Bragaw v. Supreme Lodge Knights and Ladies of Honor
| Decision Date | 28 May 1901 |
| Citation | 38 S.E. 905,128 N.C. 354 |
| Parties | BRAGAW v. SUPREME LODGE KNIGHTS AND LADIES OF HONOR. |
| Court | North Carolina Supreme Court |
Appeal from superior court, Beaufort county; Coble, Judge.
Action on a benefit policy by John G. Bragaw against the Supreme Lodge Knights and Ladies of Honor. From a judgment in favor of plaintiff, defendant appeals. Affirmed.
Where the supreme lodge of a beneficial association has designated the financial secretary of the local lodge as the proper person to receive payment of assessments, the failure of such secretary to transmit moneys received by him from an assured in payment of assessments, and the suspension of the local lodge for such nonpayment, will not forfeit his benefit certificate, since the officer's negligence is not chargeable to the assured, but is that of an agent of the supreme lodge, notwithstanding a provision in the by-laws that the officers shall be agents of the members, and not of the supreme lodge.
John L Bridgers and Chas. F. Warren, for appellant.
Small & McLean and S. C. Bragaw, for appellee.
The defendant was duly incorporated in Kentucky in 1878 as "The Supreme Lodge Knights and Ladies of Honor." It organized a subordinate lodge (Pamlico Lodge, No. 715) in Washington, N. C., in 1883, and in September of that year issued a policy for $1,000 to Annie C. Bragaw, in which policy her husband, the plaintiff, John G. Bragaw, was the beneficiary. The relieffund (or insurance) department of the organization was a separate and distinct feature from its social and fraternal features. At the date the Bragaw policy was issued (September, 1883) the constitution and by-laws which had been adopted in 1881 were in force. They were amended in several material particulars in 1889, but it is not shown that notice of these amendments was given to the subordinate lodges, nor to the assured or the beneficiary in this policy. It is not denied that the assured paid all the assessments which were demanded or of which she had any notice from the date of her policy or certificate down to the date of her death, and that the same were paid to the financial secretary of the subordinate lodge, who was admittedly the proper and only official to whom these payments could be made. His receipts for payments made by her up to her death, in 1895, were in evidence. Notice of death was given as required. The defendant declined to pay the claim upon the ground that the assured had failed to pay assessments Nos. 256 and 257, and because the subordinate lodge had been suspended for nonpayment of these two particular assessments. There is no evidence that Annie C Bragaw in any particular failed to comply with any law, rule or regulation of the order. The defense is that the subordinate lodge did not hold regular meetings, and that the secretary failed to remit collections and was suspended. The plaintiff testified that his wife paid all the assessments made on her from the date of the certificate or policy until her death; that these payments were made to the financial secretary of Pamlico Lodge, No. 715. These payments included the assessments Nos. 256 and 257. But the defendant excepted upon the ground that the true question was whether the assessments had been paid to the supreme lodge. This presents the main point involved in this case; i. e. whether the financial secretary, for the purpose of collecting money upon policies of insurance, was the agent of the supreme lodge or of the assured, the individual members. There is another feature of this association,--social and fraternal. In all matters of that kind, and in matters of purely local nature, the financial secretary, who was chosen by the subordinate lodge, was its agent. But in this matter of insurance there are only two parties to the contract. One is the insurer, the supreme lodge, which alone is incorporated, and which receives the premiums and contracts to pay the policy. The other is each individual assurer, who pays his premiums to the financial secretary, whom the supreme lodge has designated as the proper person to whom to pay the premiums, and whose duty it is to forward the money thus received to the supreme lodge. The subordinate lodge cuts no figure in the insurance. It is not incorporated. It has no legal entity. It receives no money for insurance, and contracts to pay no policy. The fact that the supreme lodge designates to receive the money, when paid by the assured, one whom the subordinate lodge has elected financial secretary, is purely a matter of convenience, but does not affect the legal proposition that such officer is thereby made the agent of the supreme lodge for the purpose of notifying the assured (who are called members) of the assessments when made from time to time, collecting the same, and forwarding the money to the supreme lodge.
In their brief the learned counsel for the defendant say The bylaws in force at the date of the policy contained no words making it otherwise. In 1889 the following amendment to the bylaws was adopted: It is not shown that the assured had any notice of or assented to this amendment. A provision that one should become a member, subject to the...
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