Sovereign Camp, W. O. W. v. Muse

• Decision Date: 28 October 1935
• Docket Number: 31861
• Citation: 174 Miss. 533,163 So. 682
• Court: Mississippi Supreme Court
• Parties: SOVEREIGN CAMP, W. O. W., v. MUSE et al

163 So. 682

174 Miss. 533

SOVEREIGN CAMP, W. O. W., v. MUSE et al

No. 31861

Supreme Court of Mississippi

October 28, 1935

Division B

1 INSURANCE.

Local financial secretary of fraternal insurance society is without authority to waive default in payment of premiums by acceptance of premiums after default.

2 INSURANCE.

Acceptance of past-due premium after loss without knowledge of loss does not revive previously forfeited or suspended policy.

3 INSURANCE.

Waiver of default for failure to pay premium on benefit certificate must be by agent empowered to waive and before death, or, if after death, waiver must be with knowledge of death, which knowledge must be that of authorized agent.

4 INSURANCE.

Acceptance of past-due premiums on benefit certificate by principal office of fraternal insurance society without knowledge of previous death of insured held not waiver of provision of certificate that nonpayment of premiums, when due, would result in suspension of insured, rendering certificate void.

HON. THOS. H. JOHNSTON, Judge.

APPEAL from the circuit court of Prentiss county HON. THOS. H. JOHNSTON, Judge.

Action by Mrs. F. H. Muse and others against the Sovereign Camp, Woodmen of the World. Judgment for plaintiffs, and defendant appeals. Reversed and rendered.

Reversed and judgment here for appellant.

C. R. Bolton, of Tupelo, for appellant.

Not only was the member actually suspended by the financial secretary, but under the terms of the beneficiary certificate and of the constitution laws and by-laws, nonpayment worked automatic suspension.

Failure of a member of fraternal benefit order to pay monthly dues works automatic suspension where constitution laws and by-laws made part of contract so provided.

Sovereign Camp, W. O. W., v. Cox, 127 So. 847; Brotherhood of Railroad Trainmen v. Bridges, 144 So. 554.

Under the terms of the certificate held by Mr. Muse and the facts as clearly disclosed in this record, Mr. Muse was unquestionably and actually suspended after his failure to pay the assessment due for July on or before the last day of the month and his certificate became of no effect.

The proof introduced in this effort was to the effect that the financial secretary permitted the members of the Booneville camp to pay their assessments after the last day of the month and any time up to the time he sent to the Sovereign Camp his report for the previous month's collection, and reported such collections as regularly made and without any information to the Sovereign Camp that such collections were made after the last day of the previous month.

It was held by this court in the case of Sovereign Camp, W. O. W., v. Hynde, 99 So. 259, that such action or custom on the part of the local camp or the clerk thereof (officer now named financial secretary) was not binding upon the Sovereign Camp, Woodmen of the World and did not waive the provisions of the certificate and constitution laws and by-laws.

Section 109 (g), Constitution Laws and By-laws of the Society; Section 5249, Code of 1930; Sovereign Camp, W. O. W., v. Valentine, 155 So. 194, 165 Miss. 707.

Every material provision with reference to reinstatement was wanting in this attempt. Mr. Muse was not in good health at the time, was never in good health thereafter, and died before the thirty day period elapsed, and there can be no sound reason given for the reinstatement becoming effective.

There could have been no waiver on the part of the secretary of the association from the receipt of the dues, because the record shows indisputably that the dues were not sent by Mr. Rees, the local financial secretary, until September 15th, which was five days after Mr. Muse was dead.

C. L. Sumners, of Corinth, for appellees.

The acceptance of a premium after the time when it should have been paid is a waiver of forfeiture.

Sovereign Camp, W. O. W., v. Rhynek, 171 Miss. 687, 158 So. 472; Wilson v. Sovereign Camp, W. O. W., 154 So. 28, 179 La. 372.

The financial secretary of a fraternal or mutual insurance association, appointed by the association, and delivering policies and collecting and remitting premiums and assessments, is an officer of the association and its agent, and not an officer of the local camp.

The financial secretary is the agent of appellant under the definition of an insurance agent under section 5196 of the Mississippi Code of 1930.

If there were any forfeiture under the policy of F. H. Muse by reason of his failure to pay a premium by a certain date, the same was waived not only through the financial secretary, but directly by the home office.

AEtna Ins. Co. v. Lester, 170 Miss. 353, 154 So. 706; Insurance Co. v. Gibson, 72 Miss. 58, 17 So. 13; Guaranty & Accident Co. v. Railroad Co., 97 Miss. 165, 52 So. 787.

The burden of proof is on the insurer to show a forfeiture under the policy contract.

Grangers' Life Ins. Co. v. Brown, 57 Miss. 308, 34 Am. Rep. 446; American Ins. Co. v. Crawford, 110 Miss. 493, 70 So. 579; Davis v. Gulf States, 168 Miss. 161, 151 So. 167; Jefferson Standard Life v. Jeffcoats, 164 Miss. 659, 143 So. 842.

We contend that, leaving out all questions of waivers, the appellant not only failed to prove a forfeiture, but by the terms of its own constitution and by-laws that Fred H. Muse was never delinquent, and that if he had not paid the last two assessments he would still be in good standing and never suspended.

Sections 5234 and 5249 of the Code of 1930, are in violation of section 1, section 87, section 90 (s) and section 144 of the Constitution of 1890, and are unconstitutional.

27 R. C. L. 912, sec. 7; Planters Bank v. Black, 11 S. & M. 43; 6 R. C. L. 160, sec. 160; Quintini v. Board of Aldermen, etc., 64 Miss. 483, 1 So. 625; City of Jackson v. Deposit Guaranty Bank & Trust Co., 160 Miss. 752, 133 So. 195.

E. C. Sharp, of Booneville, for appellees.

We think this case is controlled by the case of Sovereign Camp, Woodmen of the World v. Rhyne, 158 So. 472. The policy in the Rhyne case was issued by the same association as the one in the present case and is practically, if not identically, the same.

When a party relies upon a time provision in a contract as being of the essence of that contract, it is no more than just that when he thus calls for strictness in adjudication he should show that he has been as definite and certain in his contract stipulations in respect to the time relied on as he is in the strictness to which he seeks to hold the other party in relation thereto.

Love Petroleum Co. v. Atlantic Oil, 169 Miss. 259, 152 So. 829, 153 So. 389.

If the order seeks to avoid its liability by requiring of its members technical exactness in the payment of their dues, this court will exact of it technical exactness in its moral duty towards its membership, to the end that none may be misled.

Morgan v. Independent Order, etc., 90 Miss. 864, 44 So. 791.

The settled rule in this state is that the acceptance of a premium after the time when it should have been paid is a waiver of forfeiture which might have been enforced because it was not paid when due.

Continental Life Ins. Co. v. Clanton, 149 Miss. 289, 115 So. 569; Section 5196, Code of 1930.

It is shown by the record that Rees collected and remitted the premiums for all holders of certificates issued by this company in his community and delivered the policies forwarded to him by the home office, whether the parties to whom they were issued were members of the association or not.

Being the agent of the association it cannot now escape liability by attempting to deny the authority of the agent, and is estopped by the knowledge of Rees.

Germania Life Ins. Co. v. Bladin, 100 Miss. 660, 56 So. 609; Big Creek Drug Co. v. Stuyvesant Ins. Co., 115 Miss. 333, 75 So. 768; Agricultural Ins. Co. v. Anderson, 120 Miss. 278, 82 So. 146; Mutual Life Ins. Co. v. Vaughn, 125 Miss. 369, 88 So. 11; New York Life Ins. Co. v. Smith, 129 Miss. 544, 91 So. 456; Hartford Fire Ins. Co. v. Clarke, 154 Miss. 418, 122 So. 551.

The great supervening principles in the light of which they are to be construed, that as against forfeiture strict construction must be had, so, as to prevent a forfeiture if reasonably possible, and that in dealing with these benevolent orders liberal construction in favor of the insured is to be indulged applied here, satisfy us that appellee is liable.

Murphy v. Independent Order, 77 Miss. 830; Supreme Lodge Knights of Pythias v. Withers, 177 U.S. 260; Morgan v. Independent Order, 90 Miss. 864, 44 So. 791; Hartford Life & Annuity Ins. Co. v. Unsell, 144 U.S. 439, 12 S.Ct. 671, 36 L.Ed. 496; Phoenix Life Ins. Co. v. Doster, 166 U.S. 30, 27 L.Ed. 65.

The financial secretary having called upon him monthly for seventeen years for the collection of his premium, and the premium having almost invariably been sent in late to the company, the insured and his loved...