A. O. U. W. v. Mooney

• Decision Date: 03 January 1911
• Parties: Ancient Order of United Workmen, Appellant, <I>v.</I> Mooney
• Court: Pennsylvania Supreme Court

230 Pa. 16

Ancient Order of United Workmen, Appellant,

v. Mooney

Supreme Court of Pennsylvania.

October 20, 1910.

January 3, 1911.

Argued Oct. 20, 1910.

Appeal, Nos. 65 and 120, by

plaintiff and defendant, from judgments of C. P. No. 4, Allegheny Co., Third Term, 1907, No. 583, on verdict for plaintiff in case of The Grand Lodge of the Jurisdiction of Pennsylvania, Ancient Order of United Workmen v. Anna Mooney, Executrix of Ellen Mooney, deceased.

Before FELL, C. J., MESTREZAT, POTTER, ELKIN and STEWART, JJ. Reversed.

Ward Bonsall, with him Charles A. Poth, for Anna Mooney, appellant.—After an absence of seven years, unheard of, the insured will be presumed to be dead, and if premiums have been paid during that time, the insurance company must pay the policy: Hancock v. American Life Ins. Co., 62 Mo. 26; John Hancock Mutual Life Ins. Co. v. Moore, 34 Mich. 41; Mutual Benefit Life Ins. Co. v. Martin, 108 Ky. 11; Esterly's App., 109 Pa. 222.

Doing what one is legally bound to do cannot be a consideration to support a promise: Swaggard v. Hancock, 25 Mo. App. 596; Wimer v. Worth Township Poor Overseers, 104 Pa. 317; Robb v. Mann, 11 Pa. 300; Cleaver v. Lenhart, 182 Pa. 285; Mays v. Patterson, 20 Pa. Superior Ct. 92.

In this suit or in any suit by the plaintiff association against the defendant for the purpose of recovering the money paid to Ellen Mooney, whether a suit on the bond or not, the defendant has the right to interpose any equitable rights which she may possess in the matter, because equitable defenses are allowed in Pennsylvania: Light v. Stoever, 12 S. & R. 431; Price v. Lewis, 17 Pa. 51; Waln v. Smith, 1 Phila. 362; Blessing v. Miller, 102 Pa. 45; Murray v. Williamson, 3 Binney, 135; Heck v. Shener, 4 S. & R. 249; Gaw v. Wolcott, 10 Pa. 43; Patterson v. Hulings, 10 Pa. 506; Eckel v. Murphey, 15 Pa. 488; Weimer v. Clement, 37 Pa. 147; Pownall v. Bair, 78 Pa. 403; Kerr v. Culver, 209 Pa. 14.

When Ellen Mooney accepted the money, surrendered the benefit certificate to the plaintiff association, and signed the bond sued upon in this case, the whole transaction was done under a mistake of fact mutual to both parties, namely, that John Mooney was dead.

A mutual mistake of fact is grounds for the rescission of an agreement in a court of equity, and for a reinstatement of the policy: Riegel v. American Life Ins. Co., 140 Pa. 193; Riegel v. American Life Ins. Co., 153 Pa. 134.

R. A. Balph, with him James Balph, for Ancient Order of United Workmen.—The bond had a valid and sufficient consideration: Presbyterian Board of Foreign Missions v. Smith, 209 Pa. 361; Young v. Snyder, 3 Grant, 151.

The mistake of fact on which a contract is founded necessary to render it void, must be a mutual mistake: Fink v. Smith, 170 Pa. 124; Perkins v. Gay, 3 S. & R. 327; Kowalke v. Ry., etc., Co., 103 Wis. 472 (79 N. W. Repr. 762); Krumrine v. Grenoble, 165 Pa. 98.

OPINION BY MR. JUSTICE POTTER, January 3, 1911:

John Mooney was a member of the Ancient Order of United Workmen, a beneficial society, and as such he held a benefit certificate in the sum of $2,000 payable at his death to his wife, Ellen Mooney. He disappeared and was not heard from for more than seven years, and the presumption of his death therefore arose. The wife demanded payment of the benefit certificate, and the plaintiff society made payment, but at the same time took from Ellen Mooney a bond to insure the return of the $2,000 so paid, in case it should be found that the said John Mooney was alive; and to indemnify and save harmless the plaintiff by reason of the said payment. Ellen Mooney received the payment and gave the bond in 1902, and died in 1905. In April, 1906, his children learned that John Mooney was alive, and in the following month he returned to Pittsburg, where he died soon afterwards. The beneficial society then brought this suit to recover upon the bond given by Ellen Mooney. Upon the trial the court below refused to charge as requested by counsel for defendant, that the bond was without consideration. He also refused the instruction requested in behalf of plaintiff, that it was entitled to the full amount of the money paid to Mrs. Mooney, with interest thereon. The jury were then instructed that the right of plaintiff to recover was limited to the amount of the assessments on the benefit certificate up to the time of John Mooney's death, with interest thereon; to interest upon the sum of $2,000 paid to Ellen Mooney, from the time of such payment to the date of John Mooney's death; and to interest on these sums from the date of John Mooney's death to the date of the trial. In accordance with these instructions, the jury rendered a verdict in favor of plaintiff for $1,011.81. From the judgment entered thereon, both parties have appealed, and the appeals have been argued together. The questions raised are, whether any recovery can be had upon the bond, and if so, what amount. We cannot agree with the conclusions of the trial judge that the bond was given under a mistake of fact. It is evident that when the bond was given, both parties acted upon the theory that John Mooney might be alive, and to provide against the consequences of that contingency, the bond was required, and was given. We think this case comes within the principle announced by Mr. Justice GIBSON, in Perkins v. Gay, 3 S. & R. 327, when he said (p. 331): "Where the parties treat upon the basis that the fact which is the subject of the agreement is doubtful, and the consequent risk each is to encounter is taken into consideration in the stipulations assented to, the contract will be valid notwithstanding any mistake of one of the parties, provided there be no concealment or unfair dealing by the opposite party, that would affect any other contract. Every wager, as well as every policy of insurance, and every compromise of a doubtful right, depends on this principle. . . . . If there be no intention of fraud, no unfair dealing, and...