112 F. 913 | U.S. Circuit Court for the District of Oregon | 1901
On July io, 1900, the Woodmen of the World issued to James T. Hair, a member, on his application, a beuefitcertificate for $3,000 in favor of Clarinda I. Taylor, who he declared bore to him the relation of financée. The certificate was delivered on the 16th of July, 1900. Hair died on October 12th of the same year. Doubts having arisen as to the right of the beneficiary named in the certificate, the head camp of the order filed its bill of complaint in interpleader, and deposited the $3,000 with the clerk of the court. By stipulation of the parties in interest, an order was entered dismissing as to the order, and providing for the filing of pleadings upon the part of the defendants in the suit of interpleader. Thereupon Clarinda l. Taylor filed her cross complaint, alleging,, among other things, the issuance of the benefit certificate in question to said Hair for the benefit of complainant as financée of the deceased. To this the heirs at law of said deceased filed their joint and several answers, in which, among other things, it is denied that said Taylor was ever the financée of the deceased, and it is alleged that at the time of the issuance of said benefit certificate, and long prior thereto, said Taylor was a married woman, the wife of one Byrns, and that prior to the issuing of said certificate deceased and said Taylor contracted to marry each other as soon as said Taylor should "have procured a divorce from her husband. It is further alleged that on January 23, 1900, said J. T. Hair and one Nettie .Hair were husband and wife, and that on that day a decree of divorce was granted said Nettie from her said husband, J. T. Hair, and .that the six months within which divorced persons may not marry again did not -expire until July 23, 1900. It is further alleged that said Taylor pretends that on October 11, 1900, a decree of divorce was entered in hqr favor in the circuit court for Lane county, dissolving, the marriage contract then existing between her and her said husband;
The constitution of the order of Woodmen of the World provides as follows:
“Sec. 119. A benefit certificate can only be made expressly payable to some person or persons named, wbo sustain to tbe holder the relationship of either wife, legitimate child, adopted child, grandchild, parent, grandparent, brother, sister, nephew, niece, uncle, aunt, fiancee, brother-in-law, sister-in-law, mother-in-law, or dependent. No benefit certificate shall hereafter be made payable ‘to his estate,’ ‘to party to be named in will,’ ‘to himself,’ nor to ‘his legal heirs.’ But no benefit certificate shall hereafter be made payable to a fiancée when one or more of the above-named parties are dependent upon the neighbor. When the application does not show any special named beneficiary, he can direct the benefit to be made payable ‘to the beneficiaries designated in the constitution of the order,’ and the benefit certificate may so provide. In such cases, death benefits, when due, shall be payable as follows: If the deceased leaves a widow and no' child or grandchild, to his widow; if a widow and descendants, one-half to his widow and the remaining one-half divided equally among his children, the children of a deceased child to take collectively what their parent would have received if living; if no widow or descendants, to his parents, in equal part, or all to one parent if only one be living; if no widow, descendants or parents, then to his brothers, sisters and descendants of deceased brothers and sisters, the latter taking collectively what their parents would have taken if living; if none of said relatives are living, then to the grandparents, uncles and aunts in equal portion; if none of said relatives survive, the benefits in such case shall be forfeited and remain in the benefit fund.
“See. 1-20. In case any beneficiary expressly named in the benefit certificate does not survive the holder thereof, the amount which would have gone to such named beneficiary, if surviving, shall be paid pursuant to section 119,” etc.
The disposition of the fund in court depends upon the construction to be given to these provisions. Benefit certificates are required to be made payable to some person or persons, except that the applicant, omitting to name any beneficiary, may direct the benefits to be made payable “to the beneficiaries designated in the constitution of the order.” A certificate cannot be made payable to the applicant himself, to his estate, to a party to be named in his will, nor to his legal heirs. There must be some designation of a beneficiary, either of a person specially named or of “the beneficiaries designated in the constitution of the order.” When a beneficiary is specially named, he must have the qualifications prescribed in section 119. In this case it is claimed that the applicant described the beneficiary as his fiancee when she was not so in fact. In such a case, what is to become of the fund ? Can it be distributed to the “legal heirs’”of the applicant? Will the law make a disposition
“Upon the death of a member, where the person claiming to be his designated beneficiary is outside of the classes eligible as beneficiaries of his insurance, the member’s heirs at law who are within such classes are entitled to the insurance. There being no selection of a beneficiary authorized to take, the fund goes to them.”
This decision is upon the authority of the case of Palmer v. Welch, 132 Ill. 141, 23 N. E. 412, followed by the case of Alexander v. Parker, 144 Ill. 355, 33 N. E. 183, 19 L. R. A. 187. The benefit certificates in these cases were issued by the Supreme Council of the Royal Arcanum, a mutual benefit society organized under the. laws of Massachusetts, which provide that such 'corporations may be formed for the purpose of assisting the widows, orphans, or other relatives of deceased members, or any persons dependent upon deceased members. The beneficiary named in each case was described as the “affianced wife” of the deceased, a description not within any class entitled to take under the laws of the state or the constitution of the order. If the person so designated could become a beneficiary under a certificate of the order, she must have done so as a “dependent” upon the member for maintenance. The laws of the order permitted a certificate for the benefit of such dependent. It was provided, however, that no payment should be made to persons of this class unless the dependency was shown to exist at the time of the death of the member; and when the beneficiary was not dependent at that time the benefit, by express provision, became payable to the relatives of such member, including his brothers and sisters. The beneficiaries were not so dependent, and, by the express provision referred to, the brothers were entitled to the benefit. To understand how little room for controversy there was in these cases, it is only required to refer to the contention made in Palmer v. Welch that the dependency of the beneficiary named had not ceased at the time of the death, because it never existed;
There is no question of public morals or policy involved. The order of Woodmen may, if it sees fit, in fixing its own policy, provide by its constitution for benefit certificates in favor of any person designated by the applicant for such certificate. If the policy which it adopts is for any reason contrary to public morality, the question of intervention is for the state; and the order may make a payment of insurance, if it sees fit, without regard to the right of the beneficiary. to compel it. The right to refuse such payment belongs to the order. If it has been deceived, by misrepresentation, in issuing insurance to a beneficiary not qualified under its constitution to receive it, the remedy, in the absence of some provision in the constitution for the disposition of the benefit, is with the order where the injury is suffered, and it cannot be made a matter of gain to outsiders.. The payment into court by the order is a waiver of every objection- that the order might have made to the plaintiff's demand
The exceptions, to the answer are allowed.