Northwestern Traveling Men's Ass'n v. Crawford

Hr. Justice Brown delivered the opinion of the court. Three questions are raised by the record in this case. First. Was there at any time anything due from the appellant to the appellee in addition to what has been paid her? Secondly. If there was, did the reception by the complainant of the $2,499.90 paid by the defendant under the circumstances detailed in the prefixed statement, constitute an accord and satisfaction, so that the complainant no longer has a claim for more ? Thirdly. If there is still a claim for a balance outstanding, is this claim enforceable in equity under the bill in this cause? The appellant answers the first and third questions in the negative, and the second in the affirmative. The appellee thinks the answer to the first and third should be in the affirmative, and that to the second in the negative. We have come to the conclusion that the position of the appellant is correct, as to all of the issues involved. There is in the first place no question but that the literal interpretation of the contract between John W. Crawford and the appellant corporation, unmodified by the statutes of Illinois, is that upon his death while a member in good standing of the association, it will levy an assessment upon all of its surviving members, and pay the amount so collected, not to exceed $4,000, to such person as he may designate as beneficiary; nor is there any question but that upon the death of Crawford the association did levy such an assessment and did pay the beneficiary—the appellee—■ the entire amount collected from such assessment. The appellee in effect admits this, but her contention is that the Legislature of Illinois, by an Act approved June 22, 1893, entitled “An Act to Incorporate Companies to do the Business of Life or Accident Insurance on the Assessment Plan, and to Control such Companies of this State and of other States doing Business in this State,” etc., read into the contract theretofore made between Crawford and the appellant company at least two new provisions: First, that the company should accumulate and maintain a reserve or emergency fund equal at least to the amount of its "maximum policy outstandings and second, that if the'mortuary assessment levied on Crawford’s death should be less than $4,000, and there was in the emergency fund a -sufficient balance, the difference between the amount collected and $4,000 should be paid to the beneficiary out of the said fund. The appellee admits that the appellant corporation did not, by the amendment to its by-laws made in 1897, amend its contract with Crawford so as to make it conform to the provisions of the statute. She says, on the contrary, that the “appellant enacted new by-laws making a provision for the establishment of the emergency fund, in obedience to the law of the State of Illinois, cmd attempted to avoid the statute T>y reserving a discretionary control over the emergency fund so created, hy using the word ‘may ’ where the statute clearly repaired the word i shall ’ or its epiw/oalentP But counsel say that the law writes into ¿very contract all statutes that are applicable to the transaction. Undoubtedly this is true of statutes existing at the time that the contract is made. But statutes subsequently passed cannot constitutionally abrogate or impair the obligation of contracts, and certainly no attempt was made in the law of 1893 referred to, to change or add to any contract there- ■ tofore made. “ Corporations transacting the business of life or accident insurance upon the assessment plan,” the Act says, may re-incorporate thereunder, but are not required to do so, and any such domestic corporation may continue to exercise all the rights, powers and privileges not inconsistent with this Act, pursuant to its articles of incorporation, the same as if incorporated under the Act. The Act further provides that every policy or certificate thereafter issued “ by any corporation doing business under this Act and promising payment to be made upon a contingency of death, * * * shall specify the sum of money which it promises to pay under such contingency, * * * and upon the occurrence of such contingency, the corporation shall be obligated to the beneficiary for such payment at the time and to the amount specified in the policy or certificate.” It is upon this provision entirely that appellee relies, and yet nothing can be plainer than that it does not apply to a “policy or certificate” issued, as was the one in question here, twelve years before the Act passed. We do not mean, by calling attention to this sufficient reason why the statute in question reads no additional terms intp the contract involved here, to imply that except for this limitation to policies thereafter issued, it would certainly apply to complainant’s claim. The section quoted, it will be. observed, is applicable only to policies or certificates thereafter issued by any corporation doing business under the Act of 1893. Section 7 of the same Act provides expressly that it is corporations organized to insure lives * * * “wherein” (in addition to other requisites) “the insured’s liability to contribute to the payment of policy claims accrued or to accrue is not limited to a fixed sum,” which shall “ be deemed to be engaged in the business of life insurance upon the assessment plan, and shall be subject only to the provisions of this Act.” Appellant claims that as the liability of each of its members to contribute to a death loss is to contribute a fixed and determinate sum, the insured’s liability in it “ to contribute to the payment of policy claims accrued or to accrue” is limited to a fixed sum, and that the law of 1893 does not apply to it at all. Whether this be so, or whether, because in it the amount of the liability to contribute varies during any fixed period of time, according to the number of deaths, instead of being made definite for such period in accordance with established estimates, as in old line insurance companies, the appellant is to be considered an assessment company, under the law of 1893, is a question we do not decide in this case, because we do not consider that it is before us. By the stipulation of facts in the record, it would seem that the appellant admitted the necessity of conforming in - certain respects, at least, to the law of 1893. But we see no reason for holding that the Act governs in any respect the conceded terms of the contract between Crawford and appellant. Nor without such effect on the contract, as is claimed by appellee for this statute, can we see any reason for holding that the liability of appellant to her was not completely met by the payment of the $2,499.90, which was collected on mortuary assessment No. 705. The contract, as made, was one frequently recognized as legal and enforceable, and not unconscionable or unreasonable. Railway Conductors’ Ins. Ass’n v. Robinson, 147 Ill. 138; Covenant Mutual Life Ass’n v. Tuttle, 87 Ill. App. 309; Smith v. Covenant Mutual Ben. Ass’n, 24 Fed. Rep. 685; Niblack on Mutual Benefit Societies, Chapter 25 passim. The amended by-laws of 1897 did not impose any obligations upoti the directors to take from the emergency fund, or any other fund, the difference between the maximum sum provided for and the amount collected. As we have noted, counsel for appellee charges that the by-laws were framed with intention to avoid this obligation. We think so, too, and that the intention was carried out so far, at least, as concerns certificates or policies existing before the law of 1893. “May” does not mean “shall”, and is not so construed in private contracts. It is only in the case of statutes by which public rights are involved that this construction is sometimes adopted ex debito justitioe. Brokaw v. Highway Commissioners, 130 Ill. 482; Rothschild v. New York Life Ins. Co., 97 Ill. App. 547. The emergency fund had other uses, plainly shown by the by-laws, besides this one, to which it could be put at the discretion of the directors. It may not be improper, in concluding our discussion of this branch of the case, to say that no surer method of bringing about eventual injustice can be imagined than to deplete the emergency fund for this purpose, for the benefit of those beneficiaries first applying for it, under the theory contended for by appellee. A short time would suffice to wipe out all chance of any benefit from the fund to the others who contributed it. Our conclusion on this question of the original liability of the appellant, of course, renders supererogatory a decision of the other questions indicated at the beginning of this, opinion as involved in the cause. But we will briefly allude to them. We regard the law of Illinois as settled, going farther in this direction than that of many other jurisdictions in favor of the proposition made in appellant’s brief,—that “when a party makes an offer of a certain sum to settle a claim when the amount of the sum is open and unliquidated, and attaches to his offer a condition that the same, if taken at all, must be taken and received in full satisfaction of the claim in dispute, the party receiving the money takes it subject to the condition attached to it, and it will operate as an accord and satisfaction.” Cases not nearly as strong as the one at bar have illustrated this doctrine in Illinois. Ostrander v. Scott, 161 Ill. 339; Lapp v. Smith, 183 Ill. 179; Bingham v. Browning, 197 Ill. 122; Michigan Leather Co. v. Frazer, 104 Ill. App. 268. We think the facts concerning the payment of and receipt for this claim, as set forth in the statement prefixed hereto, conclusively establish, under the doctrine of these cases, an accord and satisfaction which bars the present demand. This opinion, that such an effect is to be given to these facts, is strengthened by the language of the fourth paragraph of section 2, of article Y of the constitution of the appellant, which was a provision under which the beneficiary received the payment in question. Finally, were there no other difficulty in the way of affirming this decree, we do not think any proper case was made for the interposition of chancery. The plaintiff, had she any claim, could have secured it as well at law. Rowell v. Cov. Mut. Life Ass’n, 176 Ill. 557. The very allegations of the bill and the theory on which the suit is brought, seem to us to show the lack in any event of any necessity for a suit in equity, and the relief granted of a money decree and a general execution show the same. The defendant should have had the benefit of. the demurrer in effect incorporated in its answer. But in view of the decision to which we have, arrived upon the merits of the cause, this is immaterial. The decree is reversed and the cause remanded with directions to the Superior Court to dissolve the injunction heretofore granted and to dismiss the bill for want of equity. Reversed and remanded with instructions.