Rodrigues ex rel. Garcia v. Portuguese Mutual Benefit Society

OPINION OP THE COURT BY HARTWELL. ,T. (Prear, C. X, dissenting.) This is a submission upon agreed facts. A. J. Rodrigues became a member of the defendant society, a corporation, on [317] August 25, 1889. At that time one of the by-laws of the society provided as follows: “The society gives the following assistance to * * * children of its members: To the children of less than 12 years of age, orphans of members who during 10 years have contributed without having received benefits, the society shall give a pension until they complete the age of 12 years. This benefit shall be of 50 cents daily if member belongs to the first class and of 25 cents if to the second class.” Rodri-gues was a member of the first class and continued such until his death, April 3, 1904, contributing all dues and assessments levied and receiving no benefits. On November 20, 1903, that is, nearly four years after the expiration of the first ten years of his membership and a little more than four months before his death, this by-law was amended by substituting the period of fifteen years for that of ten years. Rodrigues never consented to this change in the by-law but, being a resident of Wailuku, was not entitled to notice of meetings which was required to be given only to members residing in Honolulu. The plaintiffs are the children of the said Rodrigues and were under twelve years of age when he died. They claim the pension of fifty cents a day from the death of their father until their arrival at the age of twelve years, under the original by-law. The society refuses to pay on the ground that their father had not fulfilled the conditions of the amended by-law in that he had not continued a contributing member for fifteen years without receiving benefits. The by-laws, as they stood when Rodrigues joined the society, provided also that “the general assembly shall have the right to interpret and alter the by-laws;” also that one of the objects of the society was “to aid the orphan children of deceased members as long as 'the financial standing of the society will permit it.” The society at all the times mentioned was in a prosperous financial condition. This much appears from the submission. The by-laws, as a whole, which-are in Portuguese, are not made a part of the submission. It appears from a translation of a portion of them, furnished by counsel upon request, as [318] they were when Rodrigues joined, that other objects of the society were to aid members when sick or when by sickness or advanced age they were unable to obtain the necessary means of existence, and to provide funerals for members; that every member had the right to be aided in the cases and by the means indicated by the by-laws, and that at his death the orphans should be pensioned and his widow, children, parents and brothers, fulfilling the required conditions, should receive the full amount of the death benefit collected from members in conformity with the by-laws; also that the benefits .of the orphan children might be suspended wholly or in part when their continuance would threaten the existence of the society; that a member who had received benefits during the first ten years might refund the same to the society so as to give him the rights of one who had not received benefits during that period, and that the widow or person in charge of the orphans of any member who had paid more than nine years’ dues without receiving benefits might continue to pay the monthly dues until the ten years were completed in order to entitle the children to receive the prescribed pension. It does not appear that any policy was issued to Rodrigues or that any contract was made with him other than that contained by implication in the by-laws. A translation, furnished by counsel upon request, of the regular form of the certificate or diploma of membership issued by the society shows merely a statement that the member, describing him, matriculated on a certain day and paid certain fees. The claim of the plaintiffs is that their father, Rodrigues, by payment of monthly dues without receipt of benefits for the term of ten years secured to them the right to the pension provided by the by-laws in force during that time, subject only to his continuing his membership for the rest of his lifetime, and that this right was not subject to be defeated by a subsequent by-law increasing the term for payment of dues to fifteen years. [319] Tlie defendant claims that until a member’s death no pension right accrues since by the contract of membership the by-laws are subject to amendment. Did, then, Rodrigues’ payment of dues for ten years without receipt of benefits secure an absolute right that his children should be pensioned if he remained a member until his death •or merely secure a right defeasible by a new by-law againsf the operation of which his agreement that the by-laws could be amended precluded him from complaining? Conceding that the only limits of the power of such an association to amend its by-laws are (1) that the amended by-laws shall not frustrate any of its essential objects, (2) shall be of reasonably uniform application and (3) shall not manifestly be unreasonable or oppressive, it cannot be said that the change made in this case exceeds such limits. While the power to amend by-laws does not authorize imposing new conditions which are ■oppressive or unfair, a large discretion must be left to the association in determining what course will best subserve its interests. TIow much money shall be paid to a sick or invalid member or to his family and for how long a period, and how much, if any, pension shall be paid to his orphan children upon his ■decease are matters of administration which cannot be fixed by permanent rules. When by a change of rules the aid to be awarded to sick or invalid members or to their families is reduced in amount or duration all members are equally affected and none can complain. There is nothing unfair or unreasonable in such changes per se and they are all necessarily prospective in their operation. Regarding the case as presenting merely a question of reasonable exercise of power to amend by-laws and not a case,of a contractual relation established between a member and the association nor depending upon the construction of the amended by-law to determine whether it is retroactive in effect or applicable to those cases only in which payment of dues had not been made for the full term of ten years, the result would be that the plaintiffs would not be entitled to a pension. [320] But if any contractual, relation .between a member and the association can ever be established during his lifetime, not subject, to the condition that it may be altered by the association, the relation was established in this case. The obligation of the association and the right of the member were as definitely fixed as if a stated sum of money was required by the original by-laws to be paid to the member himself at the end of the ten years. The facts that the amount of money to be paid to-his children depended upon their age and that it was payable in futuro, if at all, and only if his membership continued until his death, do not affect the nature of the obligation or lessen its binding force. It may be true that a member’s right to any specified sick or invalid benefit is not secured by by-laws in force prior to his becoming sick or an invalid, if at all, and that such right is liable to be modified in respect of the amount or duration of the benefit by new by-laws; but upon the occurrence of his sickness or invalidism the right accrues and cannot be repudiated by the association. Moreover, there is no obvious reason for treating this amended by-law as intended to be applied to cases in which the condition for securing a pension payable in futuro has been performed. No right was acquired prior to the end of the ten years. Before then a member would properly regard his status as subject to-new by-laws imposing new conditions for securing the pension, as, for instance, higher monthly dues or payment for a longer-term, but his right was fixed upon the end of the original term. As a question of construction the natural and just inference is-that the new by-law was not intended to annul the status existing when the ten years had elapsed or to release the association from the obligation which it had then incurred. Figure v. Mutual Society, 43 Vt. 362, is the only case to which our attention has been called which goes to the length of holding that after a member’s death the aid to his widow secured by the by-laws in his lifetime can be reduced, or, in other words, that without an independent contract no right under the by-laws can be acquired during a member’s lifetime. E. A. Douthitt for plaintiffs. E. M. Watson for defendant. A majority of tbe court are of the opinion that the amended by-law extending to fifteen years tbe term of payment of dues required to secure a pension for children does not affect a pension right previously acquired under the by-laws prescribing ten years as the term, and also that the amended by-law does not purport to apply to such cases. The plaintiffs may take judgment accordingly.