83 A. 715 | Md. | 1912
This is an appeal from a decree of the Circuit Court of Baltimore City, which determined that the appellee was entitled to a fund which had been paid into Court by the American Mutual Benefit Society of Baltimore under a bill of interpleader. The evidence shows that the appellee was married to Frederick Meinhardt in 1888, but they separated a few years afterwards and did not live together again, although they were never divorced; that the appellant and Frederick Meinhardt lived together as man and wife for over ten years prior to his death, which occurred in December, 1909.
While the latter were so living together, to wit, on May 28th, 1907, a certificate of membership was issued by the American Benefit Society of Baltimore City to Frederick Meinhardt by which he was entitled to receive from the Benefit fund a sum not exceeding two hundred and fifty dollars, and the certificate states that "the benefits herein provided will be paid to Bertha Meinhardt, wife, after the proper proofs of death." That society became incorporated in 1909, and after the death of Mr. Meinhardt it filed a bill of interpleader against the appellant and the appellee, both of whom are claiming the fund, which finally resulted in the above mentioned decree being passed. The appellee contends that the certificate was subject to the provision in what is section 210 of Article 23 of the Code of 1904, which is as follows: "Payments of death benefits may be made only to the widow, children, grandchildren, mother, father, brother, sister, grandparent, aunt, uncle, niece, nephew, first cousin, next of kin who would be distributees of the member's personal estate if he died intestate, to an affianced husband or affianced wife of the member, or to persons dependent upon the member for food, lodging, clothing or education, and to none other." The record is by no means satisfactory, as it is difficult, if not impossible, to determine from it the precise character of business done by the American Mutual Benefit Society. Section 210 of Article 23 of *429 the Code of 1904 also says: "A fraternal beneficiary association is hereby declared to be a corporation, society or voluntary association, formed or organized and carried on for the sole benefit of its members and their beneficiaries, and not for profit. Each such association shall have a lodge system, with ritualistic form of work and a representative form of government, and shall make provision only for the payment of benefits in case of sickness, disability or death of its members, subject to their compliance with its constitution and laws."
There is nothing in the record to show whether the society had a lodge system, with ritualistic form of work, and the evidence was very meagre as to its form of government. No reference whatever is made in the charter to the provisions of the Code applicable to Fraternal Beneficiary Societies, and there are those in it which rather indicate that it was intended to organize a corporation exclusively on what is known as the mutual or co-operative plan. It is true that Mr. Pardee testified that he was "Actuary for the society, and general manager of the fraternal branch," but whether or not the society was authorized by law to conduct such business is left in uncertainty by the record. It may be that it actually was, and hence we will not decide that question on this record, which we deem too uncertain to justify us in passing on it, as our determination might injuriously affect the society and members of it who are not before us.
We have concluded that we must remand this cause without affirming or reversing the decree, and we will state the conclusions reached by us on such points as we feel justified in determining on this record, as directed by section 38 of Article 5 of the Code. If it be shown that the society is subject to the provisions of the Code in reference to Fraternal and Beneficiary Societies (sections 210, etc., of Article 23), then in our judgment the appellant is not entitled to this fund. She was confessedly not the wife of Frederick Meinhardt and was not related to or dependent upon him, as provided by section 210, and the language of that section that "Payments of death benefits may be made only to the widow, *430
children * * * and to none other," can not be disregarded. The appellant cited 29 Cyc. 105, where it is said that "even where by statute, by the common law, or by the charter or laws of the society restrictions are placed on the right to designate beneficiaries, it is generally held that no one but the society can question the eligibility of the person designated, and that its right to object may be lost by estoppel or waiver." It can not be said in this case that the society could be estopped or that it waived this provision by receiving the dues from this member, for it is thoroughly established by the evidence that it did not know until after the death of the member that the appellant was not his lawful wife. There are cases which hold that by requiring claimants to interplead and pay the money into Court, the association waives the ineligibility of the beneficiary designated by the member, Aurora Lodge v. Watson,
An examination of the cases cited in the note to 29 Cyc. 105, above quoted, will show that there was no statute such as ours involved in any of those decisions. There are undoubtedly cases which hold that in the absence of a statute prohibiting payment to beneficiaries other than those named in the statute an association may under some circumstances be estopped from denying its liability, or it may waive a by-law or rule of its own creation, although there are other decisions to the contrary, but when the statute under which it is created and by which it is governed expressly declares that payments can only be made to certain designated classes and "to none other," it cannot be set aside by acts of the society, on the ground of estoppel or waiver, and the society, its members and those claiming under such members are subject to the terms of the statute. InBritton v. Royal Arcanum,
In Coulson v. Flynn,
Our conclusion, therefore, is that if this society is a fraternal beneficiary society as defined by our statute and this certificate was issued under that plan, the appellant is not entitled to the fund in controversy. If, however, it is shown that it is not such a society, but is simply an insurance company on the mutual or co-operative plan, then as section 210 of Article 23 is not applicable she is entitled to recover the fund, as we know of no legal reason why such insurance could not have been taken out for her benefit. But the record is not sufficient to enable us to now determine which it was.
This brings us to the consideration of peculiar and unusual conditions. If it be satisfactorily shown, after the case is remanded, that the society is subject to the provisions of section 210, etc., of Article 23, then the appellant not only has no standing in Court to claim the fund, but she is in no position to contest the disposition of it. No provision is made in the society's laws which appear in the record for the disposition of the fund, if the beneficiary named in the certificate be ineligible. It may be that the executive board has adopted some by-law, rule or regulation under Law XXIV., which says: "The executive board may adopt any *433
by-laws, rules and regulations not in conflict with the laws of this society," but if it has adopted one which applies to such conditions as we have before us, we are not so informed by the record. Surely most associations of this kind have rules covering such cases. In Dale v. Brumbly,
It is said in 29 Cyc. 156, that "In case the designation of a beneficiary proves for any reason to be invalid or ineffectual, the fund does not as a rule revert to the society; but it goes to such person or persons as are eligible to take the benefits in the manner prescribed by statute or by the laws of the society or the certificate of insurance," and in giving illustrations of when that rule applies, it mentions amongst others "where the person designated as beneficiary was at the time of his designation ineligible as such." If the by-laws or some rule of the society had named the order in which those who can be beneficiaries shall be paid, if the designation in the certificate of a beneficiary proves to be invalid or ineffectual, there could be no difficulty in determining who is entitled to this fund, but if there is no such by-law or rule, then the only way it can be disposed of in this proceeding is to award the fund to the appellee. The society by its bill of interpleader in effect said that one of these two claimants is entitled to the fund, and asked permission to pay it into Court with the understanding that whichever was determined by the Court to be entitled to it should have it. If the society is subject to section 210 the *434 appellant is not entitled to any of it, but the appellee is entitled to at least part of it, and if any of the other parties named in section 210 have any interest in it they can assert their claim against the appellee. So far as we are informed, no other persons have claimed any part of it.
We would also add that in our judgment the mere fact that the word "wife" was used after the appellant's name in the certificate cannot have any effect in favor of the appellee, in considering her claim. That term was undoubtedly used as a description of Bertha Meinhardt, and the evidence shows that she and not the appellee was the one intended, but inasmuch as she is ineligible as a beneficiary, if the society is subject to section 210 of Article 23, she cannot recover the fund, but as the society paid the money into Court to be paid to the appellant or the appellee, as the Court might determine, and as the appellee is entitled to at least some part of the fund, the only solution of the peculiar conditions which occurs to us is that in the absence of some by-law or rule of the society, the fund should be awarded to her.
We regret that we can not finally dispose of the case but for the reasons we have already stated that can not be properly done on this record. The amount involved is small, but the questions are important. We will remand the cause without affirming or reversing the decree, under section 38 of Article 5 of the Code, in order that further testimony may be taken relevant to the questions, (1) whether the society is subject to sections 210, etc., of Article 23, (2) if it is so found, whether there is any by-laws, rule or resolution of the society in force, determining the order in which the beneficiaries named in section 210 shall take, on failure of a member to designate one who is eligible, and (3) such further testimony as to the lower Court may seem necessary or proper, in order to follow the conclusions reached by us as shown by this opinion. Of course, after such additional evidence is supplied by testimony or agreement, the lower *435 Court will pass such decree as the facts and this opinion require.
Cause remanded for further proceedings in accordance with thisopinion, without affirming or reversing the decree — the costs toabide the final result.