15 N.Y.S. 632 | N.Y. Sup. Ct. | 1891
The appellant is a co-operative fire insurance association, incorporated under and by virtue of chapter 155 of the Laws of 1868, for the purpose of insuring farm buildings and property in the counties of Schoharie and Schenectady. On the 7th of September, 1889, the respondent applied in writing for an insurance certificate upon the property described in his application, and on that day a certificate of insurance was "issued to him on the same. The signing of an application for insurance was by the by-laws construed to be a signing of the constitution and by-laws, within the meaning of section 6 of chapter 155 of the Laws of 1868, under which the company was incorporated, and constituted the applicant a member of the company. On the same day á certificate or policy of insurance was issued to the applicant on the property for the alleged destruction of which by fire this action was brought. On the 11th of December, 1889, the pioperty was destroyed by fire. The respondent, by his application, signed by him, and by virtue of which he became a member of the association, agreed to be bound, by the constitution and by-laws of the same, and obligated himself, his heirs and assigns, to pay hisyuo rata share to the company of all loss by fire which might be sustained by any member thereof. On the next day after the loss the respondent notified appellant’s agent of the same, and requested him to notify the company’s secretary, which he did on the 13th of the same month; and on Monday, the 16th, the appellant’s secretary and agent, both ot whom were directors of the association, met at the place where the loss occurred, and informally examined the property, and discussed the subject of the loss, but reached no agreement in relat.on to the same; the secretary then informing respondent that he would have to make pruols of loss, and have them at the next regular meeting of the association. On the. 7th of January, at the regular monthly meeting of the board of di rectors, whii h was also the annual meeting for making assessments, the plaintiff presented his proofs of loss, which were objected to as inform ill,
There was no express agreement in the certificate or policy by the association to pay this loss or any loss. The obligation of the company to pay losses arises out of the act under which it was incorporated, the articles of incorporation, the constitution and by-laws adopted by it, the application for insurance, and the certificate; all of these must be read and construed together, and they as a whole constitute the contract, and create the obligations of the association to pay losses. The plaintiff being a member of this asssociation, he and the association are alike bound by the law of its being, and the constitution and by-laws established for its government; and its liability to its members, and between it and them, must arise out of the charter, constitution, by-laws, application, and policy. By its charter, (chapter 155, Laws 1868,) the association is required to pursue the method prescribed by section 6, c. 739, Laws 1857. This provision of the charter is binding upon the assured as a member of the association, as well as upon the association, and prescribes the course of procedure in case of disagreement as to the amount of loss. The association pursued substantially the prescribed course, by the appointment of a committee of five members to ascertain the loss. The plaintiff disagreed with the committee as to the amount, and refused to accept their award. It is true that that award was not binding upon the plaintiff, but, on his refusal or failure to agree to that amount, the statute above referred to provided a method of appeal to the county judge, and this appeal
This rule applies with peculiar force to a case like the one at bar. Here the plaintiff was a member of the corporation, and as such had obligated himself to be governed by its rules and by-laws, and to seek indemnity for his loss, in accordance with their provisions. In Poultney v. Bachman, 31 Hun, 51, it was held that, where the charter and by-laws provided for an appeal from the decision of a lodge of Odd Fellows to the grand lodge of the same order, in determining a liability of the lodge to a member for benefits, no action would lie until the member had adopted that remedy; and although the grand lodge was not a tribunal known to the law, nor one invested with power to enforce its orders or decisions, yet the court held that the plaintiff must resort to it, before he could claim that the lodge had violated its duty to pay. In other words, it was in the nature of a condition precedent to his right to maintain an action, and the court in that case says: “Without discussing the question whether or not the decision of the highest appellate tribunal of the society is conclusive, we are of the opinion that the contract into which the plaintiff entered requires him to seek redress within the society itself by carrying the question to the highest tribunal; for it is evident that every part of the constitution and by-laws entered into his contract, and are to be considered therewith.” In that case it is true that the appellate tribunal was not one established by law, and was only created by the contract; while in this the legislature, by the acts of incorporation, created the tribunal to which the plaintiff might appeal, and made the decision of that tribunal final, as to the amount of the loss. It seems, therefore, that, the plaintiff having prosecuted this action without first resorting to the appeal given by the charter, his action is prematurely brought; and, the defendant having raised this question on the trial in his motion for nonsuit, it was error for the learned trial judge to deny the defendant’s motion, and allow the case to go to the jury, and for that reason the judgment should be reversed. Judgment reversed, and a new trial ordered, costs to abide the event.