Whether Mrs. Brackin's failure to disclose her 1984 operation and treatment in her original application invalidates the insurance policy presents a close question. "Under Illinois law, which is applicable in this case, the presence of false statements in an application for insurance is not in itself a ground for avoiding an insurance policy issued on the basis of the application; the insurer must prove that the false statements either were made with intent to deceive or involved matters materially affecting the acceptance of the risk." Apolskis v. Concord Life Insurance Co., 445 F.2d 31, 35 (7th Cir. 1971) (emphasis added); Roberts v. National Liberty Group, 159 Ill. App. 3d 706, 708, 512 N.E.2d 792, 111 Ill. Dec. 403 (1987) (citing Ill.Rev.Stat. 1985 ch. 73, para. 766).
A jury question clearly exists with respect to Mrs. Brackin's intent in completing the original application forms. Although the application form did request that applicants give full details of all past illnesses, Mrs. Brackin might well have believed that by indicating the nature of her illness and her prognosis she had satisfactorily responded. The fact that she disclosed the name, address and phone number of her treating physician may not suffice to excuse her non-disclosures, Apolskis v. Concord Life Insurance Co., 445 F.2d 31 at 35-36; compare Meier v. Aetna Life & Casualty Standard Fire Insurance Co., 149 Ill. App. 3d 932, 939-40, 103 Ill. Dec. 25, 500 N.E.2d 1096 (1986) (insurer with reason to believe answers are not true or complete has duty to investigate), but it does militate in favor of Mr. Brackin's position that Mrs. Brackin was not trying to deceive MIAC when she made them. See Roberts v. National Liberty Group, 159 Ill. App. 3d at 708.
Still, because under Illinois law material non-disclosures can invalidate an insurance policy irrespective of the insured's intent, MIAC could obtain summary judgment on the basis of the May 14 application despite the existence of a jury question on Mrs. Brackin's intent. Materiality is a question of fact. Hancock v. National Council of the Knights and Ladies of Security, 303 Ill. 66, 135 N.E. 33 (1922); Garde v. County Life Insurance Co., 147 Ill. App. 3d 1023, 1032, 101 Ill. Dec. 120, 498 N.E.2d 302 (1986). Therefore, in order to prevail at the summary judgment stage, MIAC must establish that there is no genuine issue with regard to the materiality of Mrs. Brackin's omissions in her May 14 application.
Whether MIAC has satisfied this burden is not at all clear. In support of its motion, MIAC presented affidavits and documents to the effect that it would not have issued the policy had Mrs. Brackin fully disclosed her condition either in the May 14 application or in the August 17 application amendment. Yet, by lumping together Mrs. Brackin's non-disclosures in this way, MIAC has made it difficult to determine whether the non-disclosures regarding Mrs. Brackin's treatments in 1984 alone would have rendered Mrs. Brackin uninsurable. Thus, while Mr. Brackin has offered no evidence to support his contention that these non-disclosures were not material, it may be that MIAC has failed to meet its initial burden of establishing the absence of a factual dispute on this score. See Fed.R.Civ.P. 56 (e).
The court, however, need not resolve this issue, for there simply is no genuine issue of material fact that Mrs. Brackin misrepresented her condition when she signed the August 17 application amendment, and that these misrepresentations were material. Indeed, Mr. Brackin does not even attempt to argue otherwise. His only arguments are that the application amendment form was ambiguous as to whether it required Mrs. Brackin to update her condition to August 17, and that Mr. Reinert's explanation of the form led Mr. Brackin to believe that all it required was for Mrs. Brackin to attest to the truthfulness of her May 14 representations as of that earlier date. These arguments fail for two reasons.
First, irrespective of what the application amendment form stated, the original application clearly provided that the insurance policy would not become effective under two circumstances: if at the time Mrs. Brackin made her first payment her health had substantially changed from the time she filed the application; or, if Mrs. Brackin had received medical advice or treatment during this period. No reasonable jury could find that after Mrs. Brackin had been diagnosed as having terminal cancer in August, 1985 her health remained substantially the same as the excellent prognosis she had reported in May. Nor could a reasonable jury find that Mrs. Brackin had not received significant medical treatment or advice during her 25 days of hospitalization in July and August. See Pistas v. New England Mutual Life Insurance Company, 843 F.2d 1038, 1040 (7th Cir. 1988) ("A person under treatment for stomach cancer, told by his physician that the disease is terminal, is not insurable at any premium significantly less than the face amount of the policy.").
Second, this court cannot agree with Mr. Brackin that the August 17 application amendment form was ambiguous. Although the form did not specifically ask whether Mrs. Brackin had suffered a deterioration in her health after May 14, it did require her to affirm that "to the best of [her] knowledge and belief, the statements and answers in the application as amended by this form are true and complete as of the date this form is signed." (Emphasis added). Mr. Brackin attempts to alter the meaning of this statement by testifying to a purported conversation he had with Mr. Reinert, but that conversation would be admissible only if the written contract were ambiguous. Zale Construction Co. v. Hoffman, 145 Ill. App. 3d 235, 98 Ill. Dec. 708, 494 N.E.2d 830 (1986); Seeburg Corp. v. United Founders Life Insurance Co. of Illinois, 82 Ill. App. 3d 1034, 403 N.E.2d 503, 38 Ill. Dec. 272 (1980). It is not. Mrs. Brackin had the obligation to reveal to MIAC that her prognosis was no longer excellent. Because she failed to do so, no contract exists. Compare National Union Fire Insurance Co. v. Continental Illinois Corporation, 643 F. Supp. 1434, 1442 (N.D. Ill. 1986) (where insurance policy supplement failed to specify that insured had to update facts to date of supplement, "a reaffirmance of a prior representation reaffirms its truth only as of that date").
MIAC's motion to strike portions of Mr. Brackin's affidavit is denied, but its motion for summary judgment is granted.
DATE: March 15, 1989