
    HAZEL CLAIR et al., Appellants, v. SUPREME COUNCIL OF THE ROYAL ARCANUM, Respondent.
    St. Louis Court of Appeals,
    April 8, 1913.
    1. FRATERNAL BENEFICIARY ASSOCIATIONS: Forfeiture of Benefit Certificate: By-laws Construed. A by-law o£ a fraternal beneficiary association provided that, if a member engage in a proscribed occupation, he “shall thereby and thereupon stand suspended” and shall forfeit his rights in the order and in the benefit certificate. Another by-law enjoined the duty upon an officer of the subordinate lodge to announce the suspension in the lodge, and enjoined the duty upon the secretary to record such suspension, with the date of the suspension and of the announcement, and to immediately notify the supreme secretary. Held, that the first by-law was self-executing,- and that . - the act of a member in engaging in a proscribed occupation operated ipso facto to render the certificate void, where his death resulted from following such occupation; held, further, that the second by-law merely provided for making a record of the suspension, and did not require affirmative action to be taken by the subordinate lodge to suspend the member and avoid the certificate.
    2. --:--: Validity of By-laws. It is competent íot a fraternal beneficiary association and its members to provide in the contract of insurance and by-laws what occupations shall not be pursued, under penalty of forfeiture of the certificate.
    3. -; -; Waiver. The payment of an assessment by a member of a fraternal beneficiary association, whose certificate was ipso facto forfeited by his engaging in a proscribed occupation, was not a waiver where the association, at the time of the payment, did not know of his being so engaged.
    
      4. -:--:--. A forfeiture of a certificate issued by a fraternal beneficiary society, based on the member’s engaging in a proscribed occupation, is not waived by conduct of the secretary of a local lodge, who had no knowledge of the forfeiture at the time.
    5. -: -: -: Authority of Local Officers. The acts of a mere ministerial officer of a subordinate lodge of a fraternal beneficiary association, wholly unauthorized by the association or its superior officers, are not binding on the association and may not be invoked as a waiver of its rights, and it is only when the act of the subordinate officer, unauthorized in the first instance, has been ratified, with knowledge of the facts, by the superior officers, that it may be so invoked.
    6. -: -: -: -. In an action on a death , benefit certificate issued by a fraternal beneficiary association, defended on the theory that the certificate was void by reason of the member’s having engaged in a proscribed occupation, held that the secretary of the subordinate lodge had no authority to write certain letters to the beneficiary, relied on by her as constituting a waiver of the forfeiture, and, therefore, that the association was not bound thereby.
    7. LIFE INSURANCE: Forfeiture of Policy: Estoppel: Fraternal Beneficiary Associations. An agreement or course of action on the part of an insurer leading a beneficiary to honestly believe that, by conforming thereto, a forfeiture of the policy will not be insisted on, followed by due conformity and the incurrence of expense in so doing, estops the insurer from thereafter insisting on the forfeiture; but this doctrine presupposes authority in- the person purporting to represent insurer, and an estoppel may not be invoked where the person acting had no authority to represent insurer and he acted without the knowledge or consent of the superior officers of insurer.
    Appeal from Knox Circuit Court. — Son. Charles D. Stewart, Judge.
    Affirmed.
    
      O. D. Jones for appellant.
    
      F. H. Bacon for respondent.
   NORTONI, J.

This is a suit on a certificate of life insurance. The finding and judgment were for defendant and plaintiffs prosecute the appeal.

Plaintiffs are beneficiaries designated in tbe certificate of life insurance which was issued by defendant September 15, 1909. Defendant is a fraternal beneficiary association, organized under the laws of Masr sachusetts, but duly qualified and licensed as such at and before the time the certificate in suit was issued, under the laws of this State as well.

There are several arguments advanced in the brief, but in the view we take of the case, but two questions need be considered. These present an inquiry as to whether or not defendant’s by-law pertaining to proscribed occupations is self-executing; and if so, is it within the power of the secretary of the local council to which insured belonged to waive a forfeiture thereunder or estop the defendant from asserting it in defense, when there is nothing in the record indicating such secretary represented defendant or its superior officers ?

Defendant having qualified under our statutes as a fraternal beneficiary association in this State, established certain subordinate lodges, among which was Hickory Council No. 766 Royal Arcanum, located in the city of St. Louis. The insured, Jesse Randolph, affiliated with this council and submitted to defendant his written application for a certificate of insurance in the amount of $1000, payable to the plaintiffs, in the event of his death. His application was accepted and the certificate issued thereon by defendant on the 15th day of September, 1909. Among other things, the va-' lidity of the certificate and its payment are conditioned upon the fact that “the insured is in good standing in this order at the time of his death,” etc.

At the time Randolph applied for the insurance and became a member of the order, he was employed as a painter in St. Louis, and so stated his occupation in the application. Defendant’s by-law No. 272 proscribes a number of occupations and both inhibits the insurance of the lives of persons engaged therein and forbids members insured to enter such occupations. Among such proscribed occupations is that of a railroad switchman. It is obvious that this by-law pertaining to proscribed occupations was in the contemplation of the parties at the time the contract was entered into, for it appears in the insured’s written application that he expressly agreed to its terms as a condition of the insurance. For himself and for any person or persons accepting or acquiring any interest in any benefit certificate issued on his application or arising out of any membership therein, the insured agreed expressly as follows: “That in case I shall, within five years from and including the date of my initiation enter upon or become engaged in a proscribed occupation, . . . my benefit certificate shall become and be null and void, and no person nor persons be entitled to a benefit thereunder or under my membership in the order.” Shortly after becoming a member of the order and taking out his insurance therein, the insured, Jesse Randolph, went to St. Paul in the State of Minnesota and there engaged in the occupation of a railroad switchman. On March 26, 1910, while engaged as a railroad switchman in the employ of the Great Northern Railroad Company, the insured came to his death as a result of such occupation. There is no controversy in the record touching the relevant facts, for they appear in an agreed statement, and the court found for defendant on the ground that the insured came to his death while engaged in such proscribed occupation, which, under defendant’s by-law and the contract of insurance, ipso facto forfeited all right of recovery on the certificate.

But it is argued for plaintiffs that defendant’s by-law touching this matter is not self-executing and that the insurance certificate remained valid until the insured should be suspended by his council — -that is,. Hickory Council No. 766, in St. Louis — which was never done. So much of defendant’s by-law as is relevant to the question here involved is as follows:

“ (1) A member who, during the first five years of his membership, shall enter upon or become engaged in a proscribed occupation, shall thereby and thereupon stand suspended from all rights and privileges in the order, cease to be in good standing, forfeit all the rights and privileges of membership and in his benefit certificate, which shall be void, and no assessments or dues shall be received from him thereafter.
“(2) The regent shall announce the suspension in the council. The secretary shall record the suspension, the date thereof, if known, and of the announcement thereof, and immediately notify the supreme secretary, giving the member’s name, date and cause of suspension, number of his benefit certificate, the proscribed occupation upon which the member has entered and the date the suspension was announced in council.”

There can be no doubt that this by-law is self-executing and that its violation operates to destroy the insurance contract when it appears the death of the member resulted as here from following such proscribed occupation. The occupation of railroad switch-man in which and because of which the insured came to his death is proscribed in by-law No. 272 as one .against the hazards of which defendant does not undertake to insure. The case concedes that the insured came to his death while engaged in such an occupation and because of that fact. The first subdivision of bylaw No. 272a, above copied, provides in plain terms that if an insured member shall enter upon oí become engaged in a proscribed occupation, he “shall thereby and thereupon stand suspended from all rights and privileges in the order, cease to be in good standing, forfeit all the rights and privileges of membership and in his benefit certificate, which shall be void, and no assessments or dues shall he received from him thereafter. ’ ’ By the very terms of this by-law, insured forfeited his good standing in the order upon entering the proscribed occupation, and the certificate of insurance requires as a condition of its payment that he should continue that status until the time of his death. It would be difficult to employ language more pointed and precise, to the end of terminating the insurance contract by engaging in a proscribed occupation than that above quoted, for it stipulates in plain language that “thereby and thereupon the member shall stand suspended from all privileges of the order, cease to be in good standing, forfeit all of his rights and privileges of niembership and in his benefit certificate and that that certificate shall become void.” It is entirely clear that the by-law is self-executing, and the insured expressly agreed in his application to abide by its terms.

It is competent for fraternal beneficiary societies and their members to thus provide in the contract of insurance and by-laws, and the courts universally sustain and enforce such contracts as made. [Smith v. Knights of Father Mathew, 36 Mo. App. 184; Pauley v. Modern Woodmen, 113 Mo. App. 473, 87 S. W. 990; Lavin v. A. O. U. W., 104 Mo. App. 1, 78 S. W. 325; Borgraefe v. Sup. Lodge, 22 Mo. App. 127.] It is true it appears the insured paid his last assessment and dues on his membership and policy in the sum of sixty-five cents on or about the fifteenth day of March, 1910 while he was engaged in the occupation of a railroad switchman, but it is agreed in the case that at the time of the payment of said assessment defendant did not know of his being so engaged and, of course, no waiver may be predicated thereon in view of this fact.

It is true the second subdivision of by-law No. 272a, above copied, provides the regent shall announce the suspension in council, etc., its date, “if known,” and notify the supreme secretary giving the member’s name, the cause of the suspension, number of the certificate, the occupation, etc., etc.; but these provisions in no respect limit the operation of the prior subdivision of the law, which summarily operates to suspend the member from good standing and render his certificate void upon entering the proscribed occupation. It appears this provision has, for its purpose, the matter of making a record, both in the council to which the member belongs and in the supreme lodge, touching the fact that the relations of the order with the member have ceased and when and for what cause. A scrutiny of this subdivision will reveal that it, too, proceeds on the hypothesis that the member has been theretofore suspended by the mere operation of the first subdivision of the by-law, for the second subdivision provides the “regent shall announce the suspension in the council” as if the suspension has theretofore occurred. No proceeding against the member is contemplated. The next provision of this subdivision is that the secretary shall record the date of the suspension “if known,” etc. The whole tenor of this provision goes to show that it only prescribes certain formula to go through after the council has learned that the fact of suspension has been accomplished through the operation of subdivision No. 1 of the by-law by means of the insured entering into a proscribed occupation. The third subdivision of this by-law contemplates that a member desiring to enter a proscribed occupation may submit all of the facts touching the matter to the supreme secretary, and that after so doing he may, with the consent of that officer and the medical examiner, enter that occupation without suspension. Nothing of that kind occurred in this ease and, therefore, this provision is not before us for consideration. By the provisions of section 272b a member about to enter upon a proscribed occupation may prepare and file a waiver with the supreme secretary of all rights on the certificate which may accrue as a result of entering in such proscribed occupation. Nothing of that kind is before us, and, though referred to in the brief, it may not be considered. . These two provisions are wholly beside the case here for nothing was done by the insured under either. •

It appears that after the insured met his death, J. C. Schall, secretary of Hickory Council, No. 766 in St. Louis, of which the insured was a member, wrote plaintiffs’ mother several letters to the effect that the claim would be paid as soon as full and satisfactory proofs of death were made. At the time these letters were written, it does- not appear that Schall, the secretary of the local council, had any knowledge whatever touching insured’s occupation nor as to what occasioned his death. It appears that Schall was endeavoring to accumulate the facts touching the matter by writing to St. Paul, where the insured came to his death, and having certain affidavits made. In one of his letters to the plaintiffs’ representative he said, “You may say to Mr. Clair as soon as I have the papers returned they will have prompt attention and be forwarded to our supreme secretary at Boston for payment, as soon as I hear from St. Paul, I will forward you several blanks to be filled out and affidavits made thereto. ’ ’ In another letter, the local secretary said, “I regret very much to cause you all this trouble and that we have not already been able to dispose of this case for settlement. If he had died in St. Louis a settlement of your claim would have been accomplished in a few-weeks. The matter is having my attention and as soon as I can get all the proper blanks filled out, you will receive the draft accordingly.” Because the secretary of the local council thus wrote plaintiffs’ representatives after the death of the insured, it is insisted that the forfeiture of the insurance was waived, for it is said these letters manifest an intention to pay the amount notwithstanding that fact. Of this it would be sufficient to say the court found the fact to be otherwise. But to discuss itr — there is naught in the case. tending to show the local secretary had any knowledge of the forfeiture at the time these letters were written, and this alone would preclude a waiver on his part, for the matter of waiver turns on the question of intention and presupposes a knowledge of the facts pertaining to the matter about which the waiver is invoked. Without knowledge concerning the facts of the forfeiture, which it is said was waived, it is clear that there could be no intention to waive it. [Francis v. A. O. U. W., 150 Mo. App. 347, 130 S. W. 500.] But to concede, for the purpose of the case, that S'chall, the secretary of the local council of St. Louis, knew the facts pertaining to the forfeiture, the same result obtains, for it was not within his power to waive defendant’s rights in the premises. Under the constitution and by-laws it appears that, while such officers represent the order as to some matters — say, for instance, in and about the collection of dues and assessments, etc. —they are without authority whatever as to payment of claims after the death of the member occurs. It is only where the officers of the local council are acting for the order with authority that they may be regarded as having waived its rights in the premises. It is certain that the acts of a mere ministerial officer of a subordinate lodge, which are wholly unauthorized by the order or its superior officers, are not binding upon the order and may not be invoked as evincing a waiver of its rights. Such 'we understand to be the accepted doctrine. [See Lavin v. A. O. U. W., 104 Mo. App. 1, 78 S. W. 325; Borgraefe v. Sup. Lodge K. & L. of H., 22 Mo. App. 127; Harvey v. A. O. U. W., 50 Mo. App. 472; Bacon, Benefit Societies (3 Ed.), sec. 434a.] It is only when the act of such a subordinate ministerial officer, unauthorized in the first instance, appears to have been ratified, with full knowledge concerning it, by the superior officers of the order, that it may be invoked and successfully relied upon as a waiver of the rights of the order touching that matter. [See McMahon v. Maccabees, 151 Mo. 522, 52 S. W. 384; Bacon, Benefit Societies (3 Ed.), 434a.] There is not a semblance of evidence in the case tending to prove either that Schall, the secretary of the local council was acting with authority for the order in writing the letters above referred to or that the superior officers of the defendant were informed thereabout and thereafter ratified his acts. This being true, it is obvious that no waiver of the forfeiture may be predicated on his conduct in writing the letters.

It appears that in obedience to the suggestion of Schall in his letters, plaintiffs expended from two to five dollars and inconvenienced themselves somewhat in preparing affidavits and proofs of death to be transmitted to defendant through Schall. Because of this it is urged defendant is estopped to assert the forfeiture of the insurance. There can be no doubt of the general proposition that any agreement or course of action on the part of an insurance company which leads a beneficiary to honestly believe that by conforming thereto a forfeiture of the policy will not be insisted upon, followed by due conformity on the part of such beneficiary, so that expense and inconvenience are incurred, will and ought to estop the company from thereafter insisting upon the forfeiture, although it may be otherwise properly claimed under- the express letter of the contract. [See Bacon, Benefit Societies (3 Ed.), sec. 431a.] But the doctrine thus stated presupposes authority in the person purporting to represent the insurance company as a predicate of the estoppel, and it is certain that it does not obtain where no such authority appears. The estoppel sought to be invoked here proceeds entirely from the fact that Schall, the local secretary, advised the beneficiaries to prepare the proofs and stated that a draft for the amount of the insurance would be forthcoming thereafter. It appearing, as it does, that Schall was without authority whatever to represent the defendant order in this matter and that he acted throughout without the knowledge or consent of its superior officers, it •is obvious that no estoppel may be invoked against the company because of his conduct. The judgment should therefore be affirmed. It is so ordered.

Reynolds, P. J., and Allen, J., concur.  