Enfinger v. Order of United Commercial Travelers of America

• Decision Date: 12 September 1963
• Docket Number: No. D-453,D-453
• Citation: 156 So.2d 38
• Parties: Margaret ENFINGER, Appellant, v. The ORDER OF UNITED COMMERCIAL TRAVELERS OF AMERICA, a foreign corporation, Appellee.
• Court: Florida District Court of Appeals

Page 38

156 So.2d 38

Margaret ENFINGER, Appellant, v. The ORDER OF UNITED COMMERCIAL TRAVELERS OF AMERICA, a foreign corporation, Appellee.

No. D-453.

District Court of Appeal of Florida, First District.

Sept. 12, 1963.

Earl R. Duncan, Panama City, for appellant.

Isler, Welch & Jones, Panama City, for appellee.

HOBSON, Associate Judge.

Appellant, Margaret Enfinger, brought her action to recover the principal amount of an insurance policy issued by the appellee upon the life of her deceased husband. The cause was submitted to the trial court upon an agreed statement of facts which reveals the following salient points.

Decedent, James W. Enfinger, first applied for membership in The Order of United Commercial Travelers of America on February 24, 1954. He was accepted as a member of March 17, 1954, and certificate of insurance #548851 was issued insuring him against accidental injury and death. When Mr. Enfinger failed to pay his quarterly dues and assessments for the period commencing September 1, 1960, he was automatically suspended from the benefits of his lodge and his certificate of insurance on October 1, 1960, pursuant to Article XI, § 8 of the Order's Constitution. The aforesaid section provides for automatic suspension when Mr. Enfinger failed 'to restore himself and his certificate to good standing within 30 days from the date of such delinquency.' On January 26, 1961, more than 90 days after his suspension, Mr. Enfinger applied for reinstatement. He was required to complete a form reinstatement application. This form contained the following printed disclaimer:

'* * * and that the Order shall not be liable for any accidental injury or death happening prior to the issuance of a Certificate or Certificates of Insurance by said Order.'

Mr. Enfinger's application was received by the local council on January 26, 1961, together with his fee in the amount of $9.20. Said $9.20 consisted of $2.50 local council dues, $2.70 insurance assessment for February and March, 1961, and $4.00 insurance assessment for April, May and June, 1961. Pursuant to a favorable committee report, Mr. Enfinger was elected to membership in the local council on January 31, 1961. The pertinent provision of the Order's constitution which provides for reinstatement of cases such as Mr. Enfinger is as follows:

'Each application shall be referred to a [local] Committee of three for investigation, upon whose report a ball ballot shall then be taken upon each application, and if not more than two adverse ballots appear, the Senior Counselor [also local] shall declare the applicant reinstated to membership, subject to the approval of the Supreme Office.' Art. XI, § 9. (Italics supplied.)

The Supreme Office is located in Columbus, Ohio.

The local chapter performed as required by the above constitutional provision and forwarded Mr. Enfinger's application for reinstatement to the Supreme Office for its approval on January 31, 1961. On February 3, 1961, the Supreme Office received and acknowledged receipt of the insurance funds paid in behalf of Mr. Enfinger. Mr. Enfinger came to his death by accidental drowning on February 4, 1961, before the Supreme Office had actually approved his application. Without knowledge of his death, on February 8, 1961, his application was unqualifiedly approved by the Supreme Office and his insurance certificate was issued bearing the number 548851, as had his original insurance certificate. The insurance certificate was not delivered and on demand the company refused to honor the same on the ground that Mr. Enfinger had died before the approval of his reinstatement application. In denying Mrs. Enfinger's claim, the company relies upon the portion of the Order's constitution which provides, 'The right of any such applicant or his beneficiary to fraternal privileges of the Order or indemnity under the provisions of Article XI, shall not accrue until twelve o'clock noon, Eastern Standard Time, of the day upon which his certificate of reinsurance is dated.' Article II, Section 9.

Subsequent to Mr. Enfinger's death, on February 17, 1961 the Supreme Office forwarded the insurance assessment for April, May and June, 1961, in the amount of $4.00 to the local council for return to decedent's estate; however, it was not until more than 14 days after the complaint was filed that the insurance assessment for February and March, 1961, and local dues were tendered to the appellant.

The trial court upon consideration of the agreed statement of facts and argument of the parties in interest entered a judgment in favor of the appellee denying appellant's recovery under the policy of insurance.

We have carefully examined the agreed statement of facts, as well as the briefs of the parties herein. From our scrutiny of the path followed by Mr. Enfinger's application for reinstatement, it is clear that the bulk of the requisite steps leading to reinstatement had been completed on or before his accidental death on February 4, 1961. The record reflects that on or before February 3, 1961, Mr. Enfinger's application for reinstatement, appropriately endorsed by two members in good standing, had been duly submitted to the local council of the Order; it had been approved by a three-member membership committee; he had been reelected to membership in the Order; the local council had issued to Mr. Enfinger a membership card showing him to be 'a member in good standing'; his approved application form, together with the insurance assessments for February through June had been forwarded to the national office of the Order and the national office of the Order had acknowledged receipt of Mr. Enfinger's assessments along with the other reports and funds submitted by the local council. Nothing was left for Mr. Enfinger to do. He had met all requirements. The only thing remaining undone prior to Mr. Enfinger's death was the perfunctory task on the part of the Supreme Council of physically issuing and delivering the insurance policy in question. Lest this statement be mistakenly considered unwarranted, it must again be pointed out that between Mr. Enfinger's death on February 4th and receipt of notice thereof by the Order's home office decedent's policy of insurance actually was issued in the routine course of business on February 8, 1961. Moreover, it is quite clear that Mr. Enfinger was not guilty of any fraud or misrepresentation; otherwise the Supreme Office would not have approved the application. No basis for disapproval of said application has even been suggested.

The agreed statement of facts discloses that appellant's decedent submitted two insurance assessment payments to the Order's home office. The first assessment of $2.70 was intended to provide insurance coverage for the months of February and March, 1961, and the second assessment was advance payment to cover the months of April, May and June, 1961. The inescapable conclusion from the division of the assessment costs is that both parties intended that the entire month of February would be covered by the premium of $2.70.

Under the appellee's customary mode of procedure, which is prescribed by its constitution, all the money which had been collected by the Secretary-Treasurer of each local chapter is remitted to the Supreme Office of the Order once a month on the first day of each month. (Art. XI, Section 10) If the appellee's contention of no coverage until the policy is actually issued is followed and applied to all cases of reinstatement, the applicants are deprived of any benefit for the premiums paid for a portion of the month of their reinstatement and the appellee is being paid for a risk that it did not incur. This is true because the appellee does not consider itself bound on the policy until noon of the date of issuance which is always subsequent to the first day of the month, yet nevertheless collects premiums covering each and every day of that month. This being so, the appellee cannot at this late date assert that the policy did not become effective until February 8, or defend on the ground of forfeiture. As the Supreme Court of Pennsylvania pointed out in the case of MacDonald v. Metropolitan Life Insurance Co., 304 Pa. 213, 155 A. 491, 77 A.L.R. 353,

'In the absence of an express agreement to the contrary, premiums will be so applied as to give the insured the protection for which he pays. 'A construction which gives insured insurance for a less period of time than that covered by the premium which he has paid should not be adopted.' 32 C.J. 1165.'

Our decision that appellant as the beneficiary is entitled to recover the principal amount of the policy is further buttressed by more than one salient fact disclosed by the agreed statement of facts.

It should be noted that the appellee's conduct after it had full knowledge of Mr. Enfinger's death supports appellant's recovery. The agreed statement of facts reflects that after receiving notice of Enfinger's death, the appellee transmitted (on February 17, 1961) to the secretary of the local order its check for $4.00 for delivery to the estate of the decedent. Said $4.00 represented a return of decedent's insurance assessments covering the months of April, May and June, 1961. It was not until 14 days after the appellant filed her suit as beneficiary that on June 27, 1961, the appellee transmitted to its local secretary a check for $2.70, which represented insurance premiums for the months of...