Modern Woodmen of America v. Tevis

• Decision Date: 30 September 1901
• Docket Number: 1,514.
• Citation: 111 F. 113
• Parties: MODERN WOODMEN OF AMERICA v. TEVIS et al.
• Court: U.S. Court of Appeals — Eighth Circuit

111 F. 113

MODERN WOODMEN OF AMERICA v. TEVIS et al.

No. 1,514.

United States Court of Appeals, Eighth Circuit.

September 30, 1901

C. G Laybourn (J. W. White, John Sullivan, and E. C. Ellis, on the brief), for plaintiff in error.

James D. Harkless (John O'Grady and Charles S. Crysler, on the brief), for defendants in error.

Before SANBORN and THAYER, Circuit Judges, and ADAMS, District Judge.

SANBORN Circuit Judge.

Does the habitual collection by the clerk of a local lodge of a fraternal beneficiary association of the benefit assessments within 1 month and 20 days after the time when, by th by-laws of the association and the terms of the certificates they become due, and the members become suspended, and their society from maintaining that the members were suspended, and that their certificates were avoided, within the customary period of extension of the time of payment? This is the issue presented by the case in hand. The Modern Woodmen of America is a fraternal beneficiary society governed by the head camp which is a representative body composed of its elective officers, its general attorney, standing committees, and delegates from state camps. It is the lawmaking body of the organization, and its board of directors and its head consul and head clerk are empowered to levy and collect from its beneficial members the assessments necessary to pay the amounts due to the beneficiaries of its deceased members. The state camps are composed of delegates from the local camps, and the local camps and their officers are the means by which the society secures its members and collects the benefit assessments upon which it relies for existence. These local camps are composed of the individuals upon whose membership and payments the welfare and success of the association depend. Their chief executive officers are consuls and clerks, and it is one of the duties of these clerks to keep the accounts, collect the benefit assessments, and remit them to the head camp. This is an action by the beneficiaries named in a certificate of this association issued on March 31, 1899, to M. W. Tevis, a member of Poplar Camp, No. 3,794, who died on August 10, 1899. By this certificate the society promised that the defendants in error should, in case of the death of Tevis while in good standing, participate in the benefit fund of the association to the amount of $3,000, on condition, among other things, that the certificate should be subject to forfeiture for any of the causes prescribed in the by-laws, and should be void if Tevis failed to pay to the clerk of his camp every benefit assessment levied upon him on or before the 1st day of the month following the date of the notice of its levy. The by-laws of the society provide that the clerk of the local camp shall collect and receive for the head camp all benefit assessments levied, keep th: records and accounts of the local camp, and report to the head camp his collections for it, and the members of his camp that are delinquent in the payment of each assessment (sections 260, 261, 263); that the clerk of the local camp is th: agent of such camp, and not the agent of the head camp, and that no act or omission on his part shall have the effect of creating a liability of the society, or of waiving any right or immunity belonging to it (section 271); that no officer of the society or of any local camp can waive any provision of the by-laws which relates to the substance of the contract for the payment of benefits (section 34); that any beneficial member who fails to pay any benefit assessment on or before the 1st day of the month following the date of the notice thereof is thereby ipso facto suspended, and his benefit certificate is 'absolutely null and void during such suspension' (section 46); that the clerk of the local camp shall report all members who fail to pay any assessment when due to his camp and to the head camp as delinquent and suspended, and that the head clerk shall immediately notify every such member of his suspension, and inform him of the requirements necessary for his reinstatement (sections 260, 264, 114); and that any suspended member in good health may be reinstated within 60 days from the date of his suspension, by paying all arrearages due and furnishing his written warranty that he is in good health (section 49). During all the time that the deceased was a member of this society the local camp to which he belonged and its clerk persistently and uniformly disregarded every provision of these by-laws and of his certificate of membership which relates to the suspension of members for failure to pay the benefit assessments when due. While the by-laws provided that every member who failed to pay on the last day fixed therefor by the notice was thereby suspended, and his certificate was void, so that he could be reinstated only by payment of arrearages and by furnishing a warranty of good health, this local camp enacted and operated a by-law in direct violation of these provisions to the effect that one assessment for each delinquent member should be paid by the local camp, so that his delinquency was never treated as a suspension of his membership, or an avoidance of his certificate, and was never reported to the head clerk. While the by-laws provided that the local clerk should report as suspended every member who failed to pay an assessment on the last day fixed therefor in the notices of assessment, and that the head clerk should thereupon notify the delinquent of his suspension, and of the necessary requirements for his reinstatement, the clerk of this local camp never reported any one suspended who was delinquent in paying but one assessment on account of the by-law of the local camp, and never reported any one suspended who was delinquent in paying a second assessment if he paid it within 20 days after it was due. The course of collection uniformly pursued by the clerk when Tevis was a member was this: The assessments were due on or before the 1st days of the respective months specified in the notices calling them. The clerk did not send his report of collections under any assessment to the head clerk, or remit the proceeds to the head banker, until the 20th day of the month on the 1st day of which it was due; and he invariably received from any delinquent member, without any warranty of health, the assessment levied upon him if he paid it after the 1st and at any time before the 20th of the month, and he never reported or treated such a delinquent member as either delinquent or suspended.

When tried by this habitual course of business, this invariable custom adopted by this local camp and its clerk, all the assessments of Tevis were paid in due time; but when tried by the literal terms of the by-laws and the certificate he was delinquent in the payment of every assessment but the first which he paid in March, when he received his certificate. On May 1, 1899, assessment No. 3 fell due, and he did...