Burke v. Grand Lodge, A. O. U. W.

• Decision Date: 29 March 1909
• Citation: 136 Mo. App. 450,118 S.W. 493
• Parties: BURKE v. GRAND LODGE, A. O. U. W. OF MISSOURI.
• Court: Missouri Court of Appeals

118 S.W. 493

136 Mo. App. 450

BURKE v. GRAND LODGE, A. O. U. W. OF MISSOURI.

Kansas City Court of Appeals. Missouri.

March 29, 1909.

Rehearing Denied April 19, 1909.

1. INSURANCE (§ 750)—MUTUAL BENEFIT —ENFORCEMENT OF BY-LAWS.

A by-law of an insurance order providing for a forfeiture of the benefit certificate held by the member as a penalty for his failure to pay, when payable, the dues and assessments called for by his contract, is reasonable, and will be enforced by the courts.

2. INSURANCE (§ 755)—MUTUAL BENEFIT —WAIVER OF GENERAL RULES BY SUBORDINATE LODGE.

Where the laws of the grand lodge do not permit a subordinate lodge or its officers to alter or waive any of the rules relating to the insurance contract, a custom of the subordinate lodge without the knowledge of the officers of the grand lodge, permitting members to remain delinquent in the payment of dues, and advancing from its treasury the amount of such dues, does not operate as a waiver of a forfeiture for nonpayment of dues.

3. INSURANCE (§ 755)—MUTUAL BENEFIT— BY-LAWS—WAIVER OF PROVISIONS.

Where a custom of a subordinate lodge of allowing members to remain delinquent in the payment of dues in violation of a general by-law, or in advancing such dues from the lodge funds, is brought to the notice of the officers of the grand lodge and receives approval, either express or implied, the general by-law must be regarded as waived or modified by the recognized custom.

Appeal from Circuit Court, Jackson County; Walter A. Powell, Judge.

Action by Margaret Anne Burke against the Grand Lodge, Ancient Order of United Workmen, of Missouri. From an order granting a new trial after verdict for defendant, defendant appeals. Affirmed.

Henry L. Jost and Frederick H. Bacon, for appellant. W. W. Colvin and W. S. Gabriel, for respondent.

JOHNSON, J.

Plaintiff, the widow of William F. Burke, deceased, brought this suit on a benefit certificate issued by defendant, a fraternal beneficiary society incorporated in this state. In 1897 Burke became a member of Summit Lodge No. 272 of said order at Kansas City, and defendant issued to him the benefit certificate in suit, by the terms of which the Grand Lodge promised to pay plaintiff, the beneficiary, $2,000 on the death of the member, on condition "that sale William F. Burke shall in every particular while a member of said order comply with all the rules, laws, and requirements thereof now existing or hereafter enacted." Burke died December 28, 1905. Plaintiff contends that he was a member in good standing at the time of his death, while defendant claims, in its answer, that, on account of failure to pay an assessment duly made and payable on November 28, 1905, Burke was suspended and forfeited the benefit certificate. Further, it is claimed by defendant that, after said suspension and forfeiture, Burke voluntarily abandoned his membership in the order. The reply of plaintiff is a general denial. At the close of the evidence introduced by plaintiff, the court gave the jury a peremptory instruction to return a verdict for defendant. Plaintiff took a nonsuit with leave, and in due time filed a motion to set it aside. One of the grounds of the motion was newly discovered evidence. This ground was supported by affidavits. The court sustained the motion on this ground alone, and defendant appealed.

It is argued by counsel for defendant that, with the facts stated in these affidavits added to those adduced at the trial, plaintiff still has failed to show a right to recover on the certificate. In our statement we shall treat the facts appearing for the first time in the affidavits as though they were supported by evidence introduced at the trial. We do this because no point is made, nor does it appear, that the plaintiff was not diligent in the discovery of the new evidence, or that it was merely cumulative. The bill of exceptions recites that plaintiff "made out a prima facie case by the admission of the benefit certificate, the death on December 29, 1905, of William Francis Burke," and that defendant then assumed the burden of proof. After defendant offered evidence in support of the affirmative defenses interposed by its answer, plaintiff introduced her evidence on the issues thus raised, after which the court instructed a verdict for defendant. In the application for membership, dated April 19, 1897, Burke agreed "that compliance on my part with all the laws, regulations, and requirements which are, or may be hereafter, enacted by said order, is the express condition upon which I am entitled to participate in the beneficiary fund, and have and enjoy all the other benefits and privileges of said order."

It is admitted Burke was born November 17, 1857, and therefore was in his fortieth year when he became a member and received his certificate. The laws of the order required him to pay regular monthly assessments which in 1905 were $3.50 each. Of this sum 50 cents went to the local lodge for its expenses and $3 to the Grand Lodge on account of the "Guarantee Fund" out of which death benefits were paid. These fixed assessments were as regular as clock-work, and were due and payable by the member on the 28th day of each month. They were payable to the financier of the local lodge who was charged with the duty of forwarding, at stated times, the portions due the Grand Lodge. Law 197 of the order provided: "A failure or neglect of any member to pay any assessment on or before the 28th day of the month in which the same is payable to the financier of his subordinate lodge, or to the grand recorder, as provided by law, shall work ipso facto a suspension and forfeiture of all rights under any beneficiary certificate issued to him to whomsoever the same may be payable, and no action on the part of the lodge or any officer thereof shall be required as essential to such suspension and forfeitures. Any member suspended or expelled from the order for any cause whatever, forfeits all claim to the beneficiary fund during suspension or expulsion." It is admitted that Burke failed to pay the assessment due November 28, 1905, a month before his death, and that he was reported as suspended at the meeting of the local lodge on the night of December 7th, but plaintiff endeavors to avoid the forfeiture by showing that the right to claim it under the provisions of Law 197 was waived by defendant by reason of the practice of the local lodge, known to and acquiesced in by the managing officers of the Grand Lodge, of accepting payments of assessments long after they became due. The financier of Summit Lodge testified that Burke's assessments for March and April, 1905, were paid May 28th. Those for July, August, and September of that year were paid September 20th. Burke was not entered suspended for these delinquencies for the reason given by the witness that a member in good standing "stood up for him." In such cases it was the practice of the local lodge to pay the assessments due the Grand Lodge out of its own funds, and the member was not reported to the Grand Lodge as...