State ex rel. Benefit Assn v. Cox

• Decision Date: 06 October 1928
• Docket Number: No. 28625.,28625.
• Citation: 9 S.W.2d 953
• Parties: THE STATE EX REL. SECURITY BENEFIT ASSOCIATION v. ARGUS COX ET AL., Judges of Springfield Court of Appeals.
• Court: Missouri Supreme Court

9 S.W.2d 953

THE STATE EX REL. SECURITY BENEFIT ASSOCIATION v. ARGUS COX ET AL., Judges of Springfield Court of Appeals.

No. 28625.

Supreme Court of Missouri. Division Two.

October 6, 1928.

Certiorari.

WRIT QUASHED.

A.W. Fulton, George R. Allen, Irwin & Bushman and Ward & Reeves for relator.

(1) From the state of facts set out in the opinion the court found relator had waived the by-laws. The opinion therefore holds that the relator, as a fraternal benefit association, waived its by-laws by permitting its members to pay during suspension. This is in direct conflict with the ruling of this court on the same identical question. Smith v. W.O.W., 179 Mo. 119. (2) The facts stated in the opinion show that the local financier permitted members for nineteen years to pay after the thirty days' grace period was up. The by-laws specifically permit that to be done. The opinion shows by one question asked and one answer given that Birdie A. Spencer was permitted to pay "out of time" when she was not in good health, and the local officer knew that fact, but did not impart it to the head office, and from this the court says that the plaintiff showed waiver. In other words, waiver could be shown by knowledge of the local officers or members of the local lodge. This is in direct conflict with the opinion of the Supreme Court. Allman v. Order, 277 Mo. 678. (3) The by-laws provided that a member had thirty days to pay without suspension, and then within the next sixty days he was suspended but could reinstate by paying his assessment "provided he was in good health;" and then provided that his paying the assessment was a warranty that he was in good health. The respondents' opinion permits a waiver upon knowledge of the local officers and does not require the knowledge to be that of the head office, and does not require it to be an intentional relinquishment of a known right by relator, nor require any facts showing an intention on the part of relator to waive, and this intention to be shown by clear and unequivocal facts. This is again in conflict with the Supreme Court's latest decision. Schwab v. American Yeomen, 305 Mo. 148. (4) The payment of the assessment during suspension was, under the by-laws, which are a part of the contract, a warranty that the party paying was in good health. The local officer had a right to rely upon this warranty in receiving assessments when the member was under suspension and could not set up her opinion against the warranty of the member that the member was in good health, and the respondents' opinion herein holding the relator waived the provision failed to follow the latest decision of the Supreme Court, holding that warranties are valid and binding against the members. Aloe v. Life Assn., 147 Mo. 575. (5) The "full faith and credit clause" of the Federal Constitution requires the courts of other states to give to the laws of the society the same interpretation as given by courts of the home state. Sec. 1, Art. 4, U.S. Constitution; Salter v. Security Ben. Assn., 120 Kan. 395; Pickens v. Security Ben. Assn., 117 Kan. 475; Supreme Council Royal Arcanum v. Green, 237 U.S. 531; M.W.A. v. Mixer, 267 U.S. 544; Hollingsworth v. Supreme Council (N.C.), 96 S.E. 81; Mooney v. B. of R.T. (Minn.), 204 N.W. 957; K. of P. v. Cooper (Tex.), 188 S.W. 943; Sov. Camp v. Wirtz, 254 S.W. 637, 268 S.W. 438; Hartford Life Ins. Co. v. Barber, 245 U.S. 146; Barber v. Ins. Co., 279 Mo. 316.

Von Mayes for respondents.

(1) Questions not discussed or ruled on by Court of Appeals will not be considered by the Supreme Court. State v. Daues, 297 S.W. 951. The Supreme Court will not consider whether the Court of Appeals erred in its application of the law to the facts, but whether the ruling is contrary to a ruling of law by the Supreme Court on like or similar facts. State v. Trimble, 290 S.W. 115. The Supreme Court will not determine whether the opinion is right or wrong, but only whether it conflicts with its own opinion. State v. Daues, 287 S.W. 606. (2) The act or knowledge of an agent performed or acquired by him within the scope of his employment is imputed to the principal. Right v. Grate, 229 S.W. 440. And this rule of law cannot be contracted away. Parsons v. Ins. Co., 132 Mo. 583; Sternaman v. Ins. Co., 170 N.Y. 13; Cobble v. Royal Neighbors, 236 S.W. 306. Of course this rule may be changed by statute. Sec. 6418, R.S. 1919, has changed this rule with reference to fraternal benefit associations. This section, however, does not apply to the head officers of such an association, as held in the opinion under review. (3) Notice of the acts or knowledge of a subordinate agent to the head officers of such association may be shown by proof of a custom on the part of the subordinate agent indulged in by such agent for a long period of time, or notice of a fact to the head officers will be presumed from proof that such fact has existed for a great length of time, where the evidence shows that, by proper attention to business, they would have been apprised of same. Johnson v. Modern Brotherhood, 109 Minn. 288; Supreme Lodge K.P. v. Kalinski, 163 U.S. 289; Maccabees v. Johnson (Tex.), 273 S.W. 614; McMahon v. Supreme Tent, 151 Mo. 522; Volpel v. Ins. Co., 183 S.W. 679; 17 C.J. 463, sec. 23. (4) Benevolent and fraternal organizations and life insurance companies re as subject to the law of estoppel and waiver as are individuals. Baker v. Assn. (Tex.), 280 S.W. 169; Edmonds v. Woodmen, 125 Mo. App. 214. (5) It is a fundamental principle of the law that forfeitures are not favored and that courts are always on the alert to take advantage of any circumstances that indicate an election to waive a forfeiture. 32 C.J. 1515; Ins. Co. v. Norton, 96 U.S. 234. (6) The law of the forum pertaining to the remedy, such as estoppel or waiver, must be applied to all contracts by the courts of this State. The case at bar turned solely upon the question of waiver. Scuder v. Bank, 91 U.S. 406; Thompson v. Ins. Co., 169 Mo. 12; Headley v. Ins. Co., 227 S.W. 921. (7) The acceptance of dues paid in time constitutes a waiver of default in the payment of past dues. Insured paid her last dues in time. 32 C.J. 1350, sec. 626. (8) Sec. 6418, R.S. 1919, has never been construed by this court. It is not applicable to superior officers of the society, for it refers only to subordinate officers. (9) Wilful ignorance is actual notice. It will not prevent waiver. 40 Cyc. 260, sec. 3, note 7; Supreme Lodge v. Kalinski, 163 U.S. 289.

HIGBEE, C.

Certiorari to quash the opinion and judgment of the Springfield Court of Appeals in Charles Spencer v. Security Benefit Association, 297 S.W. 989.

On May 11, 1925, in the Circuit Court of Pemiscot County, Charles Spencer sued the relator, a fraternal benefit association, domiciled in the State of Kansas and doing business in Missouri, on two benefit certificates issued to his wife, Birdie A. Spencer, by relator, in which certificates Charles Spencer was beneficiary, to recover $1000 on each of said certificates. The petition is in two counts and in the usual form. The answer averred that the certificates were forfeited for non-payment of dues. The by-laws of the relator and the facts relied on as constituting the suspension of the member were pleaded; that the insured failed to pay her dues on said certificates when they became due on November 1, 1924, or during that month, and was suspended on December 1, 1924; that she paid the dues for November and December, 1924, on December 30, 1924, at a time when she was not in good health, to the local financier who did not report Mrs. Spencer's ill-health to the relator's head office at Topeka, Kansas; that under the by-laws of the association such payment of her dues was a warranty that she was in good health at the time she paid said dues, and it was not the duty of the local officers to learn or report on the condition of her health; that said dues were remitted to the head office on January 8, 1925, and as soon as said office learned Mrs. Spencer was not in good health, the money so paid for her dues was returned to and refused by her.

The plaintiff in his reply pleaded that the local financier to whom said dues were paid had full knowledge of Mrs. Spencer's state of health on December 30, 1924, and relator retained said dues paid by Mrs. Spencer without objection or inquiry as to the state of her health for an unreasonable length of time, which led Mrs. Spencer to believe that payment in time was not essential.

Plaintiff recovered judgment in the trial court, which was affirmed on appeal by the Springfield Court of Appeals. After an unsuccessful motion for rehearing the relator sued out a writ of certiorari to quash the opinion and judgment of the Court of Appeals, as being in conflict with decisions of this court.

1. We quote from the opinion of the Court of Appeals:

"Wagner v. Security Benefit Association, 276 S.W. (Mo. App.) 81, is a case quite similar to the cause at bar and involved Section 114 of defendant's by-laws. In that case the defense was that the certificate had lapsed because the insured had failed to timely pay her assessment for March, 1921. The March assessment was paid to the local financier on April 7th, and it was contended that at that time the insured was not in good health. It was shown in the Wagner case that during the period insured was a member of defendant association she customarily paid her assessments out of time; that instead of paying them in the month when due she paid them up to as late as the 12th of the succeeding month. The local financier testified that there were about 1600 members of the council and that from 75 to 100 members customarily paid their dues after the end of the month in which the assessments were due. This custom was pleaded in the Wagner case as waiver on the part of defendant of its authority under its by-laws to forfeit the policy or certificate for failure to timely pay the March assessment....