NORTHWESTERN MUT LIFE INS CO. v. JOHNSON 254 U.S. 96 (1920)

[In No. 70:

Mr. George Lines, of Milwaukee, Wis., for Northwestern Mut. Life Ins. co.

[254 U.S. 96, 99]   Mr. S. F. Prouty, of Des Moines, Iowa, for Johnson.

In No. 71:

Mr. George B. Young, of Montpelier, Vt., for National Life Ins. Co.

Mr. S. F. Prouty, of Des Moines, Iowa, for Miller.

Mr. Justice HOLMES delivered the opinion of the Court.

These are suits upon policies issued to George P. Johnson upon his life, payable in the first case to his wife, in the second to his executors or administrators. The wife and the administrator respectively recovered in the District Court and the cases having gone to the Circuit Court of Appeals the latter has certified certain questions to this court. The policy payable to the wife contained a provision that--

'if within two years from the date hereof, the said insured shall ... die in consequence of a [254 U.S. 96, 100]   duel, or shall, while sane or insane, die by his own hand, then, and in every such case, this policy shall be void.'

Johnson, the insured, died by his own hand more than two years after the date of the policy. The first question put in the wife's suit is whether the above provision, there being no other in the policy as to suicide, makes the insurance company liable in the event that happened. The second is in substance whether the contract if construed to make the company liable is against public policy and void.

The policy payable to the administrator had no provision as to suicide but did agree that--

'This contract shall be incontestable after one year from the date of its issue, provided the required premiums are duly paid.'

Johnson's suicide was more than a year after the date of the policy. The first question propounded is whether the above provision prevents the insurer from denying liability in this case, it not appearing that Johnson was insane when he killed himself. The second is whether such a contract which makes no exception for death resulting from suicide is against public policy, and therefore void. There is a third as to a possible distinction between insurance payable to the wife and that payable to the estate of the insured which will not need to be discussed.

The public policy with regard to such contracts is a matter for the states to decide. Whitfield v. AEtna Life Insurance Co., 205 U.S. 489, 495 , 27 S. Sup. Ct. 578. This case qualifies the statement in Ritter v. Mutual Life Ins. Co., 169 U.S. 139, 154 , 18 S. Sup. Ct. 300, to the effect that insurance on a man's own life payable to his estate and expressly covering suicide committed by him when sane would be against public policy. The point decided was only that when the contract was silent there was an implied exception of such a death. There was evidence that the insurance was taken out with intent to commit suicide, and it plainly appeared [254 U.S. 96, 101]   that the act was done by the insured for the purpose of enabling his estate to pay his debts. The application, although excluded below, warranted against suicide within two years, within which time the death took place. So that all the circumstances gave moral support to the construction of the policy adopted by the court in accordance with the view that has prevailed in some jurisdictions as to the general rule. In Burt v. Central Life Ins. Co., 187 U.S. 362 , 23 Sup. Ct. 139, it was held that there was a similar tacit exclusion from the risk assumed of the death of the insured by execution for murder, and the same decision was reached in Northwestern Mutual Life Ins. Co. v. McCue, 223 U.S. 234 , 32 Sup. Ct. 220, 38 L. R. A. (N. S.) 57. But the question here does not concern implied exceptions, it concerns the effect of express undertakings which as we have said depends upon the policy of the state.

The certificates do not disclose in what states these contracts were made but it is not necessary to postpone our answer on that account. It appears from Whitfield v. AEtna Life Insurance Co., supra, that some legislatures have thought it best to insist that life insurance should cover suicide unless taken out in contemplation of the deed. But the case is much stronger when a considerable time is to elapse before the fact that the death was by the insured's own hand ceases to be a defense. The danger is less sinister and probably a good deal smaller than the danger of murder when the insurance is held by a third person having no interest in the continuance of the life insured, yet insurance on the life of a third person does not become void by assignment to one who has no interest in the life. Grigsby v. Russell, 222 U.S. 149 , 32 Sup. Ct. 58, 36 L. R. A. (N. S.) 642, Ann. Cas. 1913B, 863. When a clause makes a policy indisputable after one or two years, the mere evocation of a possible motive for self-slaughter is at least not more objectionable than the creation of a possible motive for murder. The object of the clause is plain and laudable-to create an absolute assurance of the benefit, [254 U.S. 96, 102]   as free as may be from any dispute of fact except the fact of death, and as soon as it reasonably can be done. It is said that the insurance companies now generally issue policies with such a clause. The state decisions, so far as we know, have upheld it. Unless it appears that the state concerned adopts a different attitude we should uphold it here. Simpson v. Life Ins. Co. of Virginia, 115 N. C. 393, 20 S. E. 517; Mareck v. Mutual Reserve Fund Life Association, 62 Minn. 39, 64 N. W. 68, 54 Am. St. Rep. 613; Goodwin v. Providence Savings Life Assurance Association, 97 Iowa, 226, 66 N. W. 157, 32 L. R. A. 473, 59 Am. St. Rep. 411; Patterson v. Natural Premium Mut. Life Ins. Co., 100 Wis. 118, 75 N. W. 980, 42 L. R. A. 253, 69 Am. St. Rep. 899.

We are of opinion that the provision in the first mentioned document avoiding the policy if the insured should die by his own hand within two years from the date is an inverted expression of the same general intent as that of the clause in the second making the policy incontestable after one year, and that both equally mean that suicide of the insured, insane or sane, after the specified time shall not be a defense. If seems to us that that would be the natural interpretation of the words by the people to whom they are addressed, and that the language of each policy makes the company issuing it liable in the event that happened. We answer the first question in each certificate, yes. The other questions are disposed of by our answer to the first.

Answer to question 1 in No. 70, Yes.

Answer to question 1 in No. 71, Yes.

Mr. Justice DAY took no part in the decision of these cases.