The plaintiff in error was an association formed "to furnish
substantial aid to their families or assigns in the event of a
member's death." The husband of the defendant in error became a
member, and received a certificate stating that, in consideration,
among outer things, "of the payment of all dues and of all mortuary
assessments," his wife should be entitled to receive $10,000 from
the death fund of the association. The constitution and bylaws of
the association provided that a mortuary assessment should be made
on the first days of February, May, August and November, but did
not fix any rate; that it should be the duty of a member failing to
receive notice of an assessment on or before those days to notify
the home office thereof, and that a failure to pay the assessment
within thirty days from said first days should work a forfeiture of
membership. When the husband died, he had failed for more than
thirty days to pay an assessment which had been made, and had not
informed the association that he had failed to receive notice of
it. To an action brought by the beneficiary to recover the amount
insured, the association set up these failures in defense.
Held:
Page 139 U. S. 298
(1) That the association was not required to make assessments
except when made necessary in order to meet existing claims.
(2) That the insured was entitled to notice of each
assessment.
(3) That the failure of the assured to inform the association of
a failure to receive notice of an assessment did not work a
forfeiture of membership and of previous payments.
(4) That as there was conflicting evidence upon the issue of
fact whether notice of the assessment was mailed by the association
to the assured, it was properly left to the determination of the
jury.
The case is stated in the opinion.
MR. JUSTICE HARLAN, after stating the facts in the foregoing
language, delivered the opinion of the Court.
This action is based upon a certificate of life insurance. There
was a verdict and judgment in favor of the plaintiff, the
beneficiary in the contract of insurance. The refusal of the court
to direct a verdict for the defendant, and its rulings upon
questions of law occurring at the trial, constitute the general
grounds upon which a reversal of the judgment is sought.
The Mutual Reserve Fund Life Association, the defendant below,
was organized under the laws of New York "to promote the wellbeing
of its members, and to furnish substantial aid to their families or
assigns in the event of a member's death." Its constitution and
bylaws, in force January 11, 1883, provided that within ninety days
after receiving satisfactory notice and proof of the death of a
member, the association should pay to the beneficiary named on its
books, or the his or her assigns or legal representatives, the
amount due according to the terms of the certificate of membership,
and that 75 percent of all net death assessments received by the
association should go into the "death fund," the balance, together
with the net earnings of the association, constituting the "reserve
fund," no part of which could be used
Page 139 U. S. 299
for expenses. They also provided:
"On and first days of February, May, August, and November (or at
such other periods as the board of directors may determine), an
assessment shall be made upon the entire membership in force at the
date of the last audited death claim prior thereto for such a sum
as the executive committee may deem sufficient to meet the existing
claims by death, the same to be apportioned among the members
according to the age of each member, as per the rates named in the
certificate of membership, and the net amount received from such
assessments (less twenty-five percent to be set apart for the
reserve fund) shall go into the death fund. A member failing to
receive a notice of an assessment on or before the first days of
February, May, August, and November, for his share of the losses
occurring during the time specified, it shall be his duty to notify
the home office in writing of such fact. A failure to pay the
assessment within thirty days from the first days of February, May,
August, and November (or at such periods as may be named by the
directors) shall work a forfeiture of membership in this
association, with all rights thereunder. The provisions of this
amendment shall take effect on and after August 1, 1883."
Further:
"If any member shall neglect to pay any dues or assessments when
due, of if any of the conditions are violated upon which the
certificate of membership is issued, then, and in every such case,
such membership shall at once cease and determine, and all payments
made thereon shall be forfeited to the association, but the
executive committee shall have the power to reinstate such
delinquent member at any time within one year for good cause shown,
and upon satisfactory evidence of good health, and upon payment of
all delinquent dues and assessments."
The certificate of insurance here in suit was executed July 26,
1883. It contains, among others, the following provisions:
"In consideration of the statements, representations, and
warranties contained in the application for this certificate of
membership, and of the admission fee paid, and of the dues to be
paid for expenses on or before the thirtieth day of June in every
year during the continuance of this certificate, and of
Page 139 U. S. 300
all mortuary assessments, as per table endorsed hereon, payable
at the principal office of the association, in the City of New
York, within thirty days from the date of each notice, the Mutual
Reserve Fund Life Association does hereby receive Henry H. Hamlin,
of Norwich, County of New London, State of Connecticut, as a member
of said association. Whenever the death fund of the association is
insufficient to meet the existing claims by death, an assessment
shall be made upon the entire membership in force at the date of
the last death, the same to be apportioned among the members
according to the age of each member, for such sum as the executive
committee may deem sufficient to cover said claims, and the net
amount received from such assessment (less twenty-five percent, to
be set apart for the reserve fund) shall go into the death fund.
Within ninety days after receipt of satisfactory evidence to the
association of the death of the above-named member during the
continuance of this certificate of membership, there shall be
payable to Sarah C. Hamlin (wife), of Norwich, County of Nee
London, State of Connecticut, if living at the time of said death,
otherwise to the legal representatives of said member, the sum of
ten thousand dollars from the death fund of the association at the
time of said death, or from any moneys that shall be realized for
the said fund from the next assessment, to be made as hereinabove
set forth, and no claim shall be otherwise due or payable except
from the reserve fund, as hereinafter provided. . . . This
certificate . . . shall be subject to all the provisions and
stipulations contained in the constitution and bylaws of this
association, with the amendments thereto."
Upon the subject of notices by the association to members, the
certificate provided:
"A notice addressed to a member at his post office address as
appearing upon the books of the association, according to its usual
course of business, shall be deemed a sufficient notice, and proof
of mailing same, according to the usual course of business of said
association, shall constitute and be deemed and held sufficient
proof of compliance herewith on the part of said association."
The same provision as to notice was in the constitution of the
association.
Page 139 U. S. 301
The certificate, by its terms, was to become null and void if
any of the payments provided for in it were not made "when due" at
the office of the association in New York, or to one of its agents
furnished with a receipt signed by its president, secretary, or
treasurer.
It was in proof that mortuary assessments were made four times a
year up to August 1, 1883. But by a resolution of the board of
directors adopted July 11, 1883, it was declared that
"Hereafter the stated periods for making the mortuary
assessments upon the members of the association, under the
provisions of the constitution, shall be the first weekdays of
February, April, June, August, October, and December."
Notice of this amendment of the constitution was duly mailed to
Hamlin at his address appearing on the books of the association,
along with notices of mortuary assessments made, respectively,
August 1, 1883, October 1, 1883, December 1, 1883, February 1,
1884, and April 1, 1884. He became insane in the fall of 1883, and
in November of that year was removed to a hospital for treatment,
remaining in that condition until his death, which occurred
February 15, 1885. It was admitted at the trial that all mortuary
assessments against him prior to and including that of April 1,
1884, were paid, and that there was an assessment upon him of $16
on the second of June, 1884.
It was averred in the defendant's answer, among other things,
that due notice, according to its usual course of business, of the
mortuary assessment of June 2, 1884, was mailed at New York,
postage paid, directed to the insured at his post office address as
appearing upon the books of the association, namely, "Mr. H. H.
Hamlin, Norwich, Connecticut;" that no information was given to it
from any source of any failure to receive such notice, and that, by
reason of the nonpayment of that assessment within the prescribed
time, Hamlin ceased to be a member of the association, and the
certificate held by him became null and void. To this the plaintiff
replied that notice of such assessment was not mailed or sent to
the insured or to her, nor received by either; that not until
September, 1884, did she hear of the June assessment; that
immediately after obtaining information of it, namely, on the
Page 139 U. S. 302
6th day of September, 1884, she offered to the defendant the
amount due on that and all subsequent assessments, but the latter
refused to receive the same, claiming that the certificate of
insurance had become void and that the insured was no longer a
member of the association. It was in proof that such an offer was
in fact made and refused; that similar offers were made October 6,
1884, and every two months thereafter, each of which was likewise
refused upon the ground that Hamlin had forfeited his membership in
the association.
In December, 1884, application was made to the association (by
whom does not appear) in the name of Hamlin for his reinstatement
as a member. The application was denied. This fact was also pleaded
in bar of the action.
By the terms of the contract, the certificate of insurance
issued to Hamlin became null and void if he failed to pay, when due
at the office of the defendant in the City of New York or to its
agent furnished with the proper receipt, any assessment upon him.
An assessment became due and payable "within thirty days from the
date of each notice" -- that is, from the date of the notice of
such assessment. But if the insured was entitled, of right, to
notice -- at least in the form prescribed by the contract, namely,
by mail, according to the defendant's usual course of business --
and such notice was not in fact given, the assessment, as to him,
did not become due and payable, and he did not cease to be a member
of the association by reason of his failure to pay it. That he was
entitled to notice is too clear to admit of dispute. The clause in
the defendant's constitution making it the duty of "a member
failing to receive a notice of an assessment," on or before certain
days, to advise the association of the fact, and the clause in both
the constitution and the certificate of insurance declaring that
notice directed to the insured, according to his address as
appearing upon its books, and mailed to him according to its usual
course of business, should be deemed and held sufficient proof of
compliance on the part of the association, necessarily imply that
it was the duty of the association to give notice of mortuary
assessments. It is true, the insured was informed by the
defendant's constitution, as amended July 11, 1883, subject to
Page 139 U. S. 303
which the contract of insurance was executed, that assessments
would regularly be made in February, April, June, August, October,
and December, or at such other periods as the directors might
determine. But if the association was bound to make assessments in
those months whether made necessary or not by its financial
condition, still the insured could not know in advance the amount
of an assessment, for such amount depended upon the state of the
"death fund," the determination of the executive committee as to
the sum required "to meet the existing claims by death," and the
apportionment of that sum among members according to their
respective ages, and the rates specified in the certificates of
membership. Now it is contended that the failure of the insured in
this case to inform the defendant in writing that he had not
received notice of the assessment of June 2, 1884, was alone
sufficient to forfeit his membership. This suggestion necessarily
proceeds upon the ground that the association had no discretion but
to make an assessment on that day, and that the insured must be
held to have known that one was made, although he could not have
knowledge of its amount. This construction of the defendant's
constitution and bylaws may well be doubted. We incline to the
opinion that the association was not required to make an assessment
except when the condition of the "death fund" made it necessary to
raise money to meet existing claims by death. The contract --
adopting almost literally the words of the constitution -- required
an assessment "whenever the death fund of the association is
insufficient to meet the existing claims by death," and "for such
sums as the executive committee may deem sufficient to cover said
claims." This would indicate that an assessment should not or would
not be made unless rendered necessary by the condition of the death
fund. Be this as it may, the duty imposed upon the insured to
inform the company of his failure to receive notice of an
assessment was neither expressly nor by necessary implication made
a condition of the contract the nonperformance of which would cause
a forfeiture of membership and previous payments. If the defendant
did not make an assessment, information in writing from the
insured
Page 139 U. S. 304
that he had not received notice of one would have been an idle
ceremony. If it made one and did not give the insured notice of it
-- at least in the mode prescribed -- his failure to inform the
association that he had not received notice of such assessment was
immaterial, and could not excuse its failure to give the required
notice.
Did the defendant give notice to the insured of the assessment
of June 2, 1884? That is the controlling question in the case. The
court instructed the jury that it was not incumbent upon the
defendant to prove anything more than that it mailed a notice of
the assessment to the insured according to his address and its
usual course of business, and, that fact being proved, it was
entitled to a verdict whether the insured received the notice or
not. Whether the clause in the certificate of insurance relating to
notice means anything more than that proof of mailing a notice
according to the defendant's usual course of business, directed to
the insured at his post office address as appearing upon its books,
made a
prima facie case of compliance upon its part with
the terms of the contract, leaving the insured to prove, in order
to prevent a forfeiture of his membership, that the notice was not
in fact received by him or for him we need not determine. The
defendant obtained the most favorable construction of the contract
to which it was entitled under any view, and the only question open
to it upon this writ of error is whether the court erred in holding
that the burden of proof was upon it to show that a notice properly
directed was mailed according to its usual course of business. We
are of opinion that upon this point no error was committed. As the
insured was not bound to pay an assessment of which notice was not
given at least in the mode designated, and as the duty to give such
notice was necessarily upon the defendant, it could not claim a
forfeiture except upon showing that that duty was performed. But
the contention is that the proof of such mailing was so
overwhelming that the court erred in refusing to instruct the jury
to find a verdict in its favor. We do not concur in this view.
Without referring to the evidence in detail, we content ourselves
with saying that upon the issue as to whether notice was in
fact
Page 139 U. S. 305
mailed, as claimed by the defendant there was evidence both
ways. The case upon this point was peculiarly one for the jury.
In this connection it may be observed that while the defendant
claims a forfeiture of the contract by reason of the failure of the
insured to pay the June assessment within thirty days after notice
thereof was mailed to him -- which its officers testified must,
according to the usual course of business, have been on the evening
of May 31, 1884 -- in its answer, verified by the oath of its
president, it stated that mortuary assessments were made upon the
insured on the first days of August, October, and December, 1884,
and that it mailed to him notices of each of those assessments;
that he failed to pay any one of them, and that by reason of each
one of such failures, the certificate became void. According to the
theory of the defense as thus disclosed by the answer, it may well
be inquired why the defendant treated the insured as a member of
the association after the time when, according to its present
contention, he had forfeited his right of membership. And why did
it refuse in September to accept payment of all previous unpaid
assessments, and yet in October, and again in December, make
further assessments upon him as a member? Notwithstanding the above
allegations in the answer, it was not claimed at the trial that
notices of assessments subsequent to that of June were mailed to
the insured. The case went to the jury upon the issue as to whether
notice of the June assessment was mailed to the insured, the court
ruling that if it was so mailed, the defendant was entitled to a
verdict. This could have occurred only upon the ground that the
defendant was mistaken when it alleged in its answer that notices
of assessments made in August, October, and December were mailed to
the insured. We suppose the fact to be that no assessments were
made in those months upon Hamlin, and the defendant would have
appeared to better advantage if it had modified of record those
parts of its verified answer, averring not only that assessments
were made in those months upon Hamlin, but that notices thereof
were mailed to him. The whole question of mailing was left in such
condition by
Page 139 U. S. 306
the proof that it would have been error to take it from the
jury.
Some stress is laid upon the fact that an application was made
in December, 1884, in the name of the insured, for reinstatement as
a member of the association. When information of the June
assessment was received by Mrs. Hamlin, the beneficiary in the
contract of insurance, in September, 1884, she promptly offered,
through a friend, to pay all previous unpaid assessments upon the
insured. The defendant refusing to accept such payment, and,
denying that the insured was any longer one of its members, the
attempt was made to have him reinstated by the act of the
association. That attempt -- evidently made to avoid litigation --
cannot be regarded as a waiver of the rights the insured has as a
member, for those rights were not forfeited by his failure to pay
the assessment of June 2, 1884, the only one in question, notice of
which, as the jury found, was not given as required by the
contract.
Numerous other points have been made on behalf of the defendant.
But they are the merest technicalities, in no wise involving the
substantial rights of the parties. We do not feel obliged to extend
this opinion by a discussion of questions of that character.
We find no error of law in the record, and the judgment is
Affirmed.