Source: https://supreme.justia.com/cases/federal/us/305/66/
Timestamp: 2019-04-25 14:33:55+00:00

Document:
(1) That the certificate was not a mere contract to be construed and enforced according to the laws of the State where it was delivered. Entry into the society was entry into a complex and abiding relation, and the rights of membership are governed by the law of the incorporation. Another State, wherein the certificate of membership was issued, cannot attach to membership, rights against the society which are refused by the law of the domicil. P. 305 U. S. 75.
(2) The question whether the association was estopped to plead ultra vires was not to be determined by the Missouri law of old line insurance companies. P. 305 U. S. 76.
(3) The judgment of the Nebraska court, in the class suit, determined that the association lacked power to issue certificates exempt from dues and assessments after twenty years, and that it was not estopped to plead ultra vires in that regard. P. 305 U. S. 78.
(4) The Missouri court, by enforcing the certificate, failed to give full faith and credit to the association's charter embodied in the statutes of Nebraska as interpreted by its highest court. P. 79.
2. In a class suit by a member of a beneficiary association to determine the power of the association to issue beneficial membership certificates exempt from dues and assessments after twenty years, the association represents all its members, and stands in judgment for them, and the judgment is conclusive upon all the members of the association with respect to all rights, questions, or facts therein determined. P. 305 U. S. 78.
112 S.W.2d 582, 592, reversed.
Certiorari, 304 U.S. 557, to review the affirmance of a judgment against the present petitioner in an action on a fraternal beneficial certificate. The Supreme Court of the State would not entertain an appeal.
We granted certiorari, 304 U.S. 557, because of the claim that the judgment of the court below failed to accord full faith and credit to the public acts, records, and judicial proceedings of the State of Nebraska as required by Article 4, § 1 of the Constitution.
The petitioner is a fraternal beneficiary association organized under the laws of Nebraska, having a lodge system, a ritualistic form of work, and a representative form of government. It has no capital stock, and transacts its affairs without profit and solely for the mutual benefit of its members and their beneficiaries. It makes provision for the payment of death benefits by assessments upon its members, and issues to members certificates assuring payment of such benefits.
and was endorsed with the words "Payments to cease after 20 years."
After Bolin's death, the respondents, as beneficiaries, brought action to recover upon the certificate. The petitioner's answer set up that Bolin had ceased to pay the required dues and assessments in July, 1916, and his certificate had therefore become void; that the bylaw making the certificate fully paid after twenty years was ultra vires of the association and had been so declared by the Supreme Court of Nebraska in a class suit brought by one Trapp, the holder of a certificate similar to that of Bolin; that, under Article 4, § 1, of the Constitution, full faith and credit must be given by the courts of Missouri to this decision of the Supreme Court of Nebraska. The respondents replied that the contract was made and delivered in Missouri, and was to be construed and enforced according to Missouri law; that, at the date of its consummation, the petitioner had no license or authority to transact business in Missouri as a corporation or otherwise, and the certificate was therefore to be considered as issued pursuant to, and governed by, the general insurance laws of Missouri; that, Bolin having fully performed in accordance with the terms of the certificate, the petitioner was estopped to plead ultra vires; and that, in truth, the contract was not ultra vires of the petitioner.
A jury was waived, and the case was tried to the court. The respondents proved the issue of the certificate and Bolin's payments for twenty years thereafter. The petitioner proved the adoption of the bylaw purporting to authorize the issue of "payments to cease" certificates, and put in evidence an exemplified copy of the record in Trapp v. Sovereign Camp of the Woodmen of the World, 102 Neb. 562, 168 N.W.191, wherein it was decided that petitioner never had power under the law of Nebraska to issue such a certificate. Judgment went for the respondents.
if the issue of the certificate be an ultra vires act under the law of Nebraska, it does not follow that it is such under the law of Missouri. The contract is not ultra vires under the law of Missouri or, if so, the petitioner may not plead ultra vires because, in the light of Missouri law, the contract is an insurance contract with an old line insurance company, and the petitioner, under Missouri decisions, cannot, in the circumstances disclosed, avail itself of the fact that the contract was in excess of its charter powers."
The court refused to give force or effect to the decision of the Supreme Court of Nebraska in Trapp v. Woodmen, supra, saying that case did not hold the issue of such a certificate ultra vires in the sense that it was prohibited by positive statute; that, the contract being a Missouri contract, its ultra vires character must be adjudged by the local law irrespective of what the courts of the domicile had held; that the respondents in the present case relied on an estoppel of the petitioner to plead ultra vires, whereas no such issue was presented or decided in the Trapp Case.
We hold that the judgment denied full faith and credit to the public acts, records, and judicial proceedings of the State of Nebraska.
Third. The doctrine of estoppel was erroneously invoked to avoid the force and effect of the Nebraska judgment. The court below was of the opinion that, as the petitioner had issued a "payments to cease after 20 years" certificate, and as Bolin had fully performed on his part by paying all dues and assessments over the named period, the petitioner was estopped to plead its lack of power to issue such a certificate. This again was on the theory that, whatever might be the nature of the petitioner's organization in Nebraska, for the purposes of this action, it must be treated as an old line insurance company in Missouri. It was further held that no question of estoppel was decided in the Trapp case.
With respect to the second position, it appears from the record that Trapp, in the suit in Nebraska, pleaded that the association was estopped to deny its power to issue the form of certificate in question, and the opinion of the Nebraska court, by reference to a case decided on the same day, clearly indicates that the issue of estoppel was considered and determined adversely to the plaintiff.
Bolin v. Sovereign Camp, W.O.W., 339 Mo. 618, 98 S.W.2d 681.
Bolin et al. v. Sovereign Camp, W.O.W., ___ Mo.App. ___, 112 S.W.2d 592.
Modern Woodmen v. Mixer, 267 U. S. 544, 267 U. S. 551; Supreme Council of Royal Arcanum v. Green, 237 U. S. 531, 237 U. S. 542.
Act of March 8, 1879, Laws 1879, p. 65; R.S.1879, §§ 972, 973.
Act of March 8, 1881, Laws of 1881, p. 87.
Act of May 7, 1889, p. 55, R.S. 1889, §§ 2823, 2824.
Act of March 16, 1897, p. 132, R.S. 1899, c. 12, art. 11, §§ 1408, 1409, 1410.
Schmidt v. Foresters, 228 Mo. 675, 686, 129 S.W. 653.
Kern .v Legion of Honor, 167 Mo. 471, 479, 484, 67 S.W. 252; Schmidt v. Foresters, supra; Mathews v. Modern Woodmen, 236 Mo. 326, 139 S.W. 151; Brassfield v. Maccabees, 92 Mo.App. 102; Gruwell v. Knights & Ladies, 126 Mo.App. 496, 104 S.W. 884.
"The contention that the plaintiff, as husband, could not be the beneficiary, under the laws of Massachusetts or under its charter and bylaws, is not open to discussion or adjudication. No such issue was raised in the pleadings or asserted upon the trial in the circuit court. . . . The defendant chose its grounds of defense. None others are open in this Court."
Barber v. Hartford Life Ins. Co., 269 Mo. 21, 187 S.W. 867, reversed, Hartford Life Insurance Co. v. Barber, 245 U. S. 146; see also Johnson v. Hartford Life Insurance Co., 166 Mo.App. 261, 148 S.W. 631.
Hartford Life Insurance Co., v. Ibs, 237 U. S. 662; Hartford Life Insurance Co. v. Barber, 245 U. S. 146; Supreme Council of Royal Arcanum v. Green, 237 U. S. 531; Modern Woodmen v. Mixer, 267 U. S. 544.
Hartford Life Ins. Co. v. Ibs, supra, p. 237 U. S. 673.
Supreme Council of Royal Arcanum v. Green, supra, pp. 237 U. S. 540, 237 U. S. 543, 237 U. S. 546; Hartford Life Ins. Co. v. Ibs, supra, p. 237 U. S. 669; Hartford Life Insurance Co. v. Barber, supra, p. 245 U. S. 151; Modern Woodmen v. Mixer, supra, p. 267 U. S. 551.

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