Hiatt v. Fraternal Home

• Decision Date: 17 February 1903
• Citation: 72 S.W. 463,99 Mo. App. 105
• Parties: HIATT v. FRATERNAL HOME.
• Court: Missouri Court of Appeals

72 S.W. 463

99 Mo. App. 105

HIATT v. FRATERNAL HOME.

Court of Appeals at St. Louis, Missouri.

February 17, 1903.

FRATERNAL BENEFICIARY ASSOCIATIONS — MEMBERSHIP — NECESSITY FOR INITIATION — CERTIFICATES — VALIDITY — ESTOPPEL — AGENCY.

1. Rev. St. 1899, § 1408, by requiring fraternal beneficiary associations to have a lodge system, intends that no person shall become a member of such an association until he has been initiated into one of its lodges.

2. Until one has been initiated into a local lodge of a fraternal beneficiary association, the association cannot rightfully issue a benefit certificate to him.

3. Where, by the by-laws of a fraternal beneficiary association, its certificates were not binding until countersigned by the secretary and president of the local lodges, and a certificate was not so countersigned until after the applicant therein had deceased, the certificate was void.

4. Where a deputy organizer of a fraternal beneficiary association had no authority either under his appointment by or contract with the supreme lodge, or under his appointment by a local lodge, to deliver certificates of insurance or to collect dues and assessments, an arrangement made by him with the secretary of a local lodge, whereby he was to perform these duties, was not binding on either the supreme or local lodge.

5. Where the secretary pro tem. of a local lodge was induced to accept the money of an applicant for insurance after his decease, and immediately on ascertaining the fraud tendered the money back to the party paying it, who would not receive it, and there was no administrator of the deceased's estate to whom it could be tendered or paid, and the secretary kept the money ready for the rightful claimant, whenever he appeared, the lodge was not estopped to deny the contract of insurance.

Appeal from circuit court, Greene county; Jas. T. Neville, Judge.

Action by Ellen O. Hiatt against the Fraternal Home. Judgment for defendant, and plaintiff appeals. Affirmed.

The defendant is a fraternal beneficiary society organized under article 11, c. 12, Rev. St. 1899. The order has a lodge system, with supreme and subordinate lodges, a ritualistic form of lodge work, a secret initiatory ceremony, with signs and passwords, and a representative form of government. Its supreme executive authority is vested in the supreme lodge. This body has a supreme president and a supreme secretary and medical examiner. The principal business office of the order is located at Hamilton, Caldwell county Mo. Foster E. Ackley is, and has been since the organization of the association, its chief medical examiner, and either its actual or acting supreme secretary and its chief manager; in fact, the evidence shows that the executive duties of the supreme lodge have been intrusted wholly to him. Subordinate lodge No. 6 of the order is located at Springfield, Mo. On July 23, 1900, William Hiatt made application for membership in the order, and applied for $2,000 insurance on his life for the benefit of his mother, Ellen O. Hiatt, of Lexington, Ky. He was examined by the local physician of the order at Springfield, and on July 31, 1900, was duly elected to become a member by local lodge No. 6. His application for insurance and his medical examination were forwarded to the home office, and were approved by Dr. Ackley, and the following certificate issued and forwarded to George Ragsdale, secretary of local lodge No. 6, at Springfield, to wit: "No.2992, $2,000. The Fraternal Home, Hamilton, Missouri. Keeps the Wolf from the door. Copyrighted 1899 by The Fraternal Home. Age 27. Rate 80c. This certifies that William M. Hiatt is a member of The Fraternal Home Lodge No. 6, at Springfield, State of Missouri, and within ninety days after receipt of satisfactory proofs of his death, there shall be paid to Ellen O. Hiatt (mother) if living, if not, to his legal representative, the sum of Two Thousand Dollars. The conditions, benefits and provisions, printed or written by the Society on the back hereof, are a part of this Certificate. The benefits herein shall be incontestable from this date. In witness whereof, The Fraternal Home has caused its corporate seal to be hereunto affixed and these presents to be signed by its Supreme President and Supreme Secretary, at Hamilton, Missouri, this 25th day of July, 1900. William W. Anderson, Supreme President. Foster E. Ackley, Supreme Secretary. [Supreme Seal.]"

Ragsdale was confined to his home at the time by illness, and a secretary pro tem. (J. J. Hibler) was elected to act in his stead during his illness. Ragsdale, however, retained possession of the certificate. By-law No. 69 of the order, after prescribing the manner for making application for insurance and requiring a medical examination to be had, provides as follows: "Upon complying with the above the secretary shall send the application and medical examiner's report to the supreme medical director for review. At the first regular meeting of the lodge thereafter he shall be balloted upon. If three black balls are cast the applicant shall be rejected, and cannot again make application for a period of three months. He may be in waiting at the time the ballot is taken, and, if elected, shall be initiated. But if he fails to be present for initiation at such time, or the first regular or special meeting thereafter, the fees paid shall be forfeited, unless by special dispensation of the supreme lodge he is permitted to appear for initiation at a later date. Where the applicant fails to appear for initiation as above required and the fees are forfeited, if he again wishes to apply for membership he must be re-examined, but shall not be required to again pay the admission fees. If the application is accepted by the supreme medical director, a benefit certificate shall be issued, signed by the supreme president and supreme secretary for such amount as the supreme medical director shall authorize, but not to exceed $2,000 from eighteen to and including forty-five years of age at nearest birthday; $1,000 from forty-five to and including fifty years of age at nearest birthday, and $500 from fifty to and including fifty-five years of age at nearest birthday: provided, that no person shall be admitted under eighteen or over fifty-five years of age. Said benefit certificate shall be sent to the secretary of the local lodge to be countersigned by the president and secretary thereof and delivered to the applicant when he is initiated and pays the following fees to the local secretary, viz.: One assessment, one month's reserve fund, one month's supreme lodge per capita tax, and one month's local lodge dues, and shall be liable for all subsequent benefit assessments in accordance with the laws of the fraternity. The benefits given under certificate applied for shall begin when the above requirements are complied with. At any time before the initiation of an applicant, the lodge may by a majority vote refuse to initiate, in which case the...