Columbian Mut. Life Assur. Society v. Penn

• Decision Date: 29 October 1923
• Docket Number: 23371
• Court: Mississippi Supreme Court
• Parties: COLUMBIAN MUT. LIFE ASSUR. SOCIETY v. PENN

97 So. 673

133 Miss. 266

COLUMBIAN MUT. LIFE ASSUR. SOCIETY v. PENN

No. 23371

Supreme Court of Mississippi

October 29, 1923

Division B

(Division B.) January 1, 1920

INSURANCE. Recovery for fracture of one bone of forearm unauthorized under clause providing for payment for "complete fracture of arm."

In a suit based upon a covenant of an insurance policy providing for the payment of a benefit in the event of a complete fracture of an arm at or above the wrist, a recovery based upon proof of injury to and a fracture of only one bone of the forearm will not be upheld.

HON. D M. MILLER, Judge.

APPEAL from circuit court of Lincoln county, HON. D. M. MILLER Judge.

Suit by J. S. Penn against the Columbian Mutual Life Assurance Society. From a judgment for plaintiff, defendant appeals. Reversed, and judgment rendered.

Judgment reversed.

Wells Stevens & Jones, and A. A. Cohn, for appellant.

The proof shows that appellant society is a fraternal benefit society operating under the Special Act of 1916, chapter 206, same being incorporated in Hemingway's Code, section 5173, et seq. This act is a complete and comprehensive one, regulating and controlling the fraternal benefit societies operating on the lodge system, with a representative form of government and ritualistic work. Our court has several times construed this act and pointed out that it is all embrasive and exclusive and any other provisions of the code relating to insurance companies do not apply. The Sovereign Camp of W. O. W. v. Farmer, 116 Miss. 626, 77 So. 655.

Ordinary life insurance companies are commercial corporations engaged in the business of selling insurance contracts for profit. The policy holders do not in any sense constitute the company. Their position is purely that of an insured and in no sense an insurer. Peterson v. Manhattan Life Insurance Company, 244 Ill. 329, 337, 91 N.E. 466 (1910).

With the fraternal benefit society the underlying principle is that the mutuality in that each member should pay according to the risk he brings to the society and the benefits promised him. He is both insured and insurer. The real society is the membership and the corporation is but an instrumentality or agency by means of which the membership carry out their purposes. Barrows v. Mutual Life Insurance Co., 151 F. 461, 465 (C. C. A.) (1907); Supreme Lodge, etc., v. Mims, 241 U.S. 574, 579 (1916); Thomas v. Knights of the Maccabees, 149 P. 7 (85 Wash. 665; L. R. A. 1916A, 750) (1915); Korn v. Mutual Aid Assurance Society, 3 L.Ed. (6 Cranch), 192, 201; U.S. 364 (1810); Haydell v. Mutual Reserve, etc., 98 F. 200, 204 (1899); Miller v. National Council, etc., 76 P. 799, 832, 69 Kan. 234 (1904); Reynolds v. Royal Arcanum, 7 L. R. A. (N. S.) 1154, 78 N.E. 129 192 Mass. 150, 157 (1906); Elliott v. Home Mutual Hail Assn,, 140 N.W. 431, 432, 160 Iowa 105 (1913); Mock v. Supreme Council, etc., 121 A.D. 474, 106 N.Y.S. 155 (1907); Hall v. Western Travelers Acc. Assn., 96 N.W. 170, 69 Neb. 601 (1903); Supreme Lodge, etc. v. Bieler, 105 N.E. 244, 246, 52 Ind.App. 550 (1914); Fullenweiden v. Royal League, 73 Ill.App. 321, 335 (1897); Mutual Reserve, etc. v. Taylor, 99 Va. 208, 219, 37 S.E. 854 (1901).

To carry out this underlying idea of mutuality, all members agree to be bound by the laws of the society including those after enacted as well as those in force at the date of entry into the society and such agreements are enforced even to the extent of readjusting and changing rates, contributions or assessments which must be paid. Thomas v. Knights of the Maccabees, 149 Pa. 7, 85 Wash. 665; L. R. A. 1916A, 750 (1915); Supreme Lodge, etc., v. Mims, 241 U.S. 574 (1916); Clarkson v. Supreme Lodge, etc., 82 S.E. 1943, 99 S.C. 134 (1914); De Graw v. I. O. F., 182 Mich. 366, 148 N.W. 703 (1914); Holt v. Supreme Lodge, etc., 235 F. 885 (C. C. A.) (1916); Newman v. Supreme Lodge, etc., 70. So. 241, 110 Miss. 371 (1915); Supreme Council, etc., v. Green, 237 U.S. 531, L. R. A. 1916A, 771, (1915); Wineland v. K. O. T. M., 148 Mich. 608, 112 N.W. 696 (1907); Reynolds v. Royal Arcanum, 192 Mass. 150, 78 N.E. 129, 7 L. R. A. (N. S.) 1154 (1906); Supreme Lodge K. of H. v. Bieler, 105 N.E. 244, 52 Ind.App. 550 (1914); Fullenweider v. Royal League, 180 Ill. 621, 54 N.E. 485 (1899); Fullenweider v. Royal League 73 Ill.App. 321 (1897); Champion v. Hannahan, 138 Ill.App. 387 (1908); Mock v. Supreme Council, R. A. 121 A.D. 474, 106 N.Y.S. 155 (1907); Messr. v. Grand Lodge, 180 Mass. 321, 62 N.E. 252 (1902); Miller v. National Council, K. & L. of S., 69 Kan. 234, 76 P. 830 (1904); Supreme Ruling Mystic Circle v. Ericson, 131 S.W. 92 (Tex. Civ. App.) (1910); Williams v. Supreme Council, C. M. B. A., 152 Mich. 1, 115 N.W. 1060 (1908); Conner v. Golden Cross, 117 Tenn. 549, 97 S.W. 306 (1906); Shepperd v. Bankers' Union, 77 Neb. 85; 108 N.W. 188 (1906); Supreme Lodge K. of P. v. Knight, 117 Ind. 489, 3 L. R. A. 409, 20 N.E. 479 (1889); Woodmen of the World v. Woods, 34 Colo. 1, 81 P. 261 (1905); Barbot v. Mutual Res. etc. Assn., 100 Ga. 681, 28 S.E. 498 (1897); Mutual Reserve Fund Life Assn. v. Taylor, 99 Va. 208, 37 S.E. 854 (1901); Richmond v. Supreme Lodge, etc., 100 Mo.App. 8; Haydel v. Mutual Reserve Fund Life Assn. 98 F. 200 (1889); Haydel v. Mutual Reserve Fund Life Assn., 104 F. 718 (C. C. A.) (1900).

The member occupies a dual situation in that he is both insured and insurer. As an insured the member is in the position of one with whom the society has promised to pay certain benefits under certain conditions. As an insurer, i. e., one of the collective membership, it is the duty of the member to do those things which are necessary to be done in order to make it possible for the society to carry out the purposes for which it has been created. Barrows v. Mutual Life Ins. Co., 151 ed. 461, 465 (C. C. A.) (1907); Supreme Lodge, etc., v. Mims, 241 U.S. 574, 579 (1916); Thomas v. Knights of the Maccabees, 149 P. 7 (85 Wash. 665, L. R. A. 1916A, 750) (1915); Korn v. Mutual Aid Assurance Society, 3 L.Ed. (6 Cranch) 190, 201, 2 U.S. 364 (1810); Haydell v. Mutual Reserve, etc., 98 F. 200, 204 (1899); Miller v. National Council, etc., 76 P. 800, 832, 69 Kan. 234 (1904); Reynolds v. Royal Arcanum, 7 L. R. A. (N. S.) 1154, 78 N.E. 29, 192 Mass. 150, 157 (1906); Elliott v. Home Mut. Hail Assn., 140 N.W. 431, 432, 160 Iowa 105 (1913); Mock v. Supreme Council, etc., 121 A.D. 474, 106 N.Y.S. 155 (1907); Hall v. Western Travelers Acc. Assn., 96 N.W. 170, 69 Neb. 601 (1903); Supreme Lodge, etc. , v. Bieler, 105 N.E. 244, 246, 53 Ind.App. 550 (1914); Fullenweider v. Royal League, 73 Ill.App. 321, 335 (1897); Mutual Reserve, etc., v. Taylor, 99 Va. 208, 219, 37 S.E. 854 (1901); Peterson v. Manhattan Life Insurance Company, 244 Ill. 329, 337.

The obligation to pay for a complete fracture of the arm depends upon the condition precedent, to-wit: The furnishing of proofs, including an X-ray photograph indicating a complete fracture. The benevolent objects would be defeated if any accident or other benefit must be paid at the whim or caprice either of the claimant or of some local physician. Here the objection is not to pay the benefits in all events, but upon conditions and these conditions bind the claimant as well as every other member of the society. Pool v. Brotherhood of Railroad Trainmen, 143 Cal. 653, 77 P. 661; Baltimore & O. R. R. Co. v. Stankard (Ohio), 49 L. R. A. 381, 60 Am. St. Rep. 475; Eighmy v. Brotherhood of Railroad Trainmen, 113 Iowa 683, 83 N.W. 1021; Knapp v. Brotherhood of America Yeoman (Iowa), 117 N.W. 298; W. C. Nelson v. Atlantic Coast Railroad Co. (N. C.), 72 S.E. 998; Sanderson v. Brotherhood of Railroad Trainmen, 204 P. 182, 53 A. 767; 2 Bacon on Life and Accident Insurance, 564.

We submit therefore that the right of action in this case does not accrue until the X-ray photograph in the judgment of the medical director showed a complete fracture. The X-ray picture did not show a complete fracture and the medical director in good faith so found. In the Avery v. Scott case, 8 Exch. 497, MAULE, J., made a statement which was quoted with approval by Lord LINDLEY in Spurrier v. La Cloche (1902), A. C. 446, as follows: "There is no decision which prevents two persons from agreeing that a sum of money shall be paid upon a contingency, but they cannot legally agree that when it is payable no action shall be maintained for it."

That is a distinction for which we contend. And in making this point and drawing this distinction we are conscious of the prior ruling of this court in Eminent Household of Columbian Woodmen v. Ramsey, 118 Miss. 454, holding that any provision of the constitution requiring the plaintiff before resorting to the courts to exhaust his remedy by appeal within the order, is contrary to public policy and void on the theory that it would deprive or oust the courts of their jurisdiction. This court in the Ramsey case, referred to Independent Order of Sons and Daughters of Jacob v. Wilkes, 98 Miss. 179, 52 L. R. A. 817, wherein Wilkes sued the order for damages before exhausting his remedy by appeal as provided by the laws of the order. We respectfully submit that the court in the Ramsey case has carried the rule as far as it possibly can be and very much further than most of the authorities suggest.

There was not a complete fracture of the arm. At most there was only a fracture of the radius, one bone of the arm not being injured at all. Complete means "total" or "entire." How then can there be a complete fracture when one of the two equally important bones has suffered no injury whatever? It is submitted that the peremptory instruction requested should have been given, in view of the fact that only one bone was in anywise injured and there was in fact no complete fracture of the...