Mutual Life Insurance Co. of New York v. Hilton-Green

Citations

• 241 U.S. 613
• 36 S. Ct. 676
• 60 L. Ed. 1202
• 1916 U.S. LEXIS 1687

Syllabus

<p>Material representations in an application for life insurance which are incorrect, if known to be untrue by the assured when made, and nothing else, appearing, invalidate the policy issued by the insurer relying on such representations, without further proof of actual conscious design to defraud.</p> <p>The general rule, which imputes an agent’s knowledge .to the principal, does not apply when the third party knows there is no foundation for the ordinary presumption, and he is acquainted with circumstances plainly indicating that the agent will not advise the principal.</p> <p>The rule imputing agents’ knowledge to the principal is intended to protect those exercising good faith and not as a shield for unfair dealing.</p> <p>While § 2765, Florida Statutes, undertakes to designate as agents of insurance companies certain persons, in fact, acting for such companies in somfe particulars, it does not fix the scope of their authority as between the company and third persons, and does not raise special ' agents with limited authority into general ones with unlimited power ></p> <p>One consciously permitting an application containing material misrepresentations to -be presented by subordinate agents to'officers of a life insurance company, under circumstances which he knows negatives' any probability of the actual facts being revealed, and later accepting policies which he knew were issued in reliance upon statements both false and material, can claim nothing under such policies.</p> <p>An applicant for insurance should exercise toward the company the • amé good faith which he may rightfully demand from it; the relar . tionship demands fair dealing by both parties.</p>