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named as a volunteer beneficiary in a certificate issued by such association, dies without leaving child or children, and without debts, prior to the death of the member, neither the administrator of the deceased member nor the administrator of the deceased beneficiary is a proper party to bring suit against the association for the benefit named in the certificate.
[See note on this question beginning on page 762.] - effect of rule of insurer.
tificate, upon failure of a beneficiary 2. In the question propounded by qualified to take.
qualified to take. Where such prothe court of appeals it does not ap- vision is made in the constitution, bypear that there is any provision made laws, or certificate, or by the statin the constitution, by-laws, or cer- utes of the state, the rule might be tificate issued by the mutual benefit different. association, providing for the pay- [See 19 R. C. L. 1314; 3 R. C. L. ment of the benefit named in the cer- Supp. 1012.]
CERTIFICATION by the Court of Appeals for the opinion of the Supreme Court of a question arising upon writ of error by defendant to review a judgment in favor of plaintiffs in an action brought to recover the proceeds of a life insurance policy. Question answered.
The facts are stated in the opinion of the court.
Messrs. Branch & Howard, for de- Md. 390, 46 L.R.A. 160, 43 Atl. 792; fendant:
United States Casualty Co. v. Kacer, The administrator of the deceased 169 Mo. 301, 58 L.R.A. 436, 92 Am. beneficiary, under the facts as stated St. Rep. 641, 69 S. W. 370; Bryan v. by the court of appeals, has no right Rooks, 25 Ga. 624, 71 Am. Dec. 194; of action.
Dewelle v. Roath, 29 Ga. 733; Perry Dell v. Varnedoe, 148 Ga. 91, 95 S. E. v. Tweedy, 128 Ga. 402, 119 Am. St. 977; Smith v. Locomotive Engineers Rep. 393, 57 S. E. 782, 11 Ann. Cas. 46; Mut. L. & Acci. Ins. Asso. 138 Ga. 717, Lee v. Wheeler, 4 Ga. 541; Smith v. 76 S. E. 44.
Moore, 129 Ga. 644, 59 S. E. 915. The administrator of the member has no right of action.
Hill, J., delivered the opinion of Perry v. Tweedy, 128 Ga. 402, 119
the court: Am. St. Rep. 393, 57 S. E. 782, 11 Ann.
The court of appeals requested Cas. 46; Union Fraternal League v. instructions from
the supreme Walton, 112 Ga. 315, 37 S. E. 389; court upon the following question: Fraternal Life & Acci. Asso. v. Evans, “Where the wife of a member of a 140 Ga. 284, 78 S. E. 915; Bacon, Life
mutual benefit association, who is & Acci. Ins. 4th ed. 313; Warner v.
named as a volunteer beneficiary in Modern Woodmen, 67 Neb. 233, 61
the certificate issued by such assoL.R.A. 603, 108 Am. St. Rep. 634, 93 N. W. 397, 2 Ann. Cas. 660; 29 Cyc.
ciation, dies without leaving child 159, 162; 19 R. C. L. 1314; Union
or children, and without debts, prior Fraternal League v. Walton, 109 Ga.
to the death of the member, is the 1, 46 L.R.A. 424, 77 Am. St. Rep. 350, administrator of the deceased mem34 S. E. 317; District Grand Lodge v. ber, or the administrator of the deMorris, 26 Ga. App. 371, 106 S. E. 188; ceased beneficiary, the proper party District Grand Lodge v. Gardner, 27 to bring suit against the associaGa. App. 145, 107 S. E. 774.
tion?" Messrs. Bond Almand and Willing
The question as to whether the ham, Wright, & Covington also for de
administrator of the deceased benefendant. Messrs. Harris & Harris, for plain- ficiary, under the facts as stated by
the court of appeals, is a proper tiffs : Plaintiff administratrix was entitled
party to sue for the benefit named to collect the insurance.
in the certificate, seems to have been Smith v. Head, 75 Ga. 755; Steele v.
settled by the decisions of this court. Gatlin, 115 Ga. 931, 59 L.R.A. 129,
In Dell v. Varnadoe, 148 Ga. 91, 95 42 S. E. 253; Thomas v. Cochrane, 89 S. E. 977, this court held:
“A mere (156 Ga. 631, 119 S. E. 594.) volunteer beneficiary in a certificate association is under no obligation to issued by a mutual benefit associa- pay to anyone, nor can the fund be tion upon the life of one of its mem- recovered by his executor or adminbers has no vested interest therein istrator as assets of his estate." prior to the death of the member." There is no waiver of the right to
And in Smith v. Locomotive En- the fund on the part of the mutual gineers Mut. L. & Acci. Ins. Asso. benefit association, but, on the con138 Ga. 717, 76 S. E. 44, it was held trary, it is insisted that the associathat "the interest of a beneficiary in tion is entitled to it. In the followa certificate on the life of a member ing cases the member's heirs took of such association is a mere expect to the exclusion of the beneficiary's ancy, which becomes vested only on heirs or representatives: Haskins the death of the member." See also v. Kendall, 158 Mass. 224, 35 Am. Modern Woodmen v. Puckett (Pilch- St. Rep. 490, 33 N. E. 495; Espy v. er v. Puckett) 17 L.R.A.(N.S.) 1083 American Legion of Honor, 7 Kulp, (3) and note (77 Kan. 284, 94 Pac. 134; Speegle v. Sovereign Camp, W. 132).
W.77 S. C. 517, 58 S. E. 435; FischThe general insurance law is not er v. American Legion of Honor, 168 applicable to mutual benefit associa- Pa. 283, 31 Atl. 1089; Supreme tions, such as the one involved in Council, A. L. H. v. Gehrenback, 124 the present case.
Park's Code, $ Cal. 43, 56 Pac. 640; Michigan Mut. 2564 (t); Union Fraternal League v. Ben. Asso. v. Rolfe, 76 Mich. 146, Walton, 112 Ga. 315, 37 S. E. 389. 42 N. W. 1094; Supreme Council, R. Also Fraternal Life & Acci. Asso. V. A. v. Bevis, 106 Mo. App. 429, 80 Evans, 140 Ga. 284, 78 S. E. 915; S. W. 739; Richmond v. Johnson, 28 Perry v. Tweedy, 128 Ga. 402 (6), Minn. 447, 10 N. W. 596; Daniels 119 Am. St. Rep. 393, 57 S. E. 782, v. Pratt, 143 Mass. 216, 10 N. E. 11 Ann. Cas. 46.
166; note in 17 L.R.A. (N.S.) 1086. The next inquiry is as to whether But in some of those cases, at least, the administrator of the deceased provision was made, either in the member can bring suit against the constitution, charter, or by-laws of mutual benefit association. The the society, preventing a forfeiture. weight of outside authority is to the But in the question propounded effect that, in the event of the death by the court of appeals there is no of the beneficiary in a mutual benefit suggestion that there is any proviassociation certificate, in the life- sion in the constitution, charter, time of the member, if the member by-laws of the socifails to designate another benefi- ety, or in the certif- -effect of rule of ary of the class provided by the con- icate of memberstitution and by-laws of the order, ship, either generally or specially,
the benefits in such or by statute of the state, which Insurance
case revert to the would prevent a forfeiture; and we predecease of beneficiary- order. Bacon, Life take it that the disposition of the
& Acci. Ins. 4th ed. benefit is generally determined by
§ 313; Warner v. these provisions. In the absence of Modern Woodmen, 67 Neb. 233, 61 such provisions we hold, with the L.R.A. 603, 108 Am. St. Rep. 634, weight of outside authority, that the 93 N. W. 397, 2 Ann. Cas. 660; 29 benefit reverts to the society, and, Cyc. 152, 162. In 19 R. C. L. 1314, answering the question propounded it is said: "By the decided weight by the Court of Appeals as asked, of authority, however, if a member and assuming that the Court of Apdies leaving no designated benefi- peals means to ask whether in the ciary qualified to take, and there is
one case or the other the adminisno one who is entitled to payment trator can bring suit against the asunder the charter, constitution, or sociation for the benefit named in by-laws of the association, or by vir- the certificate, we are of the opinion tue of statutory provisions, then the that neither the administrator of
who may enforce.
the beneficiary nor the administra- icate, so far as disciosed by the form tor of the member of the mutual of the question propounded by the benefit association is a proper party Court of Appeals. to bring suit against the association
All the Justices concur. for the benefit named in the certif
Disposition of benefit fund in benefit society on failure of beneficiary in ab
sence of specific provision for such contingency.
I. In general, 762.
V. Wife and children of member, 770.
1. In general.
of. Supreme Colony, U. 0. P. F. v. This annotation does not include Towne (1914) 87 Conn. 644, 89 Atl. cases where the distribution of the 264, Ann. Cas. 1916B, 181; Sovereign fund in a mutual benefit society in Camp, W. W. v. Muth (1920) 91 case of failure of a beneficiary is N. J. Eq. 460, 109 Atl. 853. governed by a specific provision of
II. Estate of beneficiary. the constitution or by by-laws of the society, as it is assumed that the con
It is a general rule that the benetract of membership is made with
ficiary designated in a benefit certifireference to the by-laws of the organ
cate has only a contingent interest ization, and that they have become
which is devested by his death bea part of the contract.
fore that of the insured, so that nothIt is difficult to align the cases on
ing passes to the beneficiary's estate this question with accuracy as to the
in such case, in the absence of an extheory on which the benefit fund is
press provision to that effect in the to be distributed in the absence of
laws of the order. a beneficiaryfor the disposition
California. - Supreme Council, A. thereof depends on, or rather is L. H. v. Gehrenbeck (1899) 124 Cal. affected by, the persons whom the
43, 56 Pac. 640. member left surviving him. The Colorado. Rollins V. McHatton aim, therefore, has been to classify (1891) 16 Colo. 203, 25 Am. St. Rep. with reference to the terms employed 260, 27 Pac. 254; Finnell v. Franklin by the court to describe the persons, (1913) 55 Colo. 156, 134 Pac. 122. or classes of persons, entitled in the Connecticut. — Supreme Lodge, N. particular instance; although it is not E. 0. P. v. Hine (1909) 82 Conn. 315, clear but that in many instances, as, 73 Atl. 791; Supreme Colony, U. 0. for example, where the fund is award- P. F. v. Towne (1914) 87 Conn. 644, ed to the “estate” or to the “heirs” of 89 Atl. 264, Ann. Cas. 1916B, 181; the member, the term used is an ac
Order of Scottish Clans v. Reich cident in the choice of words rather (1916) 90 Conn. 511, 97 Atl. 863. than intentional.
Iowa. Schmidt v. Northern Life It will be observed that in a num- Asso. (1900) 112 Iowa, 41, 51 L.R.A. ber of the cases set out herein the 141, 84 Am. St. Rep. 323, 83 N. W. association is not denying its liability 800; Cooper v. Order of Railway Confor the fund, as in the reported case, ductors (1912) 156 Iowa, 481, 137 N. but has expressed its willingness to W. 472; Bush v. Modern Woodmen pay the fund to the person to whom (1915) 182 Iowa, 515, 152 N. W. 31, the court directs it shall be paid. 162 N. W. 59.
And it has been said that under Kansas. Boice v. Shepard (1908) such circumstances the court will 78 Kan. 308, 96 Pac. 485. Pilcher v. make an equitable distribution there- Puckett (Modern Woodmen v. Puck
ett) (1908) 77 Kan. 284, 17 L.R.A. the member of a beneficiary conferred (N.S.) 1083, 94 Pac. 132.
upon the latter the beneficial interMassachusetts. Sargent v. Su- est and the proceeds of the policy preme Lodge, K. H. (1893) 158 Mass. when such became due, and the estate 557, 33 N. E. 650.
thus acquired, although liable to be Minnesota. Richmond v. Johnson defeated by the appointment of the (1881) 28 Minn. 447, 10 N. W. 596. new beneficiary, possessed the inher
Mississippi. - Carson v. Vicksburg ent qualities of an estate of a beneBank (1897) 75 Miss. 167, 37 L.R.A. ficiary under an ordinary policy of 559, 65 Am. St. Rep. 596, 22 So. 1; life insurance, and was a valuable Sykes v. Armstrong (1916) 111 Miss. asset, which at the death of the bene44, 71 So. 262.
ficiary devolved upon his administraNebraska. Warner v. Modern tor in whom the title remained unWoodmen (1903) 67 Neb. 233, 61 less devested by the member in his L.R.A. 603, 108 Am. St. Rep. 634, 93 lifetime by the designation of a new N. W. 397, 2 Ann. Cas. 660.
beneficiary in the manner prescribed New Jersey. Golden Star Frater- by the by-laws, and that neither the nity v. Martin (1896) 59 N. J. L. 207, children nor the grandchildren of the 35 Atl. 908.
deceased member were entitled to any Texas. Grand Lodge, C. K. P. v. interest in the fund in their own Mackey (1907) Tex. Civ. App. 2,
right. 104 S. W. 907.
In Supreme Council, C. K. A. v. Wisconsin. Given v. Wisconsin Densford (1900) 21 Ky. L. Rep. 1574, Odd Fellows Mut. L. Ins. Co. (1888) 49 L.R.A. 776, 56 S. W. 172, infra, it 71 Wis. 547, 37 N. W. 817.
was said that the beneficiary named in And see the reported case (DISTRICT a certificate of membership in a beneGRAND LODGE, G. U. 0. 0. F. V. fit association is vested with a definite COTHRAN, ante, 759).
interest in the benefit fund which will As a consequence of the right of be due on the certificate upon the a member of a mutual benefit associa- death of the member, which can only tion to change at will the beneficiary be defeated by the member making in the certificate held by him, the other or different disposition of that beneficiary, upon designation, ac- part secured to the original beneficiaquires merely an expectancy, revoca- ry. ble at any time during the life of the And in Johnson v. Hall (1891) 55 insured, which does not ripen into a Ark. 210, 17 S. W. 874, it was held property right until his death. Su- that as the benefit certificate constipreme Colony, U. O. P. F. v. Towne tuted an ordinary insurance policy, (1914) 87 Conn. 644, 89 Atl. 264, Ann. and as the member had no power to Cas. 1916B, 181.
change the beneficiary named therein But it has been held that the in- in the absence of an express authorterest in a benefit certificate in an ization by the policy or the by-laws association whose by-laws entitle a of the association, the beneficiary member to designate and change the acquired a vested interest in the cerbeneficiary at will goes to the bene- tificate upon its issuance, which deficiary's representatives, and not to scended to her heirs upon her death the representatives of the member, prior to the death of the holder of the upon the death of the member after certificate. that of the beneficiary, without hav- But under a statute providing that ing designated new beneficiary. when insurance is effected by any Thomas v. Cochran (1899) 89 Md. person on his life, in favor of some390, 46 L.R.A. 160, 43 Atl. 792; Ex- one other than himself having an inpressman's Mut. Ben. Asso. v. Hur- surable interest, “the lawful benelock (1900) 91 Md. 585, 80 Am. St. ficiary thereof other than himself, or Rep. 470, 46 Atl, 957.
his legal representatives, shall be enThe court in the Cochran Case (Md.) titled to its proceeds as against the supra, stated that the designation by creditors and representatives of the
persons effecting the same,” it has by-law of the society to the effect that been held that where the beneficiary the share of one of two beneficiaries, predeceased the insured, and no other who died during the life of the inbeneficiary was designated, the per- sured, should go to the other beneficisonal representatives of the benefici- ary pro rata, the court holding ary were entitled to the benefit, as that in the light of the statute above against the insured person's repre- referred to, the by-law must be consentatives. Neal v. Shirley (1910) strued to apply only when the de137 Ky. 818, 127 S. W. 471; Buckler ceased beneficiary left no issue. v. Supreme Council, C. K. A. (1911)
III. Estate of member. 143 Ky. 618, 136 S. W. 1006; Vaughan v. Modern Brotherhood (1912) 149 Ky.
It has been stated by a number of 587, 149 S. W. 937; Hall v. Ayer
courts that as a general rule a mem(1907) 32 Ky. L. Rep. 288, 105 S. W.
ber of a mutual benefit association 911. These decisions seem to be has no property rights in the fund based upon the ground that under
which the association undertakes to such statute the beneficiary has a vest
pay upon his death, but has only a ed interest in the benefit fund, which
power of appointing a beneficiary. can only be devested by the act of
United States. Worley v. Norththe member in his lifetime. And in
western Masonic Aid Asso. (1882) 3 Bright v. Supreme Council, C. K. L.
McCrary, 53, 10 Fed. 227. A. (1919) 183 Ky. 388, 209 S. W. 379,
Colorado. Finnell v. Franklin it was held that the Act of March 22,
(1913) 55 Colo. 156, 134 Pac. 122; 1916, chap. 27, 16, changing this
Rollins v. McHatton (1891) 16 Colo. rule to conform to the general rule
203, 25 Am. St. Rep. 260, 27 Pac. 254. that the beneficiary's interest in the
Connecticut. Order of Scottish fund is a contingent one, which does
Clans v. Reich (1916) 90 Conn. 511, not vest until the death of the mem
97 Atl. 863. ber, did not operate to bar the heirs of
District of Columbia. Masonic a beneficiary who died prior to the
Mut. Relief Asso. v. McAuley (1882) death of a member of a mutual benefit
2 Mackey, 70. association, from taking the bene
Georgia. DISTRICT GRAND LODGE, ficiary's interest, notwithstanding
G. U. 0. 0. F. v. COTHRAN (reported that the by-laws of the insurer were
herewith) ante, 759.
Kansas. changed to conform to the statute,
Boice v. Shepard (1908) and provided that the entire proceeds
78 Kan. 308, 96 Pac. 485.
Nebraska. were to go to the surviving benefici
Warner v. Modern ary upon the death of one, since
Woodmen (1903) 67 Neb. 233, 61 neither the statute nor the by-laws
L.R.A. 603, 108 Am. St. Rep. 634, 93 could devest a vested right of the
N. W. 397, 2 Ann. Cas. 660. beneficiaries in such certificates, al
New Hampshire.-Eastman v. Prov. though they were applicable to con
ident Mut. Relief Asso. (1883) 62 tracts thereafter made.
N. H. 555. In Supreme Council, C. K. A. v.
New York. Alexander V. Page Densford (Ky.) supra, it was held
(1914) 150 N. Y. Supp. 104. But see that the share of one of the three
Simon v. O'Brien (1895) 87 Hun, 160, beneficiaries in a benefit certificate,
33 N. Y. Supp. 815. who died during the life of the in- Pennsylvania. - Dickerson v. Midsured, leaving issue, was in the nature vale Beneficial Asso. (1919) 264 Pa. of a testamentary gift, and would 415, 107 Atl. 778. pass to such issue in accordance with Virginia. - Smith v. Hatke (1913) the rule as to devises or legacies pre- 115 Va. 230, 78 S. E. 584. scribed by the Kentucky statute But other
have held that providing that, in case of the prede- where a member of a mutual benefit cease of the devisee or legatee, his society dies without leaving an eligi. share should pass to the issue of such ble beneficiary the benefit fund in devisee or legatee, notwithstanding a such circumstances goes to the estate