614 PACIFIC MUTUAL LIFE INS. CO . V. BUTLER. [192
PACIFIC MUTUAL LIFE INSURANCE COMPANY V. BUTLER. 4-4263 Opinion delivered April 20, 1936. 1. INSURANCE.—Notice of disability under a policy of insurance is given, not of ailment from which the disability results, but of the fact of disability itself, when it occurred, and is known to exist and to be total within meaning of contract. • 2. JUDGMENT.—Where, in an action on policy of insurance for disability benefits, it was held that requirement of policy that notice of disability within time therein specified was condition precedent to recovery, in a suit on a second and like policy a plea of res adjudicata cannot be sustained where it is alleged that such notice was given. 3. EVIDENCE—WITNESS-B.S.—Although the allegations and testimony in a previous trial on a policy of identical nature were not, when transcript in that case was introduced, sufficient to sustain plea of res adjudicata, it was competent evidence by way of impeachment as bearing upon the good faith of the allegation that appel-lee was mistaken as to the date upon which he I;ecame disabled and the sufficiency of the testimony to support it. Appeal from Saline Circuit Court; H. B. Means, Judge ; reversed. Owens Ehrmari and John M. Lofton, Jr., for appellant. Ernest Briner and Melbourne M. Martin, for ap-pellee. SMITH, J. The appellant insurance company issued to appellee two policies of life insurance. One dated July 18, 1919, was for $2,000 with monthly benefits in case of total disability, of $20. The other policy dated September 9, 1920, was for $3,000 with monthly benefits of $30, in case of total disability. On March 22, 1933, appellee notified appellant that he was then totally and permanently disabled and had been since December 8, 1931. In this notice he demanded past-due and future benefits, and when the demand ,was refused, suit was brought to enforce it, and, from a judgment in his favor, an appeal was duly prosecuted to this court. It was held upon this appeal that liability under the policy sued on was conditioned on the happening of
ARK.] PACIFIC MUTUAL LIFE INS. CO . V. BUTLER. 615 disability and proof thereof within 120 days thereafter, and that the provisions of the policy made the requirement . as .to notice a , condition precedent to the granting of , benefits. As this notice had not been given; the judgment was reversed, and the cause dismissed. Pacific Mutual Life Ins. Co. v. Butler,• 190 Ark. 282, 78 S. W. (2d) 813. • Shortly before the rendition of this opinion, suit was brought upon the larger policy with identical allegations as to the time when the disability occurred. This cause was removed to the Federal court where, upon a trial had while the appeal from the first judgment was pending in 'this court, testimony was offered similar to that offered in the trial of the suit on the smaller policy. A voluntary nonsuit was taken in the Federal court upon the completion of the testimony, and a third suit was brought in the Saline Circuit Court. The complaint in this case alleged that the plaintiff became disabled Deceraber 8, 1931, but it was amended after the opinion' of this court waS delivered February 4, 1935. This amendment, made by interlineation, alleged that while appellee became totally and permanently disabled on December 8, 1931, he did not realize that he was disabled until March 22, 1933. This interlineation was later amended by striking out the date December 8, 1931, and inserting the date of March 22, 1933. Appellant filed a motion to dismiss the amended complaint upon . the ground that the decision in the first case between the parties was res adjudicata of the controlling question involved in the case, and that' apliellee was-estopped by the allegations of his former complaints from alleging that he became disabled on • March 22, 1933. This motion was overruled and testimony was offered at the trial from which this appeal comes fixing March 22, 1933; as the date upon which appellee became aware that his disability was total and permanent, and that proof thereof was made within 120 days of that date. Testimony was also offered to the effect that proof of an earlier date was a mistake. Appellee was asked this question by his counsel : "You state to the jury that
616 PACIFIC AUTUAL . LIFE INS. C(i. v. BUTLER. [192 the 'first time you ever- knew 'of your disability was on M'arch. 22, 19334" And his • answer was : "It was." The parties entered into a stipulation reading as. fol-ldWs' "It is' stiPulated that proof Of the Original record in the 'case of .i5714, -Butler ... v.. Pacific Mutual Life lnkar- • an'Oe -Contpariii of 'C alif ornia; the original transcript may be offered in evidence in this , case, subject, of course, to the : objections that:die-court 'may sustain aS to any in-comPetendie. -Ibis further . stipulated that the.testimony of Gus Butler in the-case of GuS Butler v. Pacific Mutual Lite Insurance Co:,.in the • United States District Court ifi:;Litt].e. 'Rock: mhy. ;.be 'offered in'evidenceithOut the necessity: of callihg the . reporter who took the testimony down. and transcribed -same; subject, of course; to • the objections that the conrtmay. sustain ,as to .any incompe-tencies." , .. „Pursuant 'to this stipulation; the testimony . of Dr. McGill, taken at . the trial of the suit: on the .smaller policy wa§. -read i evidenc& by: appellee.: Appellant offered .to introduce from' theiuriginal *transcript in the case , ap-- , pealed. :to thiS..court, a-copy of the complaint filed in, that, case;. This' was excluded....: Appellant. also offered in•evi-, dence. a :Copy uf •the testimony of appellee upon . the trial in:the Federal court . . This . was: also . excluded; exceptions. being saved to both rulings - : : . In support of the. contention that the .Plea . of 'yes' adjudicata should _be sustained , appellant . says : "The question involved . in this case was the same as that decided. . by the court on the former appeal namely, whether. .Gus: Butler, appellee, could recover disability benefits under- a. policy :of _insurance when the ; giving of notice .within 120 days from the inception of . this- disability :was.a condition- precedent to such recoVery. Ap-' pellant.also itvokes the rule . of -stare decisis,.mid insists that for both reasons the judgnient here appealed from should be, reversed; and the Cause dismissed.: In , ansWer to these. Contentions it may be said that an: insurance contract identical with the . one here sued oil' has been -construed as requiring . notice of the disability to.be . given within:120• days of its inceptien.•That
ARK.] PACIFIC MUTUAL . LIFE INs. 'Co. v. BUTLER. 617 proposition has been, definitely decided.ip litigation '1) . e-tween the parties here .appearing and arising out of a contract; identical . with thp 011e here sued on. We re-r affirm . what was ,said in ; the opinion in the, first appeal,. 'But the notice is given not of the disease, or ailment from , which the disability finally results ; but . of ; the fact of disability itself, : when it, occurred, : and, is known:to exist and to be total . within the meaning, of the insurance contract.. ..//ome Indemnity:Co. v. Banfield. _Bras, .PacA-ing co.,'Inc., * 188 Ark. 683, 67 S. W. (2d) . 203; 41406:mil State .Lif e .Co. v., Barron, 18(3, Ark, 52: '733 ;—gew717-olc--Life 63 S. W. (2d) 520; Business Men's,.Assurance ridge, 187 Ark. 1040, 63 S. W. (al) 640. But aPpellee insists * that iii the 'Suit i this .seconcl policy, be has brOnght himself Within, the -1a-W- a.S . 'declared on the former appeal, and we 'are not , asked by hith to overrule Oi . to quality , that opinion It is here allegea that'apPelled haS giYen'the nOtiee whieh thd fofther OPifiL ion 'held to. benssential to reeeyery. While the 'rule' of stare'deCi'sis requires ns to hold that this notice thnst .be given : as a condition* precedent • td * a. iecOV-ery'llipon' the poliCY here sued' oh,' if 'was' alleged; and lestinaon.y.W5,§ offered,,tending to show that the notiee WaS giveri Within the • . required time: '1STor' eah. the plea of 'res ,ad2iidicOt.4 be siistained. The qnestioii of * liability on': Ws policy has not been pre y ionslY adjudged. It vO iily decided that, giving a. certain notice had been :made a condition 'precedent by;the teruis of ,a similar, policy„an.il it„is now alleged that tbis:notice i _Tas . given..,, • . In the excellent brief of appellantnumerousi 'authorities are cited on the . question as to when the plea of res adjudicata shonld be . SuStaiiied. , Atheng ethers, onr own case of . Nat'l Surety qa. *V. Coates, 88 'Ark. 50, 104 S. W. 219. That . was a suit against the' suretY ution .a contractor's bond who, it 'was alleged, had * failed ist,) perform .a mail service cithtract with the United' 'Staie.s. The, answer alleged a former trial to a ;jury -upon the issue that the coiltract: had been:terminated prior to the alleged 'breach. A. demurrer..to. ; this pleading ;was sus-
618 PACIFIC MUTUAL LIFE INS. CO . v. BUTLER. [192 tained, and in reversing that judgment it was there said: The paragraph just quoted contains a complete defense to the action, and the demurrer should not have been sustained. It is urged on behalf of the appellee that the former adjudication was not a bar to the present action for the reason that the latter is instituted to recover damages accruing since the former adjudication. This does not prevent the former judgment from barring the present action. According to the allegations of this amendment, the question of the defendant's liability on the contract of suretyship sued on was determined in the former action adversely to the plaintiff's contention in this case, and therefore barred a recovery." A number of decisions of the Supreme Court of the United States are there cited and quoted from. Among others the case of Southern Pac. Ry. v. U. S., 168 U. S. 1, 18 S. Ct. 18, to the following effect: "A right, question or fact distinctly put in issue and directly determined by a court of competent jurisdiction, as a ground of recovery, can not be disputed in a subsequent suit between the same parties or their privies; and even if the second suit is for a different cause of action, the right, question or fact, once so determined, must, as between the same parties or their privies, be taken as conclusively established, so long as the judgment in the first suit remains unmodified." (Citing cases.) This statement of the law was again quoted and approved by this court in the case of Morgan v. Ken-drick, 91 Ark. 394, 121 S. W. 278. There are many cases to the same effect. This rule has application in cases similar to our Coates case, supra, where it was quoted. There the fact put in issue and decided by the jury at the first trial was that the contract was not in effect at the time of its alleged breach. This was as complete defense to the claim for damages subsequent to the first trial as it was to those prior thereto, and it having been adjudged that the contract had terminated, the parties to the contract were oncluded by that adjudication.
ARK.] PACIFIC MUTUAL LIFE INS. CO . v. BUTLER. 619 The rule quoted does not apply here. The point at issue which was decided in Pac. Mutual Life Ins. Cu. v. Butler, supra, was not whether Butler had been disabled for more than 120 days before giving notice, but was rather the effect of the failure to give notice: The plaintiff alleged a disability for more than 120 days, and there was no adjudication of that fact as it was not controverted, and was not an issue in the case. That judgment is not decisive of the question of liability on the separate and distinct contract here sued on although of an identical nature because appellee does not ask an adjudication liere of the quesaon-upon-which-helost-the-former-case, that is, whether the notice is a condition precedent. He now concedes that it is, as was held in the former opinion ; but he says he was in error upon the question of fact, not controverted and not adjudicated, in the former appeal as to the date from which the existence of the disability should be computed. The trial court was correct, therefore, in the view that the pleadings in one case and the transcription of appellee's testimony in the other which appellant attempted to introduce in evidence did not sustain the plea of res adjudicata, but this evidence was competent by way of impeachment as bearing upon the good faith of the allegation that appellee was mistaken as to the date upon Which he became disabled, and the sufficiency of the testimony to support it. Wrape Company v. Barrentine, 129 Ark. 111, 195 S. W. 27. It was stipulated that these records might be offered in evidence subject to objection as to competency.= It is always competent to impeach the essential testimony of a litigant by proving contradictory statements, and also to prove declarations against• interest, and the excluded testimony should have been admitted for this purpose. For the error in excluding it, the judgment must be reversed, and the cause will he remanded for a new trial. A/CHANEY and BAKER, JJ., concur in reversal of judgment.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.