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Niblack, Ben. Soc. 2d ed. §§ 18, 136; 5
Thomp. Corp. § 5987; 5 Am. & Eng. Enc.
Law, 2d ed. 100; 3 Am. & Eng. Enc. Law, 2d
ed. 1059, 1081-3.

Such member is bound by, and presumed to take notice of, all by-laws enacted by the society after his admission, where, as in this case, the application and certificate so provide.

Bacon, Ben. Soc. & Life Ins. §§ 185, 188; Niblack, Ben. Soc. 2d ed. §§ 25-27, 137; Korn v. Mutual Assur. Soc. 6 Cranch, 192, 3 L. ed. 195; 7 Cranch, 396, 3 L. ed. 383; Pain v. Société St. Joan Baptiste, 172 Mass. 319, 52 N. E. 502; May v. New York Safety Reserve Fund Soc. 14 Daly, 389; Supreme Commandery K. of the G. R. v. Ainsworth, 71 Ala. 436, 46 Am. Rep. 332; Borgards v. Farmers' Mut. Ins. Co. 79 Mich. 440, 44 N. W. 856; Hughes v. Wisconsin Odd Fellows' Mut. L. Ins. Co. 98 Wis. 292, 73 N. W. 1015: Bowie v. Grand Lodge of Legion of the West, 99 Cal. 392, 34 Pac. 103; Masonic Mut. Ben. Asso. v. Severson, 71 Conn. 719, 43 Atl. 192: Supreme Council A. L. of H. v. Adams, 68 N. H. 236, 44 Atl. 380; Fullenwider v. Supreme Council of the R. L. 180 Ill. 621, 54 N. E.

485.

These rules have been applied in the following cases against this defendant, involving similar contracts:

Supreme Lodge, K. of P. v. Knight, 117 Ind. 489, 3 L. R. A. 409, 20 N. E. 479; Supreme Lodge, K. of P. v. La Malta, 95 Tenn. 157, 30 L. R. A. 838, 31 S. W. 493; Supreme Lodge, K. of P. v. Kutscher, 179 Ill. 340, 53 N. E. 620; Supreme Lodge, K. of P. v. Trebbe, 179 Ill. 348, 53 N. E. 730; Daughtry v. Knights of Pythias, 48 La. Ann. 1203, 20 So. 712; Dornes v. Supreme Lodge K. of P. 75 Miss. 466, 23 So. 191; Lloyd v. Supreme Lodge K. of P. 98 Fed. Rep. 66, 38 C. C. A.

654.

Mr. Edward De Graffenreid argued the cause and filed a brief for defendant in error:

The fraud or mistake of a knavish or blun-
dering agent, within the scope of his powers,
will not enable the company to avoid a pol-
icy to the injury of assured, who innocently
became a party to it, although a stipulation
in the policy provides that such agent shall
be deemed the agent of the insured.

Whiteside v. Supreme Conclave Improved
O. of H. 82 Fed. Rep. 275; Knights of Pyth-
ias of the World v. Bridges, 15 Tex. Civ.
App. 196, 39 S. W. 333; Bacon, Ben. Soc. &
Ins. § 426, and authorities cited.

There is no magic in mere words to change
the rea! into the unreal. A device of words
cannot be imposed upon a court in place of
an actuality of fact.

Bacon, Ben. Soc. § 153; Union Mut. L. Ins. Co. v. Wilkinson, 13 Wall. 235, 20 L. ed. 623.

By-laws enacted subsequent to the issuance of a policy must be reasonable, or they are void.

Allnutt v. Subsidiary High Court of U. S. A. O. of F. 62 Mich. 110, 28 N. W. 802; People ex rel. Quien v. Theatrical Mechanical Asso. 8 N. Y. Supp. 675; Erd v. Bavarian Nat. Aid & Relief Asso. 67 Mich. 233, 34 N. W. 555; Brady v. Coachman's Benev. Asso. 39 N. Y. S. R. 181, 14 N. Y. Supp. 272.

*Mr. Justice Brown delivered the opin-[261] ion of the court:

The Supreme Lodge Knights of Pythias is a fraternal and benevolent society, incorpo rated by an act of Congress of *June 29, 1894[282] (28 Stat. at L. 96, chap. 119), as the successor of a former corporation of the same 5, 1870. The beneficial or insurance branch name, organized under an act approved May of the order is known as the endowment rank, which is composed of those members of the order who have taken out benefit certificates. Such members are admitted into lo

The provision that officers of sections are the agents of the members, and shall in no wise be considered as the agents or the rep-cal subordinate branches known as sections. resentatives of the board of control of the endowment rank or of the supreme lodge, was valid and binding upon the deceased under his contract of membership.

preme Lodge, and by rules and regulations
adopted by the board of control and ap-
proved by the Supreme Lodge.

The members of each section elect their own president and secretary. The endowment rank is governed by a board of control whose officers are a president and secretary, and Susquehanna Ins. Co. v. Perrine, 7 Watts whose place of business is in Chicago. The & S. 348; Peet v. Great Camp of K. of M. endowment rank is governed by a constituof the World, 83 Mich. 92, 47 N. W. 119:tion and general laws enacted by the SuGrand Lodge of A. O. of U. W. v. King, 10 Ind. App. 639, 38 N. E. 352; Sovereign Camp, Woodmen of the World v. Rothschild, 15 Tex. Civ. App. 463, 40 S. W. 553; New On January 1, 1883, Robert W. Withers York L. Ins. Co. v. Fletcher, 117 U. S. 519, made application for membership in the en29 L. ed. 934, 6 Sup. Ct. Rep. 837; Maier v. dowment rank, and in that application made Fidelity Mut. Life Asso. 47 U. S. App. 329, the following statement: "I hereby agree 78 Fed. Rep. 566, 24 C. C. A. 239; United that I will punctually pay all dues and asStates L. Ins. Co. v. Smith, 92 Fed. Rep. 503, sessments to which I may become liable, and 34 C. C. A. 506; Hubbard v. Mutual Reserve that I will be governed, and this contract Fund Life Asso. 80 Fed. Rep. 681; Bernard shall be controlled, by all the laws, rules, v. United L. Ins. Asso. 14 App. Div. 142, 43 and regulations of the order governing this N. Y. Supp. 527; Rohrbach v. Germania F. rank, now in force, or that may hereafter be Ins. Co. 62 N. Y. 47, 20 Am. Rep. 451; Mc-enacted, or submit to the penalties therein Coy v. Roman Catholic Mut. Ins. Co. 152 Mass. 272, 25 N. E. 289; Quinlan v. Providence Washington Ins. Co. 133 N. Y. 356, 31 N. E. 31.

contained." His application was accepted,
and, after receiving a certificate under the
first act of incorporation which he volun-
tarily surrendered, he received the certifi-

cate upon which this action is brought. This certificate recited the original application for membership dated January 1, 1883, the surrender of the former certificate and the application for transfer to the fourth class, which were "made a part of this contract, and in consideration of the payment heretofore to the said endowment rank of all monthly payments, as required, and the full compliance with all the laws governing this right, now in force or that may hereafter be enacted, and shall be in good standing under said laws, the sum of $3,000 will be paid by the Supreme Lodge, etc., to Josephine R. Withers, wife, upon due notice and proof of death and good standing in the rank at the time of his death, and it is understood and agreed that any violation of the within-mentioned [203]conditions or other *requirements of the laws in force governing this right shall render this certificate and all claims null and void, and the said Supreme Lodge shall not be liable for the above sum or any part thereof." Withers was a member of section 432, at Greensboro, Alabama, of which one Chadwick was secretary. By the laws of the endowment rank Withers was required to pay $4.90 monthly in accordance with his age and the amount of his endowment.

gain all right as a section, and any surviving members thereof (not less than five) shall regain full rights and privileges held previous to such forfeiture, if within thirty days from suspension of warrant said section shall pay to the board of control the amount of all monthly payments, assessments, and dues accrued upon said members.

"Sec. 10. Sections of Endowment Ranks shall be responsible and liable to the board of control for all moneys collected by the secretary or other officers from the members for monthly payments, assessments, or dues not paid over to the board within the time and manner prescribed by law. Officers of sections are the agents of members, and shall in no wise be considered as the agents of the representatives of the board of control or of the Endowment Rank or of the Supreme Lodge."

For over twelve years Withers made his monthly payments as required by law to the secretary of the section, and the money was regularly remitted to the board of control at Chicago. His last payment was made prior to October 10, 1895, as required by section 4, for the dues of that month. As there were a large number of members in the section, and as their dues were not all collected until the latter part of the month, the secIn January, 1894, defendant adopted and retary of the section did not send the money romulgated the following general laws: to the board of control until October 31, "Sec. 4. Monthly payments and dues of when he mailed to the secretary of that board members holding certificates of endowment a check covering all the amounts due by all shall be due and payable to the secretary of the members of the section for that month. section without notice, on the first day of The letter did not leave the postoffice until each and every month; and a failure to make the next day, and was received by the board such payment on or before the 10th day of of control November 4. No notice was ever each month shall cause, from and after such mailed by the board of control to Withers date, a forfeiture of the certificate of endowment and all right, title, and interest such notifying him of his suspension; but on Nomember or his beneficiaries may have in and vember 1st, as required by section 6, the secto the same, and membership shall cease ab- retary of the board of control mailed to Mr. solutely. In case of such forfeiture, mem- Chadwick, the secretary of the section at bership may be regained by making appli- Greensboro, a notice of the suspension of all cation in the form prescribed for new ap-members thereof, with an intimation that plicants, the payment of required membership fee and surrender of the forfeited certificate. If approved by the medical examiner-in-chief and accepted by the board of control, a new certificate shall be issued, and the rating shall hereafter be at the age of nearest birthday to the date of the last application."

"Sec. 6. The secretary of the section shall forward to the board of control the monthly payments and dues collected immediately after the 10th day of each and every month.

"If such payment and dues are not received by the board of control on or before the last day of the same month the section so failing to pay, and all members thereof, shall stand suspended from membership in the Endowment Rank; and their certificates and all right, title, and interest therein shall be forfeited. Notice of such suspension shall be forthwith mailed by the secretary of the board of control to the president and secretary of such section.

"Provided, that the section whose member[264]ship has forfeited their endowment, and whose warrant has been suspended, shall re

the members of the section might regain their rights under certain conditions therein named. No notice was mailed to the president of the section. In view of the technical character of the defense, it is worthy of mention that the board of control did not strictly comply with its own regulation in this particular.

*Upon receiving the remittance, and on[265] November 4, the secretary of the board of control mailed the following postal card to the secretary of the section:

Office Board of Control,

Chicago, November 4, 1895. Received of Section No. 432 one hundred and thirteen 30-100 dollars in payment of monthly payments and dues for October, 1895, on condition that all members for whom above payment is made were living at date of this receipt.

H. B. Stolte,
Secretary Board of Control.

The insured was suddenly taken ill and died of an attack of cholera morbus on No

vember 1, 1895. Proofs of death were waived by the defendant, which, however, refused to pay the amount of the certificate.

it is hardly necessary to say that the defense in this case is an extremely technical one, and does not commend itself to the average sense of justice. It ought to be made out with literal exactness. It is admitted that Withers for twelve years paid all his dues promptly to the secretary of the section as required by section 4 of the general laws, and that the failure of the board of control to receive them on or before the last day of the month was the fault of the secretary, and not of the insured. The whole defense rests upon the final clause of section 10, declaring that "officers of sections are the agents of the members and shall in no wise be considered as the agents of the representatives of the board of control of the Endowment Rank or of the Supreme Lodge." It appears to have been the habit of the secretary, Mr. Chadwick, not to remit each payment as it was made, but to allow all the dues of each month to collect in his hands and to remit them together by a check covering the whole amount, about the close of the month. In this connection he makes the following statement: "It had never been the custom of my office for me to send the money off by the twentieth of the month" (although section 6 required him to forward it immediately after the tenth). "I usually sent the money off about the last days of the month. For the previous year I had mailed to the secretary of the board of control the dues of the section as follows: October 27, 1894, November 28, 1894, December 29, 1894, January 29, 1895, February 27, 1895, March 30, 1895, April 29, 1895, June 29, 1895, July [266]8, 1895, *August 29, 1895, September 28, 1895, October 28, 1895, October 31, 1895-all of which sums were accepted by the board of control."

sible to the board of control from the mo-
ment the money is collected, and section 6
makes it the duty of the secretary to remit
it at once.

There seems to have been an attempt on
the part of the defendant to invest Mr. Chad-
wick with the power and authority of an
agent, and at the same time to repudiate his
agency. But the refusal to acknowledge
him as agent does not make him the less so,
if the principal assume to control his con-
duct. It is as if a creditor should instruct
his debtor to pay his claim to a third person,
and at the same time declare that such third
person was not his agent to receive the
money. It would scarcely be contended,
however, that such payment would not be a
good discharge of the debt, though the third
person never accounted to the creditor;
much less, that it would not be a good pay-
ment as of a certain day, though the *re-[267]
mittance, through the fault of the person
receiving it, did not reach the creditor until
the following day.

The position of the secretary must be determined by his actual power and authority, and not by the name which the defendant chooses to give him. To invest him with the duties of an agent, and to deny his agency, is a mere juggling with words. Defendant cannot thus play fast and loose with its own subordinates. Upon its theory the policy holders had absolutely no protection. They were bound to make their monthly payments to the secretary of the section, who was bound to remit them to the board of control; but they could not compel him to remit, and were thus completely at his mercy. If he chose to play into the hands of the company, it was possible for him, by delaying his remittance until after the end of the month, to cause a suspension of every certificate within his jurisdiction; and in case such remittance was not made within thirty days The position now taken by the defendant, from such suspension (sec. 6) apparently to that in receiving the money from the insured make it necessary under section 4 for each members, and remitting the same to the policy holder to regain his membership by board of control, the secretary of the section making a new application, surrendering his was the agent of the insured, and not of the forfeited certificate, making payment of the board of control, is inconsistent with the re- required membership fee, undergoing a new quirement of section 4, which makes it ob- medical examination, and paying a premium ligatory upon policy holders to pay their determined by his age at the date of the last monthly dues to the secretary of the section, application. In other words, by the failure and to him only, as well as with the provi- of the secretary, over whom he had no consion of section 10, that "sections of Endow-trol, to remit within thirty days, every memment Rank shall be responsible and liable to ber of the section might lose his rights under the board of control for all moneys collected his certificate and stand in the position of by the secretary, or other officers, from the one making a new application, with a formembers for monthly payments, assessments, feiture of all premiums previously paid. The or dues not paid over to the board within the new certificate would, of course, be refused time and manner prescribed by law." The if his health in the meantime had deterioquestion at once suggests itself, To whom rated, and the examining physician refused does the money belong when paid to the sec- to approve his application. This would enretary of the section? If to the insured, it able the company at its will to relieve itself was within his power to reclaim it at any of the burdens of undesirable risks by refustime before it was remitted. If to the boarding certificates of membership to all whose of control, it was the duty of the secretary of the section to remit it. Why, too, should the board of control attempt to deal with it at all beyond requiring it to be paid them by a certain day? Section 10 is a complete answer since that makes the sections respon

health had become impaired since the orig-
inal certificate was taken out, though such
certificate-holder may have been personally
prompt in making his monthly payments.

It could not thus clothe the secretaries of
the sections with the powers of agents by au-

thorizing them to receive monthly payments | policy. Said the court in its opinion: and instructing them to account for and re- "That he was the agent of the defendant it [268]mit them to the Supreme Lodge at Chicago, would be fatuous to deny; were it not for a and in the same breath deny that they were clause in the policy" (the agency clause) agents at all. The very definition of an "upon which the defendant builds. agent, given by Bouvier, as "one who under- But if the insured is to be now bound as takes to transact some business, or manage having thus contracted, there must be musome affair, for another, by the authority tuality in the contract. No man can serve and on account of the latter, and to render two masters. If the procurer of the insuran account of it" presupposes that the acts ance is to be deemed the agent of the indone by the agent shall be done in the inter- sured he may not be taken into est of the principal, and that he shall receive the service of the insurer as its agent also; his instructions from him. In this case the or if he is so taken, the insurer must be agent received his instructions from the Su- bound by his acts and words, when he stands preme Lodge, and his actions were, at least, in its place and moves and speaks as one as much for the convenience of the lodge as having authority from it; and pro hac vice, for that of the insured. If the Supreme at least, he does then rightfully put off his Lodge intrusted Chadwick with a certain au- agency for the insured and put on that for thority, it stands in no position to deny that the insurer. Nor will it hold the he was its agent within the scope of that plaintiff so strictly to the contract he made authority. as to permit the defendant to ignore it and take his agent as its agent, and yet make him suffer for all the shortcomings of that person while acting between them and while under authority from the defendant to act for it." So in Sprague v. Holland Purchase Ins. Co. 69 N. Y. 128, the insured signed a blank form of application, which was filled up by the company's agent without any knowledge or dictation of the insured. There were false statements therein, occasioned by the mistake or inadvertence of the agent. The policy contained the agency clause, as well as the condition that the application must be made out by the defendant's authorized agent, and it was held, using the language of the court in the Whited Case, that the latter clause "swallowed down" the former, and that there was no warranty binding upon the plaintiff.

The reports are by no means barren of cases turning upon the proper construction of this so-called "agency clause." under which the defendant seeks to shift its responsibility upon the insured for the neglect of Chadwick to remit on the proper day. In some jurisdictions it is held to be practically void and of no effect; in others, it is looked upon as a species of wild animal, lying in wait and ready to spring upon the unwary policy holder, and in all, it is eyed with suspicion and construed with great strictness. We think it should not be given effect when manifestly contrary to the facts of the case, or opposed to the interests of justice. Wherever the agency clause is inconsistent with the other clauses of the policy, conferring power and authority upon the agent, he is treated as the agent of the company rather than of the policy holder. The object of the clause in most cases is to transfer the responsibility for his acts from the party to whom it properly belongs, to one who generally has no knowledge of its existence. It s usually introduced into policies in conection with the application, and for the purpose of making the agent of the company the agent of the party making the application, with respect to the statements therein contained.

It was formerly held in New York (Rohrback v. Germania F. Ins. Co. 62 N. Y. 47, 20 Am. Rep. 451, and Alexander v. Germania F. Ins. Co. 66 N. Y. 464, 23 Am. Rep. 76), that, where the insured had contracted that the person who had procured the insurance should be deemed his agent, he must abide [269]by his agreement; and where *such person had, through fault or mistake, misstated in the application to the company the declarations of the assured, the latter must suffer for the error or wrong; but in a subsequent case (Whited v. Germania F. Ins. Co. 76 N. Y. 415, 32 Am. Rep. 330), this doctrine was held to be limited to such acts as the agent performed in connection with the original application, and that in a renewal of the policy such party was treated as the agent of the defendant, for whose acts it was bound; and that it was within his power to make a valid waiver of the conditions of the

In Patridge v. Commercial F. Ins. Co. 17 Hun, 95, it was said of the agency clause: "This is a provision which deserves the con- -[270) demnation of courts, whenever it is relied upon to work out a fraud, as it is in this case. The policy might as well say that the president of the company should be deemed the president of the assured. . Such a clause is no part of a contract. It is an attempt to reverse the law of agency, and to declare that a party is not bound by his agent's acts. Whether one is an agent of another is a question of mixed law and fact, depending on the authority given expressly or impliedly. And when a contract is, in fact, made through the agent of a party, the acts of that agent in that respect are binding on his principal."

In Nassauer v. Susquehanna Mut. F. Ins. Co. 109 Pa. 509, under a by-law providing that "in all cases the person forwarding applications shall be deemed the agent of the applicant," it was held, under the circumstances of the case, that the agent of the company soliciting insurance was not the agent of the applicant, and that such by-law was not binding upon him. Although the insured is supposed to know at his peril the conditions of the policy, that will not bind him to a provision which is not true, and one which the company had no right to insert therein. "We do not assent," said the court,

"to the proposition that the offer" (that the | pany, the payment was binding upon the agent made his own valuation of the prop-company, whether he paid the money over or erty) "was incompetent, because Laubach not. In that case the person to whom the was the agent of the assured in filling up the application and forwarding it to the company. He was not the agent of the assured. The latter had not employed him for any purpose. He was the agent of the defendant company, and as such called upon the assured and solicited a policy, and hav-loss arising from the fraud committed by ing obtained his consent proceeded to fill up the application for him to sign. As to all these preliminary matters the person soliciting the insurance is the agent of the company." The court, speaking of the agency clause, observed: "This court, in the case above cited [Columbia Ins. Co. v Cooper, 50 Pa. 331], characterized a some what similar provision as a 'cunning condition.' The court might have gone further and designated it as a dishonest condition. It was the assertion of a falsehood, and anises, and while he may not have been, in attempt to put that falsehood into the mouth of the assured. It formed no part of the contract of insurance. That contract consists of the application and the policy is [271]sued in pursuance thereof. In point of fact the assured does not see the policy until after it is executed and delivered to him. In

money was paid was not in reality an agent
of the company, although plaintiff believed
him to be such, but only a street insurance
broker, who represented himself to be the
agent of the company. Said the court: "Un-
der such circumstances who should bear the
the street broker? Should it fall upon the
plaintiff, who was an innocent party in the[272]
transaction, or should it fall upon the com-
pany, who alone enabled Puschman to suc-
cessfully consummate the contract of insur-
ance by placing in his hands the policy for
delivery? The street broker was not the
agent of the plaintiff for any purpose. If
the evidence be true, he had no authority
to act for her or bind her in any manner
whatever by what he might do in the prem-

many instances it is laid away by him and never read, especially as to the elaborate conditions in fine print. Grant that it is his duty to read it, his neglect to do so can bind him only for what the company had a right to insert therein. He was not bound to suppose that the company would falsely assert, either by direct language in the policy or by reference to a by-law, that a man was his agent who had never been his agent, but who was, on the contrary, the agent of the company. Notwithstanding this was a mutual company, the assured did not become a member thereof until after the insurance was effected. Hence, a by-law of the company of which he had no knowledge, and by

which he was not bound, could not affect

him in matters occurring before the grant-
ing of the policy.
And even a by-
law of a mutual company, which declares that
black is white, does not necessarily make it
so." Similar cases are those of Eilenberger
Susquehanna Mut. F. Ins. Co. v. Cusick,
109 Pa. 157; and Kister v. Lebanon Mut.
Ins. Co. 128 Pa. 553, 5 L. R. A. 646, 18 Atl.

v. Protective Mut. F. Ins. Co. 89 Pa. 464;

447.

The case of Lycoming F. Ins. Co. v. Ward, 90 Ill. 545, resembles the case under consid eration. In that case it was held that, where the assured contracts with one as the agent of the insurer, believing him to be such, and does not employ such supposed agent to act for him in obtaining insurance, such person has no power to act for or bind the insured, though the policy may provide that the person procuring the insurance shall be deemed the agent of the insured, and not of the company. Plaintiff paid the premium to the person with whom she contracted for the insurance, and of whoin she obtained the policy. It was held that such person, assuming to be the agent of the com

fact, the agent of the company, still the company, by placing the policy in the hands of the street broker for delivery, is estopped from claiming that the payment made to him upon delivery of the policy is not binding upon the company."

In Indiana it is also held that a recital

in the policy that the broker obtaining an insurance is the agent of the insured is not conclusive upon that subject. Indiana Ins. Co. v. Hartwell, 100 Ind. 566. In North British & M. Ins. Co. v. Crutchfield, 108 Ind. 518, 9 N. E. 458, the agency clause was held to be absolutely void as applied to a local agent, upon whose counter signature the validity of the policy, by its terms, was made to depend.

In Boetcher v. Hawkeye Ins. Co. 47 Iowa, 253, it was held that, if the assured had the right to believe the soliciting agent was the agent of the company, the insertion of clause in the policy providing that he was the agent of the assured constituted a fraud upon the latter, of which the company could

not take advantage.

Speaking of the agency clause in ContiPac. 291, it is said: "This is but a form of nental Ins. Co. v. Pearce, 39 Kan. 396, 18 words to attempt to create on paper an agency which in fact never existed. It is an attempt of the company, not to restrict the powers of its own agent, but an effort to do away with that relation altogether by mere words, and to make him in the same manner the agent of the assured, when, in fact, such relation never existed.

We do not believe the entire nature and or-
der of this well-established relation can be
vice of words. The real fact, as it existed,
so completely subverted by this ingenious de-
cannot be hidden in this manner; much less
can it be destroyed and something that did
not in reality exist be placed in its stead.
The substance is superior to the mere dra-
pery of words with which one party wishes
to bring into existence and clothe an unreal[273]
authority." See also Kausal v. Minnesota
Farmers' Mut. F. Ins. Asso. 31 Minn. 17,
47 Am. Rep. 776, 16 N. W. 430, in which
the act of an insurance agent in making out

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