Court Opinion

ID: 6278287
Source: CourtListenerOpinion
Date Created: 2022-02-18 16:07:48.503754+00
Date Added: 2024-06-11T09:00:07.833267
License: Public Domain

Opinion by
Orlady, J.,
The plaintiff’s original and amended statements were answered by three affidavits of defense, which were considered by the court as insufficient to prevent judgment for a part of the claim with leave to proceed for the balance alleged to be due on the industrial policy of insurance on which the suit was based. It is provided in the contract that “Policies in arrear more than one month are not entitled to any benefits until renewed, as provided in art. 8, of the constitution and by-laws of this company, all of which are hereby made part of this contract, although not attached hereto.” In deciding the effect to be given to this provision we are controlled by the Act of May 11, 1881, P. L. 20, which distinctly declares, that a policy of insurance “Which contains any reference to the application of the insured, or the constitution, by-laws or other rules of the company, either as forming part of the policy or contract between the parties thereto, or having any bearing on said contract, shall contain, or have attached to said policies, correct copies of the application as signed by the applicant, and the by-laws referred to, and unless so attached and accompanying' the policy, no such application, constitution or by-laws shall be received in evidence, .... nor shall such application or by-laws be considered a part of the policy or contract between such parties.”
The only pretense at compliance with this statutory requirement is found in paragraphs on the reverse side of the policy, as follows: “Grace Period. Policies in arrears more than one month are not entitled to any benefits until renewed as provided for in art. 8, of the Constitution and by-laws of this Company, all of which are made part of this contract, although not attached hereto.” And “Benefits. This policy shall be in immediate benefit for its full face value; this company reserving the right to deduct, in case of fire, the balance of what would be one annual premium unpaid at the *325time of said fire.” The first clause concedes that the policy as issued lacks the very thing required by the statute, and is clearly a mere reference to an omitted by-law, which is not to be considered as a part of the policy: Mowry v. Protective Society, 27 Pa. Super. Ct. 390; Muhlenberg v. Mutual Fire Co., 211 Pa. 432, and a failure to attach or incorporate the by-laws on which the defendant relies is fatal to its defense as presented in the affidavits: Susquehanna Mut. Fire Insurance Co. v. Oberholzer, 172 Pa. 223.
The second paragraph reasonably implies that the policy was intended to be in force for at least one year with the right of the company to deduct in case of loss, any premium that was unpaid at that time, and this result was secured by the judgment for the amount of the admitted loss, less the unpaid balance of the one year’s premium. The policy is framed in the hope that it will be continued in force for an indefinite term. Special inducements are offered to the insured if he will carry it for ten or more years and the only method of cancellation for the policy is by a direct notice to the company and a return of the unearned premium. In the supplemental .affidavit it is substantially admitted that the payment of the $1.00 kept the policy alive for three months, and this was sufficient in time to permit a recovery.
We adopt the reasoning of the learned judge of the court below and affirm the judgment.