Lee Et Ux v. Mut. Reserve Fund Life Ass'n

• Decision Date: 15 June 1899
• Citation: 97 Va. 160,33 S.E. 556
• Court: Virginia Supreme Court
• Parties: LEE et ux. v. MUTUAL RESERVE FUND LIFE ASS'N.

33 S.E. 556

97 Va. 160

LEE et ux.

v.MUTUAL RESERVE FUND LIFE ASS'N.

Supreme Court of Appeals of Virginia.

June 15, 1899.

PARTIES—MISJOINDER—ABATEMENT — INSURANCE—REPUDIATION OF POLICY-PREMATURE ACTION.

1. In Act Feb. 27, 1894 (Acts 1893-94, p. 489), amended by Act Feb. 2G, 1896 (Acts 1895-96, p. 453, c. 423), providing that in case of misjoinder of parties, the court "may" order the action to abate as to the party improperly joined, and proceed against the others, the word "may" means "shall, " and hence misjoinder of defendants is not ground of demurrer to the declaration.

2. A notice by a mutual insurance company that it will declare a policy forfeited if a certain assessment, alleged by insured to be illegal, is not paid by a certain time, is not an absolute repudiation of the contract, authorizing insured to sue on his policy, especially as, when insured sued, the time had elapsed, and the policy had not been forfeited.

3. An attempt by the company to coerce out of the assessment class all the young and good risks, thus leaving the burdens of the assessment class to fall on those least able to bear them, is not such an absolute repudiation of the policy as will authorize an action by the insured.

4. Fraudulent misappropriation by the officers of the company of large sums belonging to it as trustee of its members, and making assessments in bad faith, and not to meet expenses, but to compel policy holders above 60 to abandon their policies, and forfeit all payments made, is not such an absolute repudiation of the policy as will justify an action by the insured.

5. An action will not lie for anticipatory breach of a policy before death of an insured under Code 1887, § 3251, as amended by Act March 3, 1896, to simplify pleadings in actions on insurance policies, and requiring the complaint to set forth the loss or death relied on as grounds of recovery.

Error to law and equity court of city of Richmond.

Action by A. S. Lee and Mary E. Lee against the Mutual Reserve Fund Life Association. There was a judgment for defendant, and plaintiffs bring error. Affirmed.

W. L. Royall, for plaintiffs in error.

Chas. S. Stringfellow and L. L. Lewis, for defendant in error.

BUCHANAN, J. This is a writ of error to a judgment of the law and equity court of the city of Richmond, sustaining a demurrer to the plaintiff's declaration or complaint, and dismissing the case.

One of the grounds of demurrer relied on is that the female plaintiff had no cause of action, her right in the policy sued on being merely a contingent, and not a vested, right, and there was, therefore, a misjoinder of parties.

If it be true, as contended, that Mrs. Lee had no cause of action, and was improperly joined with her husband, it was no ground for sustaining the demurrer to the declaration and dismissing the case. Misjoinder of parties is no longer a fatal defect.

By the express terms of the act of assembly approved February 27, 1894 (Acts 1893-94, p. 489), as amended and re-enacted by the act approved February 26, 1896 (Acts 1895-96, p. 453, c. 423), it is provided that "whenever it shall appear in any action at law or suit in equity, heretofore or hereafter instituted, by the pleadings or otherwise, that there has been a misjoinder of parties, plaintiff or defendant, the court may order the action or suit, to abate as to any party improperly joined and to proceed by or against the others as if such misjoinder had not been made." The word "may" in a statute of this kind which is in furtherance of justice means the same as "shall." Potter's Dwar. St. p. 220.

Another ground of demurrer is that the action was brought for an anticipatory breach or renunciation of the contract, and that the declaration does not aver, as is required in such cases, a distinct, unequivocal, and absolute refusal to perform the contract on the part of the defendant.

This proceeding is based upon or grows out of an alleged violation of the provisions of a certificate of membership or policy of insurance issued to A. S. Lee, one of the plaintiffs, by the defendant which is a mutual beneficial assessment company chartered under the laws of the state of New York. The certificate or policy provides, among other things, in consideration of certain things done and to be done by A. S. Lee, one of the plaintiffs, that within 90 days after the receipt of satisfactory evidence to the defendant association of the death of the said Lee during the continuance of the certificate of membership there shall be pay able to Mary E. Lee (his wife), if then living, or, if she is then dead, to the heirs or legal representatives of said member, the sum of $5,000 from the death fund of the association at the time of his death, or from any moneys that shall be realized to that fund from the next assessment made by the association upon its members. A. S. Lee is still living, so that by the terms of the certificate or policy no cause of action upon it has yet accrued. But the plaintiffs claim that, notwithstanding this fact, they can maintain this action, because the association has renounced and repudiated the contract, and given notice that it will no longer be bound by it.

In England and in a number of the states of this country, including Virginia, it has been held that where there has been a total refusal on the part of one of the contracting parties to perform the contract on his part the other may elect to sue at once without waiting for the time of performance to arrive. James v. Kibler's Adm'r, 94 Va. 165, 26 S. E. 417; Hochster v. De...