Bennett v. Beavers Reserve Fund Fraternity

159 Wis. 145 | Wis. | 1914

MaRSI-iall, J.

This case must turn on the question of whether there was an absolute liability for the 'assessment which had not been paid at the time of the suicide.

Confusion with resulting injustice in cases of this sort will occur from want of appreciation of the distinction between acceptance by the insurer of money from the assured to continue the policy which he might decline to pay at his pleasure and suffer only the penalty of forfeiture, and acceptance or collection of money from the assured on account of an absolute liability created and persistent until discharged, regardless of any forfeiture after such liability became fixed. In the former situation acceptance of the money would be inconsistent with insisting upon the forfeiture, in the latter it would not.

All eases of waiver and estoppel in favor' of continued liability under a policy of insurance, are grounded upon the insurer doing some act inconsistent with insisting upon a termination of the policy. Such unequivocal inconsistent act may be characterized by elements of estoppel, as by putting the policy-holder or claimant thereunder to some expense, as in Cannon v. Home Ins. Co. 53 Wis. 585, 11 N. W. 11; Oshkosh G. L. Co. v. Germania F. Ins. Co. 71 Wis. 454, 37 N. W. 819; Dick v. Equitable F. & M. Ins. Co. 92 Wis. 46, 65 N. W. 742, or by merely the element of waiver as in Palmer v. St. Paul F. & M. Ins. Co. 44 Wis. 201, and similar cases. When there is no treatment of the insurance contract as having one status and then a change of position to the prejudice of the policy-holder or claimant thereunder by treating the contract as having a different status, the doctrine of waiver or estoppel, so often applied in actions of this sort, has no application whatever to defeat the effect of a forfeiture. „

The foregoing was very clearly illustrated in Joliffe v. Madison Mut. Ins. Co. 39 Wis. 111, where it was held that receipt and acceptance after the breach of a condition, working a forfeiture, of money which is due and collectible absolutely, without regard to any forfeiture, is not a waiver of such forfeiture. A distinction was there drawn between a case of receipt and payment upon a policy after the happening of a loss, covering a period within which the loss accrued, and receipt of a payment after loss to discharge a liability which existed, irrespective of continuance of the policy. - The court observed as to the latter situation:

“It may he here observed, that the acceptance by the defendant of such premium after the loss, and even after the defendant had notice of the loss, is of no importance. Such assessment was due and payable absolutely, .whether the policy was forfeited .or not. . . . The defendant waived nothing by accepting that which, in any event, was its due.”

The court decided that in any case acceptance on an assessment policy after a loss shall have accrued of a payment wholly earned before the loss, does not waive a forfeiture happening after creation of the absolute liability. Why the matter in question does not fall within the above stated principle is not perceived. The logic of such contracts of insurance is that each assessment is for a specific period and is fully earned when the period shall have expired. Upon such assessments the assurer depends for the fund to pay its liabilities and, in the main, liabilities existing at the time of the assessment. They are recoverable in the main solely for the benefit of the owners of existing claims. Dor that reason, as a rule, a considerable length of time is provided to enable the assured, after receiving due proof of loss, to accumulate under the assessment plan money to discharge it. That feature is present in the contract in question. There was a reserve fund and it was provided that ten per cent, of all assessments should'be covered into such fund; bu.t that was, evidently, in the main, to provide against deficiencies on account of unpaid assessments. The whole scheme embodied in the contract contemplated liability for carrying the risk for the time mentioned in the assessment. Therefore, obviously, a forfeiture occurring subsequent to such time could not logically affect such liability. Nor could acceptance of payment in discharge of such liability after forfeiture be considered as an act inconsistent with insisting upon it. Hone of the cases cited by respondent’s counsel on the subject of waiver and estoppel apply to the situation here.

It is evident that the whole case between the parties is before the court so that to plead over would only prolong the litigation. Therefore, it seems best to terminate it by a reversal and a remand for dismissal with costs.

By the Court.- — So ordered.