Grand Lodge Ancient Order of United Workmen v. Dister

Bond, J.

The petition in this case, omitting the formal parts, is as follows:

“For cause of action plaintiff states that it is now and was at the times hereafter stated, a fraternal beneficiary corporation under the laws of the State of Missouri.

“Plaintiff states that it is and was at the times hereinafter stated the governing body of a fraternal secret beneficiary order composed of it and various subordinate lodges known as the Ancient Order of United Workmen, and that at all times hereinafter stated North Star Lodge No. 245 was one of the subordinate lodges of said order.

“Plaintiff states that heretofore, to wit, on or about the 20th day of March, 1892, one John Schoeneck became a member of the Ancient Order of the United Workmen and of North Star Lodge No. 245, a subordinate lodge of plaintiff’s said order, located in the City of St. Louis, and State of ‘Missouri, and received from plaintiff a benefit certificate (No. 15752) whereby it was certified that said John Schoeneck was a member of plaintiff’s said order and was entitled to have paid to his wife, Anna Maria Augusta Schoeneck, upon his death, if at the time of such death he had complied with all the laws, rules and regulations of said order, the sum of two thousand dollars. Plaintiff states that heretofore, to wit, on the 19th day of November, 1897, said John Schoeneck died, and at the time of his death was a member in good standing in said order, and was entitled to have paid to said Anna *612 Maria Augusta Schoeneck, his widow, the sum of two thousand dollars, in accordance with the terms of said certificate. Plaintiff states that after the death of said John Schoeneck and before the payment of the money in said benefit certificate provided to be paid, to wit, on November 24th, 1897, said Anna Maria Augusta Schoeneck died. That afterwards, to wit,.said defendant Frederick M. Dister duly qualified as administrator of the estate of said Augusta Schoeneck, deceased, and demanded payment of the said two thousand dollars to be paid in and by said certificate to him as administrator of the said Augusta, claiming that the said two thousand dollars formed a part of the estate of said Augusta Schoeneck and that he as such administrator was entitled to receive same. Plaintiff states that defendants, Elizabeth Dister, Christina Overton, John Schoeneck and Dorothea Schoeneck, are the children and legal heirs of said John Schoeneck, deceased.

“Plaintiff states that defendant John Schoeneck, is a minor of the age, to wit, fourteen years. Plaintiff states that under the terms and provisions of section 10 of an act providing and regulating formal fraternal beneficial societies, etc., enacted by the legislature of the State of Missouri, approved March 16th, 1897, it is provided as follows, to wit: (Section 10).

“ ‘The money or other benefit, charity, relief, or aid already paid or to be paid, provided or rendered by any association, authorized to do business under this act shall not be liable to attachment or execution by trustee, garnishee, or other process, and shall not be seized, taken, appropriated or applied by any legal or equitable process, or by the operation of law, to pay any debt or liability of a certificate holder of any beneficiary named in a certificate or any person who may have any right thereunder.’

*613 “Plaintiff states that said act has never been construed that if, under the demand of said administrator of said Augusta Schoeneck, it pays the said two thousand dollars to him the same may be applied to the payment of debts and diverted from the heirs of said Augusta Schoeneck and said John Schoeneck who are, to wit, the defendants contrary to the statute. Plaintiff states that it is informed and believes that under the act of the legislature in question that said two thousand dollars should be paid to the said children of said Augusta Schoeneck direct and not to the administrator of said Augusta. Plaintiff says that, because of the doubt and difficulties and demands aforesaid, it is unable to decide with any safety to itself to whom said money should be paid, as in either case it will be subject to litigation.

“Plaintiff states that said certificate is now in the hands of said Frederick M. Dister, administrator as aforesaid. Plaintiff further states that it is not interested in said funds, and that it does not make any claim directly or indirectly thereto, or any part of it, but is willing and ready to pay the same to whoever is lawfully entitled thereto, and that this suit is not brought by collusion or privity with any or either of said defendants, but solely for the purpose of being relieved from the responsibility of deciding to whom such money should be paid.

“Wherefore plaintiff prays that said certificate may be brought into court and that plaintiff may by decree, of this court be ordered to pay into court the said sum of two thousand dollars, less a reasonable allowance for expenses and attorney fees, and upon payment being made as aforesaid, said certificate may be canceled and delivered up to plaintiff, and that plaintiff may be discharged from any and all liability to said defendants, or either of them on account of said *614 certificate, or on account of the membership of said John Schoeneck in said order, and that defendants and all of them may be forever enjoined and restrained from bringing any action or proceeding in law or equity against plaintiff on account of said money, said benefit certificate or on account of the membership of said John Schoeneck, and that upon the payment of said money into court as aforesaid, plaintiff may be discharged and go hence without day, and that defendants may interplead among themselves for said fund so as aforesaid paid into court, and for all such other and further relief to which plaintiff may be entitled, the premises considered.”

All the defendants, except two, appeared and filed a general demurrer to the above petition, the latter being minors answered by their guardian ad litem. The court overruled the demurrer, sustained the petition for interpleader, ordered the payment of the fund into court, and directed all the parties to interplead therefor. • The demurrants appealed.

It is insisted upon their behalf that the bill of interpleader was improperly filed, in that it was the legal duty of the plaintiff therein to pay the money in question to the administrator of the beneficary named in the certificate. The decision of this question involves a consideration of the effect of section 10 of the act of 1897, governing fraternal-beneficiary associations (Sess. Acts 1897, p. 135), quoted in the petition. Prior to that enactment the title of the administrator upon the facts stated, would be unquestionable, hence the point to be decided is, how far the section in question affects his right to the fund undethe previous law. The obvious purpose of the statute was to exempt the fund due on a benefit certificate from involuntary application to the debts of the beneficiary named therein or the person entitled thereunder. *615 It was not the purpose of the statute to create a perpetual trust or entail’in the fund. Such a motive would be contrary to sound policy and the law of this state. What it intended was, to put it out of the power of the law to deprive the person entitled to receive the fund (after the right hereto had vested) from the personal use and enjoyment of it. Such person as an incident of ownership would have an unlimited power of disposition or alienation, but without his consent no creditor could reach it by any legal or equitable machinery; nor through the process of administration. Under the facts shown in the petition when the member of the respondent order died, the right to receive the fund at once vested in the intestate of the administrator, who was then alive, with all the safeguards thrown around her ownership and enjoyment by the statute under consideration. She having died before receiving payment, the fund did not on that account lose the exemption from application to her debts which attached to it during her life, but retained that quality. Eor if this were not true the statute would only protect the fund against the creditors of a named beneficiary provided such beneficiary got actual possession of it before death. Such a construction is opposed to the law and spirit of the act. As it was then a fund secured from her creditors and yet a part of her estate, the only question to be answered is who under the laws of Missouri, was entitled to receipt for it to the respondent order? Under our laws, except upon an order of the probate court dispensing with administration, the only party entitled to the assets of the estate of an intestate is the administrator. McMillan v. Wacker, 57 Mo. App. 220 . He holds such assets as the general representative in title of the decedent, but has not on that account any right to apply *616 those, exempted by law from the payment of debts, to that purpose, but holds them in trust for the persons entitled, and must account to them therefor. This is also in accord with the law of New York on this subject. Bishop v. Grand Lodge, 112 N. Y. 627 . In this case it is clear, therefore that the administrator as the quasi trustee of the heirs is entitled to the proceeds of the benefit certificate, and that such proceeds when received by him can not be applied to the liabilities of the estate in his hands, but must be accounted for to the heirs at law of his intestate. As his right to collect the fund i-n that capacity appeared by correct legal deduction from the allegations of the petition, it did not present a proper ease for an interpleading, and the court erred in so holding. The result is that the judgment is reversed and the cause remanded with directions to dismiss the petition.

All concur.