Commonwealth v. Philadelphia Contributionship

Citations

• 242 Pa. 209
• 88 A. 929
• 1913 Pa. LEXIS 866

Syllabus

<p>Insurance — Fire insurance — Mutual policy — Cancellation—Sharing in profits — Deeds—Construction—Corporations—Governing r ules — Amendments.</p> <p>1. Certain persons formed an unincorporated society for mutual insurance against fire by subscribing to a deed of Settlement which declared the purpose of the society to be the “insurance of houses upon the most equal terms, and apart from all views of private gain or interest,” and provided that the members should be “equal sharers in the losses as well as in the gains.” Thereafter the society was incorporated by act of the legislature, which recited the purpose of the society as set forth in the deed of settlement, and empowered the members by majority vote at a general meeting to make rules and regulations “for the better and more perfect prosecution of the true intent and design of said society.” An amendment to the deed of settlement subsequently adopted, authorized the cancellation of any insurance policy upon the return of the deposit money alone, without a proportionate share of the accumulated profits. The right of the society to cancel insurance policies was admitted, but its right to retain the share of the profits which such policy had earned was questioned by the Commonwealth in quo warranto proceedings, on the ground that a fundamental corporate purpose of the society, which was profit sharing, was thereby violated. As nothing was said in the act of incorporation about profit sharing, and as the main purpose of the society as disclosed by the act and by the original deed of settlement, was insurance against fire, not division of profits derived from such insurance, the eourt properly entered judgment for the respondent.</p> <p>■ 2. Whether a risk assumed by an insurance company, stock or mutual, should subsequently be cancelled for the best interest of all other policy holders, upon terms that are not unjust, is a question which ought to he, and, as a rule, is left to the company’s determination.</p>