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Goldberg v. Colonial Life Ins. Co. of America

Supreme Court of New York, Appellate Division

October 18, 1954

SYLVIA GOLDBERG, Individually and as Administratrix of the Estate of MAX GOLDBERG, Deceased, Respondent,

APPEAL from so much of an order of the Supreme Court at Special Term (DI GIOVANNA, J.), entered May 12, 1954, in Kings County, as denied a motion by defendant for an order dismissing

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the first and second causes of action alleged in the amended complaint, under rules 106 and 107 of the Rules of Civil Practice.


Aaron Frank for appellant.

Saul Roth and Bernard Joseph Rubenstein for respondent.


Respondent, a widow, seeks to recover $10,000 from appellant under an alleged contract of life insurance of which she is beneficiary. In her first cause she alleges an agreement made April 29, 1953, between her husband and the appellant. These are the allegations: Her husband went to the office of one Max L. Weil, general agent of the appellant, to purchase a life insurance policy, and, after considerable negotiation, he agreed to purchase and Weil agreed to sell a straight life policy in the sum of $10,000; her husband signed an application, was examined by appellant's doctor, who indicated to her husband and to the general agent that her husband's physical condition was satisfactory; the general agent accepted a check in the amount of $425.20 made to appellant's order as the first year's premium and this check was deposited to the credit of appellant. Finally it is alleged, on information and belief, that thereafter and upon receipt by the appellant of the signed application, the prepaid premium and the physician's report appellant 'duly issued the said life insurance policy on its books'.

Respondent's husband died on May 18, 1953, nineteen days after he had applied for the aforesaid insurance. Appellant had never issued a policy to the deceased and refuses to pay the proceeds due under the alleged contract.

In her second cause of action, respondent seeks to recover on the ground of estoppel based upon the allegation that appellant's general agent assured her husband that a contract had been created. A third cause of action has been dismissed and need not be discussed herein as no appeal has been taken from that dismissal.

The only conceivable contract with the appellant, alleged in the first cause, is one between the husband and the general agent. The additional allegations as to the making of a written application to the appellant are insufficient to show the existence of any other contract. There could be no agreement with the company until it accepted the application for insurance. (Schultz & Co. v. Camden Fire Ins. Assn., 304 N.Y. 143, 147; More v. New York Bowery Fire Ins. Co., 130 N.Y. 537; Corning v. Prudential Ins. Co. of America, 248 A.D. 187, affd. 273 N.Y. 668.) Acceptance by the appellant had to be manifested

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by some appropriate act and such manifestation communicated to the applicant. ( White v. Corlies, 46 N.Y. 467.) Of course, the ordinary means of acceptance would be delivery of a policy to the insured. In any event, however, there had to be a notification to the insured of such acceptance by the insurer. A notation by appellant on its books would not be a binding acceptance any more than would be the words of a man speaking to himself. Until acceptance was communicated to him, the applicant was free to withdraw his application and no mutually binding contract could be said to have been entered into. (Goldstein v. New York Life Ins. Co., 176 A.D. 813, 816, affd. 227 N.Y. 575; Topken, Loring & Schwartz v. Schwartz, 249 N.Y. 206.)

As to the alleged contract with the general agent, the Statute of Frauds (Personal Property Law, § 31, subd. 1) provides that every agreement is void unless there is a note or memorandum in writing and subscribed by the party to be charged if its performance 'is not to be completed before the end of a lifetime'. A life insurance contract clearly comes within the scope of this provision. Respondent argues to the contrary, contending that the provision was enacted to prevent assertion of claims against the estate of a decedent and that therefore it was intended to restrict application of the provision to contracts relating to the lifetime of a promisor. Even under such narrow interpretation a life insurance policy would require a writing because the insured is a promisor of premiums. In any event, it is now beyond dispute that the provision means exactly what it says, namely, 'a lifetime'. As stated in Meltzer v. Koenigsberg (302 N.Y. 523, 525): 'The Statute of Frauds requires that an agreement be in writing if by its terms performance is 'not to be completed before the end of a lifetime' (Personal Property Law, § 31, subd. 1). Had the Legislature intended the 'lifetime' referred to to be the lifetime of the promisor, the party to be charged, or the lifetime of any particular person, it could easily and readily have so provided.'

Subdivision 7 of rule 107 of the Rules of Civil Practice provides for dismissal on motion on the ground that the case is founded on a contract which is unenforcible under the Statute of Frauds. The rule provides that the motion may be made 'on the complaint and an affidavit stating facts tending to show' the unenforcibility. In support of its motion and in accordance with the rule, appellant submitted an affidavit of its ...

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