T. Viola Turner v. Alfa Life Insurance (PC2 P375) Issue Can Alfa Life Insurance rescind the contract with Turner due to misrepresentation? Rule Contract - 1)Offer 2)Acceptance and 3)Consideration Rescind - power to cancel the contract. Misrepresentation - 1) Untrue assertion of fact was made 2) fact asserted was material or the assertion was fraudulent 3) complaining party entered the contract because of his reliance on the assertion and 4) the reliance of the complaining party was reasonable. Application Turner argues that she answered the question to the best of her knowledge as was required in the contract, and as far as question 12, Turner is taking pills and not insulin dependent. Also on question 14, Turner argues that it was answered truthfully because they were not aware of any diagnosis of congestive heart failure. Turner agrees that the facts were important but they were not fraudulent because the answer was based on the knowledge at hand. Turner has no argument on complaining parties reliance. Turner argues since they are able to research the patient, they should have done a preliminary search before accepting the policy of Turner, there was no need for them rely to only on the information of the application. Alfa Life insurance argues that Turner made false assertion of facts, in the question 12 it asked have you ever been diagnosed with insulin-dependent diabetes and Turner answered no, even though she was taking insulin at some point. Also on question 24 it requested any information about congestive heart failure in the past 24 months, Turner said no but her physician stated a diagnosis of congestive heart failure within 24 months. The information supplied but Turner was fraudulent as she was aware of her prior insulin use and congestive heart failure. Alfa Life clearly required the truth in the contract and loss of coverage may result if the answers were not true, which meant Alfa Life relied on the information to form a contract with Turner. Alfa Life needs to rely on the information in order to form a contract, it would not be reasonable to screen all applicants medical history upon acceptance and because Turner signed that any False statement or Misrepresentation or Concealment would risk loss of coverage. Conclusion Yes Alfa Life may rescind the contract because all of the elements for misrepresentation are met.