Hannes v. Nederland Israelitish Sick Fund

Ingraham, P. J.: The facts in this case are stated in the opinion of Mr. Justice McLaughlin. It seems to me clear that the contract between the plaintiff and the defendant was that created by the by-laws as they existed at the time the plaintiff joined the society. It is conceded that the defendant had no right without the consent of the plaintiff to abrogate or modify that contract by an amendment of its by-laws, but it is going much beyond any of the reported cases to hold that because a corporation changes its by-laws after a person has become a member and accepted the conditions there imposed such an amended by-law becomes a new contract which a corporation is powerless to change. When the plaintiff joined this corporation,the by-law provided that in the event of a member’s sickness being declared incurable by the physician of the society such member shall receive the sum of three dollars and fifty cents per week for twelve successive months and should thereupon be entitled to no further sick benefits. That was the contract, and it is conceded that the plaintiff has received a much greater sum from the defendant than the contract as between himself and the defendant required. In March, 1902, this by-law was amended by striking out the provision that a member afflicted with an incurable sickness was to be entitled to no further sick benefits than the three dollars and fifty cents per week for twelve successive months. It seems to me clear that by this amendment there was no new contract created. It provided for a gratuity in addition to that provided for in the contract between the plaintiff and the defendant, and so long as such an amended by-law was in force it may be conceded that the plaintiff would 142 be entitled to receive the weekly payments as therein provided. In each of the cases cited in the opinion of Mr. Justice McLaughlin the right of a member of such a corporation is based upon the contract which arose between the parties under the by-laws of the corporation and the certificate of membership at the time the member joined the society. What was decided by the Court of Appeals in Wright v. Knights of Maccabees (196 N. Y. 391) was that the original contract made upon the member joining the society must control and a member’s rights secured thereby could not be impaired by virtue of a subsequent amendment to the by-laws to which the member did not. assent, and in Dowdall v. Catholic Mut. Benefit Assn. (196 N. Y. 405) it was expressly held that the contract of insurance cannot be changed by any act of the defendant, as such contracts are protected by the State and Federal Constitutions and all the cases cited by the court upon which these cases are decided are based upon the original contract entered into when the member joined the society., Certainly these cases are not authorities for the proposition that a new contract arose between each member of the association and the association itself upon each change of by-law which the corporation could not thereafter modify or affect. It is conceded that the amendment of 1905 did not deprive the plaintiff of any benefit which he could have been entitled to receive under the by-laws as they existed at the time he became a member. I can see nothing in the relations between the parties which at all limited the right of the defendant to amend the amendment .so as to reduce the amount that a sick member was entitled to receive so long as the amount which the plaintiff did actually receive was equal to or in excess of the amount due under the by-law as it existed at the time he became a member of the association. If this view is correct it is evident that the determination of the Appellate Term was wrong and that the judgment must be reversed and a new trial ordered, with costs to the appellant tó abide the event. Clarke and Scott, JJ., concurred; McLaughlin and Laughlin, JJ., dissented. ..