Stout v. Independent Order of Foresters

• Decision Date: 17 February 1941
• Docket Number: No. 19616.,19616.
• Citation: 148 S.W.2d 137
• Parties: STOUT et al. v. INDEPENDENT ORDER OF FORESTERS.
• Court: Missouri Court of Appeals

148 S.W.2d 137

STOUT et al. v. INDEPENDENT ORDER OF FORESTERS.

No. 19616.

Kansas City Court of Appeals. Missouri.

February 17, 1941.

Appeal from Circuit Court, Jackson County; Paul A. Buzard, Judge.

Action on certificate of life insurance by Marie H. Stout, formerly Marie H. Clevidence, and others, against the Independent Order of Foresters. From an order sustaining plaintiff's motion for new trial after verdict and judgment for defendant, the defendant appeals.

Order reversed with directions.

E. D. Perry, of Des Moines, Iowa, Patterson, Chastain & Smith, of Kansas City, and Norman Sommerville, of Toronto, Canada, for appellant.

Goodwin Creason, of Kansas City, for respondents.

CAVE, Judge.

This suit is based on a certificate of life insurance in the sum of $2,000 issued by the defendant to Howard Clevidence, in December, 1932, and in which plaintiffs are the beneficiaries. The insured died August 8, 1934. The defendant, when informed of the death of insured, denied liability. Thereupon, this suit was brought. There is no dispute about the issuance of the certificate or the death of the insured or that the plaintiffs herein are the beneficiaries named in such certificate.

Trial to a jury resulted in a verdict and judgment for the defendant. The plaintiff filed motion for new trial, and the motion was sustained on the ground that the court erred in refusing to give plaintiff's instruction No. 2 and in giving defendant's instructions numbered 3, 5, 6, and 8. From the order sustaining the motion for new trial, the defendant has appealed.

If it was proper for the court to sustain the motion on any ground assigned therein, then the ruling must be sustained. Cole v. St. Louis, San Francisco Railway Company, 332 Mo. 999, 61 S.W.2d 344, 89 A.L.R. 373.

This same case was once tried and appealed to this court and the opinion in that case is reported in 115 S.W.2d 32, but when the case was retried, the pleadings were amended and the issues on this appeal are somewhat different from the issues in the above reported case.

Defendant is a fraternal beneficiary association, organized under the statutes of the Parliament of Canada, and is authorized to do business in this state as such an association. It will hereafter be referred to as "I. O. F."

The record discloses that one Howard E. Clevidence in 1906 became a member of a fraternal benefit association known as the "Modern Brotherhood of America" (which will hereafter be referred to as the "M. B. A."), and that association issued to him in 1906 a contract of insurance in the sum of $2,000. That contract, or certificate, required the payment of $1.35 per month as dues or premiums. In 1931, the M. B. A. was in financial difficulties and because thereof it entered into a merger contract with the I. O. F. as of November, 1931, and one of the results of that merger agreement was that all of the assets of the M. B. A. were transferred to the I. O. F., which association assumed all the obligations of the M. B. A. Whether the insured was a party to and bound by the merger agreement is beside the question here, because he elected so to be by accepting the new certificate. Spears v. I. O. F., Mo. App., 107 S.W.2d 126, loc.cit. 130. The particular part of the merger agreement which is pertinent to this suit is Section 7. It is pleaded in plaintiffs' petition and they are asserting rights thereunder, and the defendant does likewise; it is as follows:

"Seventh. There shall be set aside for the benefit and to the credit of the benefit certificates held by members of said Modern Brotherhood of America, except those members who transferred under the provisions of Sections 127 and 127-A of its by-laws 1911 — they having been permitted to transfer at a rate for an age from two to five years less than their actual ages, respectively, at date of transfer, with maximum rate not greater than that for age forty-eight years — the net level premium reserve required on such certificates, calculated on the same basis of mortality and rate of interest as now used by said The Independent Order of Foresters in calculating reserves on its own certificates; Provided, however, that there shall also be set aside the reserve — same to be arrived at on the same basis of mortality and interest — necessary to pay the installments of old age disability benefits on Death and Old Age Certificates held by members of said Modern Brotherhood of America, who transferred under said by-laws 1911 aforesaid, and which old age disability benefits shall have matured, in whole or in part, or been paid in part, at the date this agreement becomes effective, and the reserve necessary to pay the cash surrender value claims then due on Whole Life Certificates held by members who transferred as aforesaid, all without change in the rates of contribution now being paid by the holders of such certificates. There shall also be set aside the reserve required on the Paid Up and Extended Protection Certificates held by those who have elected to take their withdrawal equities in such form. After setting aside the reserves above required, all assets then remaining in the reserve, surplus and benefit funds of said Modern Brotherhood of America shall be set aside for the benefit and be apportioned to the credit of the certificates held by those members of said Modern Brotherhood of America who transferred under the provisions of said Sections 127 and 127-A of its bylaws 1911, and if said remainder of said assets does not equal the reserve required on said certificates, calculated on the basis above mentioned, then such members will be offered, and required to accept, new certificates at rates of assessment which will provide said reserve so required; Provided, that there will be first set aside out of the assets so apportioned to the credit of said members of said Modern Brotherhood of America who transferred under the provisions of said Sections 127 and 127-A of its by-laws 1911, an amount sufficient to pay the first twelve monthly assessments to be required of said members by said The Independent Order of Foresters for new certificates of the same amounts as the benefit certificates now held by them in said Modern Brotherhood of America; Provided, also, that any of said members desiring so to do may contribute on their first twelve monthly assessments at the rate they are now paying on their present certificates, in which event the members so contributing will be given a credit on their second year's payments for the amount so contributed. Should a member so contributing die before having received credit for the amount so contributed on said first twelve monthly assessments, said amount will be refunded to his or her beneficiary. Provided, Further, that in determining the rate of assessment which said members shall be required to pay on their new certificates due allowance shall be made said members of said Modern Brotherhood of America, and due credit shall be given them, for all the assets so set aside and apportioned to their present certificates, respectively. Provided, Also, that none of the funds contributed by said members of said Modern Brotherhood of America who transferred under said Sections 127 and 127-A of its by-laws 1911 as aforesaid shall be used for the benefit or apportioned to the credit of the benefit certificates held by any other class of members of said Modern Brotherhood of America. Said required reserves above mentioned shall be calculated and determined as of December 31, 1931. All other benefit members of said Modern Brotherhood of America shall be permitted to become and remain members of said The Independent Order of Foresters and entitled to have and enjoy all of the benefits, privileges and advantages of the benefit certificates now held by them, respectively, on the payment by them of the rates which they are now paying said Modern Brotherhood of America."

After the execution of the merger agreement by M.B.A. and I.O.F., and the approval of the same by the insurance commissioner of the State of Iowa (where M.B.A. was organized and had its office), and the proper authorities of Canada (where I.O.F. was organized and had its office), the insured made application to the defendant for a certificate of life insurance, and on December 1, 1932, the defendant issued to the insured the certificate sued on. This application was attached to and became a part of the certificate. The application recited that the insured was the holder of a benefit certificate issued to him by the M.B.A., and that on behalf of himself, and all persons having any interest in said certificate, he renounced and surrendered such certificate, and that he made application to the defendant for a benefit certificate to be issued by it for $2,000 life insurance.

Such provisions of the application and certificate as are pertinent will be referred to in the opinion.

On Motion to Dismiss

At the outset, we are confronted with a motion filed by the plaintiffs to dismiss the appeal for various reasons, alleging that defendant's brief does not comply with Section 1060, R.S.Mo.1929, Mo.St. Ann. § 1060, p. 1341, and Rules 16 and 17 of this court.

First, because the statement discusses too much in detail and quotes from the pleadings in the case; also, a discussion of the instructions are included in the statement, and that there are many conclusions and arguments therein. The statement does discuss the pleadings and quotes therefrom entirely too much, and there is no need for discussion of the instructions in the statement; but this case has twice been tried and appealed to this court on a prior occasion, and the rights of the litigants must be considered in determining whether we should strictly enforce the rules of the court on matters of this kind. We will treat the rather extended discussion of the pleadings and quotations therefrom, as well as instructions, as surpluses, because from the balance of the statement, we can...