Smail v. Court of Honor

• Decision Date: 01 March 1909
• Citation: 136 Mo. App. 434,117 S.W. 116
• Parties: SMAIL v. COURT OF HONOR.
• Court: Missouri Court of Appeals

117 S.W. 116

136 Mo. App. 434

SMAIL v. COURT OF HONOR.

Kansas City Court of Appeals. Missouri.

March 1, 1909.

Rehearing Denied March 29, 1909.

1. INSURANCE (§ 726) — BENEFICIAL INSURANCE — CERTIFICATES AS CONTRACTS OF INSURANCE.

Death benefit certificates are contracts of insurance, subject to the rules of construction and interpretation applicable to such contracts.

2. INSURANCE (§ 766) — BENEFICIAL INSURANCE — VESTED RIGHTS OF INSURED AND BENEFICIARY.

During the life of an insured member, his beneficiary has no vested right in the insurance; but he has a property right conferred by his certificate which cannot be destroyed or abridged without his consent clearly and unequivocally expressed.

3. INSURANCE (§ 719) — BENEFICIAL INSURANCE — AMOUNT PAYABLE IN CASE OF SUICIDE — EFFECT OF SUBSEQUENT AMENDMENT OF BY-LAW.

A death benefit certificate bound the insured to "strictly comply with the constitution, laws and rules thereof now in force, or to be hereafter enacted, amended or adopted," and the application agreed that laws subsequently enacted should become a part of the contract of indemnity and "govern all rights thereunder." Held, that the assured did not thereby consent that the society might impair or completely destroy his rights under the contract, but only that such rules and regulations might be adopted as were best suited, in the society's judgment, to effectuate and maintain his vested rights, and hence the certificate was not affected by a subsequent amendment of a by-law reducing the amount otherwise payable in case of suicide committed in delirium resulting from illness.

Appeal from Circuit Court, Jackson County; James H. Slover, Judge.

Suit by Emma A. Smail against the Court of Honor. From a judgment for plaintiff, defendant appeals. Affirmed.

W. B. Risse and John Sullivan, for appellant. James W. Garner and I. B. Kimbrell, for respondent.

JOHNSON, J.

Plaintiff, the beneficiary of a death benefit certificate issued by defendant, a fraternal beneficiary society, to Marion B. Smail, a member of the society, brought this suit after the death of Smail to recover $1,600, the amount claimed to be due under the terms of the certificate. In its answer defendant tendered $100 as the full amount of the indemnity recoverable by plaintiff and denied further liability under the contract. A jury was waived, the cause was tried on an agreed statement of facts, and plaintiff was given judgment for the amount demanded in her petition. Defendant appealed.

Defendant is a fraternal beneficiary society incorporated in Illinois and authorized to do business in this state. Smail became a member and received a death benefit certificate June 26, 1903. On the 17th day of September, 1904, while in good standing, he committed suicide "in delirium resulting from illness." The certificate provided for the payment of an indemnity of $2,000 at the death of the member to Emma A. Smail, "who bears relation to him of wife," subject to the following condition: "Provided, that if the death of the benefit member named herein occurs before the end of two years after the date of initiation, then in that event, this certificate, as provided in the constitution of the society, shall be a probational one, and the amount to be paid to the beneficiary or beneficiaries herein named shall be as follows: In the case of death within six months after initiation, $1,200; in case of death after six months, and before the end of one year, $1,400; in case of death after one year, and before the end of eighteen months, $1,600; in case of death after eighteen months, and before the end of two years, $1,800; and in case of death after two years, the full amount of the certificate; and that said benefit member shall be entitled to disability benefits as provided by the constitution and laws of the society." Smail died after he had been a member for more than one year and less than eighteen months. Hence the claim of plaintiff that she is entitled to receive indemnity of $1,600. Further, the certificate provides: "It is expressly agreed that the application for membership and medical examination upon which this certificate is issued, the constitution, laws and rules of the court of honor, and this certificate shall constitute the complete and only contract between said benefit member and the society; shall be binding upon the beneficiary or beneficiaries named herein,...