The insistence that it was part of the contract that the association reserved to itself power to change and amend the constitution and by-laws, and that the said Leander E. Nelson agreed that power should be so reserved, and that he should be bound by the constitution and by-laws as they might be thereafter amended, is based alone upon a clause or provision found in the certificate of membership issued to the said Nelson. The provision in the certificate is as follows: "This certificate is issued upon the condition that the said Leander E. Nelson shall comply with the constitution and by-laws of the association, and that the statements made in the application for this certificate are true." A copy of the constitution and of the by-laws of the association was attached to the certificate of membership and made a part thereof. Section 7 of article 9 of said constitution as it stood at the time said certificate was issued to Nelson was as follows: "The constitution can be amended and changed at the annual meeting of the association by a majority of two-thirds of all the members present." It should here be noted that that which is referred to as the constitution of this association is in no sense the charter of the association. What is here referred to as the constitution is but a code of laws adopted by the association. It is correctly said in Supreme Lodge v. 369 Knight, 117 Ind. 489, 20 N. E. 479: "A constitution of a voluntary association or a corporation is nothing more than a by-law under an inappropriate name."

The clause in the certificate does not purport to bind the member to the observance of constitutional provisions or by-laws other than such as then existed, and a copy of the so-called constitution and by-laws then in force was attached to the certificate as a part thereof. It was the constitution and the by-laws so made a part of the certificate to which the certificate had reference and which the member consented to obey. It is only when a member, in express terms, agrees to be bound by such constitutional amendments or by-laws as may thereafter be enacted that he is bound by future amendments or by-laws which impair the obligations of his contract of membership injuriously: Covenant Mut. Life Assn. v. Kentner, 188 Ill. 431, 58 N. E. 966; Baldwin v. Begley, 185 Ill. 180, 56 N. E. 1065. In the absence of such an express agreement the contract of membership cannot be impaired by subsequent changes effected by the association. The constitutional provision contained in said section 7 of article 9 of the constitution of the association at the time of the admission of said Nelson to membership in the association, to the

effect that the constitution could be amended and changed at an annual meeting of the association by a majority of two-thirds of all the members present, cannot be construed to authorize an amendment or change in the constitution which should act retrospectively, and impair the obligation of the contract entered into between the association and said Nelson prior to such amendment of the constitution.

As before remarked, that which is called the constitution of the association is but a code of by-laws adopted by the association. The association had inherent power to enact by-laws consistent with the provisions of the enactment under which it was organized, and not repugnant to the constitution of the state of Illinois, and to alter 370 and amend such by-laws. The by-law incorporated in the code called the constitution, relative to amendments and changes in such code, did not confer upon the association the right or power to make such amendments or changes. The association possessed that power as an attribute of its corporate life. The said section 7 of article 9 of the code of by-laws had no other effect than to declare the mode or manner of exercising the power of amendment possessed by the association, viz., by a majority of two-thirds of all the members present at the annual meeting. If the section had been wholly omitted from the constitution or by-laws, the association would have had ample power to pass any lawful amendment of the constitution or by-laws: Niblack on Benefit Societies, sec. 28, p. 105; 1 Bacon on Benefit Societies, 2d ed., sec. 9. The assent of the assured, therefore, did not confer any power on the association which without such assent it had not, nor did it bind the assured to submit to any amendment to which he could not be compelled to submit in the absence of said section 7. His assent was that the association, at any annual meeting, might make any change or amendment lawful to be made, by a majority of two-thirds of all the members present, and cannot be construed as an assent to the adoption of a by-law devesting him of a vested right and impairing the obligation of his contract of membership. Section 14 of article 2 of the constitution of 1870 inhibited the general assembly from adopting any statute impairing the obligation of such contract of membership. Subsequent enactments of the legislature or future amended by-laws of the association could not operate retrospectively, and thus devest the vested rights of a member or destroy existing contract obligations. In revoking the direction of the certificate as to the person to receive the mortuary benefit, and in appointing others as

beneficiaries to receive such fund, said Leander E. Nelson but exercised a legal right of which he was possessed.

371 A portion of the brief in behalf of appellee is devoted to the criticism of the action of the chancellor in relieving the appellant from the payment of any portion of the cost of the proceeding. The appellate court affirmed the action of the chancellor in respect of the order as to costs. The action of the appellate court in that respect is not assigned as for error in this court, and for that reason is not subject to review in this court. The judgment of the appellate court is affirmed.

Benefit Society.-A beneficiary has no vested right, ordinarily, under a benefit certificate issued by a benevolent association until the death of the member: Independent Foresters v. Keliher, 36 Or. 501, 78 Am. St. Rep. 785, 59 Pac. 324, 1109, 60 Pac. 563; monographic notes to Lake v. Minnesota etc. Assn., 52 Am. St. Rep. 564; Strauss v. Mutual Reserve etc. Assn., 83 Am. St. Rep. 718.

The By-laws of a Benefit Society Cannot be Changed, without the knowledge or consent of a member, so as to impair his contract with the society, unless he accepts a certificate expressly subject to the power of the association to amend its constitution and bylaws: See the monographic notes to Lake v. Minnesota etc. Assn., 52 Am. St. Rep. 557; Strauss v. Mutual Reserve etc. Assn., 83 Am. St. Rep. 706.

PEOPLE v. PETRIE.

[191 Ill. 497, 61 N. E. 499.]

BENEFIT SOCIETY-EXECUTOR'S INTEREST.-A benefit certificate payable to the devisees of the certificate holder as provided in his last will and testament is payable to the person named in such will, and not to the executor. (p. 270.)

EXECUTORS AND ADMINISTRATORS TAKE AND ADMINISTER upon the estate owned by the deceased as it existed at the time of his death. (p. 270.)

EXECUTOR'S BOND-LIABILITY OF SURETIES.-AN EXECUTOR, WHO IS ALSO TRUSTEE of a fund by the will, does not, in his dealings with the trust fund, create any liability against sureties upon his bond as executor. (p. 275.)

EXECUTOR AND TRUSTEE-BONDS OF.-A court of chancery has power and jurisdiction to require a trustee, who is also executor under the will appointing him trustee, to execute a bond, with sufficient sureties, conditioned for the faithful performance of the trust and the preservation of the fund. (p. 277.) NOMINAL DAMAGES. A NEW TRIAL will not be awarded merely to enable the recovery of nominal damages. (p.

NEW TRIAL-GROUNDS OF.-The party moving for a new trial is restricted to the reasons assigned therefor when motion made. (p. 277.)

James M. Brock and W. J. Graham, for the appellants.

Guy C. Scott and Bassett & Bassett, for the appellees.

504 MAGRUDER, J. This suit is brought for the purpose of holding the appellees, Richard S. Petrie and Cornelius L. Petrie, liable as sureties upon the executor's bond of Alexander P. Petrie, deceased, for the five thousand dollars paid to said. Alexander P. Petrie, on February 11, 1887, by the Covenant Mutual Benefit Association of Illinois upon the insurance certificate hereafter described. 505 The liability or nonliability of appellees, as such sureties, depends upon the solution of the question whether or not the executor, Alexander P. Petrie, received the sum of five thousand dollars, being the amount of the insurance certificate, as executor, and held it in his hands as executor up to the date of his death on December 5, 1898. If Alexander P. Petrie did not originally receive or subsequently hold said money as executor, but received it as an individual, or as trustee for the widow and heirs of Benjamin F. Brooks, deceased, then the sureties on his executor's bond would not be liable, as their contract, evidenced by their bond, was for his performance of his duty as executor, and not otherwise.

1. The first question in the case, then, is this: Were the proceeds of the benefit certificate, paid to Alexander P. Petrie, and amounting to five thousand dollars, assets of the estate of Benjamin F. Brooks, or not? The general rule is, that the proceeds of such a certificate are not assets of the estate.

"Moneys received on a certificate of membership in a mutual benefit association, the constitution and by-laws of which provide for insurance for the benefit of the member's family, or for such persons as the member may designate, go, on the death of the member, to his family, or the person designated by him, and are not assets subject to the payment of his debts": 11 Am. & Eng. Ency. of Law, 2d ed., 847, and cases in note 1. Elsewhere in the same encyclopedia (volume 3, page 1108), it is said: "The right to receive benefits becomes vested in the legally designated beneficiary immediately upon the death of the member while in good standing, and the amount apportioned from the fund should be paid direct to such beneficiary, not to the executor or administrator of deceased."

In addition to the fact that the money realized upon these benefit certificates is for the benefit of the certificate holder's

family, or heirs, or devisees, or those dependent upon him, the rule that the proceeds of such a 506 certificate are not assets of the estate of the deceased certificate holder rests upon the further fact that the proceeds of the certificate are not his property at the time of his death. An executor or administrator takes, and administers upon, the estate owned by the testate or intestate as it existed at the time of his death. The certificate holder is not entitled to realize the amount due upon the certificate while he is alive. Only the beneficiary named in the certificate takes the money, and this can only be after the death of the certificate holder.

Moreover, the contract of the benefit association or insurance company is to pay the money, due upon the certificate, to the beneficiary designated upon the face of the certificate. The contract is to pay to the person so designated, and not to pay to the estate or representatives of the certificate holder, unless the latter are specially designated by the certificate itself as the persons entitled to take the money.

A person in his lifetime took out a policy of insurance payable to his "heirs and assigns"; he died intestate, unmarried and childless, and leaving as his heirs at law a sister, two nieces, and a nephew; a question arose as to whether his creditors or his heirs at law should have the fund derived from the policy, and it was held that the heirs were entitled to the proceeds of the policy; and it was further held, in regard to the meaning of the word "heirs," that reference was had to the statute simply for the purpose of ascertaining who were the beneficiaries of the policy, but that, when they were thus ascertained, their right to the money was derived, not from the statute, but solely from the contract embraced in the policy; that is to say, that the next of kin of the deceased were entitled to take the proceeds of the policy by virtue of the contract he had made in their behalf with the insurance company; and, in so holding, the following language was used: "In other words, they take the proceeds, not as heirs or distributees of the deceased, but as purchasers. 507 This be ing so, the proceeds of this policy were not, under the facts of this case, any part of the estate of the assured, and, therefore, not subject to the claims of his creditors": Hubbard v. Turner, 93 Ga. 752, 20 S. E. 640, 30 L. R. A. 593, and cases in note.

In the case at bar the benefit certificate or life insurance policy provides as follows: "The association hereby agrees well and truly to pay, or cause to be paid, as a benefit to his devisees, as provided in last will and testament, or, in the event of their