Opinion
Oct. 13, 1971.
Editorial Note:
This case has been marked 'not for publication' by the court.
L. L. Nathenson, Lakewood, for plaintiff-appellee.
Robert B. Bailey, Lakewood, for defendant-appellant.
COYTE, Judge.
This case involves a health insurance policy issued by the American Estate Life Insurance Company, hereafter referred to as the defendant or company. The facts are these. Plaintiff purchased a health and accident insurance policy from an agent of the company. At the time the policy was purchased, plaintiff had a nasal deformity which was not bothering him at the time. He thought it was chronic hay fever and did not mention it in the application for insurance. Subsequently, plaintiff's nose began to trouble him. He consulted a doctor who suggested corrective surgery.
Prior to surgery, plaintiff inquired of the agent if the policy would cover the operation, and the agent advised that he would check and call back. He called back and stated that it would. The doctor also contacted the agent at a later time to inquire if the company would pay for this operation and was informed that it would.
Surgery was performed and a bill submitted. The company refused to pay on the ground that the surgery was not covered by the policy. It maintained that surgery was to correct a pre-existing condition which was excluded under the terms of the policy. At trial, the plaintiff was awarded $600.60, the amount of the hospital and surgical expenses.
The first alleged error concerns the insufficiency of the findings of fact made by the trial court. The defendant contends these findings were insufficient and not in compliance with C.R.C.P 52(a) The findings were brief. They recite the uncontroverted facts concerning the issuance of the policy to plaintiff and the refusal of defendant to pay and the judgment.
Implicit in the trial court's decision resolving the case in plaintiff's favor was a finding that the terms of the policy encompassed plaintiff's medical condition and need for surgery. By finding in plaintiff's favor, the trial court in fact found, contrary to defendant's claim, that this condition was not excluded by the terms of the policy. The ultimate test as to the propriety of the findings is met when they are sufficiently comprehensive so as to provide a basis for decision and are supported by the evidence. Mowry v. Jackson, 140 Colo. 197, 343 P.2d 833.
The next asserted error deals with the terms of the policy itself. Defendant claims that as a matter of law, the policy excludes payment for the surgery performed on plaintiff since the surgery was performed to correct a pre-existing condition.
The policy covers benefits for any injury or sickness incurred by the plaintiff, except for those conditions which existed before the policy was issued but which were not noted as an exception on the policy. A separate portion of the policy provides that a party may recover for any illness which first manifests itself after the policy goes into effect.
Plaintiff had an admitted nasal deformity at the time of application. However, plaintiff was not aware of the deformity at the time the application was made or the policy was issued. After the policy went into effect, plaintiff started having trouble with his breathing, visited a specialist, and found that he needed surgery.
The question was whether the terms of the policy covered a dormant condition which did not manifest itself until after issuance of the policy. While we agree that a valid interpretation of the clause might exclude this condition from coverage, this was not the interpretation given to the clause by the defendant's agent. It is well recognized that where an insurer's agent interprets a policy for the insured, and undertakes to inform the insured as to what constitutes compliance with the policy or coverage under it, then such interpretation as is placed upon the policy by the agent shall bind the company. Stivers v. National American Insurance Co., 9 Cir., 247 F.2d 921.
In this particular case, the agent did the coverage it provided for plaintiff. As not modify the policy, but rather undertook to interpret its provisions relative to such, this interpretation of the coverage afforded by the terms of the policy is binding upon the company.
As a third argument, defendant contends that the trial court erred in refusing to permit it the right to present argument at the close of the case. This ruling, it is claimed, denied defendant the right to present legal argument to the court which might have swayed its opinion. We, however, consider this an area of discretion with the trial court. Defendant was not denied the right to give the trial court the benefit of its thinking on the legal theories involved since such arguments were properly presented in the motion for new trial and were rejected by the trial court.
Finally, defendant urges that the trial court erred in its determination of the amount of the judgment. The amount awarded to plaintiff was $600.60, this being the total of the hospital bill ($200.60) and doctor's bill ($400). However, the policy did not completely cover plaintiff's total cost. The hospital room benefit was for $40 per day under the policy. Plaintiff was charged $47 per day for two days, or a total of $94. Therefore, out of a total of $94 for room expenses, the defendant was liable only for $80. The remaining hospital charge was for $106.60. Out of this amount the policy covered 100% Of the first $50 charged and 80% Of the remainder, or $95.28. Therefore, for hospital expenses the defendant is liable for $175.28, not the $200.60 awarded him.
The schedule listed in the policy for the surgery was $96. It also covered 60% Of the amount of the bill above the schedule. Sixty percent of the remainder of the surgical expenses actually charged ($400) minus $96, was $182.40. Thus, the total surgical expense permitted under the terms of the policy was $278.40, and not $400 as was awarded. There was some evidence that additional surgery was performed, but there was no evidence showing a breakdown between the cost of the two types of surgery. Therefore, we are limited to a consideration of the allowance for the operation as shown on the schedule. The total amount of liability is $453.68, rather than the $600.60 actually awarded.
The judgment is therefore modified by reducing the same to $453.68 and, as modified, the judgment is affirmed.
SILVERSTEIN, C.J., and PIERCE, J., concur.