Logan v. Modern Woodmen of America
| Decision Date | 15 June 1917 |
| Docket Number | 20,396 - (123) |
| Citation | 163 N.W. 292,137 Minn. 221 |
| Parties | ZOE OLIVE LOGAN AND ANOTHER v. MODERN WOODMEN OF AMERICA |
| Court | Minnesota Supreme Court |
Action in the district court for Ramsey county to recover $3,000 upon defendant's benefit certificate. Defendant made application to pay the money into court and to have Adolphus Jones, Iona Doran, Olive Doran, and her guardian, substituted as defendants in the action, and the application was granted. The case was tried before Dickson, J., who made findings and ordered judgment in favor of the substituted defendants. Plaintiffs' motions for judgment in their favor notwithstanding the decision, or for a new trial, and to amend the findings, were denied. From the judgment entered pursuant to the order for judgment, plaintiffs appealed. Affirmed.
Mutual benefit insurance -- designation of ineligible beneficiary invalid.
1. Where the by-laws of a fraternal association are made a part of the contract of insurance, and provide that no part of the benefit fund shall be paid to any person not bearing a specified relationship to the assured, the designation of a beneficiary not bearing such relationship is invalid.
Mutual benefit insurance -- acceptance of assessments not a waiver of by-law.
2. Where the by-laws provide that, in case an ineligible person is named as beneficiary, the insurance shall be payable to the widow and children of the assured, the association cannot refuse to receive assessments on the ground the beneficiary named is ineligible, and the acceptance of such assessments does not operate as a waiver of the provision which made such beneficiary ineligible.
Effect of payment into court.
3. Paying the money into court was not an admission of liability to any particular claimant, but a demand that the court protect the association against double liability by determining to whom the money rightfully belonged.
Designating an ineligible for beneficiary -- by-law.
4. Where the designation of an eligible beneficiary has been duly canceled in the manner prescribed by the contract, the designation of an ineligible beneficiary in the new benefit certificate does not operate to revive or reinstate such canceled designation, where the by-laws provide that in such event the new certificate shall remain in force and be payable to certain eligible beneficiaries designated therein.
Designating an ineligible for beneficiary.
5. The by-laws declare void any and all attempts of the insured to dispose of the fund otherwise than provided in the contract and an ineligible beneficiary acquired no interest therein by paying assessments under an agreement with the insured to share in it.
Designating an ineligible for beneficiary.
6. The designated beneficiary being ineligible, the by-laws made the children of the insured his beneficiaries.
Percy D. Godfrey, for appellants.
James E. Doran and Timothy J. Doyle, for respondents.
In 1889, Oliver Jones procured a benefit certificate for the sum of $3,000 in the Modern Woodmen of America in which Olive Austin, his housekeeper and the mother of his deceased wife was named as the beneficiary. In his later years it became difficult for him to pay the assessments upon the certificate, and he made an arrangement with Zoe Olive Logan, a granddaughter of Mrs. Austin and a niece of his deceased wife, to the effect that Mrs. Logan should pay these assessments, should receive the proceeds of the certificate, and should divide such proceeds equally between herself and Mrs. Austin. Pursuant to this arrangement, the original certificate was duly surrendered and canceled, and in lieu thereof a new certificate was issued in which Mrs. Logan was named as the beneficiary. After the making of this arrangement, Mrs. Logan paid the assessments as they became due until the death of Oliver Jones on October 15, 1915. After the death of the assured, Mrs. Austin and Mrs. Logan joined as plaintiffs in bringing this suit, and ask to recover the insurance under the certificate issued in favor of Mrs. Logan, and, in case they are not entitled to recover it under that certificate, ask to recover it under the original certificate issued in favor of Mrs. Austin, and, in case they are not entitled to recover under either certificate, ask to recover the assessments paid by Mrs. Logan amounting in the aggregate to the sum of $400. The children of the assured also made a claim for the insurance, whereupon the society paid the money into court and the children were substituted in its stead as defendants. The case then went to trial to determine whether the fund belonged to the plaintiffs or either of them, or to the children, and resulted in a judgment in favor of the children. Plaintiffs appealed.
The by-laws of the society are incorporated in and made a part of the contract of insurance. Section 45 of these by-laws provides:
Under this by-law, the assured could appoint as beneficiary any person within any of the designated classes, but could make no valid appointment of any person not within some one of such classes.
It is conceded that Mrs. Austin was a dependent of the assured and a member of his family at the time the first certificate was issued, and so remained until his death, and that she was properly and lawfully designated as the beneficiary in such first certificate. Section 47 of the by-laws provides that any member, who desires to change his beneficiary, shall execute the surrender clause on the back of his certificate and return the certificate to the society, and that the head clerk "shall thereupon issue a new benefit certificate to the beneficiary named in said surrender clause, subject to the provisions of section 45 hereof." In his application to have Mrs. Logan named as his beneficiary in place of Mrs. Austin, Oliver Jones stated that Mrs. Logan was his niece; and upon this application the society canceled the first certificate and issued a new certificate payable to Mrs. Logan, "related to said member in the relationship of niece." It is conceded, however, that Mrs. Logan in fact is not a blood relative of the assured, but the niece of his deceased wife, and that she was never dependent upon him, nor a member of his family. Consequently she is not within any of the classes of persons eligible to be appointed as his beneficiary; and her appointment as such, being prohibited by the laws of the society, gave her no right to share in the benefit fund of the society. Middelstadt v. Grand Lodge O.S.H. 107 Minn. 228, 120 N.W. 37; Meyer v. Grand Lodge O.S.H. 108 Minn. 25, 121 N.W. 235; Anderson v. Royal League, 130 Minn. 416, 153 N.W. 853, L.R.A. 1916B, 901; Bush v. Modern Woodmen of A. (Iowa) 152 N.W. 31, 162 N.W. 59; Supreme Lodge O. of M.P. v. Dewey, 142 Mich. 666, 106 N.W. 140, 3 L.R.A. (N.S.) 334, 113 Am. St. 596, 7 Ann. Cas. 681; O'Brien v. Massachusetts C.O. of F. 220 Mass. 79, 107 N.E. 400; Murphy v. Nowak, 223 Ill. 301, 79 N.E. 112, 7 L.R.A. (N.S.) 393; Gregory v. Sovereign Camp of W. of World, 104 S.C. 471, 89 S.E. 391; Kerr v. Crane, 212 Mass. 224, 98 N.E. 783, 40 L.R.A. (N.S.) 692.
Plaintiffs presented evidence tending to show that the clerk of the local camp of which Oliver Jones was a member knew the actual relationship existing between him and Mrs. Logan, and contend that the society, by...
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