162 Mo. App. 242 | Mo. Ct. App. | 1912
This is an action on a policy of fire insurance issued by an unincorporated association of printers and publishers, organized and operated, not for profit but for the purpose of providing mutual insurance at actual cost. The answer pleaded defenses the nature of which will be disclosed in our discussion of the different issues we are called upon to determine. The learned trial judge who tried the case without a jury and, doubtless, regarded it as a case in equity, rendered judgment for plaintiff in accordance with the prayer of the petition. Defendant appealed.
The facts are not in controversy, and may be stated as follows:
In 1906, certain corporations, firms and individuals organized under the name of “The Printers’ and Publishers’ Reciprocal Underwriters at Printers’ Exchange” for the purpose of insuring each other’s business establishments. One hundred and seven different concerns operating in the principal cities of the Union became members of the association by signing the preliminary written agreement by which it was created. This agreement stipulated “for maintaining an office where policies of fire insurance may be underwritten for the firms, corporations or individuals herein called subscribers,” for the supervision of the business by a committee of subscribers elected annually; and for the appointment of F. B. Hamblin as manager with headquarters at Kansas City. The manager’s duties thus were defined: “The manager’s duties shall be to underwrite for the subscribers in his own name, as manager, policies of insurance against loss or damage by fire or lightning, to reinsure same, to make cancellations, and changes in the amounts and
Other stipulations characterize the organization as one formed not for profit but to provide insurance to its members at cost.
Of the one hundred and seven signatory members, five were dropped by the association at the beginning and no policies were issued to them. One of the subscribers returned his policy the day it was issued. This reduced the number of those who accepted policies to one hundred and one. There were five of those who returned their policies shortly after accepting them without paying anything for the insurance during the time the policies were in force. The preliminary agreement contained the provision: “Nothing herein shall be construed to obligate in any manner the subscriber hereto, until he shall elect to become a policy holder and thereafter only while holding a policy,”
Before the issuance of a policy to a member he was required to fill out and sign an “information blank” which contained the clause, “This insurance is to take effect when this exchange has one hundred or more subscribers and not before,” and the policies defined subscribers as “those and only those that have executed an agreement (hereby made a part hereof) which vests in P. B. Hamblin of Kansas City, Missouri, called the manager, the power to underwrite and
Plaintiff was one of the original members and a policy of $5,000, was issued on its printing establishment and accepted. It sustained a loss by fire on May 5, 1907, while the policy was in force. This was the third loss sustained by the association in the first six months of its existence and the funds derived from the first premiums had been exhausted and assessments of the members were required to replenish the fund. Many of the members responded to the assessment levied to pay the loss of plaintiff but a large number refused to pay and by their default plaintiff’s loss has been only partially reimbursed. There still remains unpaid $744.21, the aggregate of the assessments of the defaulting members. Two other losses occurred, shortly after that of plaintiff and the last one put the association out of business. Its. manager canceled all outstanding policies. The policy contained the following stipulation:
“To avoid a multiplicity of suits, all suits or other proceedings at law or in equity, shall be begun and maintained for the recovery of any claim, upon, under, or by virtue of this contract against the manager in the court which is the highest court of original jurisdiction; and, a final decision in such suit, or other proceeding, shall be taken to be-decisive of the similar claim so far as the same may subsist, against each of the other underwriters at interest, absolutely fixing the liability in the premises, each of the underwriters, in consideration of the entire stipulation, so-far as he individually is or may be concerned, expressly agrees to accept and abide by the result of
The manager was not a policyholder or member of the association. On these facts the court rendered judgment for plaintiff in which the amounts due from the respective delinquent members were adjudged.
In their argument for a reversal of the judgment, counsel for defendant say none of the policies issued by the manager ever became vitalized nor did the association, in fact, become a living thing, for the reason that the terms of the contract fixed the minimum strength of the proposed organization at one hundred units, i. e., policy-holding members, and since this standard was not realized, there was no organization and, consequently, no reciprocal obligation among the alleged members. This argument is based on the idea that the five signatory members who received and retained their policies for a time and then surrendered them without paying the first premium were not subscribers within the definition of the contract.
The provision “this insurance is to take effect when this exchange has one hundred or more subscribers and not before” clearly was intended to prescribe the conditions under which the association should be launched and put into commission as a going concern and was not intended to fix a standard for' its continuance in business. Starting with a membership of one hundred or more the association, ipso facto, would not be dissolved by the reduction of its membership, below the initial standard. The payment of the first premium was not made a condition precedent to the ac
This was merely declaratory of the law in force at the time the interindemnity contracts under consideration were made and the purpose of the act was to bring such exchanges under the supervision of the insurance department. This purpose, of course, could not be made retroactive, and the only effect upon the present case that can be accorded the act is to say that it contains a concrete enunciation of the legislative view that interindemnity contracts are not contracts of insurance and, therefore, were not affected by the insurance laws.
The very highest policy of a state is its statutory law and if there is legislation on the subject the public policy of the state must be derived from such legislation [Moorshead v. Railways Co., 203 Mo. 121.] What we have just said answers another contention of defendant to the effect that these contracts of indemnity were void because many of the members of the exchange were private business corporations and, therefore had no power to engage in the insurance business. They did have the right to make contracts protecting themselves against loss by fire and under the view that these were merely contracts of interindemnity we perceive no good ground on which it might be said they were ultra vires a private business corporation.
We are disposed to regard this action as one in equity for the adjudication of the demand of plaintiff caused by its fire loss and of the amounts due by each of the defaulting members to the fund out of which the demand should and must be paid. As is well said in Warfield v. Williamson, 223 Ill. 487, 84 N. E. Rep. 706: “The case belongs to that class where both the primary rights and the relief sought are purely legal, but of which a court of- equity will take jurisdiction on the ground that, owing to the methods of procedure and the means available to carry its decrees into execution, its remedies are more adequate, complete and prompt than those afforded by a court of law.”
We find an answer in the decision just cited to the principal points of defendant’s argument in support of the proposition under consideration and refer to that decision for an extended discussion and proper solution of such questions. The case of Bank v. White, 220 Mo. 717, is not in point.
We find no error in the record and accordingly the judgment is affirmed.