Zea v. Werner

152 A.D. 892 | N.Y. App. Div. | 1912

Judgment-affirmed, with costs. No opinion. Hirsehberg, Burr, Thomas, Carr and Rich, JJ., concurred.

fact that the organization reserved the right to levy an extra assessment implies that it did not possess any other authority than this expressly reserved. Provisions similar to those mentioned have been recently and frequently construed by the Court of Appeals, and invariably adversely to the right to increase the assessment, charges, and in some cases where the urgency and propriety of the action taken were apparent. The following are a few of these cases: Wright v. Knights of Maccabees (196 N. Y. 391); Bowdallv. Catholic Mut. Benefit Assn. (Id. 405); Ayers v. Order of United Workmen (188 id. 380); Beach v. Supreme Tent K. of M. (177 id. 100). In the first case cited, the application and the laws of the defendant were made part of the insurance contract, and the member agreed in his application that the laws of the order “now in force, or that may hereafter be adopted, shall form the basis of this contract for beneficial' membership.” The assessment rates were Increased, and the trial court in effect found that the increase in the rate of the number of assessments was necessary for “the continued existence of the defendant.” The sum. to be paid was stated in the contract and provided that the member should “ pay at the same rate thereafter so long as he remains continually in good standing in the Order.” In its important features that scheme of insurance and its contract are closely like those in the present case. The court held the agreement as to the maintenance of the rate was a covenant, adding: “ Hence the right to pay at the old rate was one of the rights provided for and that he contracted for. It was a vested right, immune from change by amendment, in the absence of a specific reservation of power to amend in that particular.” The prohibition, therefore, upon a mutual benefit association to increase its rates or substantially to change the benefits accorded to the member by his insurance contract, Unless there is a specific authority to make the change, would seem to be well established by the recent authorities in this State. It is the contention of the appellant that if these authorities are pertinent on the proposition stated they have no application to the defendant as it is a Canadian corporation and whoever becomes a member of it is amenable to the laws of the Dominion of Canada, so far as they regulate the affairs of this body. By the original act creating the defendant (53 Viet. chap. 104, § 11) the Parliament of Canada in the most general language reserved the power to enact legislation pertaining to the affairs of the society. In 1896 the act was amended (59 Viet. chap. 51), and by subdivision 6 of section 4 the defendant was required to raise by assessments on its members from time to time an amount adequate to meet all its obligations arising from its certificates. A mortuary fund was a part of the plan of insurance for the sum of $5,000 upon the life of any member, and a license was granted. to the defendant in pursuance of the amending act of 1901 (1 Bdw. VII, chap. 100, § 5), and which license was to be renewable from year to year as long as the society complies with the requirements of the Insurance Act, and with its undertaking-to maintain a fund sufficient to carry out its mortuary plan in addition to sick and funeral benefits, etc. The trial court found: “That the defendant had undivided surplus funds applicable to the payment of death benefits, in