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REMPEL v. NATIONWIDE LIFE INSURANCE COMPANY (04/03/74)

decided: April 3, 1974.

REMPEL,
v.
NATIONWIDE LIFE INSURANCE COMPANY, INC. ET AL., APPELLANTS



Appeal from judgment of Court of Common Pleas, Civil Division, of Allegheny County, July T., 1971, No. 620, in case of Dolores I. Rempel v. Nationwide Life Insurance Company, Inc. and Reid W. McGibbeny.

COUNSEL

Charles H. Alpern, and Weis & Weis, for appellant.

Michael J. Seymour, and Feczko & Seymour, for appellee.

Wright, P. J., Watkins, Jacobs, Hoffman, Cercone, and Spaeth, JJ. (Spaulding, J., absent.) Opinion by Cercone, J. Dissenting Opinion by Jacobs, J. Hoffman, J., joins this dissenting opinion.

Author: Cercone

[ 227 Pa. Super. Page 89]

This appeal arises from a judgment in trespass totaling $6,463.80 against both appellants, Nationwide and its agent, Mr. McGibbeny. This action, which was joined at trial with an assumpsit action based upon a contract of insurance, was brought by the widow of the insured, and alleged that Mr. McGibbeny had either fraudulently or negligently misrepresented the coverage afforded by the policy while acting within the scope of his employment with Nationwide. The facts of the case, cast in the light most favorable to the plaintiff-appellee, are as follows:

In April of 1961 Mr. McGibbeny, upon request, sold to Mr. Rempel, deceased, a Nationwide "mortgage protector" policy on Mr. Rempel's life. This was basically a thirty year, decreasing term, life insurance policy whereby the lump sum death benefit would approximately equal the amount of the outstanding first mortgage on the insured's home. At the end of the thirty year term the life insurance and the mortgage would co-terminate. Some time shortly after this policy went into effect, Mr. Rempel learned through an agent of a competitor of Nationwide that, for a "few dollars more per month," he could receive the same mortgage protection and also purchase $5,000 worth of whole life insurance. This plan interested Mr. Rempel, and he therefore asked Mr. McGibbeny if Nationwide offered similar protection for his family. Mr. McGibbeny inquired into the matter; and, consequently, Nationwide reissued a $5,000 whole life policy with a "twenty year family income rider." While the monthly premium on the original mortgage protector policy was $13.00, the premium on the new policy which replaced it was $16.75. Mr. Rempel continued to pay the premiums

[ 227 Pa. Super. Page 90]

    until his death in 1970. Mrs. Rempel testified that when she contacted Mr. McGibbeny he told her that she had a very good policy and would receive approximately $16,000.00 from it. Since the balance remaining on the mortgage was $11,100.00, the estimate comported with her expectation of the policy's coverage. A few days later, however, Mr. McGibbeny informed her that the policy would provide a lump sum payment of only $10,400.00.

At trial, Mrs. Rempel testified that her husband had clearly indicated his desire to obtain the $5,000 additional whole life insurance; and, at the meetings with Mr. McGibbeny which she attended, the agent represented that he could secure the same protection for the "few dollars more" that Nationwide's competitor had offered. She also testified that, after Mr. McGibbeny presented them with a policy which he represented as fulfilling their wish, they never scrutinized it to determine whether it lived up to those representations. Mr. McGibbeny, of course, testified that no such representations had ever been made, and counsel for the defendants objected that, in any event, Mrs. Rempel's testimony thereto was barred by the Parol Evidence Rule. Plaintiff's counsel countered that the testimony was admissible because it was not offered to vary or contradict the express terms of the policy, but was offered to show that the agent had committed the tort of negligent misrepresentation causing damage to the plaintiff in the amount of $5,670.00 plus interest (representing the difference in value between the policy as represented and its value as written). The trial court directed a verdict for the plaintiff on her assumpsit action in the amount of $10,430.00 plus interest, an amount equal to the benefit provided under the policy at the time of Mr. Rempel's death. The jury also returned a verdict for the plaintiff against both defendants on the tort action in the amount requested. Both

[ 227 Pa. Super. Page 91]

    defendants bring the instant appeal from the latter judgment. They again raise their parol evidence objection to the testimony of Mrs. Rempel concerning the negotiations prior to the issuance of the written policy, and also argue that, regardless, the clear weight of the evidence indicated that the Rempels could not have ...


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