Brotherhood's Relief and Compensation Fund v. Smith

• Decision Date: 28 December 1971
• Docket Number: No. 1,No. 170A3,170A3,1
• Parties: BROTHERHOOD'S RELIEF AND COMPENSATION FUND Defendant-Appellant, v. Robert J. SMITH, Plaintiff-Appellee
• Court: Indiana Appellate Court

Page 180

277 N.E.2d 180

150 Ind.App. 452

BROTHERHOOD'S RELIEF AND COMPENSATION FUND Defendant-Appellant, v. Robert J. SMITH, Plaintiff-Appellee.

No. 170A3.

Appellate Court of Indiana, Division No. 1.

Dec. 28, 1971.

Timothy P. Galvin, Jr., Hammond, for defendant-appellant; Galvin, Galvin & Leeney, Hammond, of counsel.

Albert C. Hand, Hammond, for plaintiff-appellee.

ROBERTSON, Judge.

This is an appeal from the Lake Superior Court, wherein plaintiff-appellee Smith brought an action to recover certain benefits allegedly due him under the terms of a relief and compensation contract, purchased by Smith from jthe Brotherhood's Relief and Compensation Fund, defendant-appellant herein. The trial court entered judgment for plaintiff Smith and against defendant Brotherhood, in the sum of $3600 plus attorney fees in the sum of $450. The resulting appeal is from the overruling of Brotherhood's Motion for New Trial. ¹ The record reveals that Brotherhood is a non-profit Pennsylvania corporation, which insures employees of the railroad industry against 'held out of service' and retirement benefits. This corporation operates as a fraternal organization, to which its members are elected and thereafter pay monthly dues in order to derive the benefits of membership. On May 31, 1963, Smith was duly elected and admitted to the Brotherhood's Relief and Compensation Fund, and has since remained a member in good standing. Smith was furnished the necessary papers regarding membership, which included a copy of the constitution, and a copy of the amended constitution. Following a derailment incident on December 12, 1966, for which Smith accepted full responsibility, he was demoted by his employer, the Indiana Harbor Belt Railroad, from the position of car retarder operator to a position of lesser responsibility and pay.

After his demotion, Smith filed a claim with Brotherhood for 'held out of service' benefits. His claim asserted entitlements as scheduled in his certificate of membership, at the rate of $6 per day under his regular membership, and $12 per day under his special membership, not to exceed a maximum period of 200 days. This claim, initially and subsequently on appeal to the Board of Directors of the Brotherhood's Relief and Compensation Fund, was rejected.

During the interim between the first claim and the commencement of this action, Smith was involved in a second derailment incident on April 23, 1967, which resulted in the dismissal of himself and the crew with whom he was working. The dismissal lasted for 85 days, at which time Smith was reinstated. Upon a claim made by Smith for benefits for the 85 day period of dismissal, defendant paid Smith the sum of $1674 which, as was not contested by either party, was the full amount to which Smith was entitled on that claim.

The issues to be resolved in this appeal, are whether or not the trial court erred in allowing plaintiff to recover 'held out of service' benefits under his first claim, and whether the court erred in allowing attorneys' fees for Smith.

The first issue, involving the recovery of benefits, is divided into two arguments, namely:

'A judgment is erroneous as a matter of law when award is made to a claimant under a relief and compensation contract if such contract provides that no award shall be 'in excess of the member's average monthly earnings' and claimant presents no evidence of his average monthly earnings.'

and,

'If a relief and compensation contract provides for payments when a claimant is 'relieved by his employer from the performance of his said usual duties' and if a claimant is demoted for one offense, then suspended for a second offense, and finally reinstated at the lower (demoted) rank, a judgment is erroneous as a matter of law if it awards the claimant full benefits for his demotion without a credit for the sums paid during the period of suspension.'

This court is of the opinion that neither argument is persuasive.

The amended constitution has a clause which reads:

'ARTICLE XIII--Benefits for 'held out of service'--Sec. 1.--Any member who is in good and regular standing, and having a continuous current beneficial membership coming within any group of the classification herein provided, shall be eligible for benefits for 'held out of service', as hereinafter defined, beginning with the first day after the day of the occurrence of the cause of such 'held out of service', as established and fixed for each class of membership by the following schedule, not however, in excess of the members average monthly earnings, proof of which the Organization may require as a condition of payment of benefits: . . ..' (Emphasis added.)

Brotherhood bases their argument upon the emphasized portion of the article. (The same article in the original constitution did not have a similar provision.)

Smith alleged in his complaint, and presented testimony at the trial that he was 'held out of service' in excess of 200 days and that he was entitled to benefits, as a result of his two memberships, at a combined rate of $18 per day, for a maximum of $3600. Assuming that the amended constitution was in effect, Brotherhood wholly failed to present any evidence regarding any limitations on benefits, namely the difference between Smith's average monthly earnings, and the maximum amount of benefits. A defendant has the burden of proving a counter-claim, set-off or an affirmative defense, by a preponderance of the evidence on that particular issue. Cohen v. Reichman (1913), 55 Ind.App. 164, 102 N.E. 284. Nicholich v. Shasovich (1920), 72 Ind.App. 294, 125 N.E. 803.

Brotherhood's second...