already owned comparable life insurance when approached by defendant's agent, Mr. Mikolochick, and he dropped the earlier policies shortly after the Nationwide policy became effective. Certainly this is an unlikely course of action for someone who knew he had serious health problems, especially one who intended to increase his insurance coverage or otherwise commit a fraud on the second carrier.
On the application for insurance itself the answers now being challenged by the defendant are not so blatantly false that knowledge of their falsity must be presumed. See Anastasio v. Metropolitan Life Insurance Co., 149 Pa. Super. 414, 27 A.2d 510 (1942). Given the lack of any evidence that Dr. McClimans told Mr. Annett what specific health problems he had and what the treatment was for, it certainly is possible that Mr. Annett was unaware that he was being treated for diabetes, liver disease, alcoholism, or even high blood pressure. There was absolutely no direct evidence that he had ever been informed by anyone as to any such conditions and it is within the realm of reasonable possibility that he was never so told even by his own doctor.
Similarly, Mr. Annett could have declared truthfully that he was in "sound health." There simply is no evidence of Mr. Annett's knowledge of his medical problems. His multiple employment as a rigger, a grave digger and a janitor are all inconsistent with knowledge of serious medical problems, especially of a heart condition.
Several other answers challenged by Nationwide are to questions that are sufficiently ambiguous that under the circumstances a finding of fraud cannot be made. For example, while Dr. McClimans observed that Mr. Annett was "nervous and snappy," this nervousness would not seem to prevent a negative answer to a question concerning "disease or disorder of brain or nervous system." Likewise, a question asking whether the applicant had "ever been a patient or been under treatment or observation" in a hospital could reasonably have been interpreted as not covering a single instance of out-patient treatment following a fall.
Of course, several of Mr. Annett's answers clearly are false and do concern matters of which Mr. Annett should have been aware. Question 8(d) asked if Mr. Annett had ever had x-rays, electrocardiograms, or other medical tests. Certainly the brain scan performed in November of 1969 would qualify as a "medical test." Question 7(b) asked if Mr. Annett had been advised or treated by a doctor for fainting spells within the past 10 years, and Dr. McClimans' records indicated that Mr. Annett had had a couple of blackout spells. While Mr. Annett should have known that the answers to these questions were false, I believe that the incorrect answers were given inadvertently and are due to mistake, rather than fraud. This conclusion is supported by the lack of a motive for false statements, and by the distracting circumstances under which the application was filled out. Moreover, because Nationwide did not produce its agent, Mr. Mikolichick, as a witness at trial, there is very little evidence in the record concerning what explanations and assistance he gave to Mr. Annett when the application was completed. While Mr. Mikolichick's nonappearance is not evidence that he incorrectly explained certain questions to Mr. Annett, it does support the plaintiff's testimony that her husband did not carefully consider his answers on the application. Under all the circumstances, a finding that Mr. Annett knowingly misrepresented the state of his health on the insurance application is unwarranted.
One additional ground on which Nationwide might avoid the insurance policy must be discussed. On the "Medical History and Declaration" Mr. Annett denied that he had consulted or been treated by a doctor within the past five years. This answer is clearly incorrect and an inference of fraud could be justified. On the other hand, it is entirely possible that Mr. Annett simply made a mistake on the "Medical History and Declaration." In any event, Nationwide has waived any right to avoid the policy on the basis of this answer, because Nationwide had notice that Mr. Annett had answered "yes" to a nearly identical question on the insurance application. This obvious inconsistency would have alerted a reasonable insurance company to make further inquiry about Mr. Annett's treatment by a doctor. The fact that Nationwide issued the policy without making such inquiry must be considered a waiver of the materiality of any insufficiencies in the obviously inconsistent answers. See Franklin Life Insurance Company v. Bieniek, 312 F.2d 365 (3d Cir. 1962).
Finally, the plaintiff in this case has sought punitive damages against Nationwide. Although Nationwide acted somewhat negligently in issuing this policy without interviewing Dr. McClimans, its refusal to pay upon Mr. Annett's death was not malicious or even unreasonable in light of the information then in its possession. Consequently, punitive damages are unwarranted.
AND NOW, to wit, this 12th day of March, 1976, judgment is hereby entered in favor of the plaintiff and against the defendant for the proceeds of the contested life insurance policy, together with interest from the date of William Annett's death.
AND IT IS SO ORDERED.
Clarence C. Newcomer, J.
March 12, 1976.