Sovereign Camp Woodmen of the World v. Israel

| Ark. | Feb 15, 1915

Hart, J.,

(¡after stating the facts). In the case of Carruth v. Clawson, 97 Ark. 50" date_filed="1910-12-12" court="Ark." case_name="Carruth v. Crawson">97 Ark. 50, we said that in the absence ¡of provisions in a policy ‘concerning .the mode of changing the beneficiary, a change may be made by a member of a mutual benefit society in any -method which ■clearly expresses his intention to make the change and gives direction to the proper officer of the society to carry his intention into effect; and where1 the member ¡does all that he can toward effecting the ¡change, the substitution is complete, though there remain- acts to be done by the officers of the society in carrying the change into effect.

(1) Under the constitution and by-lawis of the order in the case before us the right of the member to change the beneficiaries is alb-solute -and the beneficiary ¡can not prevent the ¡change, if there is a substantial compliance with the rules of the order-in making the change. The transaction, however, requires -some formalities for the protection of the beneficiaries, and, the ¡constitution -and by-laws ¡of the -association being made a part of the contract, the ¡change in the beneficiary can not be effected unless those rules are substantially complied with.

In the ¡second edition -of Niblack ¡on Accident and Benefit ¡Societies, at pages 415 and 416, the author said:

“When a mutual benefit -society -has, under the powers and witMn the limits of its charter, provided in its by-laws a particular method of ¡Changing a beneficiary, or has set forth in its certificate a way by which the change may -be made, no change of beneficiary may be made in any other mode or manner. The reason for this rule is not difficult to discover. It is -based upon the familiar maxim that the expression of -one thing excludes other and 'different thing-s. When a society frames a set of rules providing for the distribution of a fund, and for the rights -of beneficiaries and members, it must be assumed that it excludes every o ther mo de and manner. Any other conclusion would lead to the most interminable confusion in the law applicable to the distribution of the insurance money, and fritter away, in the expenses of uncertain litigation, funds created for the benefit of widows, orphans and heirs. But' there is still another reason. It can not be said that a beneficiary named in a certificate has no rights therein because he has no vested rights. The beneficiary has a right to the proceeds of the certificate of insurance, subject to the right of the member to change the beneficiary according to the terms of the by-laws and regulations -of the society, which are a part of the contract of insurance; and the right of the beneficiary to have this- contract carried out in the manner provided for is as binding upon the member as his right to change the beneficiary is binding upon -the beneciary and the society. The power reserved to the member to -change the beneficiary qualifies the right of the beneficiary in the contract. It makes the interest of the beneficiary a mere expectancy while the -power to revoke the appointment continues; -but this -expectancy becomes an absolute right upon the death -of the -member, unless he has in the manner prescribed defeated it by the -affirmative act of changing the beneficiary.”

It will be noted that.-subdivision “a” of section 64 of the constitution -and by-laws of the order, as set out in the statement -of facts, prescribes the manner in which a member may change his beneficiary where -his certificate has not been lost. -Subdivision “b” provides the manner of making the change where the certificate has been lost.

Subdivision “a” provides, in substance, that where the member desires to change 'his beneficiary he may do so upon payment to the Sovereign ¡Camp of a fee of twenty-five cents with his request written on the back of Ms certificate, .giving the names of the new beneficiary or beneficiaries, wMoh sum, together with Ms certificate, he shall deliver to the clerk of the camp for attestation. It is provided further that in case of the death of the -said member before the issuance of a certificate payable to the said new beneficiary, then the amount payable on such certificate shall be paid to the newly designated benefit ciary according to the terms of the member’s request. In such a case, it will be noted, the act of the clerk of the camp in making the change is merely ministerial, and the member having done all that he was required to do in order to make the change, the constitution and by-laws provide that it shall be made, even though he should die before the formalities required of the sovereign clerk are complied with.

Subdivision “b,” which applies in cases where the certificate has been lost, prescribes an essentially different manner of making the change. In such a case before the change shall be made the member is required to furnish the sovereign clerk satisfactory proof under oath of the loss of the certificate, and if such proof is satisfactory to him the clerk issues to the member a new certificate in lieu of the old one with the desired change of beneficiaries. This requires an exercise of judgment and discretion on the part of the sovereign clerk and his action is not merely ministerial or formal. It is his duty ■to see that satisfactory proof is made that the certificate is lost and he can only issue a new certificate in lieu of the old one when such satisfactory proof is made.

As we have already seen, the constitution and bylaws of the order are a part of the contract between the order and the members thereof and the rules in regard to the change in the beneficiary are for the protection of the order, the beneficiary and the member. Such a rule is a reasonable one, and tends to protect tbe order from needless litigation.

(2) In tbe case before us tbe'member merely .stated that bis old certificate bad been lost. There was nothing in tbe affidavit tending to show tbe circumstances attending tbe loss of tbe certificate. In any event tbe constitution and by-laws of tbe order required tbe sovereign clerk to exercise some jugdment as to whether or not tbe proof of loss of the certificate was satisfactory, and, the member having died before tbe affidavit was presented to tbe sovereign clerk for bis action and judgment, it can not be said that tbe rules of tbe order bad been complied with, and for that reason we are of tbe opinion that no change was made in tbe beneficiaries before tbe death of the member.

This being tbe case, tbe plaintiff was not entitled to maintain bis action. It follows that tbe judgment must be reversed, and, tbe cause of action having been fully developed, the complaint of tbe plaintiff will be dismissed.