Case ID: nys_68/html/0777-02.html
Source: Caselaw Access Project
Author: {"author": "HATCH,. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

EAGAN v. EAGAN.
    (Supreme Court, Appellate Division, First Department.
    February 25, 1901.)
    Mutual Benefit Insurance—Change op Beneficiary.
    A certificate of insurance issued by a benefit society was payable to a brother of the insured member, who afterwards married. The by-laws of the society required the insured to surrender his certificate .and procure • the issuance of a new one, with the name of the new beneficiary therein, before any change of beneficiary could be effected. Held, that the delivery of the original certificate by the insured to his wife while on his deathbed. with an oral statement that the insurance was for her, and her subsequent possession of the certificate and payment of assessments and dues, gave her no interest in the benefits.
    
      Appeal from special term, Mew York county.'
    Action by Alice B. Eagan against Peter Eagan. From a judgment dismissing the complaint on the merits, the plaintiff appeals.
    Affirmed.
    -See 64 N. Y. Supp. 836.
    James Eagan, a brother of the defendant and the husband of the plaintiff im this action, became a member of the Mt. Morris Council of the Catholic Benevolent Legion on the 19th day of February, 1885. By the certificate of membership issued to him the supreme council of the association agreed to pay of its benefit fund to Peter Eagan, the defendant, a sum not exceeding $5,000, according to the provisions of law governing said fund, upon the death of said member in good standing, provided he should not have substituted another beneficiary or reduced the amount of his benefit certificate. The by-laws of the legion at the time of issuing this certificate and at the time of the death of the insured member provided that the name of the person to whom the member desired the benefit paid should be inserted in the certificate, “subject to-the future disposal of the benefit among their dependents” as the member may direct, and also provided that “a member may at any time surrender his certificate, and have a new one issued, payable to such beneficiary as he may direct, upon the payment of a certificate fee of fifty cents." The insured member, James Eagan, married the plaintiff in the year 1888, and died in the-month of February, 1894, leaving the plaintiff, his widow, and one child surviving. About four months .after his marriage to plaintiff the insured, while-on his deathbed, delivered the certificate of membership in said association to his wife, telling her as he did so that the insurance was for her; that, if anything happened to him, she was sure of the money. From that time to-the death of the insured the certificate remained in the possession of the plaintiff, and it appears that she from time to time gave to her husband, from' her own funds, money to pay assessments and membership dues which accrued against the member under the certificate. When James Eagan applied for membership he signed a written application in which he directed, in case of' his decease, all benefits to be paid to Peter Eagan, Jr., subject to future disposal of the benefit as he might direct in compliance with the laws of the-legion; and Peter Eagan’s name was inserted in the certificate as the beneficiary, and so remained until the certificate was paid and surrendered. It is-not claimed that any change in the beneficiary was in fact made, or that any application was made pursuant to the by-laws for a substitution of the name of the plaintiff; but it is claimed that the facts shown constitute an equitable-assignment of the certificate and money to grow due thereon, and that the-defendant held the fund paid to him upon the certificate in trust for the plaintiff, and is estopped from asserting his ownership thereof, or that there-was a valid gift of the certificate and the money secured to be paid thereby to the plaintiff, causa mortis. The court below dismissed the complaint upon the merits, upon the ground that at the death of the member the person entitled to-receive the benefit of the said certificate of insurance was Peter Eagan, the defendant, and that the plaintiff had no right or interest in the same or any part thereof, and judgment was entered accordingly. From such judgment the plaintiff appeals to this court.
    Argued before VAN BRUNT, P. J., and HATCH, McLAUGHLIN,. and INGRAHAM, JJ.
    Andrew McNickle, for appellant.
    Morris A. Tyng, for respondent.
   HATCH,. J.

In principle this case cannot be distinguished from the doctrine laid down in Thomas v. Thomas, 131 N. Y. 205, 30 N. E. 61; Coyne v. Bowe, 23 App. Div. 261, 48 N. Y. Supp. 937; and many others. These cases determine that the insured in a mutual benefit certificate of this character has no vested right or interest in the amount secured to be paid by the certificate. The insured has the single right to designate and change the beneficiary named in the certificate. It untrammeled by any extraneous circumstances, his right in this respect is absolute. It is the only right, however, of which he is possessed. It is also well settled that the certificate^ and the constitution, laws, and by-laws of the organization constitute the contract between the parties, and their rights are to be. determined thereby. In re Equitable Deserve Fund Life Ass’n of New York, 131 N. Y. 354, 30 N. E. 114; Collins v. Collins, 30 App. Div. 341, 51 N. Y. Supp. 922; Bird v. Association, 30 App. Div. 346, 52 N. Y. Supp. 1044; People v. Life & Deserve Ass’n of Buffalo, 150 N. Y. 94, 45 N. E. 8. Under the provisions of the present constitution and laws of this association, the insured was required to surrender his old certificate, and procure the issuance of a new one, with the name of the new beneficiary therein before any change would be effected. There is no pretense that he did this, or that he attempted to do it. On the contrary, the certificate was never surrendered, or any attempt made so to do. It was delivered to the wife, but under such delivery she took no right or interest therein, and could not do so, as there was no right or authority under the contract to make change of beneficiary in such form; and the insured could not change the contract, or vest any interest therein, by mere delivery of the certificate. Nothing which appears in Luhrs v. Luhrs, 123 N. Y. 367, 25 ,N. E. 388, or Manning v. Association, 86 Ky. 136, 5 S. W. 385, at all conflicts with the doctrine of the cases which we have cited. In both there was an attempt made to change the beneficiary. In the Luhrs Case, as in the Kentucky case, everything which the insured could do he had done to effect a change, and in all substantial particulars had complied with the rules which authorized him to make the-change. All that remained to be done was solely to be performed by the organization; and, as it subsequently did what the insured intended should be done, the change was held to have been effected. In the Kentucky case the insured had left his certificate with the subordinate lodge, and could not comply with the rule of the organization requiring the request for change of beneficiary to be indorsed thereon; but the lodge to which he sent his letter had the certificate, and the insured had done all that he could do, except the payment of the fee of 50 cents. So far as the payment of that fee was concerned, it is so evidently for the benefit of the association, and it alone, that, having been acted upon, it was quite proper to hold that such requirement was waived, and no advantage could be taken from such failure by any person. If that case should be construed as holding that the whole of the constitution and laws with respect to the method to be followed by the insured to effect a change in the beneficiary was solely for the benefit of the company, and might be waived by it, without regard to the rights of the beneficiary regularly designated, it is not in harmony with the rule announced in the cases to which we have called attention. But. in any event, no act was done which makes the rule of these cases applicable to the facts of the present case. They are, consequently, not authorities in support of the appellant’s contention. It is also evident that the plaintiff acquired no rights by the surrender of the certificate to the defendant. She was not vested with the slightest property right or other interest therein. The possession of the certificate gave her no right of enforcement of its provisions for her benefit. The right to receive the moneys secured to be paid by it was vested in the defendant immediately upon the death of the insured. This right could not be added to or taken away by the delivery or nondelivery of the certificate. So that there was no benefit that could by any possibility inure io the plaintiff by the delivery of the certificate, as she was wholly without interest in it or its proceeds.

It follows that the judgment should be affirmed, but without costs. All concur.