Taylor v. Grand Lodge A. O. U. W. of N.D.

• Decision Date: 04 June 1920
• Citation: 178 N.W. 130,45 N.D. 468
• Parties: TAYLOR v. GRAND LODGE A. O. U. W. OF NORTH DAKOTA et al.
• Court: North Dakota Supreme Court

45 N.D. 468

178 N.W. 130

TAYLOR

v.GRAND LODGE A. O. U. W. OF NORTH DAKOTA et al.

Supreme Court of North Dakota.

May 12, 1920.

Concurring Opinion May 24, 1920.

Rehearing Denied June 4, 1920.

Syllabus by the Court.

Where the constitution, by-laws, or regulations of a fraternal order, which issues benefit certificates, providing for the payment of death benefits at the death of the member, prescribes the acts to be done at the will of and by the insured to effect a change of beneficiary, and the insured has done some of the acts to effect such change, but dies before the change is fully completed, and it is equitable to regard all he should have done to complete the change of beneficiary as done, a court of equity will so regard it, and give effect to his intention to change the beneficiary, notwithstanding the acts done by the insured were not a full compliance with the requirements of the constitution, by-laws, etc.

Where it is plain that the insured has done all that he could do to effect the change of beneficiary in a fraternal benefit certificate, and unforeseen and unavoidable conditions and circumstances prevent the completion thereof, and in equity and good conscience the change should be effected to carry out the intentions of the insured, a court of equity will regard that as done which ought to be done.

Additional Syllabus by Editorial Staff.

Conceding the rule that, where the by-laws or constitution of a mutual benefit society provide a method of changing the beneficiary, that method must be strictly pursued, there are exceptions, as where the society has waived compliance therewith, or estopped itself to assert noncompliance, where it is beyond the member's power to literally comply, as where is it impossible to surrender the original certificate as required, and where only formal and ministerial acts remain to be done by the society to complete the change, and the member dies before the performance thereof.

Appeal from District Court, Cass County; A. T. Cole, Judge.

Action by Bentley Taylor against the Grand Lodge of the Ancient Order of United Workmen of North Dakota and another, in which defendant Order brought the proceeds of the certificate in suit into court to be turned over to plaintiff or to Margaret Jane Davis, claimant, as the beneficiary entitled thereto. Judgment for plaintiff, and Margaret Jane Davis appeals. Affirmed.Flynn, Traynor & Traynor, of Devils Lake, for plaintiff and respondent.

Fowler & Green, of Fargo, for defendants and interpleaders.

GRACE, J.

This action is one by the plaintiff, claiming as beneficiary, to recover the amount of a certain beneficiary certificate issued by the defendant to Robert Ryan. The material facts in the case are substantially as follows:

On the 18th day of February, 1909, the defendant, through its local lodge at Minnewaukan, N. D., issued to Robert Ryan, its benefit certificate No. 4140, in the sum of $2,000. In the certificate, when issued, Maggie Ryan, now Margaret Jane Davis, the appellant, was named as the sole beneficiary, and she now claims the proceeds thereof. Until Sunday, January 26, 1919, the certificate remained in the possession of Robert Ryan. On the date last mentioned, and for some time prior thereto, he was sick at a hospital in Devils Lake. At his request, the respondent had come to Devils Lake some days prior to the above date. On the 25th day of January, Edward Flynn, an attorney, at the request of plaintiff, prepared a will, which was signed by Ryan. On January 26th, Flynn took the will to the hospital and read it to Ryan, who objected to the portion of the will which provided that the proceeds of the insurance certificate become a part of his estate, and stated that he desired the insurance to go to the plaintiff. A new will was prepared, in which the insurance was not mentioned, and it was signed by Mr. Ryan. The plaintiff was not mentioned in the will.

It clearly appears from the testimony that plaintiff did not wish to be mentioned in the will and that he was not seeking in any manner to get any of Mr. Ryan's property. He acted at all times in the highest of good faith and at no time used any influence to procure Mr. Ryan to will or otherwise transfer to him any of his property; he was in fact reluctant to receive any of it. The designation of the plaintiff as beneficiary was wholly and entirely the act of Ryan who at that time was in possession of his mental faculties which were as the evidence shows, unimpaired. On the back of the certificate there is printed in a blank a request for charge of beneficiary. This Flynn filled in, the plaintiff being designated beneficiary therein, and Ryan signed it on January 26th, in the presence of Flynn and one Breah and one Harriman, and the certificate, together with the will as revised, delivered to plaintiff. At the time deceased executed the request for change of beneficiary, he was friendly to the plaintiff, and desired him to have the insurance.

On the afternoon of January 27th, Mr. Ryan died, and about 18 days after his death the certificate was presented, by plaintiff, to the local recorder at Minnewaukan, and he affixed his signature and the seal of the local lodge to the request for the change of beneficiary upon the back of the certificate. The certificate was then by the plaintiff presented to the Grand Recorder at Fargo, and payment thereon demanded. It was refused.

The application upon which the certificate was issued, as is usually the case in this class of insurance, provided that the rights of the insured and the rights of the beneficiary should, at all times, be subject to all laws, rules, and regulations of the order as they then existed, or as might thereafter be adopted. The defendant has brought the proceeds of the certificate into court, and is willing to turn it over to the beneficiary lawfully entitled to receive the same. The predominant issue in the case is which of the two is the rightful and lawful beneficiary, and entitled to receive the proceeds of the insurance policy. The regulations of the lodge or order governing change of beneficiary, read thus:

“Any member desiring to change his beneficiary may do so in the following manner: viz. 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 a civil officer having a seal, under his official seal, if such member cannot sign in the presence of the lodge recorder.

When this is done, he shall deliver his beneficiary certificate to the recorder of his lodge, together with a fee of fifty 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.”

It will be observed that the principal requirements of the regulation of the order providing for change of beneficiary are three, namely: That the insured fill out and sign the blank form on the back of the certificate, authorizing the change; second, that the signature be attested by the recorder of his lodge, and the lodge seal affixed, or attested, by a civil officer having a seal when the insured is unable to sign in the presence of the local lodge recorder; third the delivery of the beneficiary certificate with the attached request for such change to the recorder of the local lodge with a fee of 50 cents. These are all the things required of him. The forwarding of the certificate with the fee, to the Grand Recorder, the making of a record of the change on the books of the Grand Lodge and the issue of a new certificate in lieu of the old certificate are, respectively, duties exclusively belonging to the local and Grand Recorder over which the insured has no control; and his acts with reference to effecting a change of beneficiary in the certificate should not be affected by the failure of either the local or Grand Recorder to perform the duties required of them by such regulation.

We need give no further attention to the duties required of the local or Grand Recorder but may proceed to the consideration of the requirements contained in the regulation which relate to the acts to be done by the insured to accomplish a change of beneficiary.

There are numerous decisions of many courts, state and otherwise, which, in substance, hold that, where the by-laws or constitution of a mutual benefit society provide a method of making a change of beneficiary, that method must be pursued by a member making such change or designation. Thomas v. Thomas, 131 N. Y. 205, 30 N. E. 61, 27 Am. St. Rep. 582;McCarty v. Lodge, 153 Mass. 314, 26 N. E. 866, 11 L. R. A. 144, 25 Am. St. Rep. 637;Fink v. Fink, 171 N. Y. 616, 64 N. E. 506;Flowers v. Lodge, 40 Tex. Civ. App. 593, 90 S. W. 526;M. W. A. v. Headle, 88 Vt. 37, 90 Atl. 893, L. R. A. 1915A, 580;Grand Lodge, A. O. U. W., v. Ganby...