This case presents the question whether a common-law wife can recover on a policy of insurance issued by the defendant, Woodmen of the World, where the beneficiary was falsely represented as the first cousin of the insured.
The testimony and pleadings admit that the beneficiary, Marie Cushing Stevens, was married, first to Dr. Cordan some place in the eastern part of the United States; that he died; that about three years later she married Albert J. Cushing; that she and Cushing lived together as man and wife until 1931 when he died. About 1922 Albert W. Stevens came into the family, first as a boarder and then, according to the testimony of Mrs. Cushing, he assumed "the first place," and Mr. Cushing "was boarding with me." "Q. Who came first, Cushing or Stevens? A. Neither one, as far as that goes Mr. Stevens came first because *Page 143 he was the man." This state of affairs continued until the death of Cushing, in 1931. In the meantime, in 1922 and while Mr. Cushing was still alive, Stevens made a will whereby he left all of his property to plaintiff. Cushing had an insurance policy for $2,100 in favor of plaintiff in the Woodmen of the World prior to Stevens' advent into the family. Stevens also took out a policy of insurance for $1,000 in the same society in 1922 in favor of plaintiff. When the agent came to the trifamily home to fill out the blanks for the Stevens insurance he inquired the relationship of the plaintiff to the applicant Stevens. Stevens told him that she was only a friend, and the agent thereupon on his own initiative designated her as a cousin, striking from the blank the insertion first made by him designating her otherwise, but, as the blank is so blurred, it is difficult to say what designation he did give her in the first instance. When the blank application reached the head office at Denver it was discovered that she had been designated only "cousin," and the constitution of the society in directing who may be beneficiaries excludes relatives more distant than the "first cousin." It would appear that thereupon a typewritten sheet was sent to the applicant in which Marie Cushing was specifically designated as the "firstcousin" of Mr. Stevens, which statement was signed and transmitted back to the home office by Mr. Stevens and there attached to the application. This error and special correction would negative any claim that the erroneous designation was an oversight.
In 1928 the Woodmen of the World made some changes in its manner of doing business and a new application blank was filled out by Mr. Stevens and a new certificate issued to him, in which he again designated the plaintiff as his first cousin. After the death of Stevens, in 1932, the plaintiff undertook to probate the will of Stevens heretofore referred to. This proceeding was contested by some of the brothers and sisters of the deceased. This probate proceeding has apparently been abandoned there being no property in the estate. It is conceded the policy is not part of the estate. The plaintiff now relies solely upon the designation of herself as beneficiary in the insurance policy. It appears, *Page 144 however, that in 1932 plaintiff recovered about $2,100 at the death of Cushing under the policy of this defendant society issued on his life to the plaintiff, the beneficiary therein, as his wife.
The constitution and by-laws of the Woodmen of the World both at the time of the issuance of the first policy to Stevens, and also when the substitute policy was issued, designate very specifically the relatives who were permitted to become beneficiaries under the society's policies. Beyond question this plaintiff was not related to Stevens and was not competent to become a beneficiary when the policy, and also the renewal thereof in 1928, was issued to Stevens.
The constitution of the Woodmen of the World provides: "A benefit certificate can only be made expressly payable to, and the payment of all death benefits shall be confined to, some person or persons named, who sustained to the holder the relationship of either wife, child, adopted child, grandchild, parent, parent by adoption, grandparent, brother, half-brother, sister, half-sister, nephew, niece, uncle, aunt, son-in-law, daughter-in-law, brother-in-law, sister-in-law, mother-in-law, father-in-law, step-father, step-mother, step-child, first cousin * * *. In case an applicant for membership so desires, he may direct that the benefit in his certificate be made payable to the beneficiaries designated in the Constitution of the Association, and his benefit certificate shall so provide, or in case a beneficiary expressly named in a benefit certificate does not survive the holder thereof and the Neighbor has failed to designate a successor thereof, as provided in sec. 103, then in such cases the amount which would have gone to such named beneficiary, if surviving, shall be disbursed in like manner, which shall be in the following order: first if the deceased Neighbor leaves a widow and no child, or grandchild, to his widow; * * *." (Sec. 103, Constitution, W.O.W., Fifteenth Head Camp Session, June 25 to July 2, 1928.)
The plaintiff claims that the false relationship was inserted in the policy with the full knowledge and connivance of the representative of the insuring society and, therefore, it had full notice *Page 145 of the fraud and is estopped from denying responsibility on that account. The defendant disputes this conclusion and an issue here arises from such situation. Plaintiff claims now to be entitled to take as the widow of Stevens, and not as his cousin, the designation as designated in the policy. She was fully qualified to become the wife of Stevens after the death of Cushing which occurred about a year prior to the death of Stevens. Much testimony appears to establish the fact that Stevens and this plaintiff lived together as husband and wife and held themselves out as such after the death of Cushing. There is also much testimony that Stevens and plaintiff did hold themselves out as husband and wife prior to the death of Cushing, and it is also equally well established, in fact admitted by plaintiff, that she lived with Stevens in a state of concubinage for several years, possibly ten, prior to the death of Cushing. Just what was Cushing's attitude respecting the relations of Stevens and plaintiff does not appear and is probably not very material in view of the conclusions we reach herein. Apparently he was on very friendly terms with the plaintiff and perhaps also with Stevens.
Mrs. Stevens testified that she and Stevens took Cushing's body to Salt Lake for burial, and she asserts that she and Stevens were married shortly thereafter, but without ceremony and apparently merely by the continuance of their illicit intercourse and manner of living. In the case of Thomas v. Clay,120 Miss. 190, 197, 82 So. 1, 2, the court said: "The relation being illegal in its inception and void for want of capacity in Ben Clay to contract the marriage, it must be presumed in the absence of proof to the contrary that the relation continued after the death as before. If there was an agreement after the death of Polly Johnson Clay between Virginia and Ben Clay it must be proven." The instant case differs from that case in that plaintiff testified that she and Stevens were married by their mutual promises without witnesses, in the manner stated, and the testimony is not seriously refuted that after their return to Montana they did hold themselves out as husband and wife. The puzzling question then before us is, Did the removal of the disqualification of the plaintiff by the death of Cushing a year *Page 146 previous to the death of Stevens qualify the plaintiff as a common-law wife to become a proper beneficiary in the Stevens policy, and did she thereupon become a beneficiary solely by virtue of such relationship without specific designation of her by Stevens as his wife after having been fraudulently named first cousin in the policy as a beneficiary?
The improper designation of the plaintiff in the Stevens policy as a first cousin of deceased was a fraud upon the insurance society and a misrepresentation prohibited by the constitution of the Woodmen of the World, a fact known to both Stevens and the agent of the society who took his application. In other words, it was a conspiracy of Stevens and such representative. Inasmuch as the policy was in the possession of the plaintiff long prior to the death of Stevens, and she testified that she paid most of the premiums and she had the policy in her possession most of the time, wherein on its face she is plainly designated as first cousin, and it further appearing that she was present when the application was signed, we may assume that she was not ignorant of this conspiracy. The fraud of Stevens and the solicitor is well established. The complaint directly alleges the fact that plaintiff was not the first cousin of Stevens; therefore the fraud is undisputed. There is no evidence that other officers or agents of the society knew of the fact that plaintiff was in no legitimate way related to Stevens at the time of the issuance of the policy or at any time before the death of Stevens. The question then arises whether the guilty knowledge of the agent is applicable and binding on the issuing officers of the defendant insurance society. The plaintiff relies upon that proposition to establish her case.
The constitution of the society is specifically made a part of the policy. It definitely limits the authority of its officers to the issuance of policies naming only as beneficiaries relatives of stated degrees or dependents. Strangers to the blood of the applicant, other than dependents, are clearly prohibited. If the death of Cushing, the husband of the beneficiary, qualified her to then become the wife of Stevens, could such change of circumstances revive the policy in her name as his wife? This *Page 147 woman had a living husband whom she discarded for Stevens — at least she says Stevens assumed "first place," and her legitimate husband, Cushing, became a "boarder." She passed as "Mrs. Cushing" and also as "Mrs. Stevens." She collected $2,100 insurance on Cushing's life as his wife in 1931, nine years after the Stevens policy was issued. Stevens helped in a large measure to spend this Cushing insurance money as the common-law husband of plaintiff. He was earning nothing at the time of his sudden death. She had no apparent motive to encourage his living. She was the beneficiary in his will. She apparently thought she was doubly sure of acquiring whatever wealth Stevens possessed at his death.
At the time of negotiating for the policy the applicant, Stevens, in accordance with the established policy of the society, received and receipted for a copy of the constitution of the society, so that he became charged thereby with knowledge of the limitations respecting the persons who might be named as beneficiaries. All this was in addition to the other information furnished him by the agent in such respect. This disposes of one of the chief contentions of plaintiff's brief — that is, that Stevens was not charged with notice of the provisions of the constitution so long as he was not a member of the society when he made the application to join and to become insured. The constitution of the society, sections 3 and 103, very definitely specified the parties who could become beneficiaries, and Marie Cushing was not in that class when the policy was issued. She was, therefore, definitely excluded from the list of qualified beneficiaries under the rules of the society.
The defendant Woodmen of the World was organized under the laws of Colorado. The statutes of that state limit the right of organizations of this character to name as beneficiaries only blood relatives and dependents — similar to the constitution of this society. (Colorado Statutes, Mills Code, sec. 2604.) That limiting statute would govern here. (45 Cyc. 171, R.C.L. 1280; 2 Couch on Insurance, 818; 45 C.J. 176.) In addition, the law of Montana (sec. 6311, Rev. Codes) prohibits the payment to beneficiaries by such societies other than blood relatives *Page 148 or dependents. (Nitsche v. Security Benefit Assn., 78 Mont. 532,539, 255 P. 1052; Styles v. Byrne, 87 Mont. 243, 253,296 P. 577.) These cases hold that payment could be made to a party qualified where the prohibition did not apply at the time the contract was made.
The attempted contract of insurance payable to an unauthorized person was absolutely void for the reasons: First, because it violated the constitution of the insuring society in naming an unqualified person as beneficiary; second, it violated the laws of Colorado; and third, it violated the laws of Montana, either one of which was vital under the undisputed circumstances here. There was here a contract void when attempted, for want of a proper beneficiary. No attempt was made by Stevens to name anyone else as beneficiary. The law might shift the beneficiary, as was done in the case of Styles v. Byrne, supra, but there must first be a valid contract before there can be a substitution. This contract was induced by fraud and contrary to public policy. The contract to favor a concubine, especially under the circumstances established here, would not be approved by this insurance society nor by any court, once the true facts were known. Such fraud could not be successfully waived or obviated by any party whatsoever. Public policy and the statutes forbid.
A contract unlawful when made is void by common law and probably by the statutes of every state in the Union. The Montana statutes are as follows: "Sec. 7498. The object of a contract is the thing which it is agreed, on the part of the party receiving the consideration, to do or not to do." "Sec. 7499. The object of the contract must be lawful when the contract is made, and possible and ascertainable by the time the contract is to be performed." "Sec. 7501. Where a contract has but a single object, and such object is unlawful, whether in whole or in part, or wholly impossible of performance, or so vaguely expressed as to be wholly unascertainable, the entire contract is void." "Sec. 7502. Where a contract has several distinct objects, of which one at least is lawful, and one at least is unlawful, in whole or in part, the contract is void as to the latter and *Page 149 valid as to the rest." (Equity Co-operative Assn. v. EquityCo-op. Milling Co., 63 Mont. 26, 206 P. 349.) "If false or fraudulent representations were held out to the plaintiff as an inducement to the execution of the notes in suit upon which he acted, and in consequence of which it was imposed upon or on account of which the notes were executed and delivered, the obligation becomes a nullity. (Lahood v. Continental Tel.Co., 52 Mont. 313, 157 P. 639.) In the case of Glass v.Basin Bay State Min. Co., 31 Mont. 21, 31, 77 P. 302, this court held a contract to appoint a person a director of a corporation beyond the time fixed in the statute, is unlawful and void and it denied enforcement.
So much controversy and so much importance depend upon the question whether this policy was void or voidable that I now give special consideration to that feature of the case. It is not questioned that if the contract was void, as distinguished from voidable, the policy cannot be enforced. I refer particularly to the definition of these words in 67 C.J., beginning on page 263 under the titles "Void" and "Voidable": "Primarily, the word [void] implies an act utterly of no effect and incapable of ratification, and in its most limited sense, implies an act of no effect at all, and a nullity, ab initio. In one sense, and perhaps in the strictest and most accurate conception of its meaning, `void' involves an idea of utter ineffectiveness in all situations and for all purposes, leaving the effect of the void transaction the same as if it had not taken place. `Void' things are no things in legal effect. Nothing can be founded on what is absolutely `void.' Generally speaking, a `void' act isincurable, and is wholly without force or effect as to allpersons and for all purposes and incapable of being or being madeotherwise. A `void' act is one which is entirely null, not binding on any party, and not susceptible of ratification or confirmation; and its nullity cannot be waived. A thing is `void' which is done against law, at the very time of doing it, andwhere no person is bound by the act. A `void' act usually denotes an inherent defect or vice, usually relates to publictransgressions, and usually refers to a fundamental publicpolicy. Things may *Page 150 be `void' as to some persons and for some purposes, and, as to them, incapable of being otherwise, which are yet valid as to other persons, and effectual for other purposes."
"That is absolutely void which the law or the nature of things forbids to be enforced at all, and that is `relatively void' which the law condemns as a wrong to individuals, and refuses to enforce as against them." The law in this instance forbids; therefore it is void. The case of Metropolitan Life Ins. Co. v.Halcomb, 79 Fed. 788 (decided in 1935) contains this language: "The California supreme court has determined in a series of decisions that no contract can be created by an attempted agreement for the services of a person required to be licensed under California laws for the protection of the person to be served, nor implied from a request for the acceptance of such unlicensed services. There is no distinction between servicesmalum in se and malum prohibitum when an express statute is involved. Such contracts are not voidable but entirely void. This contract was prohibited by statute. `Void' will be construed in the sense that will best effectuate the intent in its use, which will be determined from the whole of the language of the instrument and the manifest purpose it was framed to accomplish." This contract became void when a beneficiary, not qualified, was atttempted to be named as such. (Swanger v. Mayberry, 59 Cal. 91. )
In Ladda v. Hawley, 57 Cal. 51, where the owner of a government homestead before patent sold the timber growing thereon contrary to a federal prohibition, the court held that the contract was void when made and recovery for the timber cut before patent was denied. "In general, it seems that where an enactment has relation only to the benefit of particular persons, `void' will be understood as `voidable' only, at the election of the persons for whose protection the enactment was made, provided they are capable of protecting themselves; but that when `void,' as used in such enactment, relates to persons not capable of protecting themselves, or when it has some object of publicpolicy in view, which requires the strict construction, `void' *Page 151 will receive its natural, full force and effect; that where `void' is used to secure a right to or confer a benefit on thepublic, it will, as a rule, be held to mean null and incapable of confirmation."
"The word `voidable' means capable of being avoided or confirmed; that which has some force or effect, but which may be set aside or annulled for some error or inherent vice or defect. Things are `voidable' which are valid and effectual until they are avoided by some act." This contract was not capable of being avoided when made or for many years thereafter.
"A thing is `void' which is done against law, at the very time of doing it, and where no person is bound by the act." "A contract which contemplates the doing of a thing which is unlawful at the time of making thereof is void." (BaltimoreProcess Co. v. Red Lodge B. Co., 66 Mont. 407, 213 P. 798.)
"Void" as distinguished from "voidable," acts are of no legal effect. Another test of a "void" act or deed is, that every stranger may take advantage of it, but not of a "voidable" one. What is "void" can always be assailed in any proceeding; what is "voidable" can be assailed only in a direct proceeding instituted for that purpose. The distinction, therefore, in regard to the consequences to third persons, is highly important, for nothing can be founded on what is absolutely "void," whereas from those deeds which are "voidable" only, fair titles may flow. Generally, a "void" act is incurable; a "voidable" act may be cured by passivity, ratification or acquiescence. A "void" act usually refers to a fundamental public policy; but a "voidable" one is more often procedural. The former usually relates to a publictransgression, the latter to a private wrong." (67 C.J. 265.)
The statute of Montana (sec. 7499) making an unlawful actvoid when made, fits this case exactly. This policy payable to a stranger was void under section 6311, because founded on public policy — the objection to payment to any persons not having an insurable interest in the life of the person insured. By section 7499 the validity of the contract must be measured as of thetime when made. Marie Cushing was not at such time *Page 152 a qualified beneficiary; therefore, the policy was void — not voidable. Note that this section definitely specifies that the object of the contract must "be lawful when made." This contract was like a stillborn babe — born dead. It was void abinitio. "Where a contract has but a single object, and suchobject is unlawful." (Sec. 7501, supra.)
If the only object of this contract was the insurance, theentire contract was void; but if the further object was the privilege of the society, then section 7502 would apply. No doubt exists that the insurance contract was void at its inception by the laws of Montana when it is sought to be enforced, and also by the laws of Colorado under which the insuring society authorized the policy. In the case of Glass v. Basin Bay State Min.Co., supra, where a corporation sold its property upon a consideration that certain officers of the retiring corporation should continue in office for a period of at least three years — a period beyond that allowed by the statutes, this court said in part: "They characterize these acts of defendant as being in violation of the contract and as wrongful. The following language from the opinion in Williamson v. Chicago, R.I. P.R.R. Co.,53 Iowa, 126, 4 N.W. 870, 36 Am. Rep. 206, is pertinent here: `In this case the plaintiffs have fully performed the contract on their part. On their side the contract has been executed. The action is not brought in disaffirmance of their contract. Upon the contrary, they allege a full performance of the contract upon their part, and a breach of the contract upon the part of the defendant. It is upon this breach that they predicate their right to recover. Their action is upon the contract. * * * We feel fully satisfied that for a breach of the contract, as alleged and proven, no damages are recoverable.' The facts in the case from which we have just quoted were that the plaintiffs procured the conveyance to the defendant of certain lots in the city of Des Moines upon consideration of a promise by defendant that it would build thereon passenger and freight depots, which should be the only ones built or maintained by it in said city. Defendant built and maintained both passenger *Page 153 and freight depots thereon, but, having also built a depot in another part of the city, an action was brought by plaintiffs to recover, as damages, the value of the lots conveyed. It was held that such action was based upon the contract, which was illegal and void as against public policy, and, the parties being in equal fault, the action could not be maintained. From the facts stated in the complaint before us, the parties, in making and carrying out the contract, which seems to have been fully executed by plaintiffs, and performed by defendant for over four years, were equally at fault. Therefore the maxim that `as between those in equal fault, the possessor's case is the better,' applies in all its force. (See Setter v. Alvey,15 Kan. 157; Bagg v. Jerome, 7 Mich. 145; Knowlton v.Congress Empire Spring Co., 57 N.Y. 518; Meyers v.Meinrath, 101 Mass. 366, 3 Am. Rep. 368; Spalding v. Bank,12 Ohio, 544; Tyler v. Smith, 18 B. Mon. (Ky.) 793; Hill v.Freeman, 73 Ala. 200, 29 Am. Rep. 48.) The general rule is thus stated by Lawson in 9 Cyclopedia of Law Procedure, commencing on page 546: `No principle of law is better settled than that a party to an illegal contract cannot come into a court of law and ask to have his illegal objects carried out, nor can he set up a case in which he must necessarily disclose an illegal purpose as the groundwork of his claim. The rule is expressed in the maxim`Ex dolo malo non oritur actio,' and `In pari delicto potiorest conditio defendentis.' The law, in short, will not aid either party to an illegal agreement. It leaves the parties where it finds them. Therefore, neither a court of law nor a court of equity will aid the one in enforcing it, or give damages for a breach of it, or set it aside at the suit of the other, or, when the agreement has been executed in whole or in part by the payment of money or the transfer of other property, lend its aid to recover it back.' It is unnecessary to cite authorities in support of this text."
The contract in this case is controlled in favor of defendant, if not otherwise, by section 7498, supra. The object of this contract was not only contrary to the purposes of the society and contrary to public policy, but positively prohibited by statute and made a misdemeanor therein. *Page 154
Much time was spent in the briefs respecting the paragraph of the policy wherein it is provided that the policy shall become incontestable after one year. In view of our holding that the policy was void ab initio the contestable issue is of no consequence. However, it is well to repeat the statement that fraud is a matter of public policy which the parties cannot waive. The confusion arises from the consideration of cases wherein mistakes arose not chargeable as fraud on the part of the assured, and other instances where the insurance company waived its privilege to contest and did not base its refusal to pay on the ground of fraud, Columbian Circle v. Auslander, 302, Ill. 603, 135 N.E. 53, does not warrant the court of its own motion to inject into the case the question of fraud as a ground for declaring such invalidity. In this case, the fraud of all the parties, except the society, is so glaring and flagrant, that this court, in the face of the objection of the insurance society, could not excuse itself from nullifying the contract and obstructing the parties actively participating in the fraud from profiting thereby through their own wrong.
In Bush v. Modern Woodmen, 182 Iowa, 515, 533,152 N.W. 31, 162 N.W. 59, the court said: "But where, as in this case, anact is prohibited by statute, the contract is illegal and void, and cannot be enforced. The rule as stated by Taylor in his work on Corporations (section 299) is as follows: `If a statute expressly prohibits a corporation to make a certain contract, the contract is void, even though not expressly declared to be so, and is incapable of ratification; and that the contract is void, as unlawful, may be pleaded by anyone to an action founded directly and conclusively on such contract; unless (1) the statutes expressly state what the consequences of violating it shall be, and those consequences are other than the contract, shall be void; or (2) unless the statutory prohibition was evidently imposed for the protection of a certain class of persons, who may alone take advantage of it; or (3) unless to adjudge the contract void and incapable of forming the basis of a right of action would clearly frustrate the evident purposes of the prohibition itself.' (Lucas v. White Line Transfer Co.,
*Page 155 70 Iowa, 541, 30 N.W. 771, 59 Am. Rep. 449; Krause v. Modern Woodmen,133 Iowa, 199, 110 N.W. 452; Modern Woodmen v. Comeaux,79 Kan. 493, 101 P. 1, 17 Ann. Cas. 865, 25 L.R.A. (n.s.) 814.) This was an action on a certificate issued to one who was not eligible, under the law, to become a beneficiary. As to the plea of waiver, the court therein said: `The plaintiff further claims that the clerk of the local camp, to whom assessments were paid, knew the relations between plaintiff and the deceased, and that the receipt by him of the assessments after the change in the name of the beneficiary amounted to a waiver of the fact that plaintiff did not belong to the class of persons who could be made beneficiaries. There are many things that can be waived by an association of this character, but this is not one of them. The statute expressly and positively prohibits the payment of benefit fund to any person who is not within the class designated as beneficiaries. This law cannot be repealed by the conduct of the clerk of a local camp.'"
The fiction of a common-law marriage was invented to protect innocence, such in particular as children of parents careless of the proper demands of society. Extension of this fiction should be carefully guarded. The presumption of a common-law marriage should be assumed only upon well-established proof measured strictly by the principles of equity and justice.
It has been earnestly suggested that the rights of the beneficiary do not accrue until the death of the insured, and that the insurance contract must be measured by the conditions then existing. Much stress has been placed upon the case ofColumbian Circle v. Auslander, 302 Ill. 603, 135 N.E. 53. That case held that where a married man presumed to marry a woman, his wife's sister in fact, and took out a policy in her favor on the life of his wife, the legal wife dying first, the assured thereafter married the woman with whom he had been living and had the policy issued in her favor. The second wife attempted to collect on the policy and the child of the first wife intervened. The insurance company placed the money in the hands of the court and left the controversy between the widow and the heir. The *Page 156 case is distinguishable from this case in that here the insurance company is denying the validity of the policy. In the cited case there was no controversy over such validity. The court there said: "Whether or not such certificate might have been void as a fraud upon the society does not arise here as it has paid the fund into court and has waived any question of fraud against it," citing Woodmen of the World v. Rutledge, 133 Cal. 640,65 P. 1105; Cowin v. Hurst, 124 Mich. 545, 83 N.W. 274, 83 Am. St. Rep. 344; Tepper v. Royal Arcanum, 61 N.J. Eq. 638,47 A. 460, 88 Am. St. Rep. 449. Further difference arises as appears from the following quotation from the same case: "Section 257 of the by-laws of the society provides that if at the time of the death of a member who has designated as beneficiary a person of the second class and the dependency required shall have ceased, or if any designation of beneficiary shall fail for illegality or otherwise, then the benefit shall be payable to the person or persons mentioned in class 1." The case cited therein — the decision of an inferior court — seems to be squarely in point, but is all included in one short paragraph, and the conditions are not clearly and fully stated; therefore too much weight should not attach to it. True the rights of the beneficiary in a valid policy are not fixed and determined until the death of the insured, but they are, when finally considered, measured by the conditions existing when the contract was made. The provisions of the contract are merely dormant and subject to alteration during the lifetime of the insured if the contract is lawful when made.
If the policy was legal when made, it might become illegal under changed conditions, but if unlawful when made it cannot spring into life upon the happening of conditions that annul the prohibitions against it when made. Section 7499, supra, settles that proposition. It says the contract must be lawful whenmade. The contract is not made at the death of the insured. (See, also, Baltimore Process Co. v. Red Lodge Co., 66 Mont. 407,213 P. 798.)
But there is a further reason why this judgment should be reversed. Stevens could not lawfully name the plaintiff as beneficiary *Page 157 when the policy was issued. Her counsel does not claim he could. The law does not declare the widow a beneficiary except under certain circumstances. The provisions of the constitution of the society of 1928 pertaining to this subject are contained in section 103: "A benefit certificate can only be made expressly payable to, and the payment of all death benefits shall be confined to, some person or persons named, who can sustain to the holder the relationship of either wife, child," etc. In case an applicant for membership so desires, he may direct that the benefit in his certificates be made payable to the beneficiaries designated in the constitution of the Association, and his benefit certificate shall so provide, or in case a beneficiary expressly named in a benefit certificate does not survive theholder thereof and the Neighbor has failed to designate asuccessor thereof, as provided in sec. 103, then in such cases the amount which would have gone to such named beneficiary, if surviving, shall be disbursed in like manner, which shall be in the following order: first if the deceased Neighbor leaves a widow and no child or grandchild, to his widow; * * *."
It will be observed that the law names the widow only in cases where the beneficiary "does not survive the holder thereof." Such condition is not present in this case, as the named beneficiary survived the holder of the certificate. She must take under the policy as the Marie Cushing, the cousin, if at all — not as thewidow of Stevens. We cannot eliminate the provision in the constitution that the named beneficiary be dead before the alternative provision designating the widow becomes effective.
Stevens lived a year after plaintiff became his common-law wife. He could then have had her named as his lawful beneficiary, if in fact he was her husband, but he did not notify the society that he had joined the lodge by a false representation and that he wanted to now insert "wife" for "first cousin." Having neglected to avail himself of the privilege granted by the policy, shall the court assume the duty of naming the beneficiary? No privilege or duty of that character appears in the policy or in the law. Shall we go beyond our jurisdiction to *Page 158 protect this confessed harlot? (West v. Grand Lodge,14 Tex. Civ. App. 471, 37 S.W. 966.) "The courts never lend themselves to the enforcement of contracts which are in violation of law and repugnant to public policy." The policy, par. 4, sec. 102, provides: "If any of the statements or declarations in the application for membership on the faith of which a certificate is issued shall be found, in any respect, untrue, then in said case such certificate shall be null and void, and of no effect, and all money which may have been paid, and rights and benefits which otherwise might have accrued on account of such certificate, shall be absolutely forfeited." Two other paragraphs of the constitution are to the same effect. Can we disregard these definite statements of the contract?
I have recited the facts as they appeared in the record and considered the law thereon without reference to the issues presented by the pleadings. I reverse the usual order and now consider the case from that standpoint. The complaint recites the issuance of the policy, the representation by Stevens that this plaintiff, Marie Cushing was his first cousin, and that the representation and allegation vital to the cause of action were false. The defendant filed a general demurrer, which was overruled. The complaint was insufficient by showing on its face that there was no lawful beneficiary named by the insured when the policy was issued, and therefore the contract was void on its face when read in connection with the admissions of the complaint. See section 6311, supra, limiting the persons who could be named beneficiaries, and section 7499: "The object of the contract must be lawful when the contract is made." (Corey v. Sunburst Oil Gas Co., 72 Mont. 383, 390,233 P. 909.) The demurrer should have been sustained, and the district court should be directed to dismiss the action.
Appellant having filed petition for rehearing, the matter was, on July 9, 1937, set for argument on September 23, 1937, at which time the questions presented were reargued by counsel for both parties. Rehearing denied October 11, 1937. MR. CHIEF JUSTICE SANDS and MR. JUSTICE STEWART dissenting. *Page 159