Facts and Fictions of Life

by Helen H. Gardener

The following extract is from the decision of the Court of Appeals in the famous Dwight case, which is so recently decided as to most forcibly illustrate this point:

"If an insurance policy in plain and unambiguous language makes the observance of an apparently immaterial requirement the condition of a valid contract, neither courts nor juries have the right to disregard it or to construct, by implication or otherwise, a new contract in the place of that deliberately made by the parties... Such contracts are open in construction,... but are subject to it only when, upon the face of the instrument, it appears that its meaning is doubtful or its language ambiguous or uncertain.

"An elementary writer says; 'Indeed, the very idea and purpose of construction imply a previous uncertainty as to the meaning of a contract, for when this is clear and unambiguous there is no room for construction and nothing for construction to do.'"

For this reason the Court of Appeals cited as the ground, and the only ground, for its decision against the widow, the following clause from the policy of the contesting company:

"This policy is issued, and the same is accepted by the said assured, upon the following express conditions and agreements: That the same shall cease and be null and void and of no effect... if the representations made in the application for this policy, upon the faith of which this contract is made, shall be found in any respect untrue."

Colonel Dwight was in the habit of making large business ventures. Several times, when he had done so, he had taken heavy amounts of life-insurance, so that in case of the failure of his undertakings, and his own death before he could regain his financial feet, his family would not suffer. On previous occasions he had dropped the greater part of his insurance as soon as his business ventures had terminated successfully. This is not an uncommon thing for rich or speculative men to do.

In 1878 Colonel Dwight died, with an insurance on his life of about $265,000, some of which he had carried for years; but a large part of it had been recently taken for the reasons above stated, and as he had done before under similar circumstances. Fifty thousand of this sum was in old and new policies against one company.

This company paid at once, thus giving the widow means to fight for her claims against the other companies. In a short time one of the other companies, against which she had a small claim of $5,000, also paid. The other nineteen companies contested. The widow employed Senator Conkling, and the fight has been the hardest, the bitterest, and the most ghoulish insurance contest ever had in this country; and finally the companies have won in the Court of Appeals on a purely technical point, after having dug Colonel Dwight's body up several times, in the effort to prove that he was poisoned, that he hung himself, and that he was not dead at all! They failed utterly to prove any material cause of contest; but they finally won on the ground that, in answering a question in the application for insurance, Colonel Dwight did not state that he had ever engaged in the liquor business, whereas it had been known that he had owned a hotel where liquor was sold.

Now, when it is remembered that at one time these companies tried to prove that Colonel Dwight had committed suicide, but that they never had any grounds upon which to claim that he had died of intemperance, the purely technical grounds for the decision of the Court of Appeals is apparent. Ninety-nine policies out of a hundred could be contested on such ground as that; and so long as insurance contracts retain these unreasonable and oppressive features, no man can be sure that he is not leaving a lawsuit and bitter sorrow to his family, and, worst of all, a blasted reputation for himself, when he applies for insurance under such a form.

An officer of one of the companies was heard to boast of the fact, but a few days ago, that his company had spent nearly ten times the amount of the claim against it in this Dwight contest! This is economy indeed! Whose money was this spent? The policy-holder's. For what? To defeat one of the policy-holders in a contest for a claim no doubt as honest as any one of the others will present in his turn.