Garretson v. Sovereign Camp, W. O. W.

• Decision Date: 08 July 1922
• Docket Number: No. 3028.,3028.
• Citation: 210 Mo. App. 539,243 S.W. 257
• Parties: GARRETSON v. SOVEREIGN CAMP, W. O. W.
• Court: Missouri Court of Appeals

243 S.W. 257

210 Mo. App. 539

GARRETSON v. SOVEREIGN CAMP, W. O. W.

No. 3028.

Springfield Court of Appeals. Missouri.

July 8, 1922.

Appeal from Circuit Court, Laclede County; L. B. Woodside, Judge.

Action by Alice Garretson against the Sovereign Camp, Woodmen of the World. From judgment for plaintiff, defendant appeals. Reversed and remanded, with directions.

D. E. Bradshaw, of Omaha, Neb., and Barbour & McDavid, of Springfield, for appellant.

Don O. Vernon, of Lebanon, for respondent.

BRADLEY, J.

This is a suit on a fraternal beneficiary certificate. The cause was tried before the court without a jury and judgment went for the face of the certificate with interest, and defendant appealed.

On August 12, 1895, defendant issued to William A. Garretson its certificate for $2,000, naming therein Alice Garretson, his wife, and plaintiff here, as beneficiary. Insured died in May, 1920, while in good standing. Proofs of death were duly made, and payment for the full face of the certificate was demanded. Defendant refused to pay the certificate in full as per its face, but tendered $1,511.95, the amount due according to defendant's contention. This tender was refused by plaintiff, and defendant again made tender in its answer.

The petition is in two counts. The first is the usual charge upon an insurance certificate. The second count alleges that one of the conditions in the certificate was that if the insured paid the dues, as therein provided, for a period of 20 years the certificate would be paid up. Then follows the allegation that this condition was met, and that the certificate was paid up. Defendant answered the first count at great length, and to the effect that by reason of the change of rates, and adjustments made, effective January 1, 1920, it is not liable for any more than tendered. The answer to the second count is in effect that the limited pay provision in the certificate was void ab initio. A reply put in issue the new matter and pleaded estoppel.

There are three questions here for determination: (1) Is division "c" of section 60 of defendant's laws of 1919, as applicable to the certificate sued on, unreasonable or in conflict with any law of this state? (2) is the limited pay provision of the certificate valid? (3) Is there any estoppel under the facts?

No declarations of law were asked, and none were given, and the finding was general; hence we do not know on what theory the trial court based its finding. It was admitted that defendant is a fraternal beneficiary society organized under the laws of Nebraska, and authorized to do business in Missouri. In July, 1910, defendant, by its lawmaking body, raised its rates, and provided for a general adjustment, said raise and adjustment affecting all members of the order. Insured became a member of defendant society at the age of 44, and had been a member 24 years at the time of his death. He carried a certificate for $2,000, and hie rate when he entered was $1.45 per month. Defendant increased its rates in 1805, 1897, 1809, 1001, 1913, 1915, 1917, and 1918, but the certificate sued on was affected only by the changes in 1809, 1015, 1017, and 1019. At the time of his death insured was paying $2.15 per month as a sovereign camp fund proper, having failed to avail himself of the options provided in the raise and adjustment of 1015, 1917, and 1919, and as a result there were liens charged against his certificate.

Section 60 of the constitution, laws, and bylaws as amended and adopted in 1919, became effective on January 1, 1020, and fixed the rates for new members, raised the rates of then existing:members, and provided for certain options as to then existing members. Division "a" of section GO fixed the rates for new members, and provided that every member in good standing, to whom a combined benefit certificate was issued prior to January 1, 1920, should thereafter pay an annual assessment or monthly installments, in advance, as fixed by a table of rates set forth therein, and that this assessment should be based on the member's attained age on January 1, 1920. Then follows a provision whereby the assessment would bp reduced as to members 38 years of age and over by reason of certain accumulated funds. Division "b" of section GO provides that every member in good standing, admitted prior to January 1, 1920, holding a combined benefit certificate, may elect to relinquish and abandon his right and privilege to the monument benefit in his certificate, and to continue the death benefit and modified old-age benefit by paying an annual assessment fixed by a table therein, and that this assessment should be based on the member's attained age on January 1, 1920. The assessment under "b" would be reduced as under "a." By division "c" of section 60 a lien was charged against the certificate every member, admitted prior to January:., 1920, who failed to elect to pay under "a" or "b." If insured had elected to pay under "a," his rate on his $2,000 certificate would have been, according to the table, $19.04 per month, less the reduction by the accumulated funds, which reduction, into the details of which it is not necessary to go, would have reduced his assessment to $13.26 per month. If he had elected under "b" his assessment per month would have been $16.46, and reduced by the accumulated fund to $10.68. Insured did not elect, and by the Provisions of division "c" a charge or lien was placed against his certificate. The lien against insured's certificate under division "c" of section 60 amounted to $440, and increased, when not paid at 5 per cent., compounded annually. By virtue of the lien provision in the Laws of 1915 and 1017, together with interest, insured was charged with $45.75 in addition to the lien of $440 under defendant's laws of 1910, making a total lien against the certificate of $485.75. In addition to the liens $5.00 was deducted for dues for May and June, 1020, making a total deduction of $491.75. The deduction of $5.00 for dues would appear to be erroneous since insured was paying his old rate, and was charged with a lien, but this small error, if it is such, is not of consequence.

Insured continued to pay $2.15 per month as sovereign camp dues and had not paid any part of the liens. His status was this: At the age of 38 he was paying $2.15 per month on a certificate of $1,514.25, which certificate was reduced each year by the interest compounded annually on $485.75 at 5 per cent. There were from time to time small additional charges in addition to the $2.15 per month, but the $2.15 per month was the assessment for sovereign camp dues fixed upon Insured's certificate prior to 1915, and was the rate he paid. Insured's expectancy, according to defendant's mortality table, was 10.7 years. The interest on the lien charge for 10.7 years would be approximately $333. This amount, deducted from the $1,514.25 leaves $1,181.25. Considered in this manner, insured at the age of 68 years was given a certificate in the nature of a limited pay certificate for $1,181.25, for which he was paying $2.15 per month. The limited pay feature is based on the assumption that insured would live his full expectancy and no longer. If he failed to live out his expectancy, which happened to be the case, the certificate was more than the minimum we have assumed. If he should have lived beyond his expectancy, then the amount of insurance would have been less than the minimum assumed based on insured's expectancy. Few there be at the age of 68 who livedeyond their expectancy under any recognized table of mortality; hence it is not unreasonable to consider insured's certificate in the above manner. If insured had been compelled to elect under division "a" or "b" of section 60, or be lapsed, and that question was here, then there would be an entirely different problem for solution. But no such question is here. Insured did not elect, and was not compelled to elect, under "a" or "b," but if he failed to elect under "a" or "b," then without any action on his part he was placed under division "c" of section 60, and a...