| New York Court of Chancery | Aug 21, 1897
Complainant is an incorporated benevolent association, and belongs to the order of the Knights of Pythias. That order consists of a Supreme Lodge of the World, incorporated under
The bill alleges and the answer admits that the complainant herein is a corporation created and existing under the laws of the State of New Jersey. In that respect the case differs from the case developed in Grand Lodge v. Germania Lodge, where Germania Lodge was an unincorporated association. The bill does not state how or when the complainant was incorporated, but, presumably, it was done under the “Act to authorize the incorporation of benevolent societies.” Gen. Stat. p. 149. In other respects the case developed herein much resembles that of Grand Lodge v. Germania Lodge.
The same volumes containing the constitution and laws of the order were put in evidence here as were admitted in the case of Grand Lodge v. Germania Lodge. Objection was made in argument to the sufficiency of the proof of the printed books of the constitution and laws of the order. They were proven to be genuine by the grand secretary of the state lodge, who received them in due course of business from the secretary of the supreme lodge for guidance and use by the grand ánd subordinate lodges of New Jersey. The presumption of their genuineness and accuracy results from their origin and custody.
The complainant was organized as a German lodge by persons; with ^ single exception, who spoke the German language; and the understanding that its work was to be done and its proceedings carried on in the German language was an inducement to all the members who joined it. Its by-laws were adopted in the German language, and so approved by the grand lodge of the state, and books of ritual were furnished to it by the grand lodge, printed in the German language.
I think it sufficiently appears that for the first two years, at
In 1892 the supreme lodge, the superior of the grand lodge, made some order directing the German lodges to discontinue the use of the German, with the result that the German ritual books which had been furnished them were demanded by the chancellor of the grand lodge, and were delivered up by the complainant. The different subordinate German lodges of the country united in an effort to reverse the action of the supreme lodge, and were finally defeated. This angered a great majority of the members of complainant lodge, and they resolved quietly to rebel, throw off the yoke of the grand lodge, dissolve the Schubert Lodge as such, and surrender its charter, but not to permit the grand lodge to obtain the funds which they had on hand, amounting to about $800. They were aware that upon the dissolution of the lodge and the surrender of its charter the grand lodge became entitled, by the constitution and laws of the order, to all their property and funds. In that view they formed (as in the case of Germania Lodge, No. 50) a society called the Schubert Kranken Untersturzen Verein (Sick Benefit Society), and, by resolution, made a present of $800 to that society, which was substantially all of their funds.
The members of the complainant lodge were not unanimous in this action, and a small number (nine) refused to vote for or to approve it. The charter was sent to the grand lodge, but, upon, investigation, the officers of the grand lodge found that there were this number of eight or nine still remaining loyal to the order, and redelivered the charter to them, and the organization, under the dominion of the grand lodge, has been kept up.
This bill was filed to recover the funds. They had been deposited in a savings bank to the credit of three or more of the individual defendants, and were there stayed by the injunction of this court, and the dispute is as to the right to those funds.
It was not disputed but that these funds were the result of the accumulation of dues paid in by members of the order, and that they became at once impressed with a trust, the terms of
On this simple statement, as in the case of Grand Lodge v. Germania Lodge, the breach of trust appears manifest.
Two defences are set up. First, that the gift to the Kranken Untersturzen Verein was justifiable under the decision in the case of Lady Lincoln Lodge v. Faist, 7 Dick. Ch. Rep. 510. But in that case the appropriation called in question was to a. new lodge formed of members of the old lodge, and owing andi acknowledging allegiance to the supreme lodge and subject to its constitution and laws. It was held that the appropriation so> made did not have the effect of changing or breaking the trust to which the funds were subject, and, besides, the terms of the trust in that case were not so strict and exclusive as in the present case. And it may be remarked that it is manifest that the learned vice-chancellor felt that in approving the action of the members of the lodge in that case he went to the very verge of safety.
The second ground of defence is that there.was an implied contract between the members of Schubert Lodge and the supreme lodge that the proceedings of the subordinate lodge might-be conducted in German, and that such contract was not subject to a right of variance by subsequent action of the supreme lodge, though such right of variance was expressly reserved by the constitution of the supreme lodge; that the supreme lodge had deliberately broken the contract by forbidding the Use of the German language, and hence absolved the Schubert Lodge from all allegiance to the supreme lodge and all obligations to observe the laws and constitution thereof.
I think this position is untenable for reasons which do not involve an inquiry as to whether there was, in fact, such a con
In the second place, the alleged breach of contract did not justify any such action as was taken. The most that could result from it was a right on the part of the Schubert Lodge to refuse to obey the grand lodge by giving up, as it did, its German rituals and the use of that language. On the theory of the defendants the right of the members of Schubert Lodge was to continue to use the German ritual and to record their proceedings therein, and to claim and exercise the right to exist as a subordinate lodge of the grand lodge, notwithstanding the adoption of the statute which forbade the use of the German language. On the theory of the defendants that statute was void as to Schubert Lodge and need not have been observed by it.
The complainant corporation has never lost its identity and organization. The funds in question belong to it, and must be so decreed, with costs against the defendants.