United Order of Good Samaritans v. Meekins

• Decision Date: 30 October 1922
• Docket Number: 230
• Citation: 244 S.W. 439,155 Ark. 407
• Parties: UNITED ORDER OF GOOD SAMARITANS v. MEEKINS
• Court: Arkansas Supreme Court

244 S.W. 439

155 Ark. 407

UNITED ORDER OF GOOD SAMARITANS v. MEEKINS

No. 230

Supreme Court of Arkansas

October 30, 1922

Appeal from Clark Circuit Court; George R. Haynie, Judge; reversed.

STATEMENT OF FACTS.

Lillian Meekins sued the United Order of Good Samaritans to recover $ 300 alleged to be due her upon a benefit certificate issued by it upon the life of Luke Jefferson.

It appears from the record tat A. A. McElroy was present on the 16th day of August, 1920, when the local lodge of the United Order of Good Samaritans was organized at Arkadelphia, Ark. Since that time, McElroy has been what he calls president or colonial chancellor of said lodge. The lodge holds regular meetings, and is a secret order. It has a book containing its by-laws and the rules of the Supreme Colony of the United Order of Good Samaritans. The by-laws and rules of the order were introduced in evidence, and provide that no person shall be received as a member of the order above the age of sixty years.

Grant Reed was present at the time the local order at Arkadelphia was organized by W. R. Cox, a deputy of the grand lodge. Reed has been treasurer of the local lodge since it was organized. Cox solicited people to join who were over sixty years of age and told them that this did not make any difference as long as their health was good. Luke Jefferson was initiated on the night the lodge was organized, and was told by Cox that it did not make any difference that he was over sixty years of age. The members pay a certain stipulated sum as dues each month, and a certain per cent. of the amount so collected is sent to the grand lodge. Luke Jefferson paid his dues regularly until his death, which occurred on the 17th day of March, 1921. The benefit certificate issued upon his life was for the sum of $ 300, and was payable to Lillian Meekins, a daughter of Luke Jefferson.

Evidence was introduced on the part of the defendant to show that Luke Jefferson was over sixty years of age at the time he was initiated in the lodge; and on the other hand evidence was introduced by the plaintiff to show that Luke Jefferson was under sixty years of age at the time he joined the lodge.

Evidence was also introduced by the defendant to show that it paid the plaintiff the sum of $ 75, as a payment in full of any amount which might be due on the beneficiary certificate sued on.

The plaintiff admitted receiving this sum, but stated that it was a voluntary gift on the part of the defendant.

The jury returned a verdict in favor of the plaintiff, and the defendant has appealed.

Judgment reversed and cause remanded.

Callaway & Callaway, for appellant.

Appellant is a fraternal benefit society, and under sec. 6071, C. & M Digest, is exempt from the general insurance laws. Sec. 6075 provides for the qualifications of members, and is mandatory and any act of a deputy attempting to waive it was ultra vires, and not binding on the order. 98 Ark. 505. See also 30 Ark. 609.

A provision of the statute under which the appellant order was organized, and which gives it the right to do business cannot be waived. 114 Ill.App. 194; 215 Ill. 190; 74 N.E 121; 106 Am. St. Rep. 160.

Where the contract of insurance is beyond the powers conferred by law, neither the society nor any other party can, by acting on it, or assenting to it, be estopped to show that it was prohibited by law. 182 Ill.App. 319; 193 Mo.App. 619; 187 S.W. 134; 168 N.W. 189.

McMillan & McMillan, for appellee.

It was appellant's duty to prove that it was a fraternal benefit society under sec. 2068. See 143 Ark. 184.

Since the man Cox, who was sent by appellant to organize the lodge, told deceased that his age didn't matter, a by-law of the kind relied on would not be a defense in this case. 130 Ark. 12.

The benefit certificate does not comply with sec. 6076, C. & M. Digest. If a fraternal benefit society issues a policy not authorized by the statute under which it is incoporated, still the contract is enforceable against it. 223 S.W. 70 (Mo.); 193 Mo.App. 619.

Where an agent having express or apparent authority to take applications, makes false representations which induce the member to join the society, the society will be estopped from controverting the truth of such representations. W. O. W. v. Richardson, 151 Ark. 231. The defense of ultra vires is not available to appellant. 74 Ark. 377; 74 Ark. 191; 77 Ark. 109; 96 Ark. 595; 137 N.Y. 417; 151 N.Y. 24.

OPINION

HART, J. (after stating the facts).

Counsel for defendant assign as error the refusal of the court to instruct the jury that, if Luke Jefferson was over sixty years of age at the time he was initiated in the local lodge of the defendant, the plaintiff was not entitled to recover.

We think the court erred in refusing to give the instruction. The rules of the order provide that no person shall be received as a member of the order above the age of sixty years, and that failure to comply with this rule renders the contract null and void.

Our statute prescribing the qualifications for membership in fraternal benefit societies provides that any such society may admit to membership any person not less than sixteen and not more than sixty years of age. Crawford & Moses' Digest, § 6075. It will be observed that the by-laws follow the statute in fixing the age limit for membership in the order.

It is the contention of the plaintiff that the receipt and retention by the defendant of the dues of the deceased with knowledge that he was over sixty years of age at the time he was initiated in the lodge at Arkadelphia, operates as a waiver of the right to forfeit the benefit certificate. Counsel contend that a corporation cannot avail itself of the defense of ultra vires when the contract has been performed in good faith by the other party and the corporation has had the full benefit of such performance. In support of this claim various decisions heretofore rendered by this court are referred to and relied upon. We need not review these decisions; for they are not applicable in cases where contracts are prohibited by statute. If the prohibition contained in the rules of the order was all that was in the case, the principles might be availing to the plaintiff. The statute, however, restricts the age limit of members to those not over sixty years of age. It provides that only persons not less than sixteen and not more than sixty years of age may be admitted to membership in fraternal benefit societies. This amounts to a prohibition against admitting members over sixty years of age.

The general rule is that if a statute...