Case Name: Mary E. Counsman v. Modern Woodmen of America et al.
Court: Nebraska Supreme Court
Jurisdiction: Nebraska
Decision Date: 1903-09-17
Citations: 69 Neb. 710
Docket Number: No. 12,964
Parties: Mary E. Counsman v. Modern Woodmen of America et al.
Judges: Oldham and Ames, CC., concur.
Reporter: Nebraska Reports
Volume: 69
Pages: 710–717

Head Matter:
Mary E. Counsman v. Modern Woodmen of America et al.
Filed September 17, 1903.
No. 12,964.
Mutual Benefit Association: Ciianse of Beneficiary. A change of beneficiaries made by a member of a mutual benefit insurance association, which does not reach the head office until after the death of the member and then is refused because not in accordance with the by-laws as to a part of the fund, has no effect as to the part of the fund in reference to which it is in proper form, the association having a by-lh,w which declares the old certificate to be in effect until the new one is delivered.
' Error to the district court for Douglas county: William W. Keysor, District Judge.
Reversed.
Charles G. McDonald and James A. C. Kennedy, for plaintiff in error.
George W. Cooper, contra.
Rehearing allowed. See opinion, p. 713, post.

Opinion:
Hastings, C.
This case presents but one question for our consideration, that is, whether or not the beneficiary in the insurance certificate of Ulysses G. Counsman was changed by his action on the 28th day of May, .1901, he having died before six o'clock in the morning, on May 29 of that year. On the evening of the 29th his benefit certificate, with the indication of the change, was forwarded to the head camp of the order by W. B. Wardell, clerk of Omaha Camp No, 1,833. Counsman died on the next morning, and his benefit certificate was received at the "head camp" in Rock Island on the 30th, and on the 31st, no notice of his death having yet been received, the certificate was mailed to the clerk at Omaha by the head clerk, with a letter refusing to make the requested change, because it was not in accordance with the by-laws of the association. The certificate had named his son to the extent of $1,500, and his wife to the extent of $500, as beneficiaries and the proposed change named his mother instead of his wife and his father as trustee for the boy as to the remainder of the benefit. Such a trustee is forbidden by the rules of the organization and the certificate was, therefore, returned to be corrected, but of course could not be after the death of the assured. The organization paid the $1,500 due the boy to his guardian. The $500 was claimed both by the mother and the wife. The association filed its petition asking leave to pay the $500 into court and be relieved from further liability, and that the court dispose of the fund. This order was granted. The mother, Arabella Counsman, and the wife, Mary E. Counsman, each filed answer and cross-petition claiming the money; the money was paid and the association discharged. The district court found the mother was entitled to the $500. Motion for new trial was filed by the wife, on the ground that the decision was contrary to law and not sustained by sufficient evidence, and also on the ground of newly discovered evidence, and errors of law occurring at the trial. This motion was overruled. Supersedeas bond was given, and the case brought by petition in error to this court by attorneys MacDonald and Kennedy, on leave obtained in this court because of the refusal of their client to prosecute the action and because of their having an interest in the result under an agreement for a contingent fee.
The only point urged is that the evidence was insufficient to show a right on the part of the. mother; that the attempt to change the beneficiary was not completed. The benefit certificate was dated May 23,1898. By a provision of the by-laws in force at that time a member in good standing at any time might change the beneficiary by paying to the camp clerk fifty cents and delivering his certificate with the surrender clause on the back of it filled out to designate the change. This surrender should be' executed in the presence of the camp clerk, bnt if he could not be present, then its execution might be attested or acknowledged by any person authorized to administer oaths and take acknowledgments. The local clerk was to forward this certificate, with the surrender clause indorsed and one-half of the fee, to the head clerk, who should thereupon issue a new certificate to the beneficiary named in the surrender clause, provided such beneficiary should meet the requirements of the by-laws.
In June, 1899, however, this provision was changed and a new by-law adopted identical with the old one, but with the clause added that no change in the beneficiary shall be of effect until the delivery of the new certificate, and until then the old certificate shall be held in force. Both provided that no change should be of binding force unless made in compliance with this section. It is not claimed that this Avas done, but it is claimed that the assured in his lifetime having changed the beneficiary, so far as he could with reference to this $500, it should be upheld; that the change with regard to his son, AAdiich Avas made at the same time, but Avas not in accordance Avith the by-laws of the organization and Avas refused, had nothing to do with this $500.
It is claimed on behalf of the defendant in error that this neAV by-laAV, adopted in 1899, after the issuance of this certificate, has no relation to it. This, hoAvever, can not be the case, for the benefit certificate itself expressly provides for a compliance with the by-laivs in existence and Avith such as should thereafter be adopted.
The real question is whether any one but the association could raise the question that this change had not been acquiesced in by the association. The learned trial court seems to have regarded the matter of beneficiary as Avholly Avithin the disposal of the assured. We can not so regard it. It is a matter of agreement betAveen the assured and the association. It was something which the association Avas to do. Under its by-laws' requirements he was powerless to do it himself. After his death, it would seem that the association' and the local camp clerk were powerless to do it for him. Doubtless, if he had procured his benefit certificate to reach the head camp in his lifetime in due form, so that it would have been entitled to the approval and the issuance of a new certificate, in the absence of express restriction in the by-laws, a new beneficiary would be entitled to receive the fund. Our own court, it is true, has held that beneficiaries have no vested interest in certificates of this kind until the death of the assured, and that the power to change rests with the assured and the association. The change, however, is conditional upon compliance with the laws of the society. Fisher v. Donovan, 57 Neb. 361.
Proceeding in Error: Attorneys' Fees. Attorneys Who have undertaken to establish, for a contingent fee, a client's right to a fund in court, and who, after rendering valuable services, have been defeated in the district court, and who have furnished a supersedeas bond to retain the^fund, and are taking steps to have the decision against their client reviewed on error, are entitled, when their client under these circumstances refuses to pay them and instructs them to proceed no. further on her. behalf, to prosecute error proceedings in her name, on their own behalf, in order to collect their contingent fee out of the fund still in court, if they can establish their client's right to it.
It would seem that the death of the assured, Counsman, before the presentation, even, of this requirement for a change of beneficiaries, which was refused when presented because of its noncompliance with the by-laws of the association, effectually prevented his desire in this respect from taking effect, and caused the right to the fund to vest upon his death, eo instante, in the beneficiary named in the certificate, which the by-laws provided should be still in force.
It is recommended that the judgment of the trial court be reversed and the cause remanded.
Oldham and Ames, CC., concur.
By the Court:
For the reasons stated in the foregoing opinion, the judgment of the trial court is reversed and the cause remanded.
Reversed.