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THOMPSON v. EQUITABLE LIFE ASSURANCE SOCIETY UNITED STATES (04/20/72)

decided: April 20, 1972.

THOMPSON, APPELLANT,
v.
EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES



Appeals from orders of Superior Court, April T., 1971, Nos. 139 and 140, affirming the judgment of the Court of Common Pleas, Civil Division, of Allegheny County, No. 848 of 1966 and No. 1911 of 1967, in case of Lenora Thompson, also known as Lenola Thompson v. The Equitable Life Assurance Society of the United States and United States Steel Corporation, successor to Carnegie-Illinois Steel Corporation; Same v. The Equitable Life Assurance Society of the United States and Clairton Works Employees Insurance and Safety Association.

COUNSEL

Samuel J. Goldstein, for appellant.

Richard C. Witt, with him Thomas Lewis Jones, Samuel P. Gerace, and Jones, Gregg, Creehan & Gerace, for appellees.

Jones, C. J., Eagen, O'Brien, Roberts, Pomeroy, Nix and Manderino, JJ. Opinion by Mr. Justice O'Brien. Mr. Chief Justice Jones dissents.

Author: O'brien

[ 447 Pa. Page 272]

Coster Thompson, Sr., contracted pulmonary tuberculosis some time in December of 1945. Although he

[ 447 Pa. Page 273]

    continued working at the Clairton Works of the United States Steel Corporation until April 26, 1946, his condition deteriorated rapidly from the inception of the disease. Because of the contagious nature of his illness, his wife, Lenora Thompson, appellant, was advised to live separately from her husband, which she did, although she visited him regularly until his death on January 16, 1947. Unbeknownst to Mrs. Thompson, at the time of her husband's death, she was the named beneficiary of two group insurance certificates, one for $2,000, which had been increased on March 1, 1946, to $3,000, and one for $1,000, issued by the Equitable Life Assurance Society, one of appellees, to her husband as an employee of the United States Steel Corporation, successor to Carnegie-Illinois Steel Corporation, another of the appellees.

In November of 1965, Mrs. Thompson, while going through her recently deceased mother's papers, discovered the two insurance certificates. She made inquiry at the steel company's mill office to determine whether the insurance policies were still in effect and was informed that they had expired. Shortly thereafter Mrs. Thompson brought suit on the policies.

At the non-jury trial of the case on October 2, 1969, there was no evidence produced to prove that the deceased was ever advised by appellees of the actual termination of his employment and his right to convert his group policies to individual policies of life insurance. Thus, the policies were in effect at the death of Mrs. Thompson's husband. Nevertheless, the trial court found that Mrs. Thompson's right to recover on the policies was barred by the six-year statute of limitations on contract actions in Pennsylvania, 12 P.S. § 31, since she did not notify the insurance company until more than six years had elapsed after her husband's death. On appeal to the Superior Court, the decision

[ 447 Pa. Page 274]

    of the trial court was affirmed with Judge Montgomery filing a dissenting opinion in which Judges Hoffman and Cercone joined. We granted allocatur, and now we reverse.

As the dissenters pointed out in the Superior Court, most jurisdictions follow the general rule that failure to bring suit within the time limit stated in the policy is excused where the beneficiary does not know of the existence of the policy until after the alleged time has expired; provided (1) he notifies the company at once after acquiring that knowledge, and (2) the lack of knowledge was without negligence or fault of the party seeking to be excused. 44 Am. Jur. 2d, § 1915. Any other rule, which would forfeit a life insurance policy because the beneficiary had not given notice or brought suit within a certain period of time after the death of the insured, when the beneficiary did not know of the existence of the policy until after the prescribed period had expired and the beneficiary's ignorance was without negligence or fault would be unduly harsh. See the recent exhaustive annotation to Clinard v. Security Life & Trust Co., 264 ...


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