46 N.J. Eq. 102 | New York Court of Chancery | 1889
The complainant brings this suit to compel the Supreme Council of the Royal Arcanum to pay her the sum of $3,000, which she alleges she became entitled to by the death of her son, Merritt C. W. C. Britton, under a contract made by her son with the defendant. Her son was a member of the defendant corporation at the time of his death. He was admitted as a full-rate member on the 13th day of February, 1884, and died on the 2d day of May, 1888. He died childless, never having been married, and his nearest kindred at the time of his death were the complainant and two brothers. The defendant is a corporation organized under statutes of Massachusetts, authorizing the formation of corporations to raise a fund “ for the purpose of assisting widows, orphans, or other relatives of deceased members, or persons dependent upon deceased members.” By a statute passed in 1877 the persons to whom the accumulated fund of such a corporation could be dispensed or paid, were limited to “ widows, orphans, or other persons dependent on deceased members.” But a statute passed in 1882 enlarged the class of persons who might become the beneficiaries of the fund accumulated by such a corporation so as to embrace “widows, orphans, or other relatives of deceased members, or persons dependent upon deceased members.” American Legion of Honor v. Perry, 140 Mass. 580.
The contract on which the complainant rests her right to relief is to be found in the application for membership made by her son, the" certificate of membership issued to him and the constitution and by-laws of the defendant corporation. One of the principal objects of the defendant corporation, as its constitution declares, is to establish a widows and orphans’ benefit fund, from which, on satisfactory evidence of the death of a member of the order, who has complied with all its lawful requirements, a sum not exceeding $3,000 shall be paid to his family, or those
“ In the event of the death of all the beneficiaries, designated by the member in accordance with the laws of the order, before the decease of such member, if he shall have made no other or further disposition thereof, the benefit shall be paid to the legal heirs of the deceased member dependent upon him; and if no person or persons shall be entitled to receive such benefit, by the laws of this order, it shall revert to the widows and orphans’ benefit fund.”
By the constitution and by-laws, no person is qualified to become a member of the defendant corporation unless he is a
“ White man between twenty-one and fifty-five years of age, of sound health, of good moral character, a believer in a Supreme Being, and competent to earn a livelihood for himself and family.”
The foregoing summary states in substance all of the provisions of the constitution and by-laws pertinent to the present discussion.
In his application for membership Merritt C. W. C. Britton designated Robert M. Brennan as the person to whom he desired his benefit to be paid on his death, and in the certificate which the defendant issued to Britton, Brennan was named as beneficiary, and Britton, after obtaining the certificate, delivered it to
The question of the case is, Did the complainant, by the death of her son, become entitled to the sum which she claims? The defendant says she did not, because her son procured his certificate of membership by deceit and fraud, and it has, in addition to answering, filed a cross-bill asking for the surrender and cancellation of the certificate. The fraud charged consists in a representation in his application for membership that Brennan was his cousin, when, in truth, no relationship existed between them. The following are the material parts of Britton’s application:
I am not now a member of this order; I have not within six months been rejected; am not now under suspension, and have never been expelled from*106 any council of this order; and am a believer in a Supreme Being. I reside at 305 York street, Jersey City. I was born ón the seventh day of August, 1851, and am between thirty-two and thirty-three years of age. My occupation is that of a medical student; place of business, College of P. and S., New York city. I direct that, in case of my death, all benefit to which I may be entitled from the Boyal Arcanum be paid to Bobert M. Brennan, Hopewell, Mercer county, N. J., related to me as cousin, subject to such future disposal of the benefit among my dependents as I may hereafter direct in compliance with the laws of the order. I am temp>erate in my habits, and have no injury or disease which will tend to shorten my life; am now in good health and able to gain a livelihood. I do hereby consent and agree that any untrue or fraudulent statement made above, or to the medical examiner, or any concealment of facts by me in this application, or any suspension or expulsion from, or voluntarily severing my connection with, the order, shall forfeit the rights of myself and my family or dependents to all benefits and privileges therein.”
The only one of the foregoing statements which it is asserted was either untrue or fraudulent, is the one in which it is stated that Brennan was related to Britton as cousin. But conceding, as it must be, that that statement was untrue, and that it was made .knowing it to be;untrue, the question which this condition of facts raises is- this: Did that statement have the least effect in influencing or inducing the defendant into doing something to its harm or injury which it would not have done if no such state-, ment had been made? It is clear, I think, that it cannot be considered a warranty. There is nothing in the constitution or by-laws which would warrant the court in so construing it. It has been held, that, where an applicant for admission to membership in a similar corporation made representations concerning the condition of his health, which were untrue, but which he supposed to be true when he made them, that they did not constitute warranties, nor preclude his beneficiary from recovering on the contract. Illinois Masons Beneficial Society v. Winthrop, 85 Ill. 537.
The only possible misleading effect which the statement in question could have had, was to produce the belief that Brennan was qualified to become Britton’s beneficiary, when, in fact, he was not. But of this, it appears, the defendant’s officers were informed by other statements contained in Britton’s application. When Britton was admitted to membership, the defendant’s bene
Britton’s application stated that he resided at Jersey City and that Brennan resided at Hopewell, Mercer county, so that the application gave the defendant’s officers notice, on its face, that Brennan was not a member of Britton’s family, but that they resided at different places, a long distance apart. The application did not represent that Brennan was dependent on Britton; it said nothing on that subject; all it said was, that he was Brit-ton’s cousin, but this did not qualify him to become Britton’s beneficiary. He could not be Britton’s beneficiary except he was dependent on him. And just in this connection, it is proper to state, that it appeared from Britton’s examination before the defendant’s medical examiner, which was annexed to his application and formed part of it, that he had three relatives nearer in
Nothing has been shown which entitles the defendant to the surrender of its certificate on the ground that it was fraudulently.
Another defence is set up. The defendant insists that, by the terms of its contract, it is under no duty to recognize any person as the beneficiary of a deceased member except the one designated by him, and that if the person whom he has designated happens to be disqualified, it is not liable to anybody, but that, in such a state of circumstances, the sum which would have been payable on the death of the member to his beneficiary, had he designated a person competent to take, lapses and sinks into the widows and orphans’ benefit fund. This defence is based on that provision of the constitution which declares, that one of the objects of the defendant is to establish a widows and orphans’ benefit fund, from which, on the death of a member, there shall be paid a certain sum to his family or those dependent on him, as he may direct The argument is, that as the contract says that that part of the fund payable on the death of a member shall be paid as he may have directed, it necessarily follows, that if a member dies without having exercised his right of direction, or if he has given a direction which he had no authority to give, nothing can be paid. The claim is, that the right of a beneficiary to take depends on the fact that the power of appointment, vested in a member, has been exercised in his favor, and that if he cannot show such an appointment he is without right. But this view manifestly overlooks another very material part of the contract. One of the defendant’s by-laws, it will be remembered, ordains, in substance, that if the beneficiary, appointed by a member, dies in the lifetime of the member, and the member shall subsequently make no other or further disposition of that part of the benefit fund payable on his death, it shall, on his death, be paid to his legal heirs dependent on him; and that if there be no person entitled to receive it, according to the laws of the order, it shall revert to the widows and orphans’ benefit fund. If we look, then, at the whole contract, and construe it in the light of all of its provisions, it would seem to be clear, that there can be no lapse or reverter, except a member dies without leaving an heir dependent on him.
Has this court power to enforce the complainant’s right ? She has no remedy at law. The defendant made no promise to her. Brennan holds Britton’s certificate of membership and refuses to surrender it. According to the terms of the contract, the defendant is not required to pay until this certificate is surrendered. This provision of its by-laws is reasonable and necessary. It was adopted to prevent the loss or waste of any part of its benefit fund in litigation in resisting illegal claims. The complainant, to'put herself in a position where she will be entitled to the payment of the money in question, must first procure a judicial sentence either compelling, or declaring it worthless in his hands. Such a sentence can only be pronounced by a court of equity. The case comes, therefore, directly within the regulation of judicial power which declares, that where there is a civil wrong there ought to be a remedy, and if the law gives none, equity shall take jurisdiction in order that what is right may be done. The complainant is not entitled to interest. The money she is seeking to recover is not payable until Britton’s certificate of membership has been surrendered. The defendant has offered to pay on the surrender of the certificate, but Brennan, by refusing to surrender it, has kept affairs in such a condition that the defendant could not pay with safety. No claim for the interest which has been lost by Brennan’s conduct is made against him by the bill, and the question, therefore, whether he is liable for it or not, is not in the case.
The complainant is entitled to a decree declaring, that that part of the certificate, issued to Britton, which promises that payment shall be made to Brennan is void, and directing Brennan forthwith to surrender the certificate for cancellation; and also declaring, that the complainant is entitled to the $3,000 which became payable on her son’s death, and directing that the defendant corporation shall within ten days after service of a copy of the decree pay that sum to the complainant. The decree will be made without costs as against the defendant corporation, but with costs as against Brennan.