Pipkin v. Order of Railway Conductors of America
| Decision Date | 20 March 1933 |
| Docket Number | 9434. |
| Citation | 169 S.E. 26,176 Ga. 809 |
| Parties | PIPKIN v. ORDER OF RAILWAY CONDUCTORS OF AMERICA. |
| Court | Georgia Supreme Court |
Rehearing Denied April 15, 1933.
Syllabus by Editorial Staff.
Change in fraternal benefit society by-laws avoiding provision of certificate making holder thereof nonassessable after reaching 70 held not breach of contract.
Certificate provided that, in consideration of statements and warranties in application, a copy of which was attached to certificate and made a part of agreement, and the sum of $3, and the payment of $3 for each assessment that might be made in accordance with the laws governing the mutual benefit department, if any violation of any covenant, condition, or restriction of the certificate or of the constitution statutes, and laws of the order, "which are now in force or which may be adopted hereafter," should occur, then the certificate would become void. Application for the certificate contained an agreement that any certificate issued should be accepted upon the express condition that certificate would become void upon violation of any covenant condition, or restriction thereof, or of the constitution statutes, and laws of the order "which are now in force or which may be adopted hereafter."
Error from Superior Court, Fulton County; John D. Humphries, Judge.
Petition by C. M. Pipkin against the Order of Railway Conductors of America. General demurrer to the petition was sustained, case was dismissed, and plaintiff brings error.
Affirmed.
Change in fraternal benefit society by-laws avoiding provision of certificate making holder thereof nonassessable after reaching 70 held not breach of contract.
C. M. Pipkin filed a petition against Order of Railway Conductors, alleging that the defendant was engaged in the mutual fraternal benefit insurance business in the state of Georgia; that, as all its members were engaged in a common hazardous enterprise, it did not come within the jurisdiction of the insurance department of the state; that it did not have on deposit bonds or securities to guarantee the faithful performance of its insurance contracts; that it had outstanding in the United States obligations on insurance certificates of membership amounting to millions of dollars; that it had various investments in stocks and bonds and real properties in several states, including Georgia; that the market value of such properties at the time of filing of the petition was insufficient to pay off its obligations should death claims accrue in any considerable number; that on February 21, 1896, the defendant issued to petitioner a certificate of insurance of the face value of $3,000; that said certificate provided that, should the assured remain in life and keep said certificate fully paid up in assessments and the assured remain in good standing in the division of the order for a period of forty years, or until he should have reached the age of 70 years, the certificate should become fully paid up and be nonassessable for any purpose whatsoever; that the beneficiary to whom the certificate was made payable was dead; that on April 15, 1931, petitioner became 70 years of age; that he was advised by the defendant that he would not be required to make any further payments against said certificate; that thereafter he was advised by the defendant that "it was found impossible to continue granting relief from payment of assessments after age of 70 or after forty years membership," and that it would be necessary for petitioner to elect whether he would take a paid-up certificate at the rate of $250 of insurance for each thousand dollars of the original certificate or would continue to make payments of assessments on the certificate for $3,000; that the right of petitioner to be relieved of the payment of assessments on said certificate after reaching 70 had become vested, and could not be evaded or invalidated by any law, by-law, rule, regulation, or business policy which may have been adopted by the defendant after April 15, 1931; that as a matter of law any such attempt on the part of defendant constituted a breach of its contract of insurance; that the notice sent by defendant to petitioner to the effect that payment of assessments on the certificate would be required after he had reached 70 years constituted an admission on the part of the defendant of its insolvency and a breach of the contract, and put petitioner upon notice that the certificate would not be paid upon his death; that it was necessary for the protection of members of the order in like situation with petitioner that a receiver be appointed to take control of the properties of the defendant located in Georgia. Other prayers were for the recovery of all moneys paid by petitioner on account of said certificate, for accounting, and for general relief.
The certificate in question provided: "This is to certify that the Mutual Benefit Department of the Order of Railway Conductors of America, in consideration of the statements and warranties made in the application of Charles M. Pipkin for membership therein, a copy of which application is hereto attached and made a part of this agreement, and the sum of $3, the receipt of which is hereby acknowledged, and the payment of three dollars for each and every assessment that may be made in accordance with the laws governing the said Mutual Benefit Department *** if any violation of any covenant, condition, or restriction of this certificate or of the constitution, statutes, and laws of the said order governing the said Mutual Benefit Department, which are now in force or which may be adopted hereafter, which are hereby made a part of this contract witnessed by this certificate, shall occur, then this certificate shall become null and void, and the holder shall forfeit his membership," etc. The application for the certificate contained the following: "It is hereby covenanted, declared, and agreed, that *** any certificate which may be issued upon this application by said department shall be accepted upon the express condition that *** if any violation of any covenant, condition, or restriction of the said certificate, or of the constitution, statutes, and laws of the said Order, governing the said Department which are now in force or which may be adopted hereafter, shall occur, then the certificate shall be null and void," etc.
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