Beth Moshav Z'Keinim v. Grand Lodge Independent Western Star Order , 141 Ill. App. 305 ( 1908 )

Mr. Justice Smith

delivered the opinion of the court.

The decree of the Circuit Court is peculiar in that it recognizes an equity in the complainant, and upon the payment into court of a certain amount of money for the use of the complainant, sustains the demurrer to the bill as amended, and dismisses the bill at defendants’ costs. But appellant states in its argument that its purpose is to ask this court to disregard any formal pleading and to meet and decide the legal questions involved, and no argument is made on the form of the decree.

The case made by the amended bill is founded on the certificate of the Western Star Order, which is the promise of the order to pay the benefits accruing thereunder on the death of Wolf G-reenbaum in accordance with and to the parties named in the statute and designated and provided for by the laws of the order, and an assignment thereof to appellant. The bill does not show that appellant is a beneficiary named or provided for by the laws of the order, or that it is such a society as the statute authorized payment of benefits to under a benefit certificate. The appellee order has waived no right by bringing the money into court, and acknowledging its liability to pay it to appellant or to Bertha Greenbaum, as would have been the case had it filed a bill of interpleader and brought the money into court, asking the court to determine which of the claimants is entitled to the fund. The appellee order is here standing upon its contract, ready to execute it by paying the money as it agreed to pay it, but objecting to paying the fund to any person or corporation other than the beneficiaries authorized by the statute under which it is organized, and the laws of the order. A different question is therefore presented by the bill from that decided in Binkley v. Jarvis, 102 Ill. App. 59. That case as stated by the court was in effect a bill of interpleader, and the court said: “The company only has the right to complain that this agreement (assignment) is void under its charter. But it is entirely content and makes no objection on that ground. Johnson v. Van Epps, 110 Ill. 561-563.”

The question presented by the demurrer to the bill is, will a court of equity under the facts shown in the bill enjoin appellee, Western Star Order, from paying the benefits to appellee G-reenbaum, and decree that such benefits be paid to appellant as assignee thereof for value?

“While a certificate such as the one here in question is not assignable in law, still all beneficial interests therein may be transferred in equity, and such equitable rights may be enforced in equity." Ptacek v. Pisa, 231 Ill. 522. Except as the statute inodifies this right of assignment, it .will be enforced in equity.

It is urged in behalf of appellant that the acceptance of dues and assessments from appellant, with knowledge of the assignment, operated as a waiver of the by-laws of the society providing that assignments shall be made only to blood relations, and as an estoppel of the society itself, since these by-laws were for the benefit only of the insured and may be waived by the society.

In National Home Building Assn. v. Bank, 181 Ill. 35-46, it is held: ‘‘The cases in this court where the corporation has been held to be estopped have been where the act complained of was within the general scope of the corporate powers.” And in the same case it is held that: “A party dealing with a corporation of limited and delegated powers conferred by law is chargeable with notice of them and their limitations,' and cannot plead ignorance in avoidance of the defense.”

Beneficiary societies organized under the laws of this state are corporations of limited powers, and their benefits are restricted to certain classes of persons named and fixed by statute. A benevolent association of the character of appellant cannot take as a beneficiary, as it is not within the classes specified in the statute. Old Peoples Home Society v. Wilson, 176 Ill. 94." In our opinion, under the authorities, the appellee, Western Star Order, did not waive its by-laws by accepting dues and assessments as averred in the amended bill, and it cannot be estopped from asserting and insisting upon its entire want of power under the law of its organization to agree to pay or to pay its beneficiary funds to appellant. What it cannot agree to do, directly or indirectly, it will not be compelled to do in equity, at the instance of an equitable assignee with full notice and knowledge of its charter powers.

The certificates in the possession of appellant on their face state that the benefits therein provided for should be paid to the beneficiaries only named in and provided for in the laws of the order. Appellant therefore was put on inquiry and thereby notified that it was not, and could not become, a beneficiary of the funds of the order under the laws and charter of the order, for the statute and the laws of the order were a part of the contract between the order and the G-reenbaums.

As said in Alexander v. Parker, 144 Ill. 355, 363, and quoted in Old Peoples’ Home Society v. Wilson, supra:

“Where the statute under which a benevolent corporation is organized, and its charter adopted in pursuance of such statute, designate certain classes of persons as those for whom a benefit fund is to be accumulated, a person not belonging to either or any of such classes is not entitled to take the fund. The corporation has no authority to create a fund for other persons than the classes specified in the law, nor can a member direct the fund to be paid to a person outside such classes.”

A court of equity will not, in our opinion, by its decree compel a fraternal beneficiary society organized under the existing statute of this state, to pay over a beneficiary fund, contrary to the provisions of its charter and laws, at the instance of an assignee outside of the classes named in the statute.

It is urged against this view of the case, that if the money is paid to appellant it is really paid to Mrs. G-reenbaum, the beneficiary named in the certificate and the charter and laws of the. order. We do not think this contention is tenable. It is based on the equities between appellant and Mrs. Greenbaum solely, and leaves out of consideration the fact that appellee, Western Star Order, has done nothing by which it has waived its rights to stand upon its charter rights and insist upon the strict terms of its contract. The relation of appellant to the order is not materially different from what it would have been if the old certificates had been surrendered and new certificates issued payable to appellant. The certificates were issued under section 258, chapter 73 of the Revised Statutes, which specifies the persons to whom benefits may be paid and limits such payments to the persons named. .

The decree is affirmed.

Affirmed.