Court Opinion

ID: 6663154
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:03:51.750885+00
Date Added: 2024-06-11T16:00:15.022201
License: Public Domain

Sedgwick, J.,
dissentingv
That “a member of a mutual .benefit society cannot complain of an increase of rates necessary, to- enable the *686society to comply with its contract” is a little too strong. This paragraph of.the syllabus is the key to the whole opinion. No burden put upon a member or a class of members is too great or too inequitable if it is “necessary to enable the society to comply with its contract.” If, as stated in the syllabus, “the mutual promise of every member of such society is to pay the certificate of every other member,” and in the opinion, “it became apparent to' the membership that the organization could not survive under the old rates,” they should have some provision in their agreement by which each member should be bound to do his share to make up the .deficiency. This they had. .Their bylaws provided: “Whenever the amount in the beneficiary fund uninvested, after providing for all reported death losses, shall be less than $4,000, and the finance committee shall by resolution declare it expedient and advisable to levy an additional assessment upon the members, it shall be the duty of the grand recorder to call an additional or second assessment for the next month, upon all of the members, notice of which shall be given as provided in section 159, and shall be paid by the members as in these laws provided.” Section 158, Laws of the Grand Lodge of A. O. U. W. 1915. .This they could have done, and by amending their rates as to new members they would have avoided all danger of insolvency. But, acting upon the principle announced in the syllabus of the present opinion, they concluded that no member could complain of any “increase of rates necessary to enable the society to comply with its contract.” They could by a vote say to any member: “You put up enough to enable us to comply with our contracts or we will cancel your policy.” They changed their mutual agreement so that a certain class of their members should pay a larger proportion of this deficiency than their agreement provided. And they were very generous in not putting this burden on one *687or two members. They put it upon all those over 60 years of age. This they could do because the necessary two-thirds to so act were much undér that age and .would not be burdened, but directly benefited, by their action.
The cases cited' in the opinion will not justify such; a rulé. The true rule is that the rates should be arranged so that new members of . whatever age should pay in proportion to the benefits received by them and sufficient to enable a compliance with their mutual agreements as to such new members. But existing members should all pay their agreed proportionate share to make good any deficiency arising from their mutual mistake. They should have levied additional assessments on all existing members in proportions specified in their contracts to enable them to carry out their mutual promises. This above-quoted provision of their laws required that, as well as.the ordinary .law of contracts and natural justice. The power to “adopt by-laws for the regulation of the business of the grand lodge, * * * not in conflict with the provisions of these laws,” comes very far short of enabling them to change tin? contract existing between themselves as to bearing the common burdens which' they mutually assumed. To put a larger and disproportionate portion of the common burden which they, had mutually contracted upon the minority because the majority had a direct pecuniary interest in so doing was “in conflict .with the provisions of these laws,” which provided for levying additional assessments on all of the existing membership to make up the deficiency.
The decisions of respectable courts generally are that the power to make laws for the government of the society does not include power to change the contract right among" the existing members.