{ "id": 11270342, "name": "M. E. WHITEHURST v. THE LIFE INSURANCE COMPANY OF VIRGINIA", "name_abbreviation": "Whitehurst v. Life Insurance", "decision_date": "1908-12-02", "docket_number": "", "first_page": "273", "last_page": "279", "citations": [ { "type": "official", "cite": "149 N.C. 273" } ], "court": { "name_abbreviation": "N.C.", "id": 9292, "name": "Supreme Court of North Carolina" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "111 U. S., 148", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 3506875 ], "opinion_index": 0, "case_paths": [ "/us/111/0148-01" ] }, { "cite": "100 N. C., 75", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8649985 ], "opinion_index": 0, "case_paths": [ "/nc/100/0075-01" ] }, { "cite": "145 N. C., 218", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 11252778 ], "opinion_index": 0, "case_paths": [ "/nc/145/0218-01" ] }, { "cite": "124 Mass., 59", "category": "reporters:state", "reporter": "Mass.", "case_ids": [ 733291 ], "opinion_index": 0, "case_paths": [ "/mass/124/0059-01" ] }, { "cite": "137 N. C., 652", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8657342 ], "opinion_index": 0, "case_paths": [ "/nc/137/0652-01" ] }, { "cite": "148 N. C., 54", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 11269221 ], "opinion_index": 0, "case_paths": [ "/nc/148/0054-01" ] }, { "cite": "148 N. C., 13", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 11269050 ], "opinion_index": 0, "case_paths": [ "/nc/148/0013-01" ] }, { "cite": "140 N. C., 100", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8651550 ], "opinion_index": 0, "case_paths": [ "/nc/140/0100-01" ] } ], "analysis": { "cardinality": 563, "char_count": 11963, "ocr_confidence": 0.448, "pagerank": { "raw": 6.357095657872208e-07, "percentile": 0.9589078359394698 }, "sha256": "6477d7d32d1fcaa65836dee67472a580a4a3cd36cda66922234b4481930bdc08", "simhash": "1:2d25ee283e5df765", "word_count": 2044 }, "last_updated": "2023-07-14T21:20:43.519867+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "M. E. WHITEHURST v. THE LIFE INSURANCE COMPANY OF VIRGINIA." ], "opinions": [ { "text": "Hoke, J.,\nafter stating the case: We find no reversible error in the record, and are of the opinion -that the case has been tried in substantial accord with the principles announced and upheld in the cases of Caldwell v. Insurance Co., 140 N. C., 100; Sykes v. Insurance Co., 148 N. C., 13; Stroud v. Insurance Co., 148 N. C., 54, and other decisions of like import.\nThere was evidence tending to show that plaintiff obtained, and held for some time, a policy in defendant company, containing, among others, a stipulation as ' follows: \u201cThat if plaintiff should be living at the end of ten years, the policies could be continued or surrendered by the insured under one of the following options: I. . . II. . . III. . . . IY. Surrender this policy and draw the entire cash value, that is, the legal reserve, computed according to the Actuary\u2019s Table of Mortality, and 4 per cent, interest, together with the dividend\u201d; that plaintiff was blind and unable to read the policy himself, and that, at the time the contract was entered into, and as inducement thereto, the defendant\u2019s agent read the policy to plaintiff, and told plaintiff that at the end of ten years the whole amount paid in would be returned with interest; that the agent explained the 4th clause to mean that \u201cthe company would pay the premium back at the end of ten years,\u201d etc.; and that plaintiff accepted the policies and paid the premiums thereon to the amount indicated, relying upon these statements and assurances of defendant\u2019s agent referred to, etc. On this evidence we think his Honor correctly ruled that the questions at issue should be submitted to a jury.\nWhile it is a correct principle, as we have held in Cash Register Co. v. Townsend, 137 N. C., 652, that expressions of 'commendation and opinion, or extravagant statements as to value, or prospects and the like, are not, as a rule, regarded as fraudulent in law, it is also true that, when assurances of value are seriously made, and are intended-and accepted and reasonably relied upon as statements of fact, inducing a contract, they may be so considered in determining whether there has been a fraud perpetrated; and, though this declaration may be clothed in the form of opinion or estimate, when there is doubt as to whether they were intended and received 'as mere expressions of opinion or as statements of fact to be regarded as material, the question must be submitted to the jury. 14 A. & E., page 35; 20 Cyc., page 124; Morse et al. v. Shaw, 124 Mass., 59.\nIn 20 Cyc., supra, it is said: \u201cWhether the representation was merely the expression of opinion or belief, or was the affirmation of a fact to be relied upon, is usually a question for the jury, so ordinarily it is for the jury to say whether' representations as to value, solvency, or a third person\u2019s financial ability, are statements of fact or opinion.\u201d\nAnd it is not always required, for the establishment of. \u2022 actionable fraud, that a false representation should be knowingly made. It is well recognized with us that, under certain conditions and circumstances, if a party to a bargain avers the existence of a material fact recklessly, or affirms its existence positively, when he is consciously ignorant whether it be true or. false, he may be held responsible for a falsehood ; and this doctrin'e is especially applicable when the parties to a bargain are not upon equal terms with reference to the representation, the one, for instance, being under a duty to investigate, and in a position to know the truth, and the other relying and having reasonable ground to rely upon the statements as importing verity. Modlin v. R. R., 145 N. C., 218; Ramsey v. Wallace, 100 N. C., 75; Cooper v. Schlesinger, 111 U. S., 148; Pollock on Torts, 7 Ed., 276; Smith on the Law of Fraud, sec. 3; Kerr on Fraud and Mistake, 68.\nThe conditions under which these misrepresentations as to material facts in the course of a bargain may be made the basis of an action for deceit, as a general proposition, will be found very well stated in Pollock, supra, as follows:\n\u201cTo create a right of action for deceit there must be a statement made by the defendant, or for which he is answerable as principal, and -with -regard to that statement all the following conditions must concur:\n(a) It is untrue in fact.\n(b) The person making the statement, or the person responsible for it, either knows it to be untrue, or is culpably ignorant (that is, recklessly and consciously ignorant) whether it be true or not.\n(c) It is made with the intent that the plaintiff shall act upon it, or in a manner apparently fitted to induce him to act upon it.\n(d) The plaintiff does act in reliance on the statement in the manner contemplated or manifestly probable, and thereby suffers damage.\u201d\nAnd as to responsibility for these statements attaching, when the parties are. not upon equal terms in reference to them, it is said.in Smith on Fraud, supra:\n\u201cThe false representation of a fact which materially affect's the value of the contract and which is peculiarly within the knowledge of the person making it, and in respect to which the other party, in the exercise of proper vigilance, had not an equal opportunity of ascertaining the truth, is fraudulent. Thus representations made by a vendor to a purchaser of matters within his own peculiar knowledge, whereby the purchaser is injured, is a fraud which is actionable. .Where facts are not equally known to both sides abatement of opinion by one who knows the facts best involves very often a statement of a material fact, for be, impliedly, states tliat lie knows facts whieli justify bis opinion.\u201d\nAnd so in Kerr on Fraud and Mistake, page 68 :\n\u201cA misrepresentation, however, is a fraud at law, although made innocently, and with an honest belief in its truth, if it be made by a man who ought in the due discharge of his duty to have known the truth, or who formerly knew, and ought to have remembered, the fact which negatives the representation, and be made under .such circumstances or in such a way as to induce a reasonable man to believe that it was true, and was meant to be acted on, and has been acted on by him, accordingly, to his prejudice. Tf a duty is cast upon a man to know the truth, and he makes a representation in such a way as to induce a reasonable man to believe' that it is true, and is meant to be acted on, he cannot be heard to say, if the representation proves to be untrue, that ho believed it to be true, and made the misstatement through mistake, or ignorance, or forgetfulness.\u201d\nApplying the principle announced and sustained by these authorities, we -are of opinion, as stated, that the mofion to nonsuit, entered by defendant, was properly overruled. The policy held by plaintiff in defendant\u2019s company contained stipulations to some extent ambiguous and certainly indefinite ; and when an agent pf defendant company, in the effort to induce plaintiff to take out 'the policy, said to him that, under one of these stipulations, .\u201cthe company at the end of ten years would pay back the premiums with interest,\u201d we think that, under the conditions attending the transaction, and having due regard to the respective positions of the parties, it was a question for the jury as to whether these assur-' anees, given by defendant\u2019s agent, were intended as statements of fact, accepted and reasonably relied upon by plaintiff as a material inducement to the contract, and that the verdict establishes,, an actionable fraud, imputable to defendant company, entitling plaintiff to recover the premiums paid and interest, Sykes v. Ins. Co., supra.\nThere is no error, and the judgment below is affirmed.\nNo error.", "type": "majority", "author": "Hoke, J.," } ], "attorneys": [ "II. 0. Whitehurst and Simmons, Ward & Allen for plaintiff.", "IF. IF. Glorie for defendant." ], "corrections": "", "head_matter": "M. E. WHITEHURST v. THE LIFE INSURANCE COMPANY OF VIRGINIA.\n(Filed 2 December, 1908).\n1. Insurance \u2014 Contracts\u2014False Representations \u2014 Expressions of Opinion \u2014 Statements of Fact \u2014 Questions for Jury.\nDeclarations, though clothed in the form of an opinion or estimate, made by a duly authorized agent to induce a contract or policy of insurance, accepted and reasonably relied upon by the other party as statements of facts, may be considered upon the question of whether fraud had been thereby perpetrated; and when there is a doubt as to whether they were intended and received as mere expressions of opinion, or statement of facts to be regarded as material, the question is one for the jury. \u2022\n2. Insurance \u2014 Contracts\u2014Principal and Agent \u2014 Agent\u2019s False Representations \u2014 Knowledge Imputed \u2014 Liability.\nWhen an agent of an insurance company has induced the insured to take a policy of insurance in his company by making misrepresentation of a material fact concerning which, as such agent, he should have known the truth, or makes it recklessly, or affirms its existence positively, when he is consciously ignorant whether it be true or false, his principal may be held responsible by the insured relying, and having reasonable ground to rely, upon the agent\u2019s statement as importing verity.\n3. Same.\nA stipulation in a policy of life insurance, among other things, gave the plaintiff, the insured, the option to \u201csurrender this policy and withdraw the entire cash value, that is, the legal reserve, computed according to the actuary\u2019s table of mortality, and four per cent, interest, together with the dividend.\u201d There was evidence tending to show that the agent of the defendant, the insurance company, induced thp plaintiff, a blind man, to take out the policy by reading this stipulation to him, and falsely informing him that the company, at the end of ten years, would pay back the premiums with interest. Held, (1) It was a question for the jury as to whether these assurances were intended as statements of fact, accepted and reasonably relied upon by plaintiff as a material inducement to the contract; (2) An affirmative finding of the jury thereon established an actionable fraud imputable to defendant company, entitling plaintiff to recover the premiums paid, and interest.\nActioN tried before 17. Ii. Allen, J., and a jury, February Term, 1908, of ObaveN.\nAt the close of plaintiff\u2019s testimony, and again at the close of the entire testimony, there was motion of nonsuit under the Hinsdale Act, motions refused, and defendant excepted. On issues submitted the jury rendered the following verdict:\n\u201c(1) Did the defendant falsely represent to the plaintiff that, under the policies in controversy, the plaintiff would be repaid the amount of premiums paid by him, with about 4- per cent, interest thereon, at the expiration of ten years?\nAnswer: \u00a3Yes.\u2019\n(2) If so, did the plaintiff rely on said representations, and was he induced to accept said policies ?\nAnswer: \u2018Yes.\u2019\n(3) Has the plaintiff waived the right to rely upon failure to deliver to the plaintiff policies that provided for the return of premiums paid, and about 4 per cent, interest, at the expiration of ten years?\nAnswer: \u00a3No.\u2019\n(4) Is the defendant indebted to the plaintiff, and if so, in what sum ?\u201d\nAnd thereupon the Court rendered judgment as follows:\n\u201cThis cause coming on to be heard before his Honor, Judge W. E. Allen, and a jury, and being heard, and the jury having answered all the issues in favor of the plaintiff, except the one as to the quantum o.f damages, and the amount and dates of payments having been agreed upon, and it having , been agreed that his Honor should answer the issue as to the quantum of damages, and his Honor having found that the1-/payments together with interest on each up to the 10th. day of February, 1908, amounted to three hundred and fifty-nine and 63-100 ($359.63) dollars:\n\u201cIt is therefore considered by the Court, and adjudged that the plaintiff recover of the defendant three hundred and fifty-nine 63-100 dollars, with interest thereon, from the lOtli day of February, 1908, till paid, and the costs of the action to.be taxed by the Clerk.\u201d\nDefendant excepted and appealed.\nII. 0. Whitehurst and Simmons, Ward & Allen for plaintiff.\nIF. IF. Glorie for defendant." }, "file_name": "0273-01", "first_page_order": 307, "last_page_order": 313 }