Davis v. National Council, Knights and L. of Security

• Decision Date: 16 June 1917
• Docket Number: No. 1971.,1971.
• Parties: DAVIS v. NATIONAL COUNCIL OF THE KNIGHTS AND LADIES OF SECURITY.
• Court: Missouri Court of Appeals

196 S.W. 97

196 Mo. App. 485

DAVIS v. NATIONAL COUNCIL OF THE KNIGHTS AND LADIES OF SECURITY.

No. 1971.

Springfield Court of Appeals. Missouri.

June 16, 1917.

Appeal from Circuit Court, Jasper County; David E. Blair, Judge.

Action by Tennie F. Davis against the National Council of the Knights and Ladies of Security. Judgment for plaintiff, and defendant appeals. Affirmed.

James P. Mead, of Joplin, for appellant. Owen & Davis, of Joplin, for respondent.

STURGIS, J.

The defendant, as its name indicates, is a fraternal benefit association organized under the laws of Kansas and authorized to do business in this state under the provisions of Laws of Missouri 1911, pp. 284 to 301. This suit is brought by the beneficiary on a benefit certificate issued by defendant on the life of Ibb P. Forney, plaintiff's son, dated August 24, 1911. The deceased was a member of a local lodge or "council" of the defendant order at Joplin, Mo. He died on February 1, 1916. Proofs of death were furnished the defendant about March 1, 1916, and this suit was filed May 18, 1916, and tried at the October term, 1916, of the Jasper county circuit court. The plaintiff recovered, and defendant appealed.

The defense relied on is that deceased was not a member of defendant order in good standing at the time of his death because of his failure to pay in due time the monthly assessment for October, 1915. The defendant's by-laws, which are made a part of the benefit certificates issued by it, make the monthly assessments due on the 1st day of each calendar month, and then provide that, if any such assessment is not paid on or before the last day of such month, the member's certificate shall, without notice or any action taken to that end, be suspended, and all rights thereunder forfeited; that no right under a suspended certificate shall be restored until the member is reinstated in compliance with the laws of the order. The laws of the order in this respect provide for reinstatement within 60 days after suspension by paying all arrearages, "provided, however, that he [the member] be in good health at the time of making payment." By the act of payment the member is made to warrant that he is in good health.

It is conceded that the October, 1915, dues were not paid during that month, but were paid on November 3d following to the financier of the local council, and transmitted in due course to the head office or National Council. It is also admitted that the deceased member was not then in good health, but was confined in the state hospital for the insane at Nevada, Mo., which affliction resulted in his death. These facts as to the member's health were known to the officers of the local council, inclusive of the financier, who accepted his delinquent dues. No notice of such delinquency was given to the National Council or its officers till after deceased's death. In the meantime the monthly dues for November, December, and January were paid in proper time. The February dues were paid after the member's death and transmitted with the proofs of death.

The proofs of death sent to the home office, made on forms provided for that purpose, disclosed that the October dues of this member were not paid till November 3d, and that all subsequent dues had been paid in proper time. The October delinquency was also referred to in the answer to the questions as to suspensions and reinstatements. The attending physician's affidavit, forming part of the proof of death, disclosed that deceased died in the insane asylum, and that this physician had treated him there since August, 1915, for "general paresis"; that the patient was first admitted to that institution December 4, 1913. The claimant's affidavit accompanying the proofs of death also stated that the deceased's health began failing in the "fall of 1914."

The plaintiff concedes the validity of the requirement that the dues and assessments of members be paid within a specified period, and that the benefit certificate in question and all plaintiff's rights thereunder became ipso facto forfeited by the nonpayment of the October, 1915, dues within that month. The plaintiff's contention is that such certificate was reinstated by the payment on the member's behalf and the receipt by defendant of such delinquent dues on November 3d, notwithstanding the member was then in bad health, because defendant accepted such delinquent dues with knowledge that the member making the payment was not in good health, and by so doing the defendant waived the delinquency in the payment and any forfeiture based thereon. A like proposition is predicated upon the receipt by defendant of the subsequent dues for November, December, January, and February following. The knowledge, if any, possessed by defendant, on which such waiver is based, and which is the sine qua non thereof, is that imputed to it from the knowledge possessed by the financier of the local lodge.

The plaintiff cites many cases supporting the affirmative of the much-mooted question as to what extent and for what purpose the local lodge and its officers are agents of the head or grand lodge of such orders, and whether such agents have power to waive the provisions of the by-laws enacted by the governing body. We do not find it necessary to attempt to reconcile the seemingly conflicting decisions of this and other jurisdictions on this question. We may say that there is much reason for holding that, where the superior body intrusts the collection of all the dues from the members to particular officers of the local lodges and designates them as the persons to whom the members shall pay their dues and assessments and who shall transmit same to the head office, then such local lodge officer is the agent of the head or grand lodge in regard to receiving and forwarding to the head office the dues of the members. Any payment of such dues to the subordinate lodge officer charged with such duty is a payment to the superior body, and the member is not responsible for such agent's default or miscarriage. Boward v. Bankers' Union of the World, 94 Mo. App. 442, 450, 68 S. W. 369; Andre v. Modern Woodmen, 102 Mo. App. 377, 76 S. W. 710. Where the governing body by a long course of conduct, showing knowledge, permits its collecting agents to receive dues for members out of time, then it may be held to have waived strict payment, but such waiver is that of the superior lodge itself. McMahon v. Maccabees, 151 Mo. 522, 52 S. W. 384; Boyce v. Royal Circle, 99 Mo. App. 349, 73 S. W. 300. But the power of such an agent, whose duty is simple and ministerial — a sort of dumb-waiter in receiving and transmitting the money — to waive the provisions of the by-laws enacted by the governing body or whose uncommunicated knowledge is imputed to the governing body and becomes the basis of an estoppel to enforce such by-laws, is a very different proposition. That the financial collector of the subordinate lodge or "council" is not an agent of the grand lodge or "National Council" with such extensive powers, where the by-laws forming part of the insurance contract provide, as is the case here, that no member or officer of the local lodge has power to waive the provisions of the contract, has been ruled in this state many times. Thompson v. M. B. A., 189 Mo. App. 15, 19, 176 S. W. 506; Borgraefe v. Knights & Ladies of Honor, 22 Mo. App. 127; Lavin v. Grand Lodge, 104 Mo. App. 1, 78 S. W. 325; State ex rel. v. Temperance Ben. Soc., 42 Mo. App. 485; Chadwick v. Triple Alliance, 56 Mo. App. 463; Day v. Supreme Forest, 174 Mo. App. 260, 156 S. W. 721; Lavin v. Grand Lodge, 112 Mo. App. 1, 86 S. W. 600; Clair v. Royal Arcanum, 172 Mo. App. 709, 155 S. W. 892; Brittenham v. W. O. W., 180 Mo. App. 523, 534, 167 S. W. 587; Burke v. Grand Lodge, 136 Mo. App. 450, 457, 118 S. W. 493; Knode v. M. W. A., 171 Mo. App. 377, 157 S. W. 818; Gilmore v. Brotherhood, 186 Mo. App. 445, 171 S. W. 629; Griffith v. Royal Arcanum, 182 Mo. App. 644, 166 S. W. 324. Such, too, is the law in many other jurisdictions, as shown by Royal Highlanders v. Scovill, 66 Neb. 213, 92 N. W. 206, 4 L. R. A. (N. S.) 421, and cases cited in the editorial note.

This question, so far as it is involved here, is put at rest in this state by the enactment of section 22, Laws 1911, p. 292, as follows:

"The constitution and laws of the society may provide that no subordinate body nor any of its subordinate officers or members shall have the power(s) or authority to waive any of the provisions of the laws and constitution of the society, and the same shall be binding on the society and each and every member thereof and on all beneficiaries of members."

The defendant's by-laws, which were put in evidence, are fully as restrictive in limiting the powers of the subordinate lodges and their officers as this statute permits.

Plaintiff seeks to escape the force and effect of the above statute by showing, as she did, that defendant is a corporation organized under the laws of Kansas, and that that state has no similar statute, that the common law is in force in Kansas by statute, and that the law of that state, as shown by the decisions of the Supreme Court thereof, is that the subordinate lodge and its officers are agents of the grand lodge and have power to waive provisions of the by-laws by receiving delinquent dues of members knowing that the paying member had not complied with such by-laws. This may be conceded. Pyramids v. Drake, 66...