Citation Numbers: 224 S.W. 129, 205 Mo. App. 260
Judges: BECKER, J.
Filed Date: 6/8/1920
Status: Precedential
Modified Date: 1/12/2023
In 1903 defendant issued to Lars Olsen a benefit certificate of insurance payable at his death, if in good standing, to his wife, Minnie Olsen. Olsen died March 8, 1917. The defendant refused to pay and plaintiff as beneficiary brought suit for $2000, the sum specified in the certificate, together with $200 penalty for vexatious refusal to pay, and $400 attorney's fees. The case was tried to a jury and a verdict found for plaintiff for $2600, and from the judgment entered in accordance therewith defendant in due course appeals.
We note that the petition alleges that the defendant company is a foreign corporation, "engaged in writing life insurance on the natural premium plan in the State of Missouri and is liable to be sued in the courts of this State as an assessment life insurance company under article 2, chapter 61, Revised Statutes of Missouri, 1909."
The defense are: First: That the defendant is a fraternal beneficiary society duly incorporated as such under the laws of the State of Massachusetts, and engaged *Page 264 in doing business as such in the State of Missouri under license from the insurance department of said State. Second: That the insured was suspended for nonpayment of assessment for the month of January, 1917. Third: That said insured, in the month of February, 1917, elected to adandon his membership in the defendant order and discontinued the payment of the assessments therein and severed his connection with said order. Fourth: That during the month of January, 1917, plaintiff, acting as the agent of the insured and in accordance with his wishes, as well as in her own behalf, notified the collector of the local council of which the insured was a member, that the said Olsen desired to become suspended from said order and thereafter would pay no further assessments, whereby the said plaintiff became estopped from claiming anything under the benefit certificate issued to said Olsen.
The reply denied that the defendant was entitled to conduct business in the State of Missouri as a fraternal beneficiary society, and sets up an alleged waiver on the part of the defendant of its by-laws requiring the payment of assessments on a day fixed and certain.
We note the following excerpts from plaintiff's own testimony:
Q. "You did not pay the January assessment?" A. "No; I didn't have the money."
Q. "Could you pay the February assessment?" A. "No, sir; because I wrote to my husband and told him I didn't have the money to pay and I wanted him to send it and he told me the Council would carry him for a while — said those were his rules — the by-laws, or whatever you call it."
Q. "Pay it indefinitely?" A. "Until I could pay."
Q. "And you never went and told them you couldn't pay?" A. "No, sir, I didn't.
Section 9 of the Laws of 1911, l. 286, applicable to fraternal beneficiary associations provides that the certificate, the charter or articles of incorporation, the constitution and laws of the society and the application for membership and medical examination, signed by the applicant, and all amendments to each thereof, shall constitute the agreement between the society and the *Page 267 member, and that any changes, additions or amendments duly made or enacted, subsequent to the issuance of the benefit certificate shall bind the member and his beneficiaries and shall govern and control the agreement in all respects the same as though such changes, additions or amendments had been made prior to and were in force at the time of the application for membership.
Section 22 of the same law (Laws of 1911, p. 292) provides that the constitution and laws of the society may provide that no subordinate body, nor any of its officers or members shall have the power or authority to waive any of the provisions of the laws or constitution of the society, and the same shall be binding on the society and each and every member thereof and on all beneficiaries of members.
By agreement of counsel for plaintiff and defendant below a duly certified copy of the code of the constitution and laws of the Royal Arcanum covering the Supreme, Grand and Subordinate Councils and members was introduced in evidence with the understanding that either party could read such portions thereof as they deemed relevant. Various sections of this code were read to the jury, among which we find the following:
Sec. 176. (1) "A Council is a body of limited jurisdiction, having no powers except those conferred upon it by the Supreme Council, and such as are implied as necessary to the exercise of powers expressly granted."
(3) "The Council and its officers, in performing the duties and administering the powers provided by the Laws of the Order, shall be the agent or agents of the members thereof, and not the Supreme Council, and no act or failure to act by the Council or by any officer or member thereof shall create, or be construed so as to create, any liability on the part of the Supreme Council."
"Neither the Council or its officers or any one or more thereof shall waive the performance of, or compliance with, any law or requirement of the Supreme *Page 268 Council, and such waiver shall be inoperative to bind, or create any liability upon, the Supreme Council."
Sec. 251. (1) "A by-law or alteration thereof must not contravene or conflict with the Constitution of the Supreme, Grand or Subordinate Councils, nor the General Laws and principles of the Order, nor repeat any portion of the said Constitutions and Laws."
(2) "No provision shall be made either by By-law, resolution or vote, for the temporary suspension of a By-law, nor for the nullification of the provisions of any law, rule or regulation adopted by the Supreme Council."
Sec. 252. "All By-laws and alterations thereof must, after adoption by the Council, be submitted to the committee on Laws of the Supreme or Grand Council, and shall take effect from the date of approval by such Committee."
252a. "Upon the approval of By-laws by the committee on laws having jurisdiction thereof, they shall be sent to the Supreme or Grand Secretary, who shall attest the same, affix the Supreme or Grand Council seal thereto, and forward them to the Council."
Sec. 253. "All By-laws relating to the Widows and Orphans' Benefit Fund, Supreme Council Dues, and sick benefits and payment thereof, must be submitted to and approved by the Committee on Laws of the Supreme Council, and shall not take effect until and be operative only in the form of such approval."
Sec. 433. (1) "Each member of the order shall pay to the collector of his council, without notice, twelve regular assessments in each calendar year, one of which shall be due on the first day and payable before ten o'clock p.m., of the last day of each calendar month, and in addition to said regular assessments such extra assessments as may from time to time be required and levied as provided in this Title."
(5) "The neglect or failure of a member's agent or friend to pay for him an assessment shall not prevent his suspension." *Page 269
Sec. 436. "Any member failing to pay any regular assessment before the time prescribed for such payment in the Laws of the Order, or to pay any extra assessment of a member's assessment as a loan or gift from the notice thereof, shall stand suspended from the order and all benefits therefrom. . . ."
Sec. 438. (1) "A Council may authorize the payment of a member's assessment as a loan or gift from its General Fund; but such payment must be made to the collector before the time fixed for such payment to avoid suspension under the law."
(3) "A By-law or resolution whereby a Council agrees to pay an assessment for a member as a loan is not binding upon the Supreme Council unless it is complied with, and no claim of a member, in case the assessment is not paid, shall be recognized or valid. If the collector shall omit to pay, within the prescribed time an assessment for a member, in compliance with such resolution or By-law, the member stands suspended at the expiration of the time for payment."
The following by-laws of the local council of which the deceased was a member were read in evidence:
Sec. 1. "This council shall set apart a portion of its general fund, to be known as the "Delinquent Fund."
Sec. 2. "The Delinquent Fund shall be placed in the hands of the treasurer of this council, subject to the warrants of the trustees of this council, to be used by them as stated in the succeeding sections of this article, and for no other purpose."
Sec. 3. "At 3 o'clock of the day on which an assessment expires, the collector shall make out a list of all members who shall have failed to pay the same and present it to the trustees, who shall pay the collector from the Delinquent Fund the full amount named on the list."
Sec. 4. "The collector shall immediately notify all members whose assessments have been paid by the Delinquent Fund, and request him to at once refund the amount with the 25 cents fine provided by section 5." *Page 270
Sec. 5. "All members whose assessments are paid from the Delinquent Fund shall pay the sum of 25 cents into the fund for each assessment so paid, in addition to the full amount of the assessment. These additional payments to form part of the fund."
Sec. 6. "If any member fails to refund the amount paid out by the Delinquent Fund for him with the fine of 25 cents, his assessment shall not be again paid from the fund."
These by-laws of the defendant society, together with the plaintiff's own admission that the January and February, 1917, assessments were not paid, when taken with the fact that plaintiff has introduced no testimony showing that the Supreme Council has in any manner, way, shape or form, directly or indirectly waived the provision of its by-laws that "any member failing to pay any regular assessment before the time prescribed for such payment in the laws of the order, shall stand suspended from the order and all benefits therefrom," and that "though a council can authorize the payment of members' assessments as a loan or gift from its general fund, such payment must be made to the collector before the time fixed for such payment to avoid suspension under the law," and that a "by-law or resolution whereby a council agrees to pay an assessment for a member as a loan is not binding upon the Supreme Council unless it is complied with and no claim of a member in case the assessment is not paid shall be recognized or valid;" and that "if the collector shall omit to pay within the prescribed time an assessment for a member in compliance with the laws, resolution or by-laws, the member stands suspended at the expiration of the time for payment," presents a case in which the plaintiff cannot recover upon the benefit certificate unless it be, as contended by respondent's counsel, that the insured had, during the period in which he was a member of the order, paid assessments at a rate in excess of the sum actually due upon his certificate, in accordance with the defendant's regular rates. In other words, it conclusively appears that the January and February, 1917, assessments were in fact *Page 271 not paid; and consequently if a forfeiture arose by reason of the failure to pay those two assessments then it is entirely clear that the record shows that the defendant order did not in any manner whatsoever waive the payment of such assessments so as to relieve an action of forfeiture on that ground and it follows that plaintiff's first instruction, the only instruction offered by plaintiff other than one on the measure of damages and one on the credibility of the witnesses, should not have been given; for that instruction submitted the case to the jury purely upon the theory that defendant had waived the forfeiture which would otherwise have arisen by reason of the failure to pay the January and February assessments. The giving of this instruction was clearly reversible error for the reason that there is no evidence in the record to support it.
As to the question of over payment, the record before us we think contains some substantial evidence tending to show that the insured had in fact paid assessments from year to year in excess of the regular rates which were due the defendant on this benefit certificate. The evidence shows that the insured was nearly 51 years of age at the time of his application and the issuance of the benefit certificate to him in November, 1903. At the time of his death, March 8, 1917, he was 64 years of age. The evidence shows that from the time of the issuance of the certificate until January, 1906, the insured paid assessments, during nearly all of that period, at the rate of $3.80 per month; and that beginning with January, 1906, and thereafter, he paid regularly assessments of $3.50 every month, to and including November, 1916. Owing to an increase in defendant's rates the assessment for December, 1916, which was paid, was $7.80. The assessments in like sum for January and February, 1917, were not paid. Respondent offered in evidence defendant's "table of regular rates," from which it appears that the rate which the insured was obliged to pay on this certificate of $2000, that is defendant's regular rate upon a $2000 benefit certificate issued to one at the age of 51 years, as was the insured, was $3.22 *Page 272
per month. In other words, though this matter was not well developed at the trial below, the evidence to which we have referred makes it appear that (even without reference to the payments prior to January, 1906,) the insured for a period of nearly 11 years made over payments amounting to 28c. per month, or $3.36 per year, aggregating a sum largely in excess of $15.60 the aggregate of the two assessments for January and February, 1916, which were not paid and for which the defendant claimed a forfeiture of the certificate. And though, as said, this matter was not thoroughly developed at the trial below, the evidence touching it was not in anywise contradicted and appears to be sufficient prima facie to take the case to the jury upon the theory that the defendant had in its possession sufficient money of the insured to keep alive this benefit certificate up to the time of the insured's death. [See Gooden v. Modern Woodmen of Am.,
It follows that the judgment should be reversed and the cause remanded, for further proceedings not inconsistent with the views expressed above. It is so ordered.
Reynolds, P.J., and Allen, J., concur.