Sovereign Camp Woodmen of the World v. Peaugh

• Decision Date: 17 October 1921
• Docket Number: 163
• Citation: 234 S.W. 161,150 Ark. 176
• Parties: SOVEREIGN CAMP WOODMEN OF THE WORLD v. PEAUGH
• Court: Arkansas Supreme Court

234 S.W. 161

150 Ark. 176

SOVEREIGN CAMP WOODMEN OF THE WORLD v. PEAUGH

No. 163

Supreme Court of Arkansas

October 17, 1921

Appeal from Clay Circuit Court, Western District; R. H. Dudley Judge; affirmed with modification.

Judgment affirmed.

T. E Helm, for appellant.

The insured failed to notify the sovereign clerk of the fact of his having entered the army, and also failed to pay the additional premium as required by the terms of his contract. The insured was charged with such notice, and the local clerk could not waive any of the conditions of the contract. 188 S.W. 941; 58 So. 100; L. R. A. 1915 E 152; 4 L. R. A. (N. S.) 421; 183 U.S. 308, note; 180 P. 2; 40 S.W. 553; 174 Mo.App 250; 186 Cal. 204; 69 N.E. 718; 141 S.W. 1055; 84 Conn. 356; 151 Mo. 552; 153 Wis. 225; 93 Kan. 485; 87 Minn. 417; 188 S.W. 941; 60 Col. 585; 42 Okla. 25; 181 N.W. 819; 230 S.W. 540.

The appellant has power to make by-laws fixing and regulating its own duties and that of its members. 71 Ala. 436; C. & M. Dig. §§ 6071, 6086, 6095. All parties are bound by the terms of the contract (71 Ark. 295), and relief can only be granted according to its terms (52 Ark. 201; 112 Ark. 171). It is not against public policy for an insurance company to exempt itself from death of insured while in military or naval service. 138 Ark. 442. This is true whether such service is voluntary or result of draft. 106 S.E. 32; 107 S.E. 177.

F. G. Taylor, for appellee.

Appellant is estopped by the acts and conduct of its local clerk. 79 Ark. 315; 142 Ark. 132; 144 Ark. 345. The fact that deceased had entered the army was communicated to appellant's clerk, who promised his mother to look after the matter of his assessments. The knowledge of the local clerk was the knowledge of the company. Sovereign Camp W. O. W. v. Key, 148 Ark. 562; Illinois Bankers' Life Assn. v. Dowdy, 149 Ark. 72. This has been the rule in this State since the decision in 52 Ark. at p. 11. Since the appellant failed to introduce the local clerk as a witness, it is presumed his testimony would be against the company. 32 Ark. 337.

OPINION

WOOD, J.

The appellee instituted this action against the appellant on a benefit certificate issued by the appellant on February 23, 1918, to the son of the appellee. The appellee was named as the beneficiary in the certificate, and in her complaint set up the certificate, and alleged that she had complied with all of the terms of the contract and was entitled to recover thereon the sum of $ 500. The appellant admitted that it had issued the certificate, but denied that the appellee was entitled to recover the sum of $ 500. It admitted that, under the contract, it was due the appellee the sum of $ 17.76, and offered to confess judgment for that amount. The essential facts are substantially as follows:

The appellant is a fraternal benefit society doing business in this State. Its constitution and by-laws are expressly made a part of the contract of insurance. The contract contained the following provision:

"In the event the holder of this certificate shall die while serving in any branch of the United States army or navy, either as an officer or enlisted man, outside of the boundaries of the United States of America, then the amount due under this certificate shall be such proportion of the amount thereof as the period he has lived since becoming a member bears to his expectancy of life at the time of becoming such member, determined by the National Fraternal Congress Table of Mortality; provided that, should the holder of this certificate so desire, he may, within thirty days after entering the service in any branch of the United States army or navy as an officer or enlisted man, notify the sovereign clerk at the home office of the society, Omaha, Nebraska, United States of America, that he has entered such service of the United States of America and pay in advance to the sovereign clerk, for the society, the sum of $ 37.50 per one thousand dollars insurance per annum in addition to the regular assessment prescribed by section 56 of the constitution and laws of the Sovereign Camp of the Woodmen of the World; and upon so doing at the death of the member, or as soon thereafter as possible, the amount prescribed in this certificate shall be paid to his beneficiary or beneficiaries."

Peaugh enlisted as a private in the United States army on April 13, 1918, and on October 26, 1918, he was killed while engaged in a battle in France. The insured did not pay the additional $ 37.50 to the sovereign clerk, and did not notify the sovereign clerk that he had enlisted in the United States army. Before leaving for France, Peaugh arranged with the cashier of the Bank of Success to pay all of his assessments as they were presented. He had on deposit with the bank more than $ 100. The cashier paid the dues for several months as they were presented by the clerk of the local camp, and would have paid the additional sum of $ 37.50 if it had been called to his notice that it was necessary to do so in order to keep Peaugh's policy alive. Appellee went to see the clerk of the local camp concerning the payment of her son's dues. The clerk told her that he was looking after the payment of the dues. He knew that her son had gone to the army.

The court, in effect, instructed the jury that if the insured had made arrangements with the cashier of the bank where he had sufficient money on deposit for the payment of his dues to pay these dues and had arranged with the clerk of the local camp to collect the dues from the bank, and the clerk of the local camp told the appellee that he was looking after the collection of the dues and premiums on the policy in her favor, and failed or neglected to collect...