Court Opinion

ID: 5189375
Source: CourtListenerOpinion
Date Created: 2022-01-06 15:33:31.749463+00
Date Added: 2024-06-11T08:26:51.902955
License: Public Domain

O’Brien, J.:
In Sabin v. Phinney (134 N. Y. 423, 428) it was said: “ The statute under which the corporation was organized, its by-laws, together with the application for and the certificate of membership, constituted the contract which existed between the member and the society, which instruments, construed together, measure the rights of these litigants.” In that case the by-laws imposed no limitation on the persons to whom the certificate should be payable, and thereunder the appointee was changeable from time to time as the member might elect. Accordingly, it was held that the appointee first designated acquired no vested right to the sum payable which would prevent the member from changing the beneficiary. This decision, however, upon which so much reliance was placed by the learned judge at Special Term, does not seem to us to have any controlling effect or bearing upon the facts here appearing, but, on the contrary, in principle, we think it favors the view for which the appellant contends.
*262It is conceded that under the act of incorporation and by-laws, together with the application for the certificate of membership, which made the contract. between Roberts and the defendant, corporation, he had the right at the time to - designate as appointee the defendant Lily Cohen,, and we fail to see how, without the consent of the member, this contract, which was valid at its inception, could be impaired or destroyed either by the Legislature or the society. Recognizing this principle of the sacredness of- contract, the theory upon which-the abrogation of these contract rights is said to rest is, that such designation of Lily Cohen, though valid when made, was rendered ineffective by the agreement between the member and the society, giving to the latter power to change the by-laws, and, such change having been made, the rights of these claimants to the fund must be governed by the regulations in force when the member died.
.The answer to this contention is obvious. The by-laws of a society must be fair and equitable and consistent with its charter. Whether, under a right reserved to alter them, a society can impair or destroy a contract valid when made, is open to question. Here, however, under the act of incorporation of the' society-—which 'must be regarded as the law -of its being — no right was originally reserved and no power given to the grand lodge to pass any regulation affecting the designation of beneficiaries. It is true that the charter was amended years after the certificate was taken out, and in this aspect the question is again presented, how far the Legislature ' or the action of the society based thereon could affect vested rights. A member having the right could change the beneficiary, but his failure to exercise such privilege, whether from disinclination or neglect, did not give the society the right to make another designation without his consent, unless such right was expressly conferred upon the society.
Apart from this, however, there is another ground upon which the appellant may confidently rest, her case. Assuming that the grand lodge had power to pass the by-law limiting the class of beneficiaries, such by-law did not affect the certificate of Roberts, nor by reason thereof was he required to change^ the beneficiary, because it was not retroactive. There was nothing -therein requiring a member who had previously made a designation to change his *263beneficiary, nor was there anything in its language which extended it so as to operate upon certificates which had been previously issued.
An instructive discussion of the question and of the identical by-law here involved will be found in the case of Wist v. Grand Lodge A. O. U. W. (22 Oreg. 271), referred to with approval in Spencer v. Grand Lodge (22 Misc. Rep. 147), which latter decision was affirmed without opinion in 53 Appellate Division, 627. The following from the .Oregon case was quoted and approved in the Spencer case: “ The law does not undertake, by its terms, to disturb what has been done; it does not nullify previous appointments. * * * It is a settled rule of construction that laws will not be interpreted to be retrospective unless by their terms they are clearly intended to be so; they are construed as operating only on cases or facts which come into existence after the laws were passed. * * * Rights will not be interfered with unless there are express words to that effect. It is not enough that upon some principles of interpretation a retroactive construction could be given to the law, but the intent to make it retroactive must be so plain and demonstrable as to exclude its prospective operation.”
Upon the ground, therefore, that neither the by-law in question nor the amendment of the charter was retroactive, the original designation, which was valid when made and was never changed by the member, is controlling, and as thereunder the appellant Lily Cohen was the beneficiary named, she is entitled to the sum due from the society.
The judgment accordingly should be reversed, with costs, and as there is no dispute as to the facts and no advantage could result from a new trial, judgment should be ordered for the appellant, with costs.
Van Brunt,-P. J., Patterson and McLaughlin, JJ., concurred.
Judgment reversed, with costs, and judgment ordered for the appellant, with costs.