Court Opinion

ID: 8508118
Source: CourtListenerOpinion
Date Created: 2022-11-23 08:33:40.936977+00
Date Added: 2024-06-11T16:50:59.001399
License: Public Domain

LAUBIE, J.,
dissenting:
My principal objection is that the opinion of the majority of the court aims to establish the rule, that in cases of this character a beneficiary is not a party to the contract of insurance, and has no right to question or contest any change of beneficiary made by the insured which is satisfactory to the society or its officers. That the laws of the society prescribing the mode and manner of such change, are solely for the benefit of the society, and may be waived by its officers without question on the part of the prior beneficiary.
Cases affirming and denying this doctrine are numerous, but I believe the better opinion, founded upon the general principles and analogies of the law, is upon the negative side.
In this discussion it must be remembered that it is not the society that is here asserting and relying upon this claim to uphold the validity of the change in this case, nor is it here affirming the validity of the acts of its officers in regard thereto. It washes its hands of everything, and leaves the question to be fought out by the beneficiaries under their own rights. Under such circumstances, “ the party who would succeed as against the other must make a case that would entitle him to recover against the society in a suit on the contract.” Niblack on Ben. Societies, Secs. 222, 254.
The affirmative of this doctrine, as maintained in the majority opinion, as I view it, is opposed to general principles and analogous cases in at least four respects.
1. It is opposed to the doctrine governing the execution of powers.
*6362. It is opposed to the rule applied to such change in policies of all other life insurance companies.
3. It is opposed to the general rule which prohibits the waiver of the charter or by-laws of benevolent societies by the society or its officers.
4. It is opposed to the rule that a contract made for the benefit of a third person, for a valuable consideration, makes such person a party to the contract after assent thereto and acceptance by him, with the right to enforce a literal performance cf its terms and conditions.
As to the first. It is undoubted that the execution of a power, which is the substantial question involved here, must be strictly in accordance with the provisions authorizing it, when it involves the revocation of an appointment, or the vesting or divesting of certain specified rights or privileges. In many instances such rights are as clearly in expectancy only as those of a beneficiary can possibly be said to be. That these are strictly analogous cases is admitted, and no solid reason can be given why a different rule should be applied to the one case that is not applied to the others. Where an instrument provides for one method of execution, it necessarily excludes all other methods.
As to the second class. In ordinary insurance policies the right of the beneficiary in the fund is a vested right, and, consequently, a change of beneficiary cannot be made without the beneficiary’s consent. In benevolent societies certificates, which are admitted to- be policies of insurance, ordinarily there is a provision authorizing such change, and that is substantially the only difference between them and a mutual life insurance policy as to the beneficiary’s rights. In each case the benefit conferred (the right to the fund) is usually a mere gratuity on the part of the insured — a provision for the future support of a wife or other member of his family or dependent, — and no sufficient reason can be given why the beneficiary’s interest should be a vested one in the one case and not in the other, for a vested interest may be conditional — to be defeated on the happening of some future event — which is the case at bar.
Indeed, in the ordinary life policy, the right of the beneficiary to the fund is conditional also, being dependent upon the performance of a subsequent condition on the part of the insured, the regular payment of the premiums or assessments. The insured may of his own will, under the terms of the contract, divest the right of the beneficiary to the fund without notice to, consent of, or knowledge of such beneficiary, by with holding payment of the premiums or assessments.
If the fact be that the beneficiary’s interest is not a- vested' one because the insured may of his own will divest the right of the beneficiary to the fund by substituting another as beneficiary, why does the *637same result not follow when he may of his own will divest the beneficiary of such right by withholding payment of the assessments ? Is it because the insured has the right to do this that makes such interest a mere expectancy, or is it because of the way he may do it ?
As to the third class. Such a contract is not like that of an ordinary stock company; it is a contract between members of one family, and they are all obliged to know what the provisions of the by-laws are, and aie mutually bound to respect and obey them. The officers and managers, as is generally held, cannot waive them; they are obligatory upon all, and must be obeyed. They must either waive them as to all and abolish the law., or they cannot waive them as to any.
Why should a different rule prevail as to a change of beneficiary, when the change involves a matter of substance, and substantially is the substitution of one contract for another ?
As to the fourth class. From what I have said already, it is, I think, apparent that the beneficiary is as much a party to the contract made for his benefit in this class of insurance as in any other, but I shall discuss this question further when I come to treat of the law of Ohio as applicable to such contracts.
While the text books of Bacon and Niblack are largely relied upon to sustain the holding in this case, it will be noticed that each author upholds somewhat both sides of the question; mainly and more forcibly, however, the negative side, in consonance with general principles and analogous cases; as will be seen from the following extracts:
“ Benefit societies in law are mutual insurance companies.” Bacon, Sec. 146.
“ This doctrine (Mass.), that officers of a mutual company cannot waive the by-laws of the company, has been approved in other cases on the ground that if the officers have discretionary powers as to the terms of the contract, the principle of mutuality would be completely abrogated.” Bacon, Sec. 147.
“ It has been held that defects or irregularities in the form or manner of the designation may be waived by the society, but this is against the weight of authority which is in favor of the rule that the required formalities in the laws of the society relating to designation of beneficiary are part of the contract.” Bacon, Sec. 239, and in a note the author refers to Sec. 307, from which I quote. (The italics are mostly my own.)
“ Section 307. Change of beneficiary must be in way prescribed by the law of the society. Although the member of a benefit society is thus generally left free to revoke his designation of beneficiary and appoint a new one, he me't do sp in the wav pointed out by the laws .of *638the organization. It is but carrying out the rule laid down in regard to powers, that if a method of revocation of an appointment is created by the instrument conferring such power, this direction must be complied with. If the laws of the society prescribe certain formalities to be observed in the change of beneficiary, or if the assent of the society to the transfer is required, all of the requirements must be obeyed.
“ The Supreme Court of Indiana [Holland v. Taylor, 12 N. E. Rep. 116; 111 Ind. 127] says that the same contract that permits the change ‘ fixed the mode and manner in which the change might be made, and we think that, taking the by-laws and the certificate together, the mode and manner of changing the beneficiary was fixed as definitely, and was as binding upon the assured as was the right to make such change binding upon the association and the beneficiary. In other words, under the contract, the assured had a right to change the beneficiary, provided he made the change in the manner provided in the contract. So, the Supreme Court of Iowa says: ‘ The contract between the association and Robert Stephenson was that the former should pay the insurance to the persons named in the certificate of membership, unless he should change the name of the beneficiaries; and the manner in which this should be done formed a part of the contract of insurance. * * * * It was perfectly competent for the parties to contract as they did, and the mode of executing the reserved power provided in the contract cannot be regarded as an idle ceremony, because substantially a nezv contract was made upon its being complied with, and thereby all doubt upon the part of the association as to who was the beneficiary was removed. Because such inode was not adopted in this case, creates the doubt we are called upon to solve. We, therefore, think the mode agreed upon in the contract, whereby the name of the beneficiary should be changed, was made a matter of substance, and should be complied with.’ * ■* * The rule above laid down has been generally accepted. The mention of one method of change has been held to impliedly or expressly exclude all others on the ground that expressio unius est exclusio alle-rius.”
In Holland v. Taylor, supra, the latest Indiana case, there is this more expressive language, p. 119, which Bacon fails to quote :
“ In that contract Anna Eaura, the beneficiary, had such an interest as that she had, and has the right to insist that, in order to cut her out, the change of the beneficiary should be made in the manner provided in the contract.”
Section 808 of Bacon is devoted to the “ opposing view. ” He says;
“ The courts of Texas and Kentucky take a different view,” auc cites Spleen v. Chew, (Texas) and Manning v. A. O. of U. W., 86 Ky. *639and say : “ The reasons given and conclusions reached as to the law ” in those cases “ are in direct conflict with the weight of authority.”
A few other cases are cited, but he says of them, “ a careful examination shows that under the terms of the contract in such cases there was room for this construction, as where the charter gave the right to dispose of the fund by will.”
Niblack Ben. Soc., Sec. 97, says:
“ Mutual benefit societies and stock companies are essentially different in +heir plans of carrying on the business of life insurance. Societies have many by-laws which are a part ol the contract of insurance, and which are binding on all members, whether officers or not. They are conducted on principle of mutuality, and should give insurance to each member on the same terms, conditions and restrictions. It would be destructive of this equality in the contracts of insurance to give to an officer the power to waive the provisions of a by-law which relates to the substance of the contract. * * * An officer of a mutual benefit society has no authority, as a general rule, to waive a strict compliance, on the part of a member, with its by-laws. This rule, however, does not extend to those by-laws which relate to the clerical transaction of its business, or to the mode of establishing its liability (that is, after liability accrues). By-laws in regard to proof of death of a member, for instance, may be waived. But it is well settled that the officers of such a society have no authority to waive those of its by-laws which relate to the substance of the contract between it and a member, determine the relations of the members to each other, or in any manner fix the rights and liabilities of the parties.”
Again, in Niblack Ben. Soc., Sec. 218, is this :
“ When a mutual benefit society has, under the powers and within the limits of its charter, provided in its by-laws a particular method of changing a beneficiary, or has set forth in its certificate a way by which the change may be made, no change of beneficiary may be made in any other mode or manner. The reason for this rule is not difficult to discover. It is based upon the familiar maxim that the expression of one thing excludes other and different things. When a society frames a set of rules providing for the distribution of a fund, and for the rights of beneficiaries and members, it must be assumed that it excludes every other mode and manner. Any other conclusion would lead to the most interminable confusion in the law applicable to the distribution of the insurance money, and fritter away, m the expenses of uncertain litigation, funds created for the benefit of widows, orphans and heirs.
“ But there is still another reason. It cannot be said that a beneficiary named in a certain certificate has no rights therein because he has no *640vested rights. The beneficiary has a right to the proceeds, of the certificate of insurance, subject to the right of the member to change the beneficiary according to the terms of the by-laws and regulations of the society, which are a part of the contract of insurance, and the right of ■the beneficiary to have this contract carried out in the manner provided for is as binding upon the member as his right to change the beneficiary is binding upon the beneficiary and the society. * * *
“ It cannot truly be said that the interests of a beneficiary may be brought to an end at any time at the will of a member. * * * it requires some affirmative act on the part of the member to change the designation ; his will and intention will not work the change. All tendency to confusion and uncertainty is avoided by requiring this change to be made in conformity with the terms of the contract.
“As has been said, the power to appoint new beneficiaries is reserved to the member of a mutual benefit society, unless it is taken away by the express provision of the contract of insurance. Where no mode of executing this power is provided, it may be executed in any manner which the member may choose to adopt. But where the mode of executing the power is set forth in the contract, it is made a matter of substance, and by every analogy to the law of general or special powers, it should be complied with. The authorities on this point are conflicting, but this seems to be the better rule.”
Niblack then proceeds to give the numerous cases wherein the rule has been qualified and exceptions have been grafted on it, with the reasons therefor, and among them the case so largely relied upon and quoted from in the case at bar, of Supreme Conclave Royal Adelphia v. Capella, 41 Fed. Rep. 1, decided by Judge Brown, now of the Supreme Court of the United States. Niblack’s criticism of it, in Sec. 219, pp. 419, 420, n. 4, shows that the case is not entitled to the credit claimed for it upon this question. He states that the point involved in the case was one of estoppel — that the original beneficiary was held to be estopped by his own misconduct from alleging that the insured had not complied with the contract in making the change; that the second and third exceptions to the rule laid down by the learned judge, were not exceptions to the rule at all, but matters of equity jurisprudence, and that as to his first exception (the one involved in the case at bar) not over one or two of the eight cases cited in support of it by Judge Brown bore directly upon the point; that “Of the authorities cited in support of the exception, Martin v. Stubbings, 18 N. E. Rep. 657 [126 Ill. 387; 9 Am. St. Rep. 620] ; National Mut. Aid Soc. v. Lupold, 101 Pa. St. 111, and Brown v. Mansur, 64 N. H, 39, relate to the assignment of certificates which is entirely different from appointing a new beneficiary. See sections 166, *641167, 169,173, and they are treated of in their proper place. In Byrne v. Casey, 8 S. W. Rep. 38 [70 Texas, 247], the right to make the change, not the manner in which it was made, was in question. In Knights of Honor v. Watson, 15 Atl. Rep. 125 [64 N. H. 517], the controversy was as to whether the new beneficiary was a proper one under the charter. Titsworth v. Titsworth, 20 Pac. Rep. 213 [40 Kan. 571], sustains the exception.”
Niblack thus refers to six of the eight cases; the seventh is Manning v. Ancient Order of United Workmen, 5 S. W. Rep. 385 [86 Ky. 136], quoted from at length in the majority opinion herein, which is contrary to almost every authority on the question. In that case the insured neither complied with the by-laws as to the manner of making the change, nor in paying the fee, and the officers would not issue the new certificates, and did not until after his death, and consent or waiver by the society was too late, according to the great weight of authority and the doctrine established in Charch v. Charch, 57 Ohio St. 561 [49 N. E. Rep. 408].
The eighth case is Splawn v. Chew, 60 Tex. 532, where it was held that the change might be made by will, which is also contrary to the authorities generally as well as to Ohio authority.
As four of these eight cases are relied upon by the majority in their opinion herein in support of their adoption of this exception to the general rule, it is well to examine them a little more closely. As to Manning v. Ancient O. of U. W., supra, I have already commented upon it.
The Kansas case, Titsworth v. Titsworth, supra, was decided upon the strength of the Texas case, Splawn v. Chew, supra, instead of following the prior decision of its own court. In Olmstead v. Society, 14 Pac. Rep. 449, 451 [37 Kas. 93], substantially a contrary doctrine was held, and it was declared:
“We think the maxim, expressio unius est exclusio alterius, applies; ■ and, as the prescribed mode has not been followed, no change was actually made, and therefore the benefit must be paid according to the terms - of the contract.”
The Illinois case, Martin v. Stubbings, supra, was a case of assignment of a certificate to a creditor, as security for a loan of money, which presents an entirely different question than a change of beneficiary. The general doctrine is that in societies of this kind the member has no own-' ership or control over the fund itself, and he cannot assign it ór transfer it to a creditor in payment of his debts, nor can he make á creditor the" beneficiary who is not of the class named in the charter.' Where the right to assign exists, it must be because of some Special provision of the by-laws. ■ ■
*642In the Illinois case the facts were essentially different from this case, and peculiar. In that case the husband kept the certificate-himself, and the wife, the beneficiary, united with him in the assignment of it to the creditor; and the charter of the society provided that a member might change his beneficiary “ at his pleasure, without notice to or consent of the beneficiary, and all persons accepting any interest in this policy or company do so upon these express termsand the fund was to be paid, to “the widow, orphans, heirs or relatives by consanguinity or affinity devisees or legatees of a deceased member.”
If the creditor could be considered a devisee or legatee, no one probably would say he was not entitled to the fund under such circumstances. But at all events it was a case of estoppel.
All of the subsequent cases in that state simply follow this case of Martin v. Stubbings, supra.
In the New Hampshire case, Knights of Honor v. Watson, supra, every single requirement of the by-laws was strictly complied with, but the additional beneficiary was not of the class provided for in the charter ; but the court held that the original beneficiaries, although beneficiaries in the new certificate also, could not be heard to allege or take advantage of the fact that the added beneficiary was not of the class named in the charter, that it was none of their business, and that they were entitled to the amount given in the new certificate only; which is in conflict with the authorities generally, and with the holding in McGinness v. Benevolent Legion, 59 Ohio St. 531 [53 N. E. Rep. 54], on the same state of facts.
In Marsh v. Legion of Honor, 21 N. E. Rep. 1070 [149 Mass. 512; 4 L. R. A. 382], cited in the majority opinion, the charter provided that “ the fund should be paid to such member of his, the insured’s, family or dependents as he may direct, without restriction,” and the by-laws provided that he “ may surrender his certificate and have a new one issued to such of his family or dependents as he may direct.” He did surrender the certificate, and directed a new one to issue to the mother, but by the fraud and conspiracy of the wife (original beneficiary) and the secretary of the lodge, it was prevented and not done, and he soon thereafter died.
On equity principles the wife was estopped from claiming the fund, by reason of her fraud, and not because the case was an exception to the general rule, or that the by-law had been substantially complied with. Indeed, the law' of Massachusetts on the question presented in the case at bar;- as déclared. in Clark v. Royal Arcanum, 57 N. E. Rep. 787, 788 [176 Mass. 471], is apparently on the negative side of the question, viz.:
*643“Yet it is well settled law in this commonwealth that in such cases a benefit certificate cannot be transferred except in the manner pointed out by the by-laws of the society. Elsey v. Relief Association, 7 N. E. Rep. 844 [142 Mass. 224] ; Daniels v. Pratt, 10 N. E. Rep. 166 [148 Mass. 216] ; McCarthy v. Order of Protection, 26 N. E. Rep. 866 [153 Mass. 314; 11 L. R. A. 144]. Where, however, the society does not object, and the transfer is prevented by the fraud of the beneficiary named in the certificate already issued, equity may afford relief. Marsh v. Legion of Honor, 21 N. E. Rep. 1070 [149 Mass. 512; 4 L. R. A. 382].”
The other Massachusetts case referred to, Anthony v. Beneficiary Assn., 33 N. E. Rep. 577 [158 Mass. 322], was a case of assignment, and the court, in Clark v. Royal Arcanum, supra, did not refer to it in its citation of authorities on the question of change of beneficiary.
In another case cited, Beatty’s Appeal, 15 Atl. Rep. 861 [122 Pa. St. 428], a Pennsylvania case, the question involved was as to the right to make the change, and not as to non-compliance with the by-laws.
In a later case in that state, Masonic Mutual Association v. Jones, 26 Atl. Rep. 255 [154 Pa. St. 107, 108], which the court said, was a Cleveland, Ohio, association, it was declared:
“ As the association has prescribed the form for changing the beneficiaries, that form must be pursued, otherwise, no change can take •place.”
If the organic law, the charter, provides for the mode and manner of making such change, either expressly or by implication, the rule that the member cannot make it in any other manner, even with the assent of the society, is made still more imperative.
“ Where the charter of a society specifies the manner and mode of designating or changing the beneficiary, and the extent to which such changes may be made, these provisions must- be strictly complied with, on the familiar ground that a corporation is the creature of its charter, and it is not within the power of the corporation or its members, or both, to waive a strict compliance with all such provisions.” Niblack Ben. Soc. (2 ed.), Sec. 215, p. 413.
And this prohibition “ is as effective when it is implied from the terms of the charter as when it is contained in its express language.” Bacon Ben. Soc., Sec. 260.
The charter of this society, as found by the court below, contains the following provisions:
“ It is formed to create a fund for the relief of sick and distressed members, and to provide for the living and bury the dead. * * * To establish a benefit fund or funds, from which, on satisfactory _evidence *644of the death of a beneficiary member of the order who has complied with all its lawful requirements, a sum not exceeding $8,000 shall be paid to the widow, children, dependent’s mother, father, sister, brother, aunt, uncle, niece or nephew of such member, as he shall direct, and as the laws of the order shall provide.”
The charter thus directs that the order shall, by its by-laws, provide how the members shall designate their beneficiaries, the mode and. manner of payment by the order, and the person to whom alone payment should be made by the order. And by-laws made in accordance therewith are as much a part of the charter as if inserted in the charter itself in express terms.
The order, therefore, is thus prohibited by by-laws, which, in effect, are part of the charter itself, from paying the fund to any one but the person designated by the member in'the mode and manner pointed out by such by-laws, and in the certificates the attention of the members is specifically called to these by-laws as constituting a material part of the contract.
In this case, it is conceded that the by-laws were not observed; that instead of filing an affidavit as required by the by-laws, the decedent filed a certificate only, and it must be assumed that he did not pay the fee; and the by-laws, therefore, by force of being the organic law, prohibit the order from paying the fund to such claimed new beneficiary.
The burden of proof was upon the defendant in error, to show that the affidavit had been made and filed and the fee paid, as provided in the by-laws, by reason of the character of his petition, and the agreement of the parties made in the submission of the case to the trial court.
Instead of merely setting up his own certificate, and letting the other claimant attack its validity, which would be the ordinary course in such cases, he took the initiative — filed a petition alleging therein that in 1898, Lewis Early, the decedent, had become a member of this society, obtained a certificate payable to his wife, Anna, who held the same, and was the beneficiary named therein, until 1899, when said Lewis, by filing a certificate in the words heretofore given, obtained a new certificate of membership and had him, the said James M. Earley, named as the beneficiary, and that by reason thereof the original certificate was rendered null and void, and that he was entitled to the fund as beneficiary instead of said defendant, Anna Earley, the latter of which allegations were denied by Mrs. Earley.
He thus not only assumed the burden of proof, but in the submission of the case, as shown by the record, it was agreed that the court should award the fund to Mrs. Earley, if the plaintiff, James M. Earley, *645should fail to show that such change was legally made and he legally substituted as beneficiary in place of said widow.
This he clearly failed to do. On the contrary, the finding of facts shows that said assured not only did not comply with the provisions of the by-laws in making snch change, but it shows conclusively that he did not intend to comply with them, that he deliberately evaded them and deceived the record keepers, and his wife, for some ulterior purpose of his own.
It appears that he never asked her for the certificate, or told her of the proposed change; she never knew of the change until after his death; that before and at the time of such change, he contemplated a separation from his wife; that such separation took place the year following such change; that in the certificate filed to obtain such change he referred to disagreement with his wife which would be followed by separation, but did not place the blame on her. The by-laws required the certificate of insurance to be surrendered, “ or if lost or in the posses siou of another who refuses to deliver the same to the member, he shall make an affidavit settingforth the fact,'', etc., and pay a fee of fifty cents• but he did not say in the certificate he filed to obtain such change that his wile had refused to deliver it to him, but that “ she would not return the same.”
The deceased knew that the by-law contemplated and meant that he should ask his wife for the certificate and obtain it if possible. A refusal to deliver, implies and includes necessarily, a prior request to deliver; and without stating an untruth he could not state that she had refused to deliver the insurance certificate to him, so he deliberately chose words that did not, but that might be taken to mean, that he had asked her for it and she had refused to deliver it to him. But he did not swear even to that.
There was no finding by the court, and, therefore, no evidence tending to prove, that she would have refused to deliver it to him, or that he knew she would refuse to deliver it to him if he asked her for it; nor was this conceded; and these material facts,- upon the showing of which alone he could obtain a change of beneficiary without. a surrender of the original certificate, cannot be assumed.
These facts show that he undoubtedly had some ulterior motive in thus acting, when considered with reference to the alleged disagreement with his wife, and is of itself sufficient to lead a court of justice to scan closely the alleged substantial compliance with the duty devolved upon him in this matter. When he deliberately sought to avoid compliance with the by-laws, and did not comply with them either as to the affi*646davit, or as to the payment of the fee, I cannot conceive it to be an act of justice to hold that he did.
There was no finding as to the payment of the required fee, the payment of which was a necessary requisite to obtain a change which the record keeper could not cheat the society out of by waiver, or favor one member.over, or at the expense of, other members, and, therefore, it must be assumed that there was no evidence of such payment, and the case stands the same as if the trial court had also found that the fee had not been paid. Springer v. Avondale, 35 Ohio St. 620, 623.
So far as the society itself is concerned, while its officers either wil-fully or negligently aided the deceased in disregarding the by-laws and in cheating the society of the fee, it is taking no stand on one side or the other in this contest, and the defendant in error should not be permitted to claim any waivet upon its part of the proper affidavit and payment of the fee, to aid him in his contention. As to him the case stands precisely as if in a suit by him against the society, the society denied that he was made a beneficiary in the mode provided for in the by-laws. Niblack Ben. Soc., Secs. 222, 254.
But, after all, I think the question has been settled by the decisions of the Supreme Court of Ohio; and it is conceded that such changes cannot be made in disregard “ of the law of the land,” which in this case is the state of Ohio. The holding of the court herein, as in all the cases upon which it is based, rests upon the ground that a beneficiary is not a party to the contract. This I believe is opposed to the settled law of this state.
Societies of other states, doing business in this state, by virtue of Sec. 3630e, Rev. Stat., are governed by the laws of this state in their dealings with residents of the state, as they would be without such provision.,
In this state certificates of the character in question, aré held to be contracts — contracts of insurance; State v. Association, 38 Ohio St. 281; and as such they must be construed, and the rights of the parties concerned determined, by the law of Ohio applicable thereto.
This contract was made for the benefit of the wife. There was a direct promise on the part of this association to pay her so much money on the death of her husband. It was made upon a valuable consideration, and delivered to her and, therefore, under the law of this state she was a party to the contract, and entitled to have all of the terms literally fulfilled and performed; and her rights in the contract could not be taken away from her, or divested, except in the manner pointed out by the contract.
*647Ever since the decision of the case in Crumbaugh v. Kugler, 3 Ohio St. 544, 549, it has béen uniformly held in this state that a contract made for the benefit of another makes that other a party to the contract, and he may enforce it. And this is so although such party is not named in the contract. Emmitt v. Brophy, 42 Ohio St. 82, 88.
Why should a different rule be applied in this case? The parties expressly made her a party to their contract; the contract was delivered to and accepted by her, and held by her for years as a valid obligation with their assent and co-operation.
Being thus a party to the contract, and . in lawful possession of it, Mrs. Earley had an interest in the fund which she could protect. Whether we call it a vested interest or not, whatever may be its character, the parties could not divest her of that interest except by the method prescribed in the by-laws, without her consent. It is not a case of mere expectancy, like that of an heir, and I am at a loss to see how it can be so regarded in this state.
And so our Supreme Court, recognizing these principles, has held that beneficiaries have an interest in the fund that they can protect; with a right to contest the validity of a change of beneficiary made by the member and the society.
“ These laws and regulations (of the society) determine the rights of the members and the association, and may be enforced by the parties or beneficiaries, according to their respective rights as therein provided.” Arthur v. Association, 29 Ohio St. 557, 560.
In Charch v. Charch, 57 Ohio St. 561 [49 N. E. Rep. 408], a part of the syllabus is:
“ Where a member of a beneficial association organized under Sec. 3630, Rev. Stat., has caused the beneficial certificate issued by the association upon his life to be made payable to his wife, such member cannot change the beneficiary except in the mode pointed out by the bylaws of the association. And where such by-laws provide that a change of beneficiary can be made onlyby surrender' and issue of a new certificate, such change cannot be made (the wife being in life) by will.”
Under the rule of our Supreme Court the syllabus is what the judges unite in as the law of the case. Could words make the rule of law more emphatic than is done in this syllabus ? While the case was one where the change was attempted to be made by will, the court proceeds to lay down absolutely what the rule' of law in this state requires to make a valid and binding change; that it can only be done by the mode provided for in the by-laws. Thus substantially and in effect stating that such beneficiary is a party to the contract, with an interest that he or she can protect, with a right to contest the validity of *648any change of beneficiary attempted. It would be singular, indeed, if it could be said that a party had an interest in a contract by its express terms, and yet could not be heard to protect and defend that interest.
It is said that no waiver on the part of the society was involved in the Charch case. Why not ? The society had paid the money, and the defendants alleged that it had paid it to the executor, and that he had improperly paid it to the widow, the beneficiary. It does not appear how this issue was decided, if at all; and the courts disposed of the case without reference to it. It can be said, therefore, that the courts regarded that question as immaterial.
In Supreme Council Cath. Benov. Legion v. McGinness, 59 Ohio St. 531 [53 N. E. Rep. 54], McGinness had a certificate issued, making the defendant in error, his wife, his beneficiary in the sum of $3,000. Subsequently he obtained a new certificate from the officers of the society, making his wife a beneficiary in the sum of $2,000, and his brother John a beneficiary in the sum of $1,000. On the death of the insured the widow brought suit against the society on the original certificate. After John had been made a party and dismissed, the society answered and set up the change made by the insured and itself, and denied her right to more than the $2,000, thus asserting the validity of the change ; but the court below held that the widow was entitled to the whole fund, under the original certificate, and this holding was affirmed on the ground that the brother, John, could not under the charter (New York) be a beneficiary, as he was not of the family of the insured, nor a dependent.
The member and the society, through its officers, united in making the change in the lifetime of the member, and the society, when sued, set it up as a defense, and if the widow, as beneficiary, was no party to the original contract, and, as held in Knights of Honor v. Watson, supra, that it was none of her business who the added beneficiary was; “that she could not question the validity of the change,” it is impossible to see why the court decided as it did.
I think, therefore, that our court of last resort has held these certificates to be contracts of insurance; that the beneficiary is a party thereto, and has an interest therein that he or she may protect, and that entitles him or her to contest the right of a subsequent beneficiary to the fund, or any part of it, and that a beneficial certificate cannot be transferred except in the manner pointed out by the by-laws of the society.