Case ID: ala_201/html/0687-01.html
Source: Caselaw Access Project
Author: {"author": "ANDERSON, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

(79 South. 259)
    SUPREME RULER OF MYSTIC CIRCLE v. DARWIN.
    (8 Div. 18.)
    (Supreme Court of Alabama.
    May 9, 1918.)
    1. Insurance <&wkey;688 —- Fraternal Insurance-Statutes Applicable.
    Code 1907, §§ 4572, 4573, 4579, as to misrepresentation in application or proof of loss, incontestability of life policy after payment of two annual premiums, and expressing- contract in policy, do not apply to fraternal benefit societies.
    2. Insurance &wkey;>762 — Fraternal Insurance —Reinstatement of Certificate.
    If insurer had been properly suspended by defendant fraternal society, statements made in his application for reinstatement would be binding, otherwise not.
    3. Insurance <&wkey;817(2) — Fraternal Insurance-Reinstatement of Certificate.
    Insured’s statements in application for reinstatement, though not conclusive, were prima facie evidence of suspension for nonpayment of dues, and made it incumbent upon plaintiff to show that insured had not been properly suspended notwithstanding application and attempted reinstatement.
    
      4. Insurance &wkey;>825(2) — Fraternal Insurance-Reinstatement of Certificate.
    Whether receipts for dues and assessments negatived a suspension, or the right to suspend under terms of policy of fraternal society, held a question of fact.
    5. Insurance <&wkey;755(3) — Waiver of Conditions of Policy.
    Fraternal society could waive provision of policy that receipts for overdue assessments were not valid, unless member had been reinstated.
    6. Insurance <&wkey;745 — Waiver of Conditions of Policy — Statutes.
    While Acts 1911, _p. 700, §§ 8, 20, would apply to renewal of policy in fraternal society, it would have no application to question whether there was a forfeiture or waiver of forfeiture of original certificate existing 'before act became effective.
    Appeal from Circuit Court, Madison County; R, C. Bi'ickell, Judge.
    Action by Mattie Lee Darwin against the Supreme Ruler of the Mystic Circle. Judgment for plaintiff, and defendant appeals.
    Reversed and remanded.
    Taylor & Watts, of Huntsville, for appellant. Addison White and Lanier & Pride, all of I-luntsville, for appellee.
   ANDERSON, C. J.

The trial court seems to have tried this case upon the idea that the policy contract was governed by sections 4572, 4573, and 4579 of the Code of 1907. The appellant, however, being a secret fraternal benefit society or association, did not belong to the class dealt with in said sections of the Code. Eminent Household of Columbian Woodmen v. Blackerby, 78 South. 821; Locomotive Engineers Ins. Co. v. Hughes, 77 South. 352, wherein the cases of National Ins. Co. v. Sherry, 180 Ala. 627, 61 South. 944, and Brotherhood v. Miller, 193 Ala. 68, 69 South. 10, were overruled upon this point. The policy is therefore controlled by the legal principles announced in the case of Ala. Gold Ins. Co. v. Johnson, 80 Ala. 467, 2 South. 125, 59 Am. Rep. 816, and the case should have bieen tried accordingly. Though It must be said, in justice to the trial court, that the cases overruling the Sherry and Miller Cases, supra, had either not been decided or published when the case at bar was tried.

We think that the record unquestionably shows that the defendant is a secret, benefit order not governed by the sections of the Code above noted. Th'e defendant’s answer to the interrogatories not only discloses this fact, hut the application or declaration for a charter recites:

“The object of the said corporation is to unite 'fraternally white persons of proper age and good social and moral character in a fraternal beneficial and relief society, with ritualistic or secret work for beneficial and protective purposes.”

As this case must be reversed and tried under the law as laid down in the Ala. Gold Ins. Case, supra, instead of the sections of the Code above noted, it is not out of place to suggest that under the evidence as'now presented it is quite material whether or not the insured was bound solely by the representations and warranties made at the time of the issuance of the policy or the change thereof in 1902, or by those made upon the reinstatement of same in 1915. There is no proof whatever of misrepresentations or a breach of warranty in procuring the original policy or a change thereof in 1902, though there was proof of same as to the application for a reinstatement in 1915, and if the insured had been properly and legally suspended under the terms of the policy the application and statements of 1915 were a condition precedent to reinstatement -and. would be binding upon him. On the other hand, had there been no lapse of the original policy, that is, if he had not in fact been suspended as for nonpayment of dues, as set out in the application for reinstatement in 1915, and which was approved June 9, 1915, and the statements made were induced through a mutual mistake or through a mistake of the insured improperly induced by the defendant, he was not bound thereby.

The statements made in the application for reinstatement, though not conclusive, were-prima facie evidende that the insured had been suspended for nonpayment of dues, and made it incumbent upon the plaintiff to show that he had not been properly suspended, notwithstanding th'e application and attempted reinstatement The plaintiff attempted to do this by showing divers and sundry receipts for dues and assessments, and whether or not this evidence negatived a suspension or the right to suspend, under the terms of the policy and constitution and bylaws of the order, is a question of fact which Should probably be left to the jury, unless, of course, the evidence upon th'e next trial should be such, as to a valid suspension vel non, as to make it a question for the court.

It is true there is a clause in the certificate that “receipts given for overdue assessments'are not valid unless the member has first been reinstated in accordance with th'e laws of the order.” But it was a question of fact as to whether or not the receipts given were for “overdue” or presently due assessments. Moreover, this clause could be waived by the order by au agent authorized to receive payments and give receipts. It was inserted for the benefit of the order, and it could at its own volition take advantage or waive it and delegate to agents the implied power vested in the president in conjunction with the secretary or actuary. United States Life Co. v. Lesser, 126 Ala. 568, 28 South. 646; Security Mutual Co. v. Riley, 157 Ala. 553, 47 South. 735; United States Co. v. Goin, 73 South. 117. Acts 1911, p. 700, §§ 8 and 20, have no application to the lapse or forfeiture in question or the waiver of same. If there was a forfeiture or waiver it was under the terms of the certificate as it existed before the act of 1911, and was a contract to which said act did not and could not apply. True, the renewal was subsequent to the act, and if there had been a legal forfeiture and no waiver of same the act of 1911 would no doubt apply to the renewed contract, but as to* whether or not there was a forfeiture or waiver of same involved the contract as made before the passage of the act of 1911, and which was governed by the law as it existed when the certificate was issued and not the act of 1911. Sherry’s Case, supra, National Order v. Lile, 200 Ala. 508, 76 South. 450, Beiser v. Sov. Camp, W. O. W., 199 Ala. 41, 74 South. 235, and Woodmen v. McHenry, 197 Ala. 541, 73 South. 97, involved certificates issued subsequent to the act of 1911.

The judgment of the circuit court is* reversed, and the cause is remanded.

Reversed and remanded.

McClellan, sayre, and Gardner, JJ., concur. 
      
       Ante, p. 443.
     
      
       Ante, p. 58.
     
      
       197 Ala. 584.