Petitioners Brief — Smith v. United States

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F INDEX

RMN TINO oncssceicsnvserasecenssevereciun ne tesla hee! heer AGP ISN |

Jurisdiction EE OI a eee Boake satan sedka etka Nipgenntiieasee

The Question Presented 2.0.0.2... ee eecpeee a.

Statement of the Case 2.0.0.0... cccccecceloeecseceseeceeecevecseecseeeseeee 8

Assignments .of Error Intended to be Urged ............... areas 8

Summary of Argument 22 coco cece coc eo cee eeeeeeeeeeeeeeeeee 10

I visti lincceveestes veetipentvevcizenned eoecstat cera sekiness pseucicsemacoe ae

Conclusion ............ SRT REA RA RCerTNe Oar SUP HISTO ER REST CLL CNP _.30

CITATIONS

Crawford vs..United States, 291 Fed. 801-805 2... @......26

Hartford Life & Annuity Insurance Company vs. Unsell .

- 144 VY. S. 589; 36 La. Ed. 500 ..........000 os . seichaprsionest *..80

Helmholz vs. Horst (C. C. A.-6) 294 Fed. 417-420........0......... 27

Insurance Co. vs. Eggleston, 96 U. S. 572; 24 La. Ed. 845._.....30

- Johnson*vs. White (C. C. A.-8) 39 Fed. (2d) 797.............. 27-28

Mortex vs. United States, 297 Fed. 485-488.......0..00.000002000.. 12-22

O’Neill vs. United States, 32 Fed. (2d) 313.............. 12-22-24-29

Railway Mail Assoc. vs. Moore, 15 Fed. (2d) 547............... 23

Sawyer vs. United States (C. C. A.-2) 10 Fed. (2d) 416....15-25

Thompson vs. Insurance Co. 104 U. S. 260; 26 La.- Ed.

‘ee I NAL COC SOT PPE eR? Ea ener DD

.,Unger vs. United States (C. C. A. 10) 65 Fed. (2d) 946....12- 29

United States vs. Barry (C. C. A.-6) 67 Fed. (2d) 763......12-22

United States vs. Cox (C. C. A.-5) 24 Fed. (2d) 799..:....... .23-28

United States vs. anliat (C.:C. A.-1) 59 Feéd. (2d)

Ne SR eee ee Se eta nee SOS EMME ASS eENAINAN 24-29

-United States vs. pre (C. C. A.-9) 59 Fed. (2d) 53............ 29 -

U. S. vs. Perry (C. C. A.-8) 55 Fed. (2d) 819.........0000....... *....28

. United States vs. Tyrakow ski (C. C. A.-7) 50 Fed. (2d)

Ma asta Sates valk ab ah counsel Mad eprerereria aera teatcee enue i coc sec ae 28

White vs. Ufiited States, 270 U. S. 175; 46 wea €tRep,_ ;

Se Sy OE oc coke antic uctdanahcanvinemngh lass teeeeeaieetovslaks 28

STATUTES AND REGULATIONS

War Risk Insurance se” Se eee eee 5-20-21

War Risk Insurance Circular "No. 1, Navy Dept. Nov.

_ 15, 1918 .. prtsenesentsseeeetheseecneeegececeeesneeseneenneees 8-13-14-18-19- 23- 24

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BAAS ay spree ss

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SAT Be ASA el

War Risk Insurance Circular No. 3, Navy Dept. Janu-

REN FE I acest seen seenosassacdaveuccusvecubesereeneess 8-13-14-15-18-19 :

‘War Risk Insurance Circular No. 14, Navy Dept. Oct. ;

SE TE heel Said ci cseahataases Wa: aoe 5-8-15-14-17-18-24-25

War Risk Insurance Circular, Navy Dept. Nov. 21, 1919,..-.19-28

Treasury Decision No. 33....... sel cieoy orene eran, Pere RB UCHR: 5-18

Treasury Decision No. 44...........0:....cccccceccceccseseesssseeeeseseesessessesee. 5

‘Tremmery Boctahom No. 4B......~....0..:ccce-coocecccocooeess. wae 6-8-14-18

Treasury, War Risk Insurance Form 2303............. yee A5-17-18_

‘Judicial ‘Code Sec. 240 ...........2c.cceccccecceseeeeeteeseees Pe. Peer N SR Se

Section 13, Chapte 105, War. Risk Ins. ri (40 Stat.

399 and 555) ....\ “SET OT ORE

Section 202, War Risk Ins. Act (40 Stat. 403). 21

Section 402 War Risk Ins. Act (40 Stat. 409..000000000000.2

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War Risk Seeiiiie Circular No. 2, Nav y Dept. Dec. ‘19, ;

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Supreme Court of.

——- Anited States

@ctober Term; 1933 |

D

the -

No. 742

BERTHA MEYER SMITH,

Petitioner,

| vs. .

UNITED STATES OF AMERIGA,: * =

ay Respondent.

| pein oF PETITIONER |

REVIEW ON WRIT OF CERTIORARI OF DECISION OF —

UNITED STATES. CIRCUIT ne OF APPEALS

‘FOR THE NINTH CIRCUIT .

OPINION BELOW

The Bistrict Court of Oregon rendered no opinion

but entered findings and gave judgment for petitioner.

(R. 23-28.) The opinion of the Circuit Court of Ap-

peals (R. 91-102). is reported in 67 Fed. (2d) 412.

» JURISDICTION ae

The judgment of the United States District Court

for the District of Oregon was entered on August 9, —

1932 (R. 49-52 C. C. A.-9 and 27-28 Sup.;Ct.), and

the Findings of Fact and Conclusions of law were ©

2

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-rendered on the same date (R. 43-48 C. C. A.-9 and

23-26 Sup. Ct.) The judgment of the United States

Circuit Court of Appeals for the Ninth Circuit. was

‘entered on November 6, 1933 (R. 102). A petition for -

re-hearing was denied December 11, 1933-(R. 103).

‘The petition for writ of certiorari was filed in the

United States Supreme Court on January 25, 1934

“and granted March 5, 1934. Petitioner invokes the

jurisdiction of this Supreme Court of the Unites States

under the provisions of Section 240 (a) of the Judicial

Code, as. amended by the Act of February 13, 1925, so

that this Court may review and. determine this case.

THE QUESTION PRESENTED

’ The real question presented in this case is whether

the..War Risk Tarm Insurance policy issued to Elias

Melvin Zimmerman on his application dated December

3, 1917, and on which it appears no premiums were

paid after the month of March, 1918 was kept in full

‘force and effect during’ his continuous active service

in the United States Navy from March 18, 1914, to

June 39, 1921, during two subsequent re-enlistments

without a single day out of active service by reason of

can authorization-unlimited as to time, for deduction of.

insurance premiums from active service pay executed

duting an enlistment extending from March 18, 1914

to March 17, 1918, and not renewed during such con-

tinuous subsequent enlistments which authorization

.

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was never revoked in writing and. there was always

sufficient pay due Elias Melvin Zimmerman to pay the

premiums on his insurance, he having continuous ser-

vice certificate No. 49,689 and he had not been dis-

charged from active naval service of the United States

at the time of his death.

STATEMENT OF THE CASE

A jury having been waived the case was tried _be-

fore the District Court upon the following stipulated

facts as shown on Pages 53 to 58 R. C. C. A.-9 and

Pages 29-32 Sup. Ct. as follows:

Plaintiff, Bertha Meyer Smith, was the mother of

one Elias Melvin Zimmerman, and beneficiary desig-

nated in the War Risk Insurance Policy of said Elias

Melvin Zimmerman. .

That at all times mentioned in the pleadings, the

plaintiff was and she now is a citizen of the United

States and a resident and inhabitant of the State of

Oregon.

Elias Melvin Zimmerman enlisted in the United

States Navy on March 18, 1914 at Portland, Oregon,

as an apprentice seaman and that he served through-

out such enlistment and was honorably discharged

therefrom at the expiration thereof on March 17, 1918;

that he re-enlisted in the United States Navy on March

18, 1918 and served throughout such enlistment and re-

ceived an honorable discharge therefrom on Septem-

.

“Tae rr Fe Po RR OR ENTS ome

~ -no further authority for deductions executed and no

,

PRPS NER WYN era EP Ma FRAT

> ber 15, 1919; that he re-enlisted on September ‘16, "

. (1919, and ‘served thereafter until the date of his death,

. _ tyne 30, 1921.

, That Elias Melvin Zimmerman is holder of Con-

tines Service Certificate No. 49689. |

That’ on the ard day of December, 1917, Elias Niele.

vin Zimmerman ‘made application for and was.

_ granted a policy of War Risk Inisuruaice i in the amount

- of $10,000; and that at the time of his application for

such insurance, Elias Melvin Zimmermam authorized a

deductions to be made from his navy pay for the pur- .

pose of paying the monthly premiums _on his insur-

ance policy in the following words: _

“T authorize the’ necessary monthly dedue-

tions from my pay; or if insufficient, from any

deposits: with the United States in payment of

the premiums as they become _ unless they

be otherwise paid.”

That deductions were made frei the pay of Elias

Melvin Zimmerman until the: expiration of his first

endistment, by which deductions premiums were paid

on his insurance policy to and including the month of:

March, 1918. That thereafter. no further deductions

_ for the payment of: ‘insurance premiums were *made;

- further premiums ever paid on such insurance.

That pay was due Elias Melvin.Zimmerman for

- each and every day from and including March 18,1914, -

| to the official date ns death, Juné 30, 1921. |

| “That at the time of his discharge on, March 47,

1918, and on September 15, 1919, Elias Mélvin. Zim-

-. merman was paid all the money then due _ by the

defendant.

* ‘ , : a. .

‘That at the time of his isi, June 30; 1921, pay

was due Elias Melvin eee, which was later

- ia isaei

paid to the plaintiff. |

-o

War Risk Circular No. 14, 8. & A. Ci cular letter.

121-1920, dated October 20, 1920, was foie by the’

_ Navy Department, Bureau of Supplies and Accounts,

Washington, D. €., on that date.

That in passing upon the question at issue the Court —

may consider as evidence the depositions and exhibits

* previously filed in the case.

The following exhibits were admitted in evidence

by Stipulation : i.

3s ’

Exhibit; 1, Bulletin No. 1, War Risk Insurance

Bureau.

Exhibit 2, Application for insurance of Elias Mel-

vin Zimmerman, dated Decerfbdr 3, 1917: ;

Exhibit 3, Treasury Decision No. 383—War Risk |

Insurance, dated September 20, 1918.°

Exhib’ t 4, Treasury Decision No. 44—War Risk

- Insurance, dated 7 17, 1919.

‘Exhibit 5, Treasury Decision No.. 48-—War Risk

“Insurance, dated September 29, 1919.

Exhibit 6, Letter of Navy Department, dated May

25, 1921. (Included in Stipulation of Facts. )

Exhibit 7, Letter of Navy Department, dated « July; ry

8, 1921. (Included i in Stipulation of Facts.) =“

IT WAS FURTHER STIPULATED that a dis-

agreement existed. between plaintiff and defendant.-

Thereafter the following proceedings were had:

MR. KIMMELL: The record shows there was. de- |

‘duction for the 5 ie enlistment for premiums.

2 COURT: I think the service should be considered

as continuous. The question is whether the Govern-

ment should ‘have deducted the premiums. Of course,

: payments made to the ‘month after his death would be |

after the policy had: matured. I think you should ten-

der the amount of the premiums, whatever they were.

| MR. CROSSLEY: Of course, it is over ten’ years

since he lost his life,

COURT: Yes, but up to the time of his death, when

the policy matured, to 1921.

MR. CROSSLEY: June 39, 1921. If your Honor

please, I think T'would like-to add an amendment to

"our complaint. I think there are five paragraphs and °

‘ the sixth I would like to. add, that plaintiff hereby

makes tender of all premiums that may have been due,

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if any were. aye on the 18th day of March, 1918, to

the 30th day of June, 1921. | oS

| THE CQURT: Yes. | ~~)

‘IT WAS FURTHER STIPULATED and

AGREED that there was one fact only in controversy; ~

* namely: was the War Risk Insyrance Policy applied

for and obtained by Elias Melvin Zimmerman on De- —

cember 3, 1917, in force and effect and cunterminated —

on June 30, 1921. :

The deposition of Lieutenant Walter Dismukes,

taken and filed on behalf of the defendant in Wash-

“ington, D. C., on December 2, 1929, in addition to the

matters stipulated and agreed upon, was in substance aes

as follows:

I'am at present. in meee of the retainer division,

Bureau of Supplies and Accounts, Navy Department,

Washington, D. C., and in such capacity have access to *

. the records relating to enlisted men in'the United States

Navy; that I Have searched such records for the pur-

* pose of ascertaining what was disclosed by the records

of the enlistments of Elias Melvin Zimmerman. The

Navy Department records relating to’ Elias ‘Melvin

_ Zimmerman, disclose that he never made any allot-

- ment. for War Risk Insurance Premiums other than

. the authorization for deduction of premiums at -

time of his application for’ insurance.

I furthere examined the. records of the enlisted |

+ .

8.

“personnel aboard the United States Ship “Conestoga”

with reference to Elias Melvin Zimmerman, and found ~

that the record shows that twelve members of the crew

of that ship executed allotments for the payment of |

premiums on War Risk Insurance, but that no allot-

' ment was executed by Zimmerman.

| ASSIGNMENTS OF ERROR INTENDED TO

BE URGED:

The Cireuit Court of Appeals erred:

LY In reversing the District Court and in : aha

that the contract of insurance on the sailor’s applica-

tion for insurance ended with the enlistment in which

it was made or any subsequent re-enlistment when the

sailor had unbroken continuous service every day for.

‘ over seven years, was the holder of a continuous serv- .

‘ice certificate No. 49,689, and his contract for insur-

ance was separate’from his enlistment contract.

Il. In holding..without any evidence to support

the same, that the insured sailor, Zimmerman, accepted |

his full pay, without’ ‘hi8) insurance premiums being

| deducted, knowing it to be such. .

Ill. In holding that the sailor did not aie with

the requirements of Navy Circular No. 1 of November ;

- 15, 1918 and No. 3 of January 13, 1919, and No. 14

of October 20, 1920 and Treasury Decision No. 48 of —

September 29- 1919 and that this rr the

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cancellation of his.insurance contract when said: cir-

culars were not introduced in evidence in the Court be-

low and no proof was submitted that they were ever

.. shown to Zimmerman, and part thereof were not ap-

plicable and controlling in Zimmerman’ S status. 7

IV... In holding that the Court may assume that

this sailor was advised that he should give his certified

copy of his i insurance: application to the officer of the

*Pay Corps having his account when the sailor’s service

was anor and continuous.

Vv. ‘In holding that the insured sailor did not treat

7 his written authorization to deduct premiums in his"

application for insurance as continuing in subsequent

enlistments, since he wanted andneeded the insurance

during the war, there. being nb ‘written request for

sessor of a continuous service certificate.

te oeuagiation of his policy and the insured being the pos-

VI. In holding that the insured sailor’s War Risk

Term Insurance was cancelled without his written re-

‘quest or notice to him thereof, there being: money due

him for active service pay at all times from the

Government occupying a fiduciary relation to the

sailor, from which to deduct the premiums as he had

directed-in his written application. . .

VII. In holding toa severely strict.construction of

the War Risk Insurance law and regulations when

ied should be construed liberally.

ae : e° ?

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. . ‘SUMMARY OF ARGUMENT

Your petitioner respectfully urges upon this Honor- .

able Court that this Court should reverse the decision

of the United States Circuit Court of Appeals for the

Ninth Circuit and affirm the decision and judgment

of the United States District Court for the District of

.Orégon in favor of the petitioner for the reasons here-

inbefore and hereafter set forth: —

A \

on / \ (1) That the authorization for deduction of

premiums from active service did not expire with the

enlistment in which it was executed.

(2) That it was not necessary to have such auth-

orization renewed and the Navy Paynmiaster had full

authority’ and should have deducted the insurance

premiums during the subsgquent enlistments.

.

(3) That Zimmerman did not by any writing or

otherwise revoke or cancel his pulicy of insurance or —_

the authorization which he had given for deduction of -

_ premiums on his insurance ,from his active service i

pay and that the insurance policy in this case-was in ~

full force and effect and unterminated on the date of

the death of Elias Melvin Zimmerman, then a boat-

_ swain’s mate, while he was yet in the active service of

the Navy on June 30, 1921.

(4) .There was “always, active service pay due.

Zimmerman from the Government for his santie service

. a u

‘from which to deduct the payments for premiums on

his insurance authorized in his application without

limit as to enlistment. (R. 55 C. C. A.-9 and 30. Sup.

Ct.) .

(5) That Zimmerman did not understand and

there was no proof that he-was ever notified that there

was any law or regulation which would prevent the:

-_ Government from deducting the premium as he had

authorized and that Zimmerman wanted and needed

insurance : protection subsequent to his first enlist-

ment since the war was still on. and the Government

had urged and insisted that soldiers and sailors Sake

out insurance. .

(6) That Zimmerman had a Continuous Service

Certificate No. 49,689, having served over seven (7)

years continuously in the Navy and that not-only at the

jast of each month did he have pay due him enough to

pay the premium on his insurance, but that at the time

of his death when he was a boatswain’s mate he had

more than enough due him to pay all of his premiums

which the Governnient had failed to deduct. *

(7) The Circuit Court of Appeals of’ the Ninth

Circuit has in this case adopted a rule of severely strict.,

construction in direct conflict with the liberal rule an-

nounced by the Supreme Court of the United States

: and in conflict too with the more liberal rules of most —

other Courts, particularly in other cases coming under

the War Risk Insurance Act.

,

bd SECT ARNE TOS mths TAD

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ARGUMENT °. * 4

~ ASSIGNMENT OF ERROR No. I=

This plaintiff and petitioner contends that the con-

tract of insurance on the sailor’s application did not

expire with the enlistment in which it was made or his

subsequent enlistments for the reason that:

(1) The enlistment contract applied to service

only, while the contract of insurance, based upon the

application therefor, was separate and distinct and.

made at a different time. (R. 36-42 C: C. A. od and 19- —

22 oup. Ct, ) 3

near vs. United States 297 Fed. 485. .

O'Neill vs. U.S. 32 Fed. (2nd Se.) 313.

.Unger vs. U.S. (C. C. A.-10) 65 Fed. (2nd

Se.) 946.

(2) There was no limit as tothe time the-contract

of insurance should run stated in the application of the

insured, which application was acgepted by the Govern-

ment, and there was no time limit upon the authoriza- _

tion to deduct premiums for the insurance. (R. 36-42

C.C. A.-9 and 19-22 Sup. Ct.) |

(3) The insured sailor had a Continuous Service.

Certificate No. 39,689 and he had at the time of his

' death been serving for more than seven (7) years in

the Navy of the United States from March 18,1914 to

the date of his death, June 30, 1921:.(R. 54. C. A-9

and 29 Sup. Ct.)

1S a

(4) _ When a sailor was dischaFged and left the ;

~ Service he could still keep up his insurance without a

_ new application for contract of insurance and if he re-

enlisted after being out of the service for sometime, all

he’ needed to do was to present a certified copy of his’

insurance application and have his: insurance contin-

ued.. %

See II War Risk Ins.’ Cirgulira No. 4 Navy

‘Dept. Dated Not. 15, 1918.

No. 3, ‘Dated January 13, 1919.

‘No. 14, Dated October 20, 1920.

All-by the Navy Department, ‘Bureau of Supplies

and Accounts.

ASSIGNMENT OF ERROR No. I.

This plaintiff and: i petitioner contends that the in-°

sured Sailor did riot accept hisl full pay without his in-

- surance premiums Being deducted knowing it to be

such, for. the following reasons:

(1) That there was no yeidense i in this casé what:

ever to show that Zimmerman, the insured, knew that

he was paid in full without his insurance premiums

being deducted. either monthly or at the end of his en-

listments.-

| (2) oe gra S pay varied from time to } .

time since he Was making an allotment to ¥ mothers

which varied from time to time.

A s:

14 *

(3) . That any ate ie the insured from he

Ship Storés on board ship would be deducted from his :

- pay, and that, ‘too, would make the amount of the pay

‘he: himself received vary from time to time. =

ASSIGNMENT OF ERROR No. Ill.

"This petitioner and plaimtiff contends that Circu-

‘lar No. 1 of the Navy Department, Bureau of Supplies ©

_ and Accounts dated November 15, 1918 ‘as amended by

Circular,No. 3 of January 13, 1919 and Circular No.

14 of October 20, 1920 and Treasury Decision No. 48

| were not sufficiently applicable to and controlling in

the case at bar to cancel and t&minate the insurance '

of this sailor for the reasons that:

(1) “Circular No. 1 of November 15, 1918 was not

in effect and therefore could not apply to the re-en-

. listment of the insured on March 18, 1918. |

(2 ) ‘ Congidering this Gintdantio. 1 of November -

15, 1918 to have been in effect on September 18, 1919 .

~ when the sailor re-enlisted a second time it provided

in Paragraph 8 thereof as follows: ;

“Checking: of ‘insurance premium will con-

tinue while a man is in a pay status or until the

insurance is tancelled by written request over

the man’s signature forwarded to the officer of —

the Pay Corps carrying his account.” (R. 98.).

(3) . There was never a written request over Zim-

—M”'s

merman’s signature to cancel his. insurance, and no°

15

| proof ‘ileus of _" request. (R. 53-58 GC. A. 7

and 29-32 Sup. Ct.)

»

oo That the discharge spoken of in Par. 11 of

i Naw Circular No. 3, , January 413, 1919 referred .

particularly to men who left the service as it provided

for payment of premiums, when the Government ‘may

ceases which Zimmerman’s never did ‘and.it provided

for the first remittance” of premium by the insured

himself and:not through tle Paymaster, unless he re-

- enlisted at a later date, (R. 98-99) and the Seeond Cir-

~ cuit Court of Appeals sets forth a part of Treasury

"Bureau of War- Risk Insurance Form 2303 which

stated: . . |

“After discharge from the service when the’

Government pay ceases, you should send check

- or money order drawn to the Treasurer of the

United States,.to the Disbursing Clerk, Bureau ,

- of War Risk, Insurance, eae Department, :

Washington, D. gare ‘

Sawyer vs. 7.3 ¢ ge 10 Fed. ae

gy ee

(5) The office of the-Pay Gian already had the

‘ insured’s pay account, and if the ‘sailor, continued in

service as‘he did, the checkage would be continuous

instead of a first checkage by the Paymaster. (R. 98.)

(6) “That Treasury, Bureau of War Risk Insurance,

Form 2308, ‘containingyinformation relative to ‘com-

| -. 416 . | $

pensation and continuation of War Risk Insurance

was intended to be filled oyt in duplicate in the event a

sailor was finally discharged and went out of the serv-.

Jee for sometime, and this applied too, to the certified

copy of his insurance application, as it will be noted he

was to be instructed to forward these papers direct to

- the Bureau of War Risk Insurance with his firs re-

+ mittance or premium, when the insured was out of a¢-

tive service and out of a pay status, but this did not

_apply to Zimmerman as he was always on, a pay statug

and was never out of active service for a single day. | |

(R. Par. 1-54 and Par. 2-55 C. C. “A. 9 and Par. 4-29

and Rar. 2-30 Sup. Ct. i

(7) That Besoin | Decision No. 48 rendered on

_ September 29, 1919 was ‘not in effect on September,

16,1919 when the insured re-enlisted for a third term _

of service-in the Navy, and not being in effect’ it was |

not controlling either at the time of his first re-enlist-

ment or at the time of his second re- enlistment just 28

the N avy Department Circular of November 15, 1918

and January 13, 1919 were not in effect at the time of

- the insured’s first re-enlistment and as contended by

the petitioner were not applicable to the case at bar at

the time of either re-enlistment on account of the in-

sured’s continuous service and: being always ina pay |

status. However, Treasury Decision No. 48 provided

that “authorization of. deductions from the insured’s

pay shall be equivalent of tender,” and the Navy De-

~~

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ea

partment always had the sailor’s unrevoked serifen |

authorization of deduction contained in his applTta-

tion for insurance. (R. 38-42 C. C. A.-9 and 19-22 ©

_ Sup. Ct.) | | ; ae ee

- (8). That War Risk. Insurance Circular No. 14°_

issued by the Navy Department, Bureau of Supplies

and Accounts, on October 20, 1920, although not in ef-.

fect at the time of Zimmerman’s second re-enlistment

on tide naar 16, 1919, provided: fe b

“The attached War Risk circular letter shall

be effective upon receipt thereof except in case

of term i insurance which i is now in effect. si

} 7? —

At ‘also stated that:

a

“The responsibility for the proper execution

of application for Government insurance rests

upon commanding officers and commandants.”

It also provided that: =

“When. term insurance is cancélled or ,re-

-duced except in'‘conversion (but there is no con-

Kr in this case) ‘a request signed by the in- ’

red myst be made in duplicate and addressed

td the ‘Baxeae of War Risk Insurance through.

the supply officer ee the ee pay

account. ss

and there was never any such request signed by the in-

sured sailor. Said War Risk Insurance Circular No. 14

~ also provided: that upon final discharge “he shall be

instructed to forward Treasury Form 2303 to. the

: | cs 18 ve

Bureau of War Risk Insurance with the first remit-.

tance of premium by him, ” but it will be noted this,

does not apply to a man like Zimmerman who was con-

tinuing actively in the service. ‘

(9) on it. i is to be noted that. War Risk In-

surance Circulars Nos. 1,3, and 14 of the. Navy Depart-

~ ment and Treasury Form 2303 were none of them ad-

mitted in evidence by stipulation or in any other way

~and no proof that: they were ever shown to the sailor,

Zimmerman. (R. 56 6.CcAs and 30-31 Sup. Ct.)

(10) Attention is called to the provisions of Sec.

18, Chapter 105 (40 Statute at Large 399 and 555) ;

which provide that the Director of the War Risk Insur-

“ance Bureau and the Secretary of the Treasury. De-

- partment could make regulations urider the Insurance

Act, and surely the Navy Department could not issue

regulations. that would deprive Zimmerman of . his

rights under his contract with the Government.

€11) Furthermore, Treasury Decision 48 of Sep-

tember ‘29, 1919, which incorporated Treasuryg De-

cision 33-of September 20, 1918, and in full forde and

éffect provided “insurance will not be permitted to.

| lapse for non-payment. of premiums while the msured

is in the active, military, or naval service and premiums

therefor are authorized ’to be deducted from the Ko

sured’s pay or deposits.”

* ca ye 19

‘ASSIGNMENT OF ERROR No. IV.

This petitioner and plaintiff contends that the Cir-

cuit Court of Appeals should ‘not have assumed that

- the insured was advised that he should give a certified

- ‘eopy of his insurance application to the officer of the -

Pay Corps taking up “his accounts, which assumption

was based upon the presumption of the performance Z

of official duty (R, 99) for the following reasons:

(1). That the officer of the Pay Corps no -doubt

- consideréd,. and rightly SO, that the insured did not

come under the provisions of the Navy Department

A Circular of November 15, 1918 as amended hy the Cir-

eular of January 13, 1919, since the sailor was in con-'

tinuous,active service, and that checkage of his ‘insur-

- nce premiums on term insurance should continue on -

. the payroll while he was in a pay status and this -is

, supported by War Risk Insurance Circulat issued by

-\, Navy Department, Bureau of Supplies and Accounts

on November 21, 1919 after Z immerman’ s second re-

enlistment on September 16, 1919, wherein it is —

in Paragraph One (1) thereof that:.

“Buréau of War Risk Insurance-reports that.

‘numerous supply officers are registering Form.

_6 allotments in payment of premiums on term in-

surance. Attention is called to War Risk Circu-

lar No. 1 instruction in which read:

That premium for term insurance be charged

. by checkage on the payroll by the supply officer

$

~

7 20 i

: _ carrying the pay account of the insured.”

, . , (

. — aad & a 7 :

° _ Par. 1 and 4 War Risk Ins. Circular No. 2,

ac N avy Dept. dated December 19, 1918. )

(2) Thus the presynption of the performance of

official duty is not always a substantial basis for the

assumption that certain acts have been done, for it is \

a well known fact that many duties are not performed

through inadvertance, mistake or otherwise.

ASSIGNMENT OF ERROR No. V.

This petitioner and plaintiff contends that the in-

sured sailor having confidence in his written applica-

tion and his Government, did treat his authorization

to deduct premiums as continuing os his subse-

-« quent enlistments for the reasons that: - 4

(1) The sailor made fis application for insurance

and his written authorization to deduct premiums

therefor on December 3, 1917 when he knew the time ©

of the enlistment, he was then serving would expire on

March 17, 1918, just three and one-half mons later

_and so he expected his term insurance to continue in

his next: enlistments, as the war was still raging, the

premium rate of $6.50 per month being low, and he

wished to provide for his mother. (R. 36-42 C. C. A. 9

and 19-22 Sup. Ct.) |

Bulletin ‘No. 1 War Risk Insurance es

~ _

‘ag

21 *

October 15, 1917, ander authority of Section 13 and

the direction contained in Section 402 War Risk Insur-

ance Act provided that the Government - |

“hereby insures from arrd after the..:............. day

— SERRE Nib no , 19....... John Doe of

Illinois, Private Co: A, Third Infantry, con-

ditioneg up the payment of premiums | as” nete-

in pr ided”

_ and there was no limit to any one ‘enlistment. Said .

bulletin also provided that: ,

“premiums shall be paid monthly ‘on ér before

the-last day of each calendar month and will,

unless the insured otherwise elects in writing,

be deducted from any pay due him from the |

United States or deposited by him with the , .~ |

United States and, if so to be deducted a prem-

.. jum when due will be treated as paid whether or

not such deduction is in fact made, if uppwthe -

due date the United States owe him on account

of pay or deposit an amount sufficient to provide

_ the premium”

y °

and there was ng limit as to any one.enlistment.and -

Zimmerman in his application for insurance,’ signed

al 8, 1917, which was a part of his contract

with* the Government, provided by Section 202, War

Risk Insurance. Circular, stated ‘specifically |

“TI authorize the necessary monthly deduction’

from my pay, or if insufficient, from any deposit

with the United States in payment of the premi-.

ums as they become due, « unless they be other-

wise paid” -

. 22.

e

and it is to be noted there was no limit in such

authorization to any one enlistment, and there was no

authority to pay the premiums otherwise.

. (2) The insured never gave: any written request —

whatever over his own signature to revoke his applica-

tion or to cancel the insurance and there was no evi-

dence whatever of such written request and premiums

should have been paid from pay ‘due him. (R..53-58 C..

C. A. 9 and 29-32 Sup. Ct.)

On July 31, 1933 the Tenth Circuit wid of =

peals held that; :

“Under authority conteinel in applicatioh,

not: revoked in writing, premiums of War Risk ~

Policy on insured’s re-enlistment within three

‘months, after discharge should have been de-

. ducted from pay and paid.”

Unger vs. U- S. (C. C. A.-10): 65 Fed. (2nd

- Se.) 946.

Mortex vs. United States 297 Fed. 485-488.

_ O'Neill vs. U. S. 32. Fed. (2nd Se.) 313.

(3) The sailor having filed his application for in-

surance with the Government. and having authorized

in such written application the deduction from his pay .

of premiums therefor, whieh application, premium,

and contract the Government had accepted, the sailor

felt confident that this insurance was continued and |

particularly since he was in continuous active service

" with a certificate to that effect. and these policies and,

%

23

the lat generally are entitled to the most liberal con-

struction in favor of the soldier or sailor. —

=

” USS. us. Con (C. C. A.-5) 24 Fed. (24) 799. -

(4) That the sailor being in continuous service

during the'period of 7 years 3% months, it was the

duty of the officers of the Navy to see that his insur- ,

ance was kept alive by the deduction of premiums from -

his pay as he authorized them to do, or to have advised’

him that his insurance was lapsing because of failure

- to pay-the premiums, and there is no evidence whatever .-

to show that they did this as the regulations required

“<* them to do as Par. 4 War Risk Insurance Circular No. _

1, Navy Dept., Bireau of Supplies and a dated

November 15, 1918, provided that:

“Fhe responsibility for the proper checkage

of insurance premiums rests on the officer of the

‘Pay Corps carrying the account against which

' the premium is to be charged” - 2

and so ‘the sailor, “‘Dimmeiman, felt satisfied that his

. Insurance was continued.

Railway Mail Assoc. vs. Moore 15 Fed. -( 2d) 7. /

547.. a ait

(5) . That premiums were not paid on this poliey

was not the fault.of the insured or the beneficiary-as

— itis admitted that the Government had at. all times in

| its possession from the time ‘the policy was in effect to

the date of the death of the insured, then a boatswain’s

a .

“>

» 7 - = Cee ————— we on™ ~

24

to pay the premiums due on the poly. (R. Par.. 2-55

-.C..C. A.-9 and Par. 2-30 Sup. Ct.) |

- O'Neill vs. U.S. 32 Fed. (2nd Se:) 313.

U.S. vs LaPage (C. C. A.-1) 59 Fed. )2d) «5 Me

- 167-168: f

-

~

ASSIGNMENT OF ERROR No. Vi.

Your petitioner and plaintiff contends that the Cir- |

cuit Court of Appeals erred in holding that the ing

sured sailor’s War Risk Term Insurance was onatiied

without his written request for the following reasons:

oS

* (1) The regulations provided “checkage must be

made on the Navy ‘Pay Roll of premium for every ap-

plication for insurance executed by officers or men of

~ the Navy. Checkage of insurance premium will con-

tinue while a man is in a pay status or until the insur-

ance is cancelled by -written request oyer the man’s

signature forwarded through the officer of the Pay

Corps carrying his acount. ” (R. Sec. 8, 98.)

Par. 8, Navy Dept. War Risk’ Insurance

Circular No. 1, dated. Nov. 15, 1918, Bu-

reau of Supplies and Accounts.

e €&

~

(2) A further and later’ regulatioy) provided that

“When term instxance is cancelled a request

signed by the insured must be made in duplicate

and addresSed to ‘the Bureau of War Risk In-

surance via the Supply. Officer ee his pay

account.” -

ate

.

@?

25

A ad

-

'’

3

: eular No. 14 of Navy Dept., Bureau. of.

and’ ren = saad 20,

, 1920. °

416, decided against the benificiary by the Setond Cir-

cuit Gourt of Appeals has been quoted as in accord with

the ruling of the Ninth Circuit Court of Appeals in.

this ‘case, but while it was a N avy , case it is not at all

' like this, case at bar for the reason that, Sawyer had

-been finally discharged from active service in the Navy

with no active service pay due him and he: was-in the

reserve where he had te look after-his own ingurance

and he’ ‘gHowed his premiums. to be in default, an entire-

ly differént status thar. that of Zimmerman, the sailor, -

in this case who hhd continuous active servicé and he

died i in that status with pay always d - him sufficient .

to pay his premiums. "

Algo the cae of U. S. ais. Bar ry 67 Fed. (24) 763

decided against the beneficiary by the Sixth’ Circtit -

Court of Appéals, has been quoted as ip accord with |

the decision of the Ninth Circuit Court of Appeals ©

’ in this case, buts? is-not like, tltis case at : bar for the

reason that in that case Barry Kad been promoted to be

an officer whereupon: he made special allotmenjs, was,

finally discharged with no active service pay due him —

and he allowde his premium payments to-.default, an

entirely different status than ‘that of Zimmerman,

tr >

See “Cancellation” War Risk Ins. Cir-

(3) The case of Sawyer vs U. S.°J0th Fea” (24) |

O°

°§

26 a

the sailor in this case, who had continuous active serv-.

ice as an enlisted man, being: boatswain’ s mate at the

time of his -—- and having pay always due him.

In the a of Crawford vs. U. S. 291 Fed.. Page

~ _ 801-805, sometimes referred to as,in | accord.with the »

_ deci ision of the Unitéd States Circuit Court of Appeals —

for the Ninth Cixtenit, it is to be particularly noted that

' while this was a case of a sailor in the Navy; ‘Chawford

had béen discharged from active service and became a

mentber of the United States’ Naval Reserve and had’

“retainer” pay coming to him but not active sérvice |

pay. In this case too, he had been released and finally

esi from. active service and fully paid for all.

: serviges. rendered incliding a Sixty ($60:00) Dollar

. bonus and he was given a written notice, War Risk

Insurance. Form 2303, which notice advised him that:*

‘ when’ his golernment pay ceased he should send his in-

surance premium by check or money order to the Secre-

» tary of the Treasurer of the United States promptly on .

. ths 1st of each month, otherwise his insurance would’

' * become void, while in this case of Zimmerman’ 's the

sailor was never finally released or discharged from |

‘active service and his Government active sefvice pay

. never ceasegl during the whole of; more than 7 years

service in the avy until the date of his segh, June 80,

1921. +

a

a ‘

5 a

This petitioner and plaintiff further contends that

the. United States. Circuit Court of Appeals : for the.

- Ninth Circuit has followed a severely strict construe-

tion. of law and regulations instead of construing the

law and regulations liberally in favor of the insured so-

| as not to work a forfeiture, annulment or.lapse of the

7 )

insurance policy for the reasons’ that: i.

(1) The very ne the Congress*in passing

_the War Risk Insurance Act was “to give insurance to

those who entered the military and naval service and to:

. protect those who were dependent upon them’, and

~

farther’ the Eighth Circuit Court. of Appeals has

stated “great latitude should be allowed in order to

give effect ta the acts.and intentions'of those in mili-

: tary service in time of war’, for surely the vaca

ment should keep farth with its dead:

Helmholz vs. ‘floret (C. C. A. -6) 294 Fed.

a : 417-420.

, Johnson vs. White ae C. A.-8), 39 oo (24)

197. :

#2)". In the tire place the regulathons a

through its, War Risk Insurarice Circulars, Bureau of

Supplies and Accounts, by the Navy Department, fol-

lowing the sailor’s application for insurance and his

duthorization for the payment, of premiums therefor

\ were too complex and iene for, a sailor to follow

‘3 ° : 9

tee ; % : > Be /

‘ . Ot < .

a . ‘ ¢ f Setl

ASSIGNMENT OF. ERROR No. VII. |”

C3

v 28 "

ia werein fact often misunderstood and improperly

carried into effect by the officers themselves as shown ~

in Paragraph 1 of Assignment. of Error No. IV, here-

inbefore set forth. |

See War Risk Ins. Chreuiee No. 2, Navy

-Dept.,; Bureau of Supplies and Accounts, .

dated Dec. 19,°1918. :

War Risk Ins. Circular, Navy Dept., Bureau

.of Supplies and Accounts, dated Nov. 21,

_ 1919.

Cc

- 8

(3) “The Supreme Court of the United States has -

“| adopted. a rule of liberal construction in War — :

@

| Insurance Acts.

_ White vs. U. S. 270 U.S. 175, 46 on

ea Reports.274, 70 Law Edition 530.

(4) . The Cireuit Court of Appeals for the Ninth

Circuit in the case at bar has in reversing the judg-

ment of the District Court for the District of Oregon

: adopted a rule of severely strict construction directly -

in conflict with the liberal. rule announced by. the Su-

preme Court and other Circuit Courts of Appeals.

U.,S. vs. Cow 24th Fed. (2d) 799.

Johnson vs. W hite a C. seis ius Dae “

793.

U.S. vs. Tyrakowski (C. C. A. “ry 50 Fed.

(2d). 766. -

U.S. vs. ps (C. C. 8) 55 Fed. (2d)

819.

‘i,

29

ae is gs vs. Lesher (. ©. 49) 59 Fed: (2d)

a 7

(5) It surely deca not be the policy of the Navy

Department, Bureau of Supplies and Accounts, to make

rules and regulations to break contracts which the

sailor had entered into with the Government in good

faith and the present. decision’ of théNinth Circuit

Court of Appeals surely lends itself to that proposition,

and this should not be the policy of the Courts, particu-

larly since the sailor is.in a confidential relation with

his Government and in a sense a ward of the, Govern-

‘ment. ’ | 7 | lap

‘The First Circuit Court of Appeals says:

“The Government extended to hole in the.

service during the World War every possible

benefit and encouragement to protect themselves ~

| and their family against want—in case of their

death. or disability while in the service. The

Government should not stand on rarrow techni-~

'calities when the good faith of the parties is un-

questioned.”

U.S. vs. uns (C. C. A.-1) 59 Fed. (2d) =

167. Va

O’Neill vs. U. S. 32. Fed. (24) 313.

» (6) The rule is that Sourts do not favor a for

feiture, and when doubts arise as to the proper con-

~ struction of an insurance contract, that View should be

adopted which‘ is most favorable to the insured and

will preyent annulment and lapse of his policy.

¢

Hartford Life and Annuity Insurance Co.,

us. Unsell, 144 U.S. 539; 36 La. Ed: 500. -

Insurance Co. vs, Eggleston, 96 U.S. 572;

' 24 La. Ed. 845.

. Thompson vs. Insurance Co., 104 U.S. 260:

26-L. Ed. 768.

CONCL USION

WHEREFORE, your petitioner and plaintiff in |

this case at bar urges upon this Honorable Court, the 3

final arbiter of these important and far reaching ques- .

"tions that will effect so many widowed mothers and

other needy relatives of deceased World War Veterans,

a reversal of the decision of the United States Circuit .

Court of f Appeals for the Ninth Circus€&nd an affirm-

ance of t the judgment of the United States District

. Court for the District of Oregon holding:

_1) That the contract for insurance on the

; sailor, Zimmerman’ s application did not. expire

* with the enlistment: in which it was executed or

his subsequent re-enlistment. a) ss

(2) That the’ authorization for deduction °

of premiums from active service pay did not

expire with the enlistment in which it was exe-

cuted or his subsequent re- -enlistment and it was

. not necessary to: have such authorization, un-

limited as to time, renewed upon each subsequent

continuing re-enlistment. .

(3) That Zimmerman. had a Contents

Service Certificate No. 49-689, having served’

*»

. ) nes

- continuously in the Navy without missing a

single day for over seven years.

. (4) That the sailor, Zimmerman, always

had active service pay due him sufficient to pay

the prémium on his insurance and that at the

time of his ‘death he had more than enough ac-

. tive service pay due him to pay accrued premi- ,

‘ums, which the Gover ment failed to deduct.

(5) That Zimmerman did not by- writing

or otherwise revoke or cancel his policy of in-

surance or the unlimiféd authorfzation which he-

had given for deduction of premiums on his in-

surance from his active service pay, and that he

« wanted and needed the insurance ghd did not

understand that there was any law or regula-

tion that would prevent the Government from

deducting the premium.as he had authorized or

that the Government could cancel his contract |

for i insurance without due notige to him. |

>. ~ (6) That the Navy ‘Pay Master had full

; authority and should rave deducted the insur- 6

ance premium during the subsequent enlist- ‘

ments. | yo.

: (7) .That the Insurance Policy in this case \

- together with the authorization to deduct premi-" a

-- -ums from his active: servicé pay were in full ~ §&

'- force ‘and effect. arid unterminated on the date

of the death-of Elias Melvin Zimmerman, while

he was still in the active-service of the Navy on ©

‘ June 30, 1921 when he together with all others :

on board the U. S. S. Conestoga-went down to « &

their eternal sleep in the great Pacific-and the ° . &

beneficiary, Bertha Meyer Smith, the deceased - - -

eon ate

Ji aotos

Rts Cae

EAS

82

sailor’s widowed. mother, should: be paid the

- amount due on his War’ Risk Insurance Policy.

Respectfully submitted,

| JAMES J. CROSSLEY, | -

Attorney for Petitioner and Plaintiff. -

c°

at