Hill v. Business Men's Accident Ass'n

• Decision Date: 06 November 1916
• Citation: 189 S.W. 587
• Parties: HILL v. BUSINESS MEN'S ACCIDENT ASS'N.
• Court: Missouri Court of Appeals

189 S.W. 587

HILL v. BUSINESS MEN'S ACCIDENT ASS'N.

Kansas City Court of Appeals. Missouri.

November 6, 1916.

Appeal from Circuit Court, Macon County; Nat M. Shelton, Judge.

"Not to be officially published."

Action by Edward J. Hill against the Business Men's Accident Association. Judgment for plaintiff, and defendant appeals. Reversed and remanded.

Guthrie & Franklin, of Macon, and Gilmore & Brown, of Kansas City, for appellant. George N. Davis, of Macon, Waldo Edwards, of Bevier, and D. L. Dempsey, of Macon, for respondent.

ELLISON, P. J.

Plaintiff became a member of the defendant association, and secured from it an accident insurance policy providing for payment of a certain sum in case of death, and for an indemnity of $15 per week when in certain circumstances he should be injured by an accident. He hurt his leg between the knee and ankle by striking it against a chair, and was disabled for a time. Defendant declined to pay him any indemnity on grounds to be considered further on, and this action was brought resulting in a judgment for plaintiff.

Plaintiff was charged to have been afflicted with varicose veins in his leg at the time the policy was issued to him, and in his application he stated he was not, and he warranted his statements to be true. A warranty of this kind under our statute will not affect the assured's right in regular, or old line, insurance, though it be false, unless it was material to the risk. But if the insurance is what is known under our law, as on the assessment plan, such warranty, if false, will defeat the policy without regard to a question of its materiality. Hanford v. Ins. Co., 122 Mo. 58, 59, 26 S. W. 680; Aloe v. Ins. Co., 164 Mo. 675, 55 S. W. 993. So therefore it becomes of the first importance to determine whether the contract in question was general regular insurance, or insurance on the assessment plan.

Undoubtedly the company was chartered as an assessment company. But its charter or its holding out to the public does not alone determine the actual character of the insurance. For merely calling it insurance assessment does not make it so. The character of the insurance will be judged by the contract; Hanford v. Mass. Ben. Ass'n, 122 Mo. 50, 26 S. W. 680; Jacobs v. Omaha Life Ass'n, 146 Mo. 523, 48 S. W. 462.

This policy provides that the by-laws of the association shall be considered as agreed to by the assured and as forming a part of the contract, and they thus became a part of it. St. Louis v. Gas Co., 155 Mo. 1, 17, 55 S. W. 1003. These by-laws provided that:

"The revenue of the association shall be derived from membership fees, assessments to be paid by the members, the income of its investments, and otherwise."

And that:

"The board of directors shall levy assessments of not to exceed two and one-half dollars upon each member of this association. * * * The board of directors shall have power to reduce or pass any quarterly assessment or levy additional assessments in the same amount whenever required under the provisions of law."

It was further provided that the secretary of the association shall give written notice of every assessment to each member; and upon nonpayment the assured's membership and insurance shall terminate. It was further provided that:

"Each member shall be liable for all assessments during his membership, whether they be made for the...