O'BRIEN v. ANCIENT ORDER OF UNITED WORKMEN

Fraternal Beneficiary Corporation. Interpleader. Contract, Implied in law. Where under a certificate issued by a fraternal beneficiary corporation a death benefit was due, but the person named in the certificate as beneficiary had died before the member and no other beneficiary had been designated by him, and it was provided by the by-laws subject to which the certificate was issued that, if no beneficiary was living and certain near relations were not living, the benefit should be paid to the "legal heirs" of the member, and where it appeared that the member had promised orally to his stepdaughter that the benefit should be paid to her, if she would pay the premiums and assessments on the certificate, and she had done so for fifteen years and up to the time of his death, it was held, that the benefit must be paid to the member's heirs at law.

In an action of contract against a fraternal beneficiary corporation for a death benefit, the defendant admitted its liability and paid the money into court, and at its request a person who had paid the premiums and assessments on the member's certificate for many years and claimed to be entitled to the death benefit was allowed to interplead. After certain questions had been answered by the jury, the trial judge reported the case to this court, "such judgment to be ordered as the facts and law require." This court, in holding that the plaintiffs as matter of law were entitled to recover the benefit, held also, that the plaintiffs and the claimant should be treated as interpleading under R.L.c. 173, § 37, and that the claimant's claim for reimbursement for money paid for premiums and assessments should be passed upon.

Accordingly in such action above described, which was brought by the heirs at law on the certificate for the death benefit, where the defendant had paid into court the amount of the benefit and had caused the stepdaughter to be made a party as claimant, and where it was evident that but for the payments of premiums and assessments made by the claimant all rights under the certificate would have lapsed and the plaintiffs would have got nothing, it was held, that the claimant was entitled to be reimbursed for the amount of such payments with interest thereon.

BRALEY, J.

By the defendant's general laws and by-laws which were incorporated in the "beneficiary certificate" or contract, the original beneficiary, the wife of the assured, having predeceased him and no further designation of a beneficiary having been made, the plaintiffs as his sole heirs at law are entitled to the fund notwithstanding his parol promise to the claimant, his stepdaughter, that if she would pay the assessments as they fell due she should receive the proceeds of the certificate at his death. Ulman v. United Order of the Golden Cross, 220 Mass. 422, 427. Pease v. Royal Society of Good Fellows, 176 Mass. 506. Daniels v. Pratt, 143 Mass. 216. American Legion of Honor v. Perry, 140 Mass. 580. Pub. Sts. c. 115, § 8. St. 1882, c. 195, § 2. See R.L.c. 119, § 6.

But, if the plaintiffs' request that as matter of law they were entitled to a verdict should have been given, the case is before us on the report of the presiding judge under which justice may be done between the parties. The fund has been paid into court by the defendant, and the plaintiffs and the claimant should be treated as interpleading under R.L.c. 173, § 37.

It is evident that but for the payments which the claimant made, the certificate would have lapsed, and the plaintiffs would not have received anything. The advances were made on the express promise of the decedent under whom the plaintiffs claim, and, having been beneficial in the preservation of their property interests, the claimant should be reimbursed for both principal and interest. Unity Mutual Life Assurance Association v. Dugan, 118 Mass. 219. Haggerty v. McCanna, 10 C.E. Green, 48. West v. Reid, 2 Hare, 249. Gill v. Downing, L.R. 17 Eq. 316.

The cases of Clark v. Royal Arcanum, 176 Mass. 468, United Order of the Golden Cross v. Merrick, 163 Mass. 374, and Clarke v. Schwarzenberg, 164 Mass. 347, are plainly distinguishable. In the first case the suit was against the society to recover the amount of the certificate or the amount of assessments which the plaintiff had paid in reliance on the promise of her husband to transfer the certificate to her. It was held that no rights had been acquired in the certificate, or to the proceeds by force of the agreement. See Kerr v. Crane, 212 Mass. 224, 226. In United Order of the Golden Cross v. Merrick, where there were rival claimants the court decided that the fraternal order could maintain a bill of interpleader, and in Clarke v. Schwarzenberg the plaintiff's right to reimbursement for premiums voluntarily paid was expressly left undetermined.

By the terms of the report the plaintiffs are to have judgment in the sum of $1,246.89 with costs to the defendant taxed at $7.83, while judgment is to be entered for the claimant in the sum of $745.28.

So ordered.