Laker v. Royal Fraternal Union

• Decision Date: 27 May 1902
• Parties: LAKER v. ROYAL FRATERNAL UNION.
• Court: Missouri Court of Appeals

75 S.W. 705

95 Mo. App. 353

LAKER v. ROYAL FRATERNAL UNION.

Court of Appeals at St. Louis, Missouri.

May 27, 1902.

FRATERNAL BENEFIT INSURANCE—CERTIFICATE —CONSTRUCTION—EXTENT OF LIABILITY.

1. A fraternal benefit society issued a certificate to a member, which provided that, on receipt of satisfactory proofs of death, $2,000 should be paid his wife; that the benefits accruing under the certificate should be payable on the annuity system—a specific sum quarterly until the full amount should be paid. In the application for insurance and in the certificate the member agreed that the constitution and by-laws should be a part of the certificate. By-law 108 provided for monthly assessments, and conferred authority to levy and collect such additional assessments as might be necessary to provide for the payment of accrued benefits and expenses. By-law 183 required the supreme executive committee to pass on and examine all claims for benefits, and to order their payment first from the benefit fund; then out of the reserve fund, if necessary; and then pro rata in case of the insufficiency of both funds. By-law 209 limited the liability of the society for a death benefit to "the amount of one assessment actually realized for the benefit fund from the membership in force * * * for the month in which the death occurs," and not exceeding the amount of the certificate. Held, that the beneficiary in the certificate was entitled to $2,000 on the death of the member, and not merely to the amount realized from one assessment, as provided in by-law 209.

Appeal from Circuit Court, Greene County; James T. Neville, Judge.

Action by Medora E. C. Laker against the Royal Fraternal Union. From a judgment for plaintiff, defendant appeals. Affirmed.

Vaughan & Coltrane, for appellant. Millard R. Powers and Carlos S. Hardy, for respondent.

BLAND, P. J.

The suit is to recover the fourth installment of $125, claimed to be due plaintiff as the beneficiary in the benefit certificate issued by the defendant to Frederick W. Laker. The contents of the certificate, material to this controversy, are as follows:

                              "Division Two
                           "Read Your Certificate
                             "Benefit Certificate
                    "Royal Fraternal Union of St. Louis, Mo
                                  "No. 3,712
                    "Assessment, $4.30.      Age, 53 years.
                                    "$2,000.
                   "Date, April 1, 1898.
                   "Member, Frederick W. Laker.
                   "Address, Springfield.
                   "State, Mo.
                   "National Council No One.
                

"When writing the home office with reference to this certificate, always give the number. In case of death or disability from accident or sickness, immediate notice must be given the home office.

                            "Division Two.
                   "Number 3,712.            Age, 53 years.
                

"The Royal Fraternal Union of St. Louis, Mo., hereby certifies that in reliance upon the representations, statements, and agreements contained in the application of Frederick W. Laker, of Springfield, Mo., a member of National Council No. one, of St. Louis, state of Missouri, by occupation a locomotive engineer, passenger train, he is accepted as a beneficiary member of this order, in Class D, under the conditions hereinafter specified, and that he is entitled to the following benefits, to be paid from the benefit or benefit reserve fund, as provided in the by-laws, during the time this certificate is maintained in continuous force and effect, viz.: * * *

"Fifth. To be paid to Mrs. Medora E. C. Laker (his wife), if surviving, otherwise to the legal representatives of the member, at the home office of said order, in the city of St. Louis, Missouri, upon the receipt of satisfactory proof of the death of the member, together with the surrender of this certificate, two thousand ($2,000.00) dollars.

"All benefits accruing under this certificate, except monthly, sick, and accident benefits, shall be payable on the annuity system, as follows: One hundred and twenty-five dollars shall be paid quarterly until the full amount of the benefit shall have been paid, provided that, should the death of the member occur after five years from the date hereof, then in such case the death benefit will be paid in one sum.

"Sixth. A written notice from the member or his representative, and a certificate from the attending physician, stating the time, place, and manner and nature of injury, sickness, or death, must be received at the home office of the order, in St. Louis, Missouri, within ten days of the date of injury, commencement of sickness, or within sixty days after the death of the member, as conditions precedent to recovery. No sick or accident benefits will be paid for any time prior to the date of mailing letter and said notice or attending physician's certificate. Monthly, sick, and accident benefits will not be paid in excess of twenty weeks during any membership year; neither will both sick and accident benefits be paid for the same period, or to the member on more than one certificate at the same time. All benefits for which the order is liable shall be payable only after satisfactory, direct, and affirmative proofs have been received by the order at its office in St. Louis, Missouri.

"Seventh. This certificate shall not take effect until after payment in cash of the certificate fee and one assessment, and delivery hereof to the member while he is alive and in good health, and shall continue in force only so long as all assessments are fully paid. It is issued in consideration of the payment of the certificate fee, and the further payment of one assessment of four and thirty-hundredths dollars, payable in advance, without notice, on or before the last week day of each month, at the home office of the order, in St. Louis, Missouri, or to the authorized local treasurer or collector—the first assessment to apply in payment for the month in which this certificate is issued—and is subject to the agreements and statements contained in the member's application, all of which we agree to be warranties, and the conditions and statements on the back hereof, and the constitution and by-laws of the order, now in force or hereafter enacted, all of which are made a part of this certificate.

"In testimony whereof, the Royal Fraternal Union has caused this certificate to be signed by its supreme president, supreme secretary, and certificate writer, and has hereunto attached its seal, at the city of St. Louis, state of Missouri, this first day of April, at 12 o'clock noon, A. D. eighteen hundred and ninety-eight. A. Price, Certificate Writer. John N. Dalby, Supreme President. F. H. Pickerell, Supreme Secretary."

"(3) Privileges and Requirements. While it is the custom and privilege of the order to pay just claims immediately on presentation of acceptable and proper proofs of the disability or death of a member, yet the order reserves the right, if it so desires, to take such a reasonable time as is necessary to properly investigate the merits of a claim. It is agreed that no claim shall be valid against the order unless final proofs thereof are received at the home office of the order, in St. Louis, Missouri, within six months from the date of the death of said member, or within one month from the date the disability ceases for which indemnity is claimed, and that three months shall be allowed, after the receipt of said proofs, for the investigation of said claim by the order, if it so desires, during which period no proceedings shall be commenced thereon against said order; and it is agreed that all claims against the order upon this certificate shall be deemed to be waived, and shall be invalid for any purpose, unless the matter shall be submitted to arbitration in the manner prescribed in the by-laws of this order within six months after receipt of final proof of the claim. No suit at law on this certificate shall be begun or maintained unless instituted within sixty days next succeeding the adjournment of the supreme council next following the decision of the arbitration committee. All claims for benefits on this certificate shall require affidavits of the claimant, attending physician, undertaker, and such others as are clearly necessary to establish the claim, and such affidavits shall be on the forms of blanks furnished by the order, and all questions thereon are required to be fully answered."

Defendant pleaded two special defenses: First, that the plaintiff's claim had not been submitted to arbitrators as provided for by the certificate, constitution, and by-laws of the defendant order; second, by-law No. 209, which reads as follows, to wit: "Sec. 209. The liability of this order as to the amount of death benefit due in any division shall not exceed the amount of one assessment actually realized for the benefit fund on the membership in force in such division for the month in which the death occurs, and not to exceed the amount named in the benefit certificate as being due, or proper claim thereunder, and is to be paid under the conditions specified in the benefit certificate"— which the answer alleges was in force when the benefit certificate was issued to F. W. Laker, and that it entered into and formed a part of the contract of insurance; that on March 23, 1898, said by-law was duly amended by the supreme trustees of the order, and, as amended, reads as follows: "Sec. 209 (amended). The liability of this order as realized for the benefit fund from the membership in such division for the month in which the death occurs, and not to exceed the amount named in the benefit certificate, and such sum shall be the full amount of the liability of this order, and it is to be paid under the conditions specified in the benefit certificate and these by-laws"— and "that said Frederick W. Laker, for himself and on behalf of his beneficiary, assented and agreed to its terms and conditions; that the amount of one assessment actually realized for the benefit fund from all the membership in force in division two for the...