Grand United Order of Eagles, E. B. S. T. v. Workman

• Decision Date: 21 June 1928
• Docket Number: 3 Div. 853
• Parties: GRAND UNITED ORDER OF EAGLES, E.B.S.T., etc., v. WORKMAN.
• Court: Alabama Supreme Court

117 So. 659

218 Ala. 37

GRAND UNITED ORDER OF EAGLES, E.B.S.T., etc., v. WORKMAN.

3 Div. 853

Supreme Court of Alabama

June 21, 1928

Appeal from Circuit Court, Montgomery County; Leon McCord, Judge.

Action on an oral contract of insurance by Ella Workman against the Grand United Order of Eagles, E.B.S.T., Christian Knights of Joseph, the Easter Knights of Canaan and Knights of Benjamin and Ladies Knights of Eagles of Alabama, J.B.S.T. From a judgment for plaintiff, defendant appeals. Transferred from Court of Appeals under Code 1923, § 7326. Reversed and remanded.

Rushton Crenshaw & Rushton, of Montgomery, for appellant.

John S Tilley and Hill, Hill, Whiting, Thomas & Rives, all of Montgomery, for appellee.

THOMAS J.

The complaint was in two counts substantially in Code form, and upon parol contract of insurance. The demurrer, that the complaint was vague and fails to set out the parol contract, was overruled. No assignment of error challenges that ruling. The counts are not vague and insufficient to support a judgment. The cause of action is stated; the parties, though not stated in the complaint, yet their respective relations are shown by the accompanying and attached summons. Roney v. Dothan Produce Co., 117 So. 422.

In order that we pass upon the ruling on the facts at a trial, before the Code of 1923, the same was required to be exhibited here by a bill of exceptions. Volume 3, Code, p. 275, § 6429 et seq.; Clark v. McCrary, 80 Ala. 110; Southern Express Co. v. Black, 54 Ala. 177; Kirby v. Vann, 51 Ala. 221; Kerley v. Vann, 52 Ala. 7. However, there are inserted in the Code of 1923 sections 6110 and 6095 (Williams v. State, 215 Ala. 586, 112 So. 193); held to authorize the parties by written agreement to substitute an abstract of the record for a complete transcript, thereby curtailing the cost of appeal, etc., and to make an agreed case.

Distinguished counsel have proceeded in this case, not by way of a bill of exceptions, but, under this statute, by way of an "agreed case certified" to this court for review after decision by the circuit court.

Counsel invoke the court to a decision of the question whether the Supreme Master of the defendant corporation may insure the life of a member by parol and without the issuance of a written policy. The question was adverted to in Royal Neighbors of Amer. v. Fortenberry, 214 Ala. 387, 389, 107 So. 846, where this court declared that in the absence of statutory provision forbidding a parol contract to insure, an agent, duly authorized to bind the company by the issuance and delivery of its said written contracts for insurance, may bind the company by a parol contract relating thereto. Reliance Life Ins. Co. v. Russell, 208 Ala. 559, 94 So. 748; Manhattan, etc., Co. v. Parker, 204 Ala. 313, 85 So. 298; Cherokee Life Ins. Co. v. Brannum, 203 Ala. 146, 82 So. 175. As to capacity or dealing with such contracts by mutual companies, see 1 Cooley's Briefs, pp. 391, 401, and the nature and requisites of oral contracts for insurance are considered in 6 Cooley's Briefs, p. 85 et seq.

In Home Ins. Co. v. Adler, 71 Ala. 516, Judge Stone declared that a valid contract of fire insurance may be made in parol, and an action may be maintained on an agreement to insure, if all the terms are agreed upon, and the breach consists in the failure to issue the policy. Police & Firemen's Ins. Co. v. Crabtree, 215 Ala. 36, 109 So. 156, held that demurrer to replication setting up waiver by an agent, was properly overruled in the absence of showing in the pleading that the insurer had provided that section 8477 of the Code should be the law of the association, or that the policy contained valid stipulations against waiver by a subordinate officer or member; and the Crabtree Case thus differed from Sovereign Camp v. Allen, 206 Ala. 41, 89 So. 58.

The date of the payment and agreement to insure is stated as being on February 21, 1927; that it was effective by the making of the "initial payment of 75 cents and of the payment thereafter of 60 cents premium per month"; that plaintiff was the beneficiary and that assured and the beneficiary had complied with all of the provisions of said contract on their parts; that the contract was the property of the plaintiff; and that assured died on March 17, 1927, within the first monthly period. And the averments of the contract declared upon in the first count as amended, if binding in law, show the same to be in effect at the time of assured's death.

The agreed statement of facts is as follows:

"The defendant in this cause is a fraternal benefit society, incorporated under the laws of Alabama, and E.H. Fields is the Supreme Master thereof. The society issues a beneficiary certificate, a copy of which is attached hereto as an exhibit.

"Section 6 of the revised constitution and by-laws of the defendant society provide:

" 'The Supreme Master shall preside over all meetings of the Supreme Lodge and shall be the executive officer of the society. He shall issue all charters for the installation of new lodges, all dispensations, appoint deputies and organizers and all appointive officers. He shall fix the compensation of all appointive officers, agents and servants and shall remove any such officer, agent or employee at his own discretion. He shall make reports of his actions to the Board of Trustees. He shall sign all certificates or his signature may be lithographed thereon and the Supreme Secretary shall attest the same under the corporate seal. He shall sign all written contracts in the manner thus prescribed.'

"In the early part of February, 1927, Fields organized a lodge of the society at Montgomery, which organization meeting L.D. Workman was invited to attend. He did not attend but his wife, Ella Workman, the plaintiff, was present at the lodge rooms. The next morning, Fields came to the plaintiff's house and invited the plaintiff's husband, L.D. Workman, to become a member of the defendant order. He agreed and paid Fields the sum of 75 cents, which was the proper amount for the initial premium and dues to April 1/27, for an insurance certificate of $750.00, and designated the plaintiff as the beneficiary of such insurance. The Supreme Master stated that the policy would be written up at once and that he was going back to rush the matter

up with a written policy, and further said that the plaintiff and her husband ought to feel very happy, for that now, if her husband died, she would get $750, and, if she died, her husband would get $750. No written policy was, however, delivered, although Fields came back to see Workman on several occasions. L.D. Workman died on March 17, 1927, of which the defendant had due notice, and the question presented upon this appeal is whether or not the defendant order is liable or can be made liable upon a parol contract of insurance so entered into." (Italics supplied.)

The evidence before us shows that the minds of the parties met upon the terms of the insurance contract and payment in full of the premiums due thereon to April 1, 1927, a period beyond assured's death, for the issuance of the beneficiary certificate like that "issued to Ella Workman" on same date of February 11, 1927. We find nothing in section 6 of the Revised Constitution, or in the laws of defendant order as shown by the agreement, or in the conditions on the back of the certificate exhibited and as issued to the wife as to be issued to the alleged assured, that would prevent the liability from attaching, or rather that relieved defendant from the effect of an estoppel raised by the conduct of its alter ego or vice principal to deny liability for the contract to insure, if it was within its corporate powers and purposes and for which plaintiff and husband had fully paid the required dues or premiums and which sums were retained by defendant. The general rule as to estoppels is stated in Ivy v. Hood, 202 Ala. 121, 79 So. 587, and need not be repeated.

We come now to consider the general law of the state as to fraternal benefit societies, and particularly sections 8449, 8459, 8464, 8477, 8489, 8503, and 8508 of the Code, invoked by appellant's counsel and insisted as denying the right of contract for parol agreement to insure.

Article 8 of volume 4, Code of 1923, p. 125 et seq., relates to fraternal benefit societies. Section 8439 touches the making of "provision for the payment of benefits in accordance with section 8443 of the Code," where it is required that societies transacting business under this article "shall provide for the payment of death" and other benefits for which contract is made, and the right to "accept a part of the periodical contributions in cash and charge the remainder, not exceeding one-half of the periodical contribution against the certificate with interest," etc. Section 8444 provides for the extended or paid-up protection granted. In section 8445 the beneficiaries are defined as wife, husband, relative by blood to the fourth degree, fathers and mothers-in-law, sons and daughters-in-law, stepfather, stepmother, stepchildren, or those by adoption, or persons dependent on the member. The qualifications for membership are prescribed in section 8446, as to the admittance to beneficial membership of any person not more than 60 years of age, who has been examined by a "legally qualified physician and whose examination has been supervised and approved in accordance with the laws of the society"; and nothing declared therein "shall prevent such society from accepting general or social members." The right of issue of certificates upon the lives of children upon examination and approval, in accordance with the by-laws of such...