People's Mutual Benefit Society v. Werner

• Decision Date: 10 May 1893
• Docket Number: 880
• Parties: PEOPLE'S MUTUAL BENEFIT SOCIETY v. WERNER, ADMINISTRATRIX
• Court: Indiana Appellate Court

34 N.E. 105

6 Ind.App. 614

PEOPLE'S MUTUAL BENEFIT SOCIETY v. WERNER, ADMINISTRATRIX

No. 880

Court of Appeals of Indiana

May 10, 1893

From the Elkhart Circuit Court.

Judgment affirmed.

J. H Baker, F. E. Baker, O. Z. Hubble and O. Conley, for appellant.

E. C Dodge, for appellee.

OPINION

REINHARD, C. J.

The appellee sued the appellant in the court below on a judgment recovered in the Circuit Court of Will county, Illinois, for $ 1,000 and costs. The court below sustained a demurrer to the special and sole answer of the appellant, and rendered judgment for the appellee for the full amount of her claim. The single question presented for our consideration is that of the sufficiency of the answer.

The appellant is a life insurance corporation organized under the laws of the State of Indiana, where it exists and carries on its corporate business of life insurance on the mutual or assessment plan. See act approved March 9, 1883 Elliott's Supp., section 970. The answer avers, among other things, that the judgment declared upon was recovered on an insurance policy or certificate which is copied into the answer at length. One of the printed conditions of said policy is as follows:

"11. That this society shall at no time, nor under any circumstances, make to exceed one assessment per month; and the losses of each alternate two months of each year (beginning with the first two months) shall be paid by the assessments of the following two months. (Losses of January and February, paid by the March and April assessments, and the March and April losses by the May and June assessments, etc.) But should the losses of any two months amount to more than 80 per cent. of the amount collected from the assessments of the two months following, then, and in every such case, the 80 per cent. of the amount so collected shall be divided pro rata among the beneficiaries of said two months' losses, and the amount so divided shall be received and accepted as full payment of the certificate or certificates held as aforesaid. Should one assessment be sufficient to pay two months' losses, then only one assessment shall be made during the two months. If two are required, two will be made--one each month, etc. All losses shall be classed and paid with the pool of the months in which the proofs of deaths are approved by the society, and in case this certificate becomes a claim, and is contested by the society, and a judgment is rendered in favor of the plaintiff, said judgment shall be placed in and paid pro rata with the pool then forming."

It is further alleged that the by-laws of said society, which had been adopted long before the appellee's intestate became a member, and remained in force at and after the time of his death, provided, among other things, as follows:

"Section 23. Each calendar year shall be divided into six parts designated as pools. Each pool consisting of two calendar months, beginning with January and February for the first pool; March and April for the second; May and June the third; July and August the fourth; September and October the fifth; and November and December the sixth.

"Section 24. The society shall at no time, or under any circumstances, make to exceed six assessments per year; and 80 per cent. of the entire amount collected from the assessment levied in January, and each pool thereafter, shall be placed in a burial fund and divided equally among the shares (i. e., claims for death loss), which mature and are approved during the pool next preceding the one in which the assessment is levied, and the amount so divided shall be considered as payment in full of the certificates terminated in said pool, and shall be so received by the beneficiaries named therein, or the legal holder thereof, who shall properly receipt the same in accordance therewith, and deliver them to the society at Elkhart, Indiana, upon the payment to them of said sum. If no shares mature during any pool, no assessment will be made during the next. All shares maturing shall be paid with the pool of the months in which the proofs of death maturing the same are approved by the society. In case any shares mature, the payment of which is contested by the society, and a judgment is rendered in favor of the plaintiff, said shares shall be placed in, and paid with, the pool then forming."

The answer avers that the claim upon which said judgment is founded was believed by said company to be fraudulent and unjust, and was rejected, and was for that reason not placed in the pool for March and April, 1889, out of which said claim would have been payable pro rata, if it had been approved. It is further stated that the appellee, upon said rejection of said claim, brought suit to recover the full amount of said policy in said court, and to establish the validity of said claim, and to liquidate and settle by the judgment of said court the amount at which said claim and judgment should be placed in the pool forming at the time said claim might become a judgment of said court; that the appellant contested the claim in said court, but that upon proper proceedings had it was adjudged to be valid, and the amount thereof, as provided in said policy or certificate was adjudged to be $ 1,000 and cost of suit taxed at $ 69.40, which is the judgment sued upon. It is averred that the company formed pools in compliance with its by-laws and the provisions of the policy, and placed said judgment in the pool forming when the judgment was rendered (November 26, 1890), that is to say, in the pool forming for the months of November and December, 1890, and that out of the pool thus formed, it made a pro rata distribution among all the claims placed in, and entitled to payment out of, the same, including appellee's judgment with interest and cost; that the amount of the appellee's pro rata share of said pool is $...