Grand Lodge A. O. U. W. of N.J. v. Gandy

• Decision Date: 01 October 1902
• Citation: 53 A. 142,63 N.J.E. 692
• Parties: GRAND LODGE A. O. U. W. OF NEW JERSEY v. GANDY et al.
• Court: New Jersey Court of Chancery

53 A. 142

63 N.J.E. 692

GRAND LODGE A. O. U. W. OF NEW JERSEY

v. GANDY et al.

Court of Chancery of New Jersey.

Oct. 1, 1902.

(Syllabus by the Court.)

Bill by the Grand Lodge of the Ancient Order of United Workmen of New Jersey against Lydia Gandy and others. Decree in favor of Mrs. George and Harry B. Middleton, defendants.

This case arises under an interpleader bill filed by the Grand Lodge of the Ancient Order of the United Workmen of New Jersey, an unincorporated and fraternal benefit society doing business in the state of New Jersey. The defendants are Mattie George and Harry B. Middleton, children who have survived their father, Frank P. Middleton, and Lydia Gandy, who appears to have been named as a beneficiary in a certificate issued by the complainant society under circumstances hereinafter narrated. The bill shows that Frank P. Middleton, on December 16, 1880, became a member of the complainant society, and that he continued his membership until his death, on February 16, 1902; that pursuant to the laws of the society he designated his wife, Mary Middleton, as his beneficiary to receive at his death the sum of $2,000 from the society's beneficiary fund; that Mary Middleton predeceased her husband. The bill alleges that under the laws of the society, from Mary's death until Frank P. Middleton should make another lawful designation of a beneficiary, his two children, the defendants Mattie George and Harry B. Middleton, became and remained his lawful beneficiaries, and that said Frank P. Middleton died leaving his said two children him surviving. The bill further alleges that on the 26th of December, 1901, Frank P. Middleton made an affidavit whereby he purported to set out circumstances which would be sufficient to show that Lydia Gandy bore to him the relation of a dependent (which being established would bring her into the class of persons designated as beneficiaries under the laws of the complainant society), and sent the affidavit to the office of the grand recorder of the complainant society, pinned to the original beneficiary certificate issued to him on his admission to the order; that thereupon, unadvisedly, and without warrant of law for so doing, and in violation of the laws of the order, a new beneficiary certificate was issued, wherein Lydia Gandy was designated as beneficiary of the said Frank P. Middleton; that the new beneficiary certificate remained in the possession of Middleton at the time of his death, and the mistake of the complainant society's officer in issuing it was not discovered until after his death. The bill then sets out the clause governing the society members in making changes in the designation of beneficiaries, which may be found on page 27 of the "Constitution and Standing Regulations of the Society," par. 7, in words following: "(7) Change of Beneficiaries. Any member desiring to change his beneficiaries may do so in the following manner: He shall fill out the blank form on the back of his beneficiary certificate authorizing the change. He shall have his signature attested by the recorder of his lodge and the seal of the lodge attached thereto, or attested by any civil officer qualified to administer oaths. When this is done he shall deliver his beneficiary certificate to the recorder of his lodge, together with a fee of 50 cents. The recorder shall forward the said certificate and fee to the grand recorder, who shall make a record of the change on the books of the grand lodge, and shall issue a new certificate in lieu thereof, payable as directed on the back of the surrendered certificate. The new certificate shall bear the same number as the old one, which shall be safely filed and preserved. The provisions hereof in special cases may be waived by the grand lodge at its option.' The bill further alleges that Middleton did not affix his signature to the form provided on the back of the original certificate for making a change of a beneficiary, and that there was no attestation of his signature by the recorder of his lodge, or in any other way, and that he did not, in the manner required by the laws of the society, change his beneficiary, yet through inadvertence a new beneficiary certificate was issued to him. The bill then narrates that Miss Gandy, under the new certificate, and Mr. Middleton's two children, under the laws of the society, claiming the new certificate to be inefficient, each claim from the complainant the payment of the benefit sum of $2,000. It contains the usual allegation of noncollusion of the complainant with either party, and that it has not been indemnified by either, and concludes with a prayer that upon its payment into this court of the benefit sum of $2,000, the defendants may be decreed to interplead, and the complainant may be discharged from all liability to either of them in the premises.

A decree has been taken against the defendants, adjudging that the bill of interpleader was properly brought by the complainant, that it is entitled to relief, and that it be dismissed from the further prosecution of the suit with its costs and a fee, and be discharged from all liability to either of the defendants in the suit by reason of the fund in question, and that the defendants interplead and adjust their several demands in controversy in this suit as between themselves. The defendants have filed their interpleading claims; Lydia Gandy under the new certificate issued to her, and Mattie George and Harry B. Middleton, children of Frank P. Middleton, claiming under the regulations of the society found on page 26 of its constitution, in paragraph 6 of which the applicable part is as follows: "(6) Order of Payment to Beneficiaries. If one or more of the beneficiaries shall die during the lifetime of the member, the surviving beneficiary or beneficiaries shall be entitled to the benefit equally, unless otherwise provided in the beneficiary certificate, and if all the beneficiaries shall die during the lifetime of the member, and he shall have made no other direction, the benefit shall be paid to his widow if living at the time of his death; if he leaves no widow surviving him, then said benefit shall be paid, share and share alike, to his children,"—with further limitations not applicable in this case. On these pleadings the respective parties submitted testimony and argued the cause.

F. G. Toram and E. G. C. Bleakley, for defendants.

Mattie George and Harry B. Middleton. T. B. Hall, for defendant Lydia Gandy.

GREY, V. C. (after stating the facts). The relation created by a certificate issued by a beneficial association such as the complainant society has been authoritatively declared to be contractual. The terms of the contract are to be discovered in the language of the certificate read in connection with the rules and by-laws of the society. It is to be construed and given force and effect as other contracts are which deal with similar subjects. Fraternity v. Martin, 59 N. J. Law, 213, 35 Atl. 908. In that case the plaintiff in error was an incorporated society. Page 210, 59 N. J. Law, page 909, 35 Atl. In the present case the complainant is a voluntary beneficial association, not incorporated. The statute of 1885 (Gen. St. p. 2588, § 324) enables a voluntary association organized for benevolent purposes to be sued by its recognized name, but does not authorize it to bring a suit in the name of the organization. Mayer v. Association, 47 N. J. Eq. 520, 20 Atl. 492. In the suit now at bar the complainant did in fact prosecute this suit by its recognized name, without opposition, has paid the fund in dispute into court, and has been dismissed, and is no longer a litigant The present parties in court are Miss Gandy on one side and Mr. Middleton and Mrs. George on the other. There is no question of their capacity to sue and be sued, so that whatever may have been the infirmity of the complainant in this interpleader suit to bring its action by its recognized name, it is no longer of any significance.

A contract entered into with a voluntary unincorporated association does not differ in its essential nature from one entered into with an incorporated body. The principles declared by the court of appeals in the above-cited case are therefore applicable to the decision of this case. The standing regulations of the Ancient Order of United Workmen prescribe that each member shall designate the person to whom the benefit due at his death shall be paid. Mr. Middleton designated his wife as the person to whom his benefit should be paid. She predeceased him. The regulations provide for this contingency, and declare that, if the beneficiary dies during the lifetime of the member, and he makes no other direction, the benefit shall be paid in the first place to his widow, if living at the time of his death, and, if not then share and share alike to his children. Mrs. Middleton having predeceased Mr. Middleton, this rule operated to give the benefit to Mr. Middleton's children, Mrs. George and Harry B. Middleton, unless Mr. Middleton in his lifetime prevented the operation of this standing regulation of the society by making some effectual direction changing his beneficiaries from his children to some other person who was within some of the classes from which he might select. Miss Gandy, the other party in this controversy, insists that there was a direction in her favor made by Mr. Middleton in accordance with the regulations of the order, whereby he changed his beneficiary so that she Miss Gandy, and not Mr. Middleton's children, is entitled to receive the benefit. Miss Gandy's claim is opposed by the Middleton children as invalid upon two grounds: First, that the mode in which Mr. Middleton attempted to change his beneficiary selecting Miss Gandy in the place of his children did not accord with the requirements of the standing regulations of the society; secondly, that, even if there was a substantial compliance by Mr. Middleton with the methods...