McLaughlin v. Brotherhood of R. R. Trainmen
| Decision Date | 01 February 1950 |
| Docket Number | 16314. |
| Citation | 57 S.E.2d 411,216 S.C. 233 |
| Parties | McLAUGHLIN v. BROTHERHOOD OF RAILROAD TRAINMEN. |
| Court | South Carolina Supreme Court |
William H. Blackwell, Florence, for appellant.
McEachin & Townsend, Florence, Willcox, Hardee, Houck & Palmer Florence, for respondent.
This is an action to recover damages for alleged unlawful cancellation of an insurance certificate or policy issued to the plaintiff, B W. McLaughlin, by the defendant, Brotherhood of Railroad Trainmen, which has an insurance department incorporated under the laws of Ohio. The Court below held that the undisputed facts showed a wrongful cancellation and submitted to the jury only the question of damages. From the judgment entered on the verdict of the jury, the defendant has appealed. We shall refer to the parties as they appeared in the Court below.
The principal questions for determination are (1) whether the Court erred in refusing defendant's motion for a directed verict, and (2) the measure of damages in the event the plaintiff is entitled to recover.
Plaintiff commenced working for the Atlantic Coast Line Railway Company in 1920. He became a member of the Brotherhood of Railroad Trainmen in 1922. Under the constitution of this organization, any member in good standing may, if he so desires, apply to the insurance department for a certificate of insurance for which he is required to pay a monthly assessment. On plaintiff's application, a benefit certificate was issued to him in 1922 which remained in force until 1932, at which time it was exchanged for another certificate. The latter certificate remained in force until November 1, 1936, when it was surrendered and the certificate involved in this controversy issued. The first two certificates mentioned were surrendered because the assessments were insufficient to pay for the cost of the protection afforded. They are not involved on this appeal.
Under the terms of the certificate issued on November 1, 1936, the defendant agreed, in consideration of a monthly assessment of $12.51 to pay to the plaintiff on November 1, 1956, the sum of $3000.00, or if he died prior to that date, to pay said amount to his wife who was nameed beneficiary. In addition to the protection above mentioned, it was further provided that the amount therein stated should be paid to the insured in the event he became totally and permanently disabled through the loss of certain designated members of the body.
Section 6 of the special provisions and conditions of the certificate is as follows:
The constitution and general rules of the Brotherhood then in effect or those thereafter adopted were made a part of the above certificate. In this constitution there was a provision almost identical with that of Section 6 above quoted.
On July 15, 1946, plaintiff was expelled from the local lodge upon the ground that on May 18, 1946, he, as a flagman, accepted a call when the Brotherhood 'was not on a legal strike.' Plaintiff denied this charge and contended that the strike had been called off prior to his acceptance of the call. Thereafter during the latter part of July plaintiff tendered the assessment for August but the defendant refused to accept it. On August 14, 1946, the General Secretary & Treasurer of the Brotherhood wrote plaintiff as follows: 'Consistent with the termination of your membership, effective July 15th, 1946; we enclose check in your favor for $1,004.64, representing the Cash Surrender Value of your $3,000, Plan 5, Certificate No. 26926.'
On August 19th, plaintiff replied:
'I am in receipt of your letter of 14th instant enclosing check for cash surrender value of above mentioned policy.
On August 22nd, the General Secretary & Treasurer wrote plaintiff that since his membership in the Brotherhood had terminated as of July 15th, the insurance department was required to determine and pay to him his equity in the certificate. It was further stated in this letter that in the event plaintiff appealed and his appeal was sustained, the certificate would be reinstated upon plaintiff's returning the cash value of the policy. Thereafter, in accordance with the rules of the Brotherhood, plaintiff appealed to the President, A. F. Whitney, who on October 16, 1946, sustained the appeal and set aside the expulsion made by the local lodge. On October 25th, the plaintiff wrote to the General Secretary and Treasurer, calling attention to the fact that the President had ruled that his expulsion was unlawful and demanding a return of all premiums paid. The General Secretary and Treasurer replied on October 30th, stating that upon plaintiff's returning the check for the cash surrender value and paying all accrued dues, the policy would be continued in force. On November 4th, plaintiff again demanded a return of all premiums paid. About this time Mr. Whitney wired the plaintiff to disregard his letter sustaining the appeal, stating that the action of the local lodge in expelling the plaintiff was affirmed. Plaintiff thereafter appealed to the Board of Directors of the Brotherhood, which under the rules is the final appellate tribunal. That body on May 12, 1947, held that the local lodge erred in expelling plaintiff.
On June 4, 1947, plaintiff wrote the Secretary and Treasurer a letter in which he returned the check for the cash surrender value of the policy and again demanded the return of all premiums paid. On June 10th, the General Secretary and Treasurer replied, stating that the plaintiff was entitled to have his insurance continued in force upon the payment of the accrued premiums but that he was not entitled to the return of the premiums.
We agree with the Court below that there was a wrongful cancellation of plaintiff's policy. The provision in the certificate and constitution to the effect that when a member is expelled from the Brotherhood, his certificate becomes null and void and he is only entitled to receive the cash surrender value thereof, contemplates a lawful expulsion. It is true that plaintiff was expelled by the local lodge but it was finally determined that there was no foundation for the charge upon which he was expelled. When his appeal was sustained by the Board of Directors, his standing was the same as if he had never been expelled. Vivar v. Supreme Lodge of Knights of Pythias, 52 N.J.L. 455, 20 A. 36; Connelly v. Masonic Mutual Benefit Association, 58 Conn. 552, 20 A. 671, 9 L.R.A. 428, 18 Am.St.Rep. 296; Marck v. Supreme Lodge Knights of Honor, C.C., 29 F. 896.
In Baker v Modern Woodmen of America, 140 Mo.App. 619, 121 S.W. 794, 798, the certificate of insurance and by-laws of the defendant provided that the certificate should be void and all payment made thereon forfeited if the insured was 'convicted' of a felony. Subsequent to the issuance of the certificate the insured was found guilty of murder in the second degree, a felony, and a term of imprisonment in the penitentiary imposed. The insured appealed to the Supreme Court from the judgment of conviction and was granted bail during the pendency of said appeal. While it was pending, he died. The beneficiaries named in the certificate brought suit to recover the amount of the certificate. The defendant denied liability on the ground that all rights under the policy had been forfeited by the conviction of the insured. In upholding the right of the beneficiaries to recover, the Court said: 'Construing the language in the certificate of membership and...
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