
    Meagher v. Life Union.
    
      (Supreme Court, General Term, Fourth Department.
    
    September, 1892.)
    1. Mutual Benefit Insurance—Assignment of Policy.
    A policy issued by an assessment life insurance companymay be assigned on the company’s refusal to pay, or furnish blanks, as required by the policy, with which to make proof of loss, nothing in the policy prohibiting such assignment.
    2. Same—Proof of Loss—Waiver—Refusal to Furnish Blank.
    Where a policy issued by an assessment life insurance company provides that “proofs must be completed on blanks furnished by the union, ” the refusal to furnish blanks, on application, on the ground that the policy is void because a premium has not been paid, will excuse failure to make proof of loss.
    Appeal from circuit court, Oneida county.
    Action by Helena A. Meagher against the Life Union. There was a judgment of nonsuit, and plaintiff appeals. Reversed.
    The complaint alleges the defendant is a “domestic corporation, duly organized and incorporated under and pursuant to the laws of the state of New York, as a co-operative or assessment life insurance association or society, and located and doing business as such in the city of New York; that the defendant, upon due application therefor, on or about the 3d day of December, 1888, received Hanorah Kelly, then of the city of Oswego, state of New York, as a member of the defendant, and thereupon issued to her a certificate or policy of membership therein; that thereupon the said Hanorah Kelly became and was a member of the defendant in good standing; that in and by said certificate or policy of membership, and the contract between said Hanorah Kelly and the defendant, the defendant insured the life of said Hanorah Kelly in the sum of $1,000, for the benefit of Mary Kelly, daughter of Hanorah Kelly, and thereby agreed that within ninety days after approval of proofs, by the executive committee of the defendant, of the death of said Hanorah Kelly, the defendant would pay to said Mary Kelly the sum of $1,000 from the mortuary or benefit fund of the defendant at the time of said death, or from any moneys that should be realized to the said fund from the next premium due from all the members, as in said certificate or policy of membership set forth: provided, that the amount due should not exceed the product of one premium payment upon policies in force at the time of said death.” The answer admitted all of the allegations quoted. The complaint further alleged that, on the 26th day of February, 1891, Hanorah Kelly died in the city of Oswego; also that the policy provided that proofs of the death of said Hanorah Kelly should be made upon the blank to be furnished by the defendant, and, “after the death of- said Hanorah Kelly, the said Mary Kelly duly applied to the defendant for the blank or blanks mentioned in said certificate or policy of membership, for the purpose of making proof, as required by said certificate or policy of said membership, of the death of said Hanorah Kelly; but the defendant declined and refused to furnish such or any blanks therefor, although the defendant was provided with such blanks, and it was the custom of the defendant, upon the death of any of its members, or of the person insured by defendant, to deliver such blanks to or for the beneficiary, that proof of death might be made; that therefore and thereby the defendant waived the provisions of said certificate or policy of membership requiring proofs of the death of said Hanorah Kelly to be furnished.” The complaint alleges that the mortuary or benefit fund of the defendant, at the time of the-death of-said Hanorah Kelly, “amounted to and was upwards of the sum of $1,000;” and that-the defendant has refused to pay the $1,000 due and payable on said certificate or policy of membership as aforesaid." The plaintiff further alleged that, “after the claim upon said certificate or policy of membership matured, and became vested in said Mary Kelly as hereinbeforestated, she, for a good and valuable consideration to her duly paid, duly sold, assigned, transferred, conveyed, and set over, by an instrument in writing to this plaintiff, her claim, demand, and cause of action against the defendant above stated and set out, and this plaintiff' thereupon became and now is the owner and holder of the claim under said certificate or policy of membership issued by the defendant, as aforesaid, for $1,000.” The defendant in its answer admits “that the mortuary or benefit fund of the defendant at the time of the death of said Hanorah Kelly amounted to and was upwards of the sum of $1,000;” and the “defendant admits that the moneys realized to the said mortuary and'benefit fund from the next premiums due after said alleged death on all the members, as in said policy or certificate of membership set forth, whose policies were in force at the time of said alleged death, exceeded the sum of $1,000.” The answer of the defendant also “admits that it absolutely refused, and still refuses, to pay the $1,000 named in said policy.” By way of defense, the answer alleges that the action was prematurely brought; that no notice was given of the assignment or demand made by the assignee; and that the policy was null and void at the time of the death of Hanorah Kelly, “by reason of her failure, and that of her beneficiary or any one on her or their behalf, to pay the premium which had become due and payable on the 3d day of December, 1890.” Upon the trial" proof was given that Hanorah Kelly died February 26,1891; that on the 11th of March, 1891, Mary Kelly, her' daughter and beneficiary named in the policy, addressed a letter to the defendant in the following words:
    “Oswego, March 11,1891.
    
      “Mr. Ralph Marden—:Dear Sin: Please send me blank proofs of loss on policy 5,021, H. Kelly, who" died February 26.
    “Respectfully yours, Mary Kelly, Beneficiary.”
    To that letter she received a reply in the following language:
    “The Life Union, Ho. 234 Broadway, Yew York.
    “Yew York, March 12th, 1891.
    
      “Miss Mary Kelly, Oswego, N. Y.—Madam: I have your favor of yesterday, asking for proofs of death on policy 5,021 on life of Mrs. Hanorah Kelly. In reply I would state that the last payment made on this policy was September 15th, 1890, and the premium due Yovember 3d, 1890, was not paid. I sent out two notices to this effect asking payment, neither of which were replied to. The policy, therefore, became null and void, and ceased to be in force, on Yovember 4th, 1890.
    “Respectfully yours, Ralph Harden, Secretary.”
    
      Proof was also given that the beneficiary, Mary Kelly, on the 21st of March, assigned to the plaintiff “all and every claim, * * * and all moneys to which I am entitled, under and by virtue of a policy of membership issued to and upon the life of Hanorah Kelly, now deceased, by the Life Union of the city of New York,” .by a written assignment, which was acknowledged on the 21st of March, 1891. Plaintiff put the policy in evidence bearing date December 3, 1888, issued by the defendant. Among the provisions in the policy was the following: “Within ninety days after approval of proofs by the executive committee of the union of the death of the above-named member, if occurring during the continuance of this policy in full force and effect, upon the following conditions, there shall be payable to Mary Kelly, daughter, of Oswego, state of New York, if living at the time of said death, * * * the sum of $1,000 from the mortuary and benefit fund of the union, at the time of said death, or from any moneys that shall be realized to the said fund from the next premium due, on all the members, as hereinafter set forth; it being understood and agreed that the amount due shall not exceed the product of one premium payment on policies in force at time of said death.” Another provision in said policy was as follows: “The proofs of loss by which this contract matures must be furnished to the,Life Union within six months after death occurs, and must contain full and true answers under oath to all questions asked by the company relating to the life, health, and death of the deceased member, and the said proofs must be completed upon the blank furnished by the union.” At the close of the plaintiff’s evidence the defendant moved to dismiss the complaint, and to nonsuit the plaintiff, upon several grounds. The nonsuit was granted, apparently upon the ground “that this action is prematurely brought.” An exception was taken by the plaintiff.
    Argued before Hardin, P. J., and Martin, J.
    
      S. M. Lindsley, for appellant. W. H. Law, for respondent.
   Hardin, P. J.

1. Under the allegations of the complaint, and admissions thereof by the defendant, it must be assumed that it is incorporated under and governed by chapter 175 of the Laws of 1883, and is “engaged in the business of life insurance upon the co-operative or assessment plan.” The defendant issued its policy or certificate of membership to Hanorah Kelly, and she thereby became a member of the defendant, and was insured in the sum of $1,000 for the benefit of her daughter, Mary Kelly, which sum the defendant agreed to pay, in case of the death of the assured, from its mortuary or benefit fund, or from any moneys that should be realized to said fund from the next premium or assessment due from all the members. It appears to have been admitted upon the trial that at the time of the death of Hanorah Kelly the mortuary fund amounted to upwards of $1,000. The production of the certificate of membership established prima facie Hanorah Kelly’s standing as a member of defendant’s association, and cast the burden of proof upon the defendant to show such facts and circumstances as should indicate that she had lost such standing at the time of her death. Demings v. Supreme Lodge, (Sup.) 14 N. Y. Supp. 834; Supreme, Lodge v. Johnson, 78 Ind. 111. The complaint contained an allegation that “said Hanorah Kelly became and was a member of the defendant in good standing, ” That allegation was admitted expressly by the answer of the defendant, and must therefore be taken as true for all purposes of the action. Code, § 522; Quinby v. Carhart, (N. Y. App.) 30 N. E. Rep. 973.

2. After the refusal by the company to pay or to furnish blanks, Mary Kelly had an undoubted right to assign any cause of action, which she had against the defendant; nothing in the policy prohibited such assignment. Cooke, Life Ins. § 72, p. 118; Lyon v. Rolfe, 76 Mich. 146, 42 N. W. Rep. 1094.

3. Under the policy, presumptively it was the duty of the beneficiary to furnish “proofs of loss * ,* * within six months after death occurs,” and by a provision in the policy such “proofs must be completed upon the blank furnished by the union.” With a view of carrying forward that duty the beneficiary applied by a letter written on the 11th of March, and sent to the defendant for “blank proofs of loss on policy 5,021, H. Kelly.” That application Seems to have been received by the defendant, considered, acted upon, and a refusal made to furnish the blanks; and the position taken by the company in its refusal was that “the policy therefore became null and void, and ceased to be in force, on November 4,1890.” After the beneficiary «received such notice of such refusal, she was entitled to assume that the company would furnish no blanks to her upon which proofs could be made, and that proofs would be unavailing, and that the company absolutely refused to pay. In section 469, May, Ins., it is said: “A distinct denial of liability and refusal to pay, on the ground that there is no liability, is a waiver of the condition requiring proof of the loss. It is equivalent to a declaration that they will not pay though the proof be furnished; and to require the presentation of proof in such a ease, when it can be of no importance to either party, and the conduct of the party in favor of whom the stipulation is made has rendered it practically superfluous, is but an idle formality, the observance of which the law will not sustain. * * * And of course the waiver of the proof is a waiver of the condition that payment is not to be made till a limited time after the proof; so that, in such ease, suit may be brought at once upon the denial of1 liability, although the time within which, after proof of loss, the payment would hé demandable may not have expired. ” The author cites, for the doctrine just stated, Norwich & N. Y. Transp. Co. v. Western Mass. Ins. Co., 34 Conn. 561. See Citizens' Co. v. Boisvert, 11 Quebec, Law R. 337.

The learned counsel for the respondent calls attention to the case of McConnell v. Association, 79 Iowa, 757, 43 N. W. Rep. 188. The language of the policy in that case diffiers somewhat from the language of the policy at bar. We think that case does not overrule the doctrine we have taken froth the writers on insurance. We think the language of the court in the case reported in Norwich & N. Y. Transp. Co. v. Western Mass. Ins. Co., 34 Conn. 561, is appropriate to the case before us, and pertinent to the question under consideration. In speaking of a clause in the policy in that case somewhat similar to the ope before us, Shipman, J., said: “This clause was for the protection or convenience of underwriters, and, when they waived the preliminary proofs, they also waived the benefit of this stipulation, and rendered it nugatory. It would be absurd to say that they still retained the right to have 60 days within which to pay the loss, when they had declared they would not pay at anytime nor under any circumstances.” This doctrine finds countenance in the following cases: Insurance Co. v. Catlett, 12 Wheat. 392; Allegre v. Insurance Co., 6 Har. & J. 408; Phillips v. Insurance Co., 14 Mo. 220; Insurance Co. v. Cary, 83 Ill. 453; Insurance Co. v. Maguire, 51 Ill. 342; Insurance Co. v. Gracey, 15 Colo. 70, 24 Pac. Rep. 577; Insurance Co. v. Harvey, 82 Va. 949. See, also, Cooper v. Association, (Sup.) 10 N. Y. Supp. 748.

We think the evidence produced by the plaintiff warrants the conclusion that the defendant absolutely refused to furnish blanks upon which proofs of loss could be made, and that the defendant intended to convey to the beneficiary the idea that proofs of loss would be useless and unavailing, and to take the position that the company absolutely refused to recognize the policy issued by it to Hanorah Kelly, and to declare that the same was null and void, and that the beneficiary had no claim upon the defendant. Under such circumstances, we think the defendant was not entitled to delay the plaintiff in the assertion of her claim by suit upon her supposed cause of action against the defendant. We are therefore of the opinion that the nonsuit ought not to be sustained upon the ground suggested at the circuit. We think a new trial should be granted. Judgment reversed, and a new trial ordered, with costs to abide the event.  