
    Margaret Coyne, Plaintiff, v. Mary Ann Cecelia Bowe, Respondent; Margaret M. Conroy, Appellant, Interpleaded.
    
      Benefit life insurance — compliance with the rules of the association is a prerequisite to a change of beneficiaries.
    
    Under the statute (Laws of 1892, chap. 690, § 238) requiring mutual benefit insurance associations to permit certificate holders to make changes in the beneficiaries at any time, compliance with the rules of the association is an essential prerequisite to any change.
    The holder of a certificate in such an association, the rules of which required the change to be authorized in writing on the back of the certificate in a prescribed form, and provided that “no change of direction shall be valid or have any .binding force or effect until it shall have been reported to the grand recorder, ■ the old certificate filed with him and a new beneficiary certificate issued," duly indorsed a direction for a change of the beneficiary upon the back of the policy, and procured it to be transmitted in accordance with the rules of the association to the grand lodge. The grand lodge did not issue a new certificate, but the old one was sent back to the certificate holder, who received it, although he was familiar with the rule of the association regarding changes of beneficiaries, having already effected two valid changes. After the death of the certificate holder the certificate was produced with the designation of the new beneficiary canceled by means- of lines drawn through it with a pen.
    
      Held, that no change in the beneficiary had been effected;
    That if it should be held that the acts of the certificate holder amounted to a revocation of the direction to pay to the former beneficiary, it was also valid as a designation of the new beneficiary, as, under the rules of the association, when the revocation was accomplished, the designation was complete.
    Appeal by the defendant, Margaret M. Conroy, from a judgment of the Supreme Court in favor of the defendant Mary Ann Cecelia Bowe, entered in the office of the clerk of the county of Kings on the 2d day of April, 1897, upon the decision of the court rendered after a trial at the Kings County Special Term, except from so much of said judgment as dismisses the complaint of Margaret Coyne.
    
      Charles S. Haight, for the appellant.
    
      Sidney H. Stuart, for the respondent.
   Hatch, J.:

An action having been begun against the Grand Lodge of the Ancient Order of United Workmen of the State of New York, to recover the sum of $2,000 upon a beneficiary certificate issued by the order to Edward Conroy, it admitted liability to some one, and paying the. money into court it procured the substitution, by order of interpleader, of the defendants. • Upon the trial the plaintiff, being advised that she was without legal interest in the fund, withdrew from the action, and the complaint was dismissed. This left the contention to remain between the defendants.

It appeared that Conroy became a member of the order in 1888 and received a certificate in accordance with its rules, in which he designated his daughter, the defendant Margaret M. Conroy, as beneficiary ; subsequently he changed this designation and had his wife named as beneficiary. She having died, he designated the defendant Bowe as beneficiary. This was in JVIay, 1895. In February, 1896, in the presence of Louis -Ungerland, Conroy filled out the blank form upon the back of the certificate as required by the rules of the order when it is desired to change the beneficiary, and wrote therein the name of Ungerland as beneficiary. This act, the proof shows, he acknowledged before a notary public, although that officer’s name does not appear thereon. Conroy then caused the certificate, with the designation upon the back to be delivered to the recorder of his lodge, and the latter signed his name thereon.as recorder, affixed thereto the seal of the lodge and transmitted it to the grand lodge. • These acts were performed in the usual manner and in accordance with the rules of the order.

There is no evidence of how long the certificate was kept or of any action having been taken thereon by the grand lodge. The same certificate was subsequently returned to the recorder and was by him sent to Conroy. What Conroy thereafter did with the certificate does not appear. It was produced by the respondent upon the trial, and when produced the name of Ungerland and the other written words in the blank for changing the designation of the beneficiary were erased by a line drawn through them with a pen. It did not appear who did this. Counsel for the respondent stated upon the trial that lie was prepared to prove that the erasing was done by the direction of Conroy the night before he died. The court stated that it would hold that there was no cancellation of the certificate, and, therefore, no proof was given upon this subject. It would have been 'more satisfactory had the proof been received.

It is claimed by the appellant that the legal conclusion following these facts is that there was a revocation of the designation of the defendant Bowe as beneficiary; that as there was a failure to designate Ungerland as beneficiary by the issuance of a new certificate, he did not become a beneficiary, with the result that there was a failure to designate a beneficiary, im consequence of which the appellant becomes entitled to take under the rules of the order. . The statute (Chap. 690, Laws of 1892, § 238) requires associations of this character to permit a member to make changes in beneficiaries at any time, subject only to, the consent of the association in the form and manner prescribed by its laws. Compliance with the rules of the association is an essential prerequisite to a change of beneficiary. (Armstrong v. Warren, 83 Hun, 217.) The law of this association provides* any member holding a beneficiary certificate desirous at any time to make a new direction as to its payment, may do so by authorizing such change in writing on the back of his certificate in the form prescribed; 4 * but no change of direction shall be valid or have any binding force or effect until it shall have been reported to the grand recorder, the old certificate filed with him and a new beneficiary certificate issued.” This provision is essentially different from those, which were considered in Luhrs v. Luhrs (123 N. Y. 367) and Cullin v. Knights of Maccabees (77 Hun, 6). In the former case a member who desired to change his beneficiary was simply required to surrender to the lodge of which he was a member his benefit certificate with direction for the change. Hpon payment of the fe.e required the reporter .of the lodge transmitted the surrendered certificate, with the direction, to tlie supreme reporter, who thereupon canceled the old certificate and issued a new one payable as directed. There was no provision as to when the change should take effect, whether upon the surrender of the old certificate or the issuance of the new. As the insured in -that case liad died' after a surrender of the old certificate was had, and before the new one was issued, and nothing more remained for him to do after the surrender, it was held that a change was effected and that the issuance of the new certificate would relate back to the time of the original surrender of the old certificate to the lodge of which he wTas a member.

It is quite evident from the discussion which was had in that case that if there had been a provision fixing a time when the new designation should take effect, which had not arrived when death ensued, that the decision would have gone the other way. It was the absence of all such considerations which enabled the court to reach the judgment which it pronounced.

In the Guilin case the difference is more marked. The law of that association required that no transfer or assignment of a certificate should be binding unless with the consent of the supreme commander and the supreme record keeper and the surrender of the certificate transferred or assigned. The court held that this language did not apply to a revocation of the direction to pay, which act required no consent; that it related alone to the transfer or assignment to another person. There was in that case no attempt to depart from the binding force of the provision of the association, and had the consent been required for the act of revocation it would have led the court by the process of reasoning which it adopted to determine that the revocation was without effect until the consent was given. These cases, therefore, as well as the statute and the authority construing it, makes compliance with the law an essential prerequisite to any change. (Thomas v. Thomas, 131 N. Y. 205.)

Force must, therefore, be given in this case to the provision of the law fixing the time when the direction for the new designation shall take effect. The provision is that no change of direction shall be valid or have binding force and effect until the new beneficiary certificate issues. Change of direction involves power of revocation, as that is essential in order to divert payment from the person entitled thereto by the terms of the certificate. It is quite evident that the association deemed it wise to provide against a complicated situation by requiring that no designation or change should be had until it was evidenced by a new certificate. This rule ought to receive sanction, as it will at all times conclusively evidence who the beneficiary is and thereby prevent complications and obviate the difficulty, often very perplexing, of determining between conflicting claimants. In this case no consent was given to change the beneficiary, and no new certificate was issued. It might well be concluded that Conroy changed his mind and thereby nullified his attempt to make a change. He evidently knew what was required to effect a change in the beneficiary ; he had twice effected a valid change, and he followed the usual course in this case in order to accomplish a third change. He must, therefore, be presumed to have known what the requirements of the association were, not alone by being a member, but by actual use of its procedure. He knew that the association had failed to act,, that the old certificate was returned, and.he received it without objection. We think this excludes the conclusion that he had made a successful revocation or designated a new beneficiary. On the contrary, we regard it ■ as essentially inconsistent, not only with an accomplished change, but with a continuous disposition to change. At'the most, it only shows that at one time he contemplated a change, which he. subsequently abandoned.

If, however, we were able to construe his act as working a revocation of beneficiary, we are unable to see how it inures to the benefit of the appellant. If the act of Conroy was good as a revocation, it was also good as a designation. As we have observed, there is no rule of this association, as in the Cullin Case (supra), whereby revocation might be had without consent of the association. Provision is here made for revocation and designation;. where the first is accomplished, the last is complete: . If the designation of the respondent Bowe was revoked, then it follows that Ungerland was named, and, if he was named, then the daughter is' without interest. In no view of the case, therefore, is the appellant entitled to the fund.

The judgment should be affirmed.

All concurred.

Judgment affirmed, with costs.  