Modern Woodmen of America v. Mixer/Opinion of the Court

This is a suit by the beneficiary of a certificate issued by a fraternal beneficiary society incorporated in Illinois. The member to whom the certificate was issued was the plaintiff's husband and the ground of recovery is that the husband had disappeared and had not been heard of for ten years before this suit was brought. His expectancy of life according to the tables had not expired and the defense is a by-law of the Corporation to the effect that:

'Long continued absence of any member unheard of shall not *     *  * give any right to recover on any benefit certificate *  *      * until the full term of the member's expectancy of life,      according to the National Fraternal Congress Table of      Mortality, has expired, *  *  * and this law shall be in full      force and effect any statute of any state or country or rule      of common law of any state or country to the contrary      notwithstanding.'

The only facts that need be mentioned are that the certificate seems to have been issued in South Dakota, although there was no allegation or proof concerning the law of that State, and that it was issued in 1901, while the by-law relied upon was not adopted until 1908. But the by-law has been held valid and binding upon the members of the Corporation by the Supreme Court of Illinois, although they had become members before the change. Steen v. Modern Woodmen of America, 296 Ill. 104, 129 N. E. 546, 17 A. L. R. 406. The Supreme Court of Nebraska affirmed a judgment for the plaintiff, seemingly, from the cases cited, on the ground either that the rule of evidence must be determined by the lex fori, or, more probably, that the by-law was unreasonable. Mixer v. Modern Woodmen of America, 197 N. W. 129. The result is that if the validity of the by-law ought to be determined by the laws of Illinois, the plaintiff is allowed to recover upon a state of facts which the contract expressly stipulates shall not give her that right. A writ of certiorari was issued by this Court. 265 U.S. 576, 44 S.C.t. 455, 68 L. Ed. 1187.

The indivisible unity between the members of a corporation of this kind in respect of the fund from which their rights are to be enforced and the consequence that their rights must be determined by a single law, is elaborated in Supreme Council of the Royal Arcanum v. Green, 237 U.S. 531, 542, 35 S.C.t. 724, 59 L. Ed. 1089, L. R. A. 1916A, 771. The act of becoming a member is something more than a contract, it is entering into a complex and abiding relation, and as marriage looks to domicil, membership looks to and must be governed by the law of the State granting the incorporation. We need not consider what other States may refuse to do, but we deem it established that they cannot attach to membership rights against the Company that are refused by the law of the domicil. It does not matter that the member joined in another State. In the above cited case Green became a member of a Massachusetts corporation in New York, and the State Court held on ordinary principles of contract that his rights were governed by New York law. Green v Royal Arcanum, 206 N. Y. 591, 597, 100 N. E. 411. But the decision was reversed and it was held a failure to give full faith and credit to the Massachusetts charter as construed by the Massachusetts Court that Green was relieved by decree from paying assessments increased by the corporation after his contract was made. We are of opinion that the decision in that case governs this, and that the judgment must be reversed.

Judgment reversed.