benefits were to be paid for the first two days of the disablement. Plaintiff asserts that this was not mentioned in the telephonic conversations. This cover note in Paragraph 7 of the "Schedule of Compensation" also provided, as follows: "7. Total disablement which either permanently or temporarily, necessarily and continuously disables the Assured and prevents the Assured from fulfilling her engagements as a classical dancer while on tour principally through the Southern States of the United States of America. $200.00 per day so long as the disablement continues, during the period between January 24, 1938, and March 4, 1938, both days inclusive." Plaintiff likewise asserts that this provision was not discussed and that nothing was said about any contracts of employment during that period.
The plaintiff had previously, in August, 1935, through her husband as agent, obtained from defendant a written binder of accident insurance, covering a period of 35 days which provided that the defendant would pay the plaintiff $1,500 a week "for total disablement which either permanently or temporarily, necessarily and continuously disables the assured and prevents assured from filling the contract with H. H. Handley." This binder provided that no benefits were payable for the first two days of disablement.
Again in November, 1935, she obtained a similar written binder of accident insurance from defendant, covering a period of thirteen days, which provided that defendant would pay the plaintiff $1,000 a week "for total disablement which either permanently or temporarily, necessarily and continuously, disables the assured and prevents the assured from filling her contract." This binder also contained the two day elimination clause.
Again in February, 1936, the plaintiff obtained from defendant a similar written binder which provided that defendant would pay plaintiff $2,500 a day for "total disablement which either permanently or temporarily necessarily and continuously disables the Assured and prevents the Assured from filling her contract, on March 1st and March 2nd, 1936 * * * ." This binder covered only a two day period and, presumably for this reason, cointained no two day elimination clause. Also in 1936, defendant issued to plaintiff a ...