Commonwealth v. Equitable Beneficial Ass'n , 137 Pa. 412 ( 1890 )

Opinion,

Mr. Justice Clark:

This writ of quo warranto issued out of the Common Pleas of Dauphin county, upon the suggestion of the attorney general, against what is known as the Equitable Beneficial Association of Pennsylvania, commanding the said association to appear and show by what authority they were exercising the franchises, rights, and privileges of a body politic and corporate, by the name stated, and in that name making contracts and issuing policies of insurance. In response to the writ, the association sets forth that their warrant and authority is derived from a charter of incorporation, which they hold under the decree of the Court of Common Pleas No. 2, of Philadelphia, bearing date November 19, 1884, and recorded in the office for the recording of deeds, etc., in and for the city and county of Philadelphia, in Charter Book No. 9, p. 484, etc., on November 22, 1884, according to law; that the said charter was granted pursuant to the provisions of the act of assembly of April 29,1874; that the character and objects of the association, as set forth in their charter, are, by the accumulation of a fund from weekly, monthly, or quarterly dues, or contributions from its members, to aid and protect them in time of sickness or injury, by payment of “benefits,” either to the members directly in their lifetime, or to the widows, heirs, or assigns of members, in case of death, for funeral or other purposes, or, otherwise, the said fund to revert to the members at an advanced age. Their contention is that their organization falls within the first class of corporations, authorized by the second section of the act of 1874, which, in the ninth clause, provides for the granting of charters for the maintenance of societies “ for beneficial or protective purposes to its members from funds collected therein; ” and that the Equitable Beneficial Association of Pennsylvania is in no sense an insurance company, and has not been, and-is not now, so conducted.

As the law plainly recognizes the existence of beneficial societies, as distinguished from insurance companies, and provides for their incorporation as such, it is proper that we should determine what is meant by “ a society for beneficial or protective purposes,” and in what respects it may be said to differ from an insurance company. The general object or purpose of an insurance company is to afford indemnity ox security against loss: its engagement is not founded in any philanthropic, benevolent, or charitable principle; it is a purely business adventure, in which one, for a stipulated consideration or premium per cent, engages to make up, wholly or in part, or in a certain agreed amount, any specific loss which another may sustain; and it may apply to loss of property, to personal injury, or to loss of life. To grant indemnity or security against loss, for a consideration, is not only the design and purpose of an insurance company, but is also the dominant and characteristic feature of the contract of insurance.

What is known as a beneficial association, however, has a wholly different object and purpose in view. The great underlying purpose of the organization is not to indemnify or to secure against loss : its design is to accumulate a fund from the contributions of its members, “ for beneficial or protective purposes,” to be used in their own aid or relief, jn the misfortunes of sickness, injury, or death. The benefits, although secured by contract, and for that reason to a limited extent assimilated to the proceeds of insurance, are not so considered. Such societies are rather of a philanthropic or benevolent character: their beneficial features may be of a narrow or restricted character ; the motives of the members may be to some extent selfish, but the principle upon which they rest is founded in the considerations mentioned. These benefits, by the rule of their organization, are payable to their own unfortunate, out of funds which the members have themselves contributed for the purpose, not as an indemnity, or security against loss, but as a protective relief in case of sickness or injury, or to provide the means of a decent burial in the event of death. Such societies have no capital stock. They yield no profit, and their contracts, although beneficial and protective, altogether exclude the idea of insurance, or of indemnity, or of security against loss. There were many of these societies in existence at the time of the passage of the act of 1874 in this state : the character of their business was a matter of common knowledge, and it was doubtless to societies of this character the ninth clause of the second section of the act of 1874 was intended to apply.

• But we are wholly in the dark as to the nature of the business conducted by these defendants. The cause was tried under the act of April 22, 1874, without a jury, and the facts necessary to the determination of the case are not found. It is the duty of the court, in such case, to “state separately and distinctly the facts found, the answers to any points submitted in writing by counsel, and the conclusions of law: ” Act of April 22, 1874, P. L. 109; Marr v. Marr, 103 Pa. 468; Sweigard v. Wilson, 106 Pa. 213; Harris v. Hay, 111 Pa. 564. In the opinion of the court, after reciting the purpose or design of. the association, as defined by the charter, the learned court says : “ The facts in the case are substantially the same as in the. case, of the Commonwealth v. Beneficial Association of Philadelphia, No. 36 January Term 1889, Dauphin county Common Pleas, in which an opinion has this day been filed; and for the reasons in the said opinion given, we find, as matter of law, that the commonwealth is entitled to a judgment of ouster against this defendant.” What these facts were the record does not show, and it is impossible for us to examine into the correctness of the conclusion of law without the facts from which that conclusion is drawn. In a case of this kind we are confined to the record. What is not found, must be presumed not to exist. We are wholly without information as to the business in which the defendants are engaged: there is no finding that they are making any contracts of insurance, or issuing policies in pursuance thereof; or, indeed, that they are engaged in any business at all.

The judgment is reversed, and a procedendo awarded.