Arkansas Medical & Hospital Service v. Cragar, 4-9808

• Decision Date: 09 June 1952
• Docket Number: No. 4-9808,4-9808
• Citation: 249 S.W.2d 554,220 Ark. 704
• Parties: ARKANSAS MEDICAL & HOSPITAL SERVICE, Inc. v. CRAGAR.
• Court: Arkansas Supreme Court

Page 554

249 S.W.2d 554

220 Ark. 704

ARKANSAS MEDICAL & HOSPITAL SERVICE, Inc. v. CRAGAR.

No. 4-9808.

Supreme Court of Arkansas.

June 9, 1952.

Wright, Harrison, Lindsey & Upton, Little Rock, for appellant.

John G. Moore, Morrilton, for appellee.

HOLT, Justice.

Appellee, C. A. Cragar, brought this suit against appellant, Arkansas Medical and Hospital Service, Inc., for expenses for medical and hospital services which he incurred on and after June 5, 1951. Appellant operated under the Blue Cross-Blue Shield plan and membership is obtained principally through groups. Appellee was one of a group of thirteen, added to the Perry County Farm Bureau (a unit of Arkansas Farm Bureau Federation). Appellant denied any liability.

The question presented is whether appellee's contract with appellant became effective on June 1, 1951, or on June 15, 1951. Appellee claimed that the effective date was June 1st and appellant asserted it was June 15th. Appellant says: 'Appellant refused to pay benefits under the contract on the ground that it did not become effective until June 15, 1951, approximately ten days after appellee began the hospitalization which promptly led to the operation.'

On a trial, and at the close of all the testimony, both sides asked for a directed verdict and other instructions, whereupon the court declared, as a matter of law, that appellee should recover and found in favor of appellee. From the judgment is this appeal. The judgment was correct.

As we read this record, the evidence is undisputed and to the following effect: May 14, 1951, the Perry County Farm Bureau met in Perryville to discuss and consider appellant's Blue Cross-Blue Shield plan of operation and membership therein. Among those present were H. T. Baber, representing Arkansas Farm Bureau Federation, Walter Paul, secretary-treasurer of Perry County Farm Bureau, Byron Huddleston, County Agent of Perry County, and R. L. McMasters, Sales Representative for appellant. Mr. McMasters took part in the meeting and 'made a talk' (he is now in California and did not testify in this case).

Mr. Huddleston testified:

'Was there at that meeting a discussion relative to the effective date of the certificates and memberships that were to be issued? A. That is right, there was.

'Q. Was there an agreement reached between those present what that effective date should be? A. I understood at this meeting that there was a definite effective date.

'Q. And what was that effective date? A. I understood that date to be June 1, 1951, provided a county quota was reached.

'Q. You mean June 1, 1951? A. Yes.

'Q. Was the county quota reached? A. It was.

'Q. And Mr. McMasters was present and participated in that meeting? A. He did.'

Mr. Paul's testimony tended to corroborate Huddleston's as to his understanding that June 1st was the effective date. This evidence was not contradicted.

May 29, 1951, following the May 14th meeting, a meeting was held at Aplin, Arkansas, attended by appellee, at which Mr. Huddleston filled out appellee's application dated June 1, 1951. Appellee signed this application and just above his signature thereon was this language:

'I hereby apply for membership as indicated with the understanding that I will receive a certificate specifying benefits to be received and conditions under which they will be available. I also understand my group treasurer acts as my agent in forwarding payments to Blue Cross or Blue Corss-Blue Shield, Little Rock, Arkansas.

'I understand that services are available on the common service date established for my group and I certify that neither I nor any dependents eligible under this application have any knowledge of any condition which may require hospital, medical, or surgical care.'

On this same day (May 29th) Cragar gave his check for $16.20, payable to Perry County Farm Bureau. In the face of this check was this language: 'This check is to apply on account as shown thereon. Acceptance by endorsement constitutes receipt. First full Quarterly payment for Blue Cross-Blue Shield effective June 1, 1951, providing County quota is reached.' This check was in payment of appellee's first quarterly premium.

May 31, 1951, Mr. Paul, as secretary-treasurer of the Perry County Farm Bureau, mailed the new applications, including appellee's with a Perry County Farm Bureau County check for $129.90, to cover appellee's quarterly premium, along with the premiums of the other...