Home Mutual Benefit Association v. Rowland

• Decision Date: 06 November 1922
• Docket Number: 242
• Citation: 244 S.W. 719,155 Ark. 450
• Parties: HOME MUTUAL BENEFIT ASSOCIATION v. ROWLAND
• Court: Arkansas Supreme Court

244 S.W. 719

155 Ark. 450

HOME MUTUAL BENEFIT ASSOCIATION v. ROWLAND

No. 242

Supreme Court of Arkansas

November 6, 1922

Appeal from Hempstead Circuit Court; George R. Haynie, Judge reversed.

Judgment reversed.

Longstreth & Bohlinger, for appellant.

The court erred in refusing to permit the introduction, in evidence, of the certificates under the seal of the State Register of Vital Statistics. C. & M. Dig., § 5151. Where an agent of an insurance company, in collusion with an applicant, even though acting within the scope of his authority, perpetrates a fraud upon the company by making false and fraudulent representations upon which the insurance is obtained, such fraud will vititate the policy. 129 Ark 450. One wishing to become a member of a mutual benefit society is supposed to have made himself acquainted with the constitution and by-laws. 104 Ark. 536. Parties competent to contract may enter into such agreements as they see fit and it is the purpose of the law to carry out the agreements. 108 S.W. 206. The court erred in refusing to construe the contract. 112 Ark. 165; 125 S.W. 428; 169 S.W. 796.

Bush & Bush, for appellee.

OPINION

MCCULLOCH, C. J.

Appellant is a fraternal benefit society, organized under the laws of the State of Arkansas. It does business on what the attorneys in the case designate as the pro rata assessment plan, no surplus funds being accumulated, but the members are grouped together in "circles," according to age, and when a death occurs an assessment is levied on the members of the particular circle to which the deceased belonged.

The policy, or benefit certificate, as well as the by-laws, specify the maximum amount of the benefit to be the sum of $ 1,000, but the certificate refers to the by-laws, which provide that the association "shall not be liable for the full face value of the certificate unless full and prompt payment of all assessments shall have been made by all members of the group to which the deceased member belonged, and in no event shall said certificate have a greater value than the amount paid in by the whole membership of said group on the last assessment preceding the death of the insured, after deducting the cost of collecting said assessment."

Appellant accepted as a member Ellen S. Fox and issued a certificate of membership to her, dated July 18, 1916, payable to appellee, who was Mrs. Fox's granddaughter. Mrs. Fox died in July, 1920, and this action was instituted on February 23, 1921, to recover the full amount ($ 1,000) mentioned in the benefit certificate.

Appellant pleaded, among other things which are insisted on here as grounds for reversal, that Mrs. Fox misrepresented her age in the application which was made for membership in the society; that the by-laws did not authorize the issuance of a certificate to persons over sixty years of age, and that Mrs. Fox's age was above sixty at the time she joined.

The answer also contained a denial that the indebtedness amounted to $ 1,000, if anything at all.

The case was tried before a jury, and the trial resulted in a verdict and judgment in appellee's favor, for the maximum amount stated in the policy.

It appears from the undisputed evidence adduced in the case that the application of Mrs. Fox was solicited and accepted by J. W. Boyd, who was her son-in-law, and who was appellee's father. In the application Mrs. Fox's age was stated at fifty-nine, and there is proof to show that she was about ten years older than that. The testimony is, however, conflicting, and the jury might have found either way as to the question of her age being above sixty.

Mrs. Fox lived with her daughter, Mrs. Boyd, and there is testimony tending to show that she was an invalid at the time she made application for insurance in appellant society.

No testimony was introduced by either party as to what occurred between Boyd and Mrs. Fox at the time the application was made out, appellant contenting itself with attempting to prove that there was a misrepresentation as to Mrs. Fox's age and that Boyd, her...