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FRANKLIN LIFE INSURANCE COMPANY v. FRANCHOCK. (12/13/63)

December 13, 1963

FRANKLIN LIFE INSURANCE COMPANY, APPELLANT,
v.
FRANCHOCK.



Appeal, No. 176, April T., 1963, from decree of Court of Common Pleas of Westmoreland County, No. 3002, in equity, in case of The Franklin Life Insurance Company v. Luella Franchock et al. Decree affirmed.

COUNSEL

B. Patrick Costello, with him Smith, best & Horn, for appellant.

Ned J. Nakles, with him Gene E. McDonald, for appellee.

Before Rhodes, P.j., Ervin, Wright, Woodside, Watkins, Montgomery, and Flood, JJ.

Author: Flood

[ 202 Pa. Super. Page 439]

OPINION BY FLOOD, J.

The plaintiff insurance company, seeking rescission of an insurance policy issued on the life of Michael M. Franchock, alleged that it issued the policy in reliance upon the statements and representations made to the plaintiff's examining physician by Franchock fraudulently and in bad faith. The chancellor found that Franchock was not aware of the conditions which he did not disclose in those answers and that there was no bad faith. He further found that the plaintiff issued the policy in reliance exclusively upon its own investigation, not upon the answers noted in the application. The chancellor thereupon refused the relief sought by the plaintiff and entered judgment for the defendant beneficiaries on their counterclaim for the amount of the policy. The plaintiff has appealed from the decree of the court en banc making absolute the chancellor's decree nisi.

As the appellant points out, the guide-lines in this type of case consist of five governing principles laid down in Evans, v. Penn Mutual Life Insurance Co., 322 Pa. 547, 186 A. 133 (1936). We need not repeat these five principles which are set forth at length in the

[ 202 Pa. Super. Page 440]

The court found that the answers were written in the application by Dr. Lechman, the plaintiff's examining physician, and the application, so filled in, was signed by the insured.The court further found that the insured was not highly educated, having gone only to the third grade. A factual question is immediately raised as to whether Dr. Lechman properly put the questions to the plaintiff, understood and properly recorded his answers, and whether the insured relied upon the doctor's properly filling in the application before he signed it. The following quotation from Dr. Lechman's cross-examination illustrates that the insured's fraudulent conduct or bad faith cannot be determined as a matter of law from this application alone, and that it cannot fall into the category of "competent and uncontradicted documentary evidence" which would justify a directed verdict for the insurer under principle (3) of the Evans decision.

"Q. How many times did you read each question to Michael Franchock do you recall, Doctor?

"A. Well, that is difficult. I am sure that I read them once. Occasionally there is a question that has to be re-read, sometimes asked to be ...


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