United States District Court, Southern District of Illinois, N.D
January 4, 1956
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY, A CORPORATION, PLAINTIFF,
ALICE REICHENTHAL, DEFENDANT.
The opinion of the court was delivered by: Adair, District Judge.
Massachusetts Mutual Life Insurance Company, a corporation,
brought this action to rescind two policies of life insurance
issued by it on the life of David Reichenthal, late of Rock
Island, Illinois. The insured died within the two year
contestable period, and the suit was filed within that period.
Prior to instituting the action plaintiff delivered to defendant,
Alice Reichenthal, widow of decedent and sole beneficiary under
the policies, a letter of rescission as to each policy and
tendered to her a return of all premiums paid, with interest at
6% from the respective dates of payment. This tender, in the
amount of $2,165.76, was declined, and the amount thereof was
later paid by plaintiff to the Clerk under Fed.Rules Civ.Proc.
rule 67, 28 U.S.C.A. to abide the further order of the Court.
Alice Reichenthal, with her Answer to the Amended Complaint,
filed a Counterclaim for $30,000, the face amount of the
policies, and demanded trial by jury. To avoid confusion, we
shall continue to refer to Massachusetts Mutual Life Insurance
Company as "plaintiff", and Alice Reichenthal as "defendant",
although their positions are reversed as to the Counterclaim.
Under the direction of the Court the actions were tried
simultaneously, the rescission suit being heard by the Court and
the Counterclaim by a jury, with the plaintiff taking the burden
of going forward with the evidence. The jury trial resulted in a
verdict for defendant for $30,000, and judgment was entered in
At the close of all the evidence the plaintiff filed a motion
for judgment in the rescission suit and a motion for a directed
verdict in the jury action on the Counterclaim. The defendant
filed a motion for a directed verdict in both cases. Since the
rescission suit was tried by the court without a jury,
defendant's motion for a directed verdict in that suit is
misentitled and will be considered as a motion to dismiss and for
judgment in accordance with the prayer of the motion. Ruling on
all these motions was taken under advisement until after the
verdict of the jury.
Following the verdict of the jury and within the time allowed
by Rule 50(b), the plaintiff filed a motion to have the verdict
and the judgment entered thereon set aside and to have judgment
entered in accordance with its motion for a directed verdict,
and, in the alternative, for a new trial. Decision on this motion
was taken under advisement.
In the suit for rescission the Court is of the opinion that
plaintiff's motion for judgment should be granted, and it follows
that plaintiff's motion in the action on the Counterclaim must
also be granted.
In the action for rescission the Court finds the following
facts specially and states separately its conclusions of law
Findings of Fact
The Court finds that:
1. The plaintiff is a citizen of the State of Massachusetts;
and the defendant is a citizen of the State of Illinois, residing
in Rock Island, Illinois.
2. This case involves two policies of life insurance written by
the plaintiff on the life of David Reichenthal, viz.: A
policy for $20,000 dated October 2, 1950, written on the ten-year
term plan, and a policy for $10,000 dated October 11, 1951,
written on the ordinary life plan. This second policy was issued
in exchange for a term policy in the same amount dated October
11, 1950, under a provision of the earlier policy which permitted
it to be exchanged prior to the end of the seventh policy year
without medical examination.
3. In the case of each policy the first premium required by the
terms thereof was paid in the State of Illinois, and each of said
policies was delivered in Illinois.
4. The insured died August 7, 1952, and the cause of his death
was coronary thrombosis.
5. The insured's original application for insurance, dated
September 8, 1950, was in two parts. Part 2, the medical portion
of the application, contained certain questions which were
propounded to the applicant by plaintiff's medical examiner and
insured's answers thereto correctly recorded.
Among these questions and answers are the following:
Q. "4. During the past ten years have you had
"A. Advice, attendence, or
treatment by physicians,
any other persons? Ans. Yes.
"B. Treatment or observation
in a clinic, health
resort, hospital or
sanatorium? Ans. No.
"C. Periodic health
examinations? Ans. Yes.
blood or basal metabolism
examinations? Ans. Yes."
And, in explanation of the foregoing answers, the applicant
"Cecil Zuckerman, M.D. — Davenport, Iowa.
General exam 1949 — and for desire to lose
weight. Says exam was normal. Had E.K.G. and
chest x-ray at that time."
2. "5. Have you at any time ever had
"A. Pain, pressure, or
discomfort in the chest,
shortness of breath,
palpitation, or any
disease of the heart? Ans. No.
"E. Bright's disease, kidney
stones, colic or gravel,
or any disorder or
disease of the bladder,
kidney or prostate
gland? Ans. No.
"F. * * * gout
* * *? Ans. No.
"G. Any serious illness,
disease, or injury or
ever undergone any
other than those
mentioned? Ans. No."
6. On said Part 2 of his application for insurance David
Reichenthal also stated at the bottom thereof over his signature:
"I understand and agree that:
"1. This application consisting of Parts 1 and 2
taken together shall form the basis of the contract
applied for and shall become a part of said contract
"I hereby declare that all answers and statements
in Parts 1 and 2 of
this application are full, complete and true, and
that there are no exceptions to any of such answers
other than stated above."
7. The foregoing questions, answers, and statements of the
insured were material, both to the acceptance of the risk and the
hazard assumed by the plaintiff insurance company. They were
accepted by said insurance company as true and relied upon by it
as a material inducement to the issuance of the policies in suit,
and at the time said policies were issued plaintiff had no
information to the contrary.
8. The insured's application for insurance, including Part 2
thereof, forms the basis of and is a part of each of the policies
9. That the insured's answers, representations, and statements
in Part 2 of his application for insurance were, in fact, false,
misleading, and incomplete in the light of the following facts
established by the evidence:
(A) Insured was a patient at the Moline Public Hospital,
Moline, Illinois, May 13-15, 1943, under the care of Dr. Leo
Gamburg of Moline, Illinois. On this occasion he gave a history
of severe pain in the right groin radiating from the kidney
region down into the testicle. Dr. Gamburg's diagnosis was renal
calculus of the right side. Treatment included a complete blood
count and the administration of morphine. Plaintiff's medical
expert testified that renal calculus, or kidney stones, is a
serious disease and that the pain associated therewith is one of
the most anguishing experiences a human being can have.
(B) Insured was a patient at the Moline Public Hospital for a
second time, April 22-23, 1947, again under the care of Dr.
Gamburg. On this occasion the insured had a severe pain in his
left big toe. He also told Dr. Gamburg that he had substernal
pain on exertion radiating down both arms. Dr. Gamburg testified
on cross examination that this latter pain was suggestive of
angina pectoris. The doctor's diagnosis at the time was an acute
attack of gout, which is a constitutional disease. Treatment
included a complete blood count, an electrocardiogram, an x-ray
of the chest and of the left toe.
(C) Again, for a third time, June 1-3, 1948, the insured was a
patient in the Moline Public Hospital under the care of Dr.
Gamburg. The immediate occasion for this hospitalization was a
pain in his left knee caused by a fall; but upon admission he
gave a history of pain under the sternum brought on by walking
even small distances for the previous year or two, the pain
radiating down both arms and recently becoming more pronounced.
He also gave a history of dribbling of urine, first noticed about
a year previously, frequency and urgency only recently. Dr.
Gamburg's working and final diagnosis was a sprain of the left
knee, possible angina pectoris, and prostatic enlargement. An
x-ray of the insured's knee disclosed no recent injury, but it
did disclose calcification of the larger blood vessels. Treatment
also included a complete blood count and an electrocardiogram.
10. On July 21, 1951, a little over nine months after the
original policies were issued, the insured while on a vacation in
Toledo, Ohio, suffered a coronary heart attack and was
hospitalized in the Riverside Hospital of that city until August
15, 1951, under the care of Dr. Benjamin Schulak of Toledo. Upon
admission, his chief complaint was a pain in the chest, and he
told the admitting intern that he had had transient periods of
substernal pain, best described as a feeling of pressure, for the
previous five or six years, brought on by smoking or walking too
fast. Dr. Schulak's diagnosis was coronary thrombosis following
a long history of angina pectoris.
11. While both the policies in suit rest upon insured's
original application, the second policy also rests upon an
amendment of application which insured executed October 6, 1950,
to increase the total amount of insurance applied for from
$20,000 to $30,000. In this amendment of application, in
which no further medical examination was required under the rules
of the Company, the insured stated, over his signature, in part,
"I hereby declare that since the date of Part 2 of
the original application referred to above:
"(a) I have had no illness, injury, impairment of
health or symptom thereof; * * *
"EXCEPT Give full details of exceptions None
"It is understood and agreed that:
"5. The statements, answers, agreements and
declarations contained in Parts 1 and 2 of the
original application, except as herein altered or
modified shall be held to relate as well to the
additional insurance herein applied for and together
with this amendment, shall form the basis of the
contract for said additional insurance applied for,
and shall become a part of said contract when issued.
"It is hereby declared that all the answers and
statements in this amendment are full, complete and
true, and have been correctly recorded and that there
are no exceptions to any of such answers other than
as stated above, and that the applicant is in sound
Said statements as to insured's physical condition were
incomplete, and untrue, in view of the facts set forth in
Paragraph 9 and the history stated in Paragraph 10, above, of
12. In the absence of any evidence to the contrary I find that
at the time he made application for insurance in the plaintiff
Company on September 8, 1950, the insured was aware that he had
been a patient in the Moline Public Hospital in 1943, 1947, and
1948, under the care of Dr. Leo Gamburg of Moline, Illinois, and
was aware that from 1945 or 1946 on he had suffered from pain in
the chest, sometimes radiating down both arms, brought on by
smoking or exertion. This pain was identified by the medical
witnesses as angina pectoris, a symptom of heart disease.
13. Plaintiff, when it issued the policies in suit, had none of
the information described in Paragraph 9, above, of these
Findings, although if insured's answers to Part 2 of the
application form had been full, complete, and true, as
represented, such information would have been disclosed. If
plaintiff had had the information set forth in Paragraph 9, or
known of the insured's medical history stated in Paragraph 10,
above, plaintiff would not have issued the policies in suit.
14. Prior to accepting insured's application plaintiff caused
the insured to be examined by one of its medical examiners and
even ordered a subsequent cardio-vascular examination because of
a slight elevation of the blood pressure. These examinations were
objective and disclosed nothing which made the applicant
unacceptable for insurance. The same is true of a report which
plaintiff received from Dr. Cecil Zuckerman, whose name was
mentioned by the insured in his application as having given him
an examination in 1949.
15. Plaintiff established that in the diagnosis of heart
disease subjective symptoms are more important than objective
symptoms and that the chest pain typical of angina pectoris,
unless voluntarily disclosed by the patient, may exist and remain
undetected by listening to the heart, by blood pressure readings,
by an electrocardiogram, or by any other type of objective
examination, the examining physician being entirely dependent
upon information supplied by the patient unless he happens to
observe the patient during an attack. Life expectancy is
substantially less among individuals suffering from angina
pectoris, which is a symptom of heart disease, than among
individuals who are not so afflicted.
16. On the sole issue of the insured's intent plaintiff placed
in evidence Part 2 of an application for insurance which David
Reichenthal made to the New York Life Insurance Company under
date of July 14, 1952. This was after plaintiff's policies were
issued. It was also after
insured's hospitalizations at the Moline Public Hospital and his
hospitalization at Riverside Hospital, Toledo, Ohio, detailed in
Paragraphs 9 and 10, above, of these Findings. It was also after
a subsequent hospitalization at St. Luke's Hospital, Davenport,
Iowa, August 23 — September 4, 1951, where he was attended by Dr.
Cecil Zuckerman of Davenport, Iowa. In this application to the
New York Life Insurance Company, in response to questions
propounded by that Company's medical examiner, the insured stated
that he had never been under observation or treatment in any
hospital, clinic, asylum or sanitarium; that he had never had and
had never consulted a physician or practitioner for any ailment
or disease of the heart, blood vessels, kidney or bladder, or for
any other ailment or disease not included in previous answers;
that he had never had gout; and that he had never consulted or
been examined or treated by any physician or practitioner within
the previous five years; and at the bottom of this application he
declared that he had read each and all of the answers contained
thereon; that they were each written as made by him; and that
each of them was full, complete, and true; and that the Company,
believing them to be true, might rely and act upon them
accordingly. This evidence respecting the New York Life
application was not controverted by any evidence offered by
Conclusions of Law
1. That the Court has jurisdiction of the parties and the
2. Under the evidence there is no controverted question of fact
in this case upon which reasonable men could differ that
misrepresentations were made in the Insured's application and
amended application for insurance; that they were relied on by
the Insurance Company; and that they were material to the
acceptance of the risk and the hazard assumed by the Insurance
3. The false answers and misrepresentations of the Insured in
his application and amended application for insurance, as a
matter of law, materially affected the acceptance of the risk and
the hazard assumed by the plaintiff insurance Company.
4. Under Illinois law proof that a representation in an
insurance application, which is believed and relied on by the
company, is false and material either to the acceptance of the
risk or to the hazard assumed by the insurance company
constitutes a sufficient cause for rescission of the policy
issued thereon and a complete defense to an action on such policy
without proof of actual intent to deceive.
5. That the insured made false statements in his application
and amended application, statements material both to the
acceptance of the risk and to the hazard assumed by the insurance
company and that they were relied on by the Company has been so
conclusively proved in this case that actual intent to deceive,
if a showing thereof were required, would be presumed as a matter
6. The evidence which entitles plaintiff to rescind the
insurance policies in suit constitutes a complete defense to
defendant's Counterclaim on the policies.
7. In the suit on the Counterclaim the verdict of the jury is
contrary to the law, the evidence, and the weight of the
In accordance with the foregoing Findings of Fact and
Conclusions of Law, it is ordered, adjudged, and decreed as
Plaintiff's motion for judgment in the rescission suit is
granted, and each of the policies in suit is ordered rescinded,
and plaintiff is discharged of and from any and all further
liability with regard to each of said policies except as
hereinafter provided with respect to the return of premiums. The
policies in suit, if in the possession of the defendant or the
Clerk, are ordered delivered up to the plaintiff for
The judgment entered June 9, 1955, on the verdict of the jury
is vacated, and the Clerk is directed to re-tax the costs
against the defendant and to enter judgment for plaintiff for its
costs. The Clerk is directed to continue holding the sum of
$2,165.76, representing premiums paid on the policies in suit
with interest thereon until disposition of the appeal in this
case, if any be taken. If no appeal is taken within the time
permitted by law, then the Clerk is ordered to pay said sum to
defendant after costs are paid in full or defendant has
authorized their deduction from the aforesaid sum.
In view of the foregoing rulings, the verdict of the jury is
set aside. Plaintiff's motion for judgment notwithstanding the
verdict and for judgment in accordance with its previous motion
for a directed verdict in the suit on the Counterclaim is
granted. Plaintiff's motion in the alternative for a new trial is
Defendant's motions are, and each of them is, denied.
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