Supreme Conclave Knights of Damon v. Wood

Simmons, C.J.

The courts of the United States and of several of the States have for several years been trying to get away from the earlier decisions in regard to warranties in insurance policies. All of the earlier decisions, so far as we are aware, hold the insured bound by the strict law of warranty, whether the statement warranted be material or not, holding that the parties had the right to agree that a representation was material, though in fact it was not. Latterly some of the courts have strained to construe the statements of the insured as representations wherever they were not unequivocally made warranties. Thus it has been held, that where in the application certain statements were covenanted to be true, if the policy or contract did not declare them to be warranties but referred to them as representations or statements, they would be construed as mere representations, so that, if immaterial, their falsity would not avoid the policy. See Moulor v. Ins. Co., 111 U. S. 335; Phoenix L. I. Co. v. Raddin, 120 U. S. 183; Northwestern Mut. L. I. Co. v. Woods (Kaus.), 39 Pac. 189; Alabama Gold L. I. Co. v. Johnson, 80 Ala. 467. But the courts in this State are not troubled with these finer distinctions and strained constructions. Mr. T. R. R. Cobb, the great lawyer and codifier, who incorporated the principles of law and equity into our code, doubtless saw the great injustice and hardship to the insured under the earlier decisions of the courts. It was to change this, we apprehend, that he, in 1860, placed in the code which was adopted in 1863 what are now sections 2097 and 2098 of the Civil Code. These sections are as follows: 2097. “Every application for insurance must be made in the utmost good faith, and the representations contained in such application are considered as covenanted to be true by the applicant. Any variation by which the nature, or extent, or character of the risk is changed, will void the policy.” 2098. “Any verbal or written representations of facts by the assured to induce the acceptance of the risk, if material, must be true, or the policy is void. If, however, the party has no knowledge, but states on the representations of others, bona fide, and so informs the insurer, the falsity of the information *337 does not void the policy.” Thus it will be seen that a policy can not now be avoided upon the ground of the falsity of a representation, though warrantied, unless that representation be material and the variation from truth be such as to change the nature, extent, or character of the risk. So this court has uniformly construed these sections, as far as we can ascertain. Wherever an applicant for life insurance makes material representations in his application or examination, and covenants that they are true, under the above section of the code, and these representations are made the basis of the contract of insurance, such contract is void if the representations vary from the truth in such manner as to change the nature, extent, or character of the risk. This is true although the applicant may have made the representations in good faith, not knowing that they were untrue. Southern L. I. Co. v. Wilkinson, 53 Ga. 535; O’Connell v. Supreme Conclave Knights of Damon, 102 Ga. 143; Morris v. Imperial Ins. Co., 106 Ga. 461. The representations when made, if material, are warranties under the code, but‘they differ from the ordinary warranty in that their falsity does not avoid the policy unless they are material and the variation from truth is such as to change the nature, extent, or character of the risk. It is therefore immaterial whether the warrantor acted in good faith in making them. If one sell another a horse and warrant the soundness of the animal, he is bound by the warranty, whether at the time of the sale he knew or did not know that the animal was diseased. So too, if an applicant for life insurance inform the insurance company, by a written answer to a question as to whether he has had heart disease, that he has not had it, such answer being covenanted in his application, he is bound by his covenant without regard to his good faith in making the representation. Such was the present case. The representation was certainly a material one, and doubtless the company acted upon it. It is scarcely conceivable 'that the company would have issued the policy if the applicant had answered that he was or had been afflicted with heart disease, or even if he had answered doubtfully. We think that if the answer made was untrue, the plaintiff below can not recover. In reading the brief of evidence we find that the testimony was conflicting as to whether the insured was or had been afflicted with heart disease at the time of his application for insurance. The *338 physician who treated him testified that in his opinion the applicant was at the time afflicted with the disease. The company’s physician, who made an examination at the time of the application, testified that in his opinion the applicant had at that time no sign or sympton of the disease. This will be a question for the jury to decide upon the next trial. A great many assignments of error are made in the motion for a new trial, upon rulings on evidence and upon the charge of the court. We have not discussed the grounds of the motion seriatim, but have laid down the principles which we think control the case. The views of the trial judge were not in accord with what we have laid down, and a new trial will have to be granted.

2. One of the charges complained of related to the burden of proof. This we will not discuss further than to say that the second headnote gives the rule in regard thereto as laid down in the Civil Code, §§ 5144, 5145. In the charge given on this subject the judge confused preponderance of evidence with proof to a reasonable and moral certainty, confusing the law as to civil cases with the law applicable in criminal cases. We do not think it proper in a civil case to instruct the jury that the party on whom rests the burden of proof must establish his contention to a reasonable and moral certainty. If he establishes it by a preponderance or superior weight of evidence, to the satisfaction of the jury, that is sufficient. As to the meaning of “ reasonable and moral certainty,” see Bone v. State, 102 Ga. 387.

Judgment reversed.

All the Justices concur.