Sanger v. Rothschild — 19 N.Y. St. Rep. 345

Majority

p. 345

Simon Sanger, Individually, and as Administrator, etc., v. Emma Rothschild, Individually, and as Executrix, etc.

(Supreme Court, General Term, First Department,

Filed November 24, 1888.)

Headnote

1. Mutual befefit associations—Dividend payable on death of member—Title to—Constitution and by-laws contbolling as to mode of alienation.

The question of title to payments from the benefit fund on the death of

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a member of a mutual benefit association, must be determined by the constitution or the by-laws of the association. It is not in the power of the company or of the members, or both, to alter the rights of those who, by the constitution, are declared to be beneficiaries, except in the mode and to the extent therein designated.

2. Same — Dividend payable on death op member — Title to—Construction op provisions op constitution regarding.

The constitution of a mutual benefit association provided that the dividend payable from the benefit fund on the death of a member, should, in the' first instance be paid to the widow, or, in case of her death, to the children of the deceased member; and that no other person should be entitled thereto, unless the member should have so designated, in writing, to his lodge, as thereinafter provided. Further provision was made whereby a member might bequeath a certain proportion ef the amount payable to one or all of his children, a stated sum, in any case, being made payable to the widow. Held, That a member could not, by his written designation of a beneficiary defeat the provisions of the constitution of the association, and that not having diverted the title to'the dividend from his widow in the manner provided by the constitution, she was entitled to it.

Case submitted under section 12T9 of the Code of Civil Procedure.

Solon P. Rothschild, for pl’ff; Charles A. Adams for deft.

William Rothschild, who was then unmarried, in 1874, became a member of the Independent Order of Free Sons of Israel, which was a Mutual Benefit Aid association, organized and existing under the Laws of the state of New York.

By its constitution, or by-laws, it obligated itself to pay the sum of $1,000 on the decease of a member. Rothschild, in September, 1881, made the following designation for the payment of this sum of $1,000:

I, the undersigned, member of the Standard Lodge No. 30, I. O. F. S. of I, do hereby declare of my own free will that the money, according to the endowment law of this district, amounting to $1,000, should be paid, after my demise, to my uncle and aunt, Simon and Yandel Sanger, except otherwise by me directed.

W. ROTHSCHILD.

Witness:

Henry Levy.

Moses Lichtenauer.

And it is under the designation that the plaintiff, in his own behalf, and as administrator of his wife Yandel Sanger, claims this sum of money. Rothschild married the defendant on the 4th of May, 1884, and died on the 15th of January, 1888, leaving his widow surviving him, but no children, and she, individually, and also as administratrix, claims the same sum of money.

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Which of these parties has the better title to the money in controversy must be determined by the constitution or by-laws of the association. Greeno v. Greeno ( 23 Hun, 478 , 482), where it was held “that it was not in the power of the company, or of the member, or both, to alter the rights of those who by charter are declared to be beneficiaries, except in the mode and to the extent therein indicated.”

And the cases of Masonic Ins. Co. v. Miller ( 13 Bush, 489 ); Duval v. Goodson ( 79 Ky., 224 ); Pres. Mutual Assurance Fund v. Allen ( 106 Ind., 593 ); Addison v. New England Com. Travelers Association ( 144 Mass., 591 ); Kaiser v. Kaiser (1 N. Y. State Rep., 258); Hellenberg v. District No. 1, etc. ( 94 N. Y., 580 ); Massey v. Mutual Relief Society ( 102 N. Y., 523 ; 2 N. Y. State Rep., 487), support this principle. The title to the fund, therefore, becomes a question of construction of the language employed in framing the constitution, or by-laws in force and operative upon these parties.

At the time whert the written designation for the payment of the $1,000 was made and which was the only designation made in writing by the deceased member, the constitution of the society declared, by section 2, that the object of this fund shall be to secure the sum of $1,000, after the death of a member, and this amount shall be paid, in the first instance, to his wife or children, as hereinafter provided by section 6, or, secondly, if his wife be dead, to his children. Ho other person shall be entitled thereto, unless a brother shall have so designated in writing to his lodge, as hereinafter provided. And by section 6 in this manner ref erred to, further that “A married brother may bequeath one-half of the legal amount to either one or all of his children; $500 at least must be devised to his widow. In 1885, and again in 1887, changes were made in the constitution or by-laws of the order concerning the payment of this sum of money, but in no way advancing the rights or claims of the plaintiff, either individually or as administrator. But so far as the changes extended they appear to have been intended more definitely and distinctly to provide for the widow and the children of the deceased member than that had been done by the constitution or by-laws in force when this written designation was made. If therefore, the plaintiff, as the widow of this deceased member, became entitled to the money under the constitution or by-laws existing when the written designation was made, a judgment to that effect must be directed in the action, without rendering it in any respect dependent upon more favorable action afterwards taken in her behalf by the association or society.

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And as the wife and widow of the member the constitution or by-law already quoted secured to her this sum of money, inasmuch as no bequest of any part of it was at any time made, or could have been made to children of the deceased member. As to the widow, no designation in writing was required, for it was declared in plain language that the sum of $1,000 should be paid in the first instance to the wife of the member, or to his children, as provided by section 6. And as he left no children and made no bequest under the authority of section 6, the direction of the constitution was absolute for the payment of the money to his widow.

That direction was no less imperative for the reason that he was not married at the time when he made the written designation in favor of the plaintiff and the intestate represented by him. The designation was necessarily subject to this direction contained in section 2 of the constitution or by-laws. It rendered that designation ineffectual in case of the decease of the member leaving a widow surviving him, as was the fact in this instance.

The case of Folmer’s Appeal ( 87 Penn., 133 ), has been relied upon as an authority opposed to this construction, but the facts of that case materially differ from the present controversy. It seems to have been disposed of upon the effect of a proviso which the court held did not deprive the member of the power of disposing of the fund in favor of another person not within the proviso. The construction which was there adopted was somewhat severe, and is not entirely in harmony with the language of the constitution or by-laws of the association, and it cannot reasonably be extended to this case, which does not depend upon a proviso, but upon an unqualified direction that the money shall in the first instance be paid to the wife of the deceased member. The case of Highland v. Highland ( 109 Ill., 366 ), also depended upon the peculiar provisions of the constitution of the order from which the money proceeded in that instance, and it as materially differs in its controlling facts from this case, as the other authority just referred to. Here there can be no misapprehension as to the construction which should be placed upon the constitution or by-laws of the order, for it in plain language contains the clear direction that the money shall be paid in the firstv instance to the wife. And her right to it has in no way been rendered dependent upon or subject to any written or other direction of the member himself. It is secured to her in direct terms as a fundamental part of the arrangement affecting the disposition of the amount to be paid. His marriage consequently annulled the preceding written designation in favor of the plaintiff, and the intestate

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represented by him and entitled the defendant as the wife or widow of the deceased member to this sum of money. Judgment must accordingly be directed upon the case submitted to that effect.

Van Brunt, Ch. J., and Brady, J., concur.