Stringham v. Dillon

Mr. Chief Justice Moore, after stating the facts, delivered the opinion of the court. It is contended by plaintiff’s counsel that the failure of Stringham to pay the fee prescribed to secure a change of his beneficiary does not defeat the right of his widow to recover the sum specified in his benefit certificate, and that the amendments made by the order to its by-laws after he became a member thereof are unreasonable and contrary to its purposes. It is argued that the payment of the fee is not a condition precedent to the right to change a beneficiary, and that the acceptance of the money therefor by the order after Stringham’s death, with knowledge thereof, waived any informality, in the manner of securing such change, and that, notwithstanding the right to modify the by-laws was reserved by the order, the adoption of the amendments and modifications thereof after Stringham became a member placed it beyond his power to comply literally with the regulations, and that for these reasons the court erred in not decreeing to plaintiff the money due under the policy. It will be remembered that the prescribed fee was not paid, nor was String-ham’s old certificate delivered to the head clerk, or a new one issued, in the lifetime of the deceased, as required by the amended by-laws. To justify a reversal of the decree, it would be necessary, therefore, to uphold both points for which plaintiff’s counsel contend. If it should be determined, however, that the payment of the fee was a condition precedent to the right to change a beneficiary, it would be unnecessary to consider whether the amendment of the by-laws after Stringham became a member of the order was prejudicial to the rights of either party. As a matter preliminary to the principal inquiry, it is deemed proper to consider whether the acceptance of the sum of twenty-five cents by the order after Stringham’s death waived, so far as plaintiff (Maud Stringham) is concerned, any [69] defect in the manner of changing the beneficiary. The testimony fails to show that the corporation had any notice of his death when it received the money; but, conceding that it possessed such information, the acceptance of a part of the fee, under the circumstances assumed, could not in any manner change the rights or prejudice the interests of Stringham’s widow or of his mother, which, as between them, became vested at his death. It is possible that, by accepting and retaining the payment of a delinquent assessment with knowledge of all the facts constituting a breach of duty imposed upon an insured, the insurer might waive the right to declare a forfeiture of the contract of indemnity, thereby rendering itself liable thereon (Frazier v. New Zealand Ins. Co. 39 Or. 342, 64 Pac. 814; Lord v. National Protec. Soc.--Mich.--, 88 N. W. 876); but, even if the determination of the order were clearly manifest, it would not be binding upon the courts, when conflicting claims to any part of the fund 'collected by it from its members are involved. When Stringham, after designating his wife as his beneficiary in the surrender clause, left his benefit certificate with the clerk of Oregon Fir Camp, No. 5,085, he did not request nor did the latter promise to advance the fee necessary to secure the change desired, and hence the neglect to pay the sum required for the purpose indicated was attributable to his fault, and not to the carelessness of the clerk of the local camp. It is true the clerk, the day after Stringham’s death, advanced twenty-five cents, and sent it with the benefit certificate to the head clerk; but, no request therefor having been made by Stringham, such post-mortem payment could not revive a right that had never been initiated, if the payment of the fee be a condition precedent to a change of beneficiary. The rule is quite well settled that the person named in a certificate of a mutual benefit association as the recipient of its bounty has no vested interest in the fund to be distributed until the happening of the contingency insured against, but only an expectancy, which may be defeated by the member to whom the certificate is issued changing the beneficiary: Inde [70] pendent Foresters v. Keliher, 36 Or. 501 (59 Pac. 1109, 60 Pac. 563, 78 Am. St. Kep. 785.) “But,” as was said by Mr. Justice Bean in that case, “it is equally as well settled that such power must be executed in the manner pointed out by the policy and the by-laws and rules of the order, and any material deviation from the course prescribed will invalidate the transfer.” "Where, however, the member has performed the part required of him to perfect the substitution, according to the mode prescribed, but, owing to circumstances over which he had no control, the change is not fully effectuated at the time of his death, a court of equity will occasionally aid the defective execution of the power attempted to be exercised: Bacon, Ben. Soc. §§ 309, 310. Stringham complied with all the requirements imposed upon him by the rules of the order necessary to substitute his wife as beneficiary, except to pay the fee prescribed. At the time he executed the surrender clause the clerk informed him that the payment of fifty cents was required to secure such change, and, having inquired if the payment of this sum could be deferred until the next meeting of the society, he knew that he had not fully performed on his part ‘all the conditions necessary to effectuate a substitution according to the method prescribed. If, owing to circumstances over which Stringham had no control, the substitution was not entirely consummated at the time of his death, and he had, by the prescribed method, done all acts required of him therefor, the court might treat the commutation as complete; but since he did not perform on his part all the acts required of him by the rules of the order, and as the failure in this respect was not owing to circumstances beyond his control, a court of equity can grant no relief, for the payment of the fee prescribed"was the consideration for the transfer, which the rules of the order demanded should be made in advance, thereby rendering its payment a condition precedent to the substitution. Stringham having failed to comply therewith, his widow has no legal right to the fund deposited in court, and hence the decree is affirmed. Affirmed.