Goldbard v. Empire State Mutual Life Ins. Co.

Facts

The Plaintiff, Goldbard (the "Plaintiff"), a barber, was insured under an accident and health insurance policy. The Defendant, Empire State Mutual Life Ins. Co. (the "Defendant"), was the Plaintiff's insurer. In December 1951, the Defendant issued an insurance policy to the Plaintiff, and the Plaintiff was for all times relevant was current with his premium payments. In 1955, the Plaintiff filed a claim with the insurance company because of a fungus infection he was suffering from, which did not allow him to engage in his occupation. If the Plaintiff was deemed unable to work, the Plaintiff was entitled to a monthly indemnity under the insurance policy. The Defendant disputed the seriousness of the Plaintiff's injuries. The parties negotiated, but did not reach an agreement. The Plaintiff then complained to the State Insurance Department (the "Department"). The matter came before a representative of the Department and during those discussions the Defendant offered to pay the Plaintiff $800 if he would surrender the policy. The Plaintiff would have taken the $800, but he did not want to surrender the renewable policy. Later that same day, the Plaintiff called a representative of the Department and told them he would accept the $800 and not require renewal of the policy. The Defendant received the message from the Department representative and then wrote the Plaintiff a letter asking the Plaintiff to surrender the policy, sign a release, and collect his $800. The Plaintiff ignored this letter and filed a complaint in this action. The trial court awarded the Plaintiff $2,800, but the appellate court reduced the award to $800. The Defendant argued that a valid settlement and compromise existed.