DeChter v. Nat'l Council of Knights & Ladies of Sec.

• Decision Date: 09 July 1915
• Docket Number: No. 19375[250].,19375[250].
• Citation: 130 Minn. 329,153 N.W. 742
• Parties: DECHTER v. NATIONAL COUNCIL OF KNIGHTS AND LADIES OF SECURITY.
• Court: Minnesota Supreme Court

130 Minn. 329

153 N.W. 742

DECHTER

v.NATIONAL COUNCIL OF KNIGHTS AND LADIES OF SECURITY.

No. 19375[250].

Supreme Court of Minnesota.

July 9, 1915.

Appeal from District Court, Ramsey County; Olin B. Lewis, Judge.

Action by William Dechter against the National Council of the Knights and Ladies of Security. From an adverse order, defendant appeals. Affirmed.

Syllabus by the Court

The complaint in an action on a beneficiary certificate of a fraternal order alleged an absolute obligation to pay a certain sum on the death of the member. The certificate in fact contained some conditions. It is clear that defendant was not misled. Under Gen. St. 1913, § 7789, providing that the court shall disregard all defects in pleadings which do not affect the substantial rights of the adverse party, the variance was not fatal.

The beneficiary certificate of a fraternal order may be received in evidence without offer of the application, the medical examination, or the laws of the order, though these documents form part of the contract between the member and the order.

The evidence does not show that plaintiff acquiesced in a wrongful claim of expulsion.

Where the contract of the parties prescribes a limitation of time in which to bring action, which is shorter than the statutory period, such provision, if reasonable, is valid. Such provisions are, however, in derogation of law and are not especially favored, and should be construed strictly against the party invoking them. If the limitation applies only under certain conditions, such conditions must exist or it will not bar an action.

A beneficiary certificate provided that no action upon it should be brought until proofs of death and of claimant's claim have been filed and passed upon by the executive committee of the order, nor unless brought within one year from the date of such action by the committee. Where the wrongful act of defendant dispenses with such proofs and there is accordingly no action by the committee, the contract provision has no application. Denial of liability in a pleading in a former action did not operate to set the contract limitation in motion. William G. White, of St. Paul, for appellant.

A. J. Hertz, of St. Paul (James E. Markham, of St. Paul, of counsel), for respondent.

HALLAM, J.

Defendant is a fraternal beneficiary order. This action is brought on a beneficiary certificate issued by defendant to Louis Dechter. It is admitted, that Dechter was a member of the order, that he received the usual beneficiary certificate, that plaintiff is the beneficiary named in the certificate, and that Louis Dechter is now deceased. Defendant seeks to defeat plaintiff's right to recover by raising question of practice. Several meritorious defenses were pleaded but no proof was offered to sustain any of them. No defenses to the merits are suggested, save such as it is claimed are made out by plaintiff's own testimony.

[1] 1. Defendant contends there is a variance between the complaint and the proof. The complaint alleges that by the terms of the beneficiary certificate defendant agreed to pay $1,000 on the death of deceased. In other words, it alleges an absolute obligation. The certificate offered in evidence contained some conditions. It contained the condition general in such certificates that no obligation rests on the defendant unless the member is in good standing at the time of his death, and it provides for certain deductions from the face of the certificate in certain events.

The answer admitted the issuance of a beneficiary certificate to deceased. It denied that defendant ‘entered into the purported contract of insurance attempted to be set forth in the complaint,’ but it did not allege that the certificate contained terms different from those alleged by plaintiff. It only alleged that the beneficiary certificate was not the whole contract, that the application for membership, the medical examination, and the constitution and laws of the order were also part of the contract. The complaint was sufficient to admit proof of the certificate. The purpose of a complaint is to advise the defendant of the nature of the cause of action sued on. There is no pretense that defendant was misled in this case. The proof was somewhat less favorable to plaintiff than was his pleading, but it cannot be said that the complaint did not sufficiently advise the defendant that the certificate offered in evidence was the certificate on which the action was based.

G. S. 1913, § 7789, provides that:

‘In every stage of an action, the court shall disregard all errors or defects in the pleadings and proceedings which do not affect the substantial rights of the adverse party, and no judgment shall be reversed or affected by reason thereof.’

The variance in this case did not affect the substantial rights of defendant. If authority is necessary, reference may be made to Heffernan v. Supreme Council Amer. L. of H., 40 Mo. App. 605, where the same question was raised and the variance was held immaterial.

Kulberg v. Supreme Ruling F. M. Circle, 126 Minn. 494, 148 N. W. 299, relied on by defendant, does not hold otherwise. The complaint in that case alleged the issuance of a beneficiary certificate containing an absolute obligation. The answer admitted the issuance of a beneficiary certificate but alleged that the contract was a conditional one, and it set out the conditions. It also ‘contained a general denial of everything not admitted.’ The trial court held that the answer admitted plaintiff's cause of action as pleaded, and refused to receive the certificate in evidence to prove the version of the contract which defendant alleged. The refusal of this offer was the error which caused the reversal. The court held that there was no conclusive admission of the contract as plaintiff alleged it to be. That was the issue presented. The complaint in that case was much the same as in this and the form of the certificate was much the same, but it was nowhere held that the certificate would not have been admitted in evidence under the complaint. The rules of construction involved in the two cases are not the same. In that case there was a motion by plaintiff for judgment on the pleadings. On such a motion every reasonable intendment is indulged in favor of the sufficiency of the answer to raise an issue. Malone v. Minn. Stone Co., 36 Minn. 325, 31 N. W. 170;McAllister v. Welker, 39 Minn. 535, 41 N. W. 107. In this case the question is as to the sufficiency of the complaint to admit proof of the uncontroverted facts, and equal liberality is indulged to sustain the sufficiency of the complaint to admit the proof. Hoag v. Mendenhall, 19 Minn. 335 (Gil. 289, 291); Johnson v. Robinson, 20 Minn. 189 (Gil. 169); Redner v. N. Y. Fire Ins. Co., 92 Minn. 306, 99 N. W. 886. Both rules are calculated to secure a determination of a lawsuit on the merits.

[2] 2. The statutes of this state provide that:

‘The certificate, the constitution and laws of the association and the application for membership and medical examination, signed by the applicant, shall constitute the contract between the association and the member.’ G. S. 1913, § 3544.

Plaintiff offered in evidence only the certificate. Defendant contends that, since the application, the medical examination, and the laws of the order are part of the contract between the member and the order, the beneficiary certificate cannot be received in evidence unless these documents are offered with it. The question is not a new one. Bacon in his work on Benefit Societies and Life Insurance sustains defendant's contention (section 463). Singularly enough all of the cases, save one that the author cites, repudiate the doctrine of the text. See Continental Life Ins. Co. v. Rogers, 119 Ill. 474, 485, 10 N. E. 242,59 Am. Rep. 810;Continental Life Ins. Co. v. Kessler, 84 Ind. 310; Cushman v. U. S. Life Ins. Co., 4 Hun (N. Y.) 783; Megrue v. U. S. Life Ins. Co., 71 Hun, 174, 24 N. Y. Supp. 618;Roach v. Ky. Mut. Sec. Fund Co., 28 S. C. 431, 6 S. E. 286;Sladden v. N. Y. Life Ins. Co., 86 Fed. 102, 29 C. C. A. 596. The question has not been squarely raised in this state, though there are decisions holding generally that the beneficiary certificate is evidence that deceased was received into general membership, and, with the aid of the presumption of continuance, is evidence that deceased was in good standing at the time of his death. Cornfield v. Order Brith Abraham, 64 Minn. 261, 66 N. W. 970;Monahan v. Order of Columbian Knights, 88 Minn. 224, 92 N. W. 972. The rule urged by defendant's counsel does not appeal to u...