This is an action at law brought in the Court of Common Pleas of Baltimore City by the appellant, the widow of Philip Weigand, of Baltimore City, against the appellee, a corporation conducting a fraternal beneficial insurance business for the benfit of its members.
It appears that the appellee on the 26th day of January, 1900, issued a certificate of membership to Philip Weigand *Page 455 payable to the appellant as beneficiary, for a sum not exceedins three thousand dollars, in accordance with and under the provisions of the laws governing the order.
Philip Weigand died on the 9th of June. 1900, and subsequently the appellant, the beneficiary, filed her claim for benefits with the order, which was approved by the Grand Executive Committee for the sum of one hundred and fifty dollars.
The appellant declined to accept the amount as thus allowed, and on the 5th of December, 1901, instituted this suit to recover the sum of $3,000, the amount of the insurance stated in the policy.
To the declaration, the defendant pleaded, first, never indebted as alleged; second, never promised as alleged, and third, a special plea. The first and second pleas were withdrawn and a demurrer was interposed to the third, and as this plea contains the defense relied upon by the company and presents the material question in the case it will be set out here. The plea is in effect, as stated by the appellee in his brief, as follows:
1st. The appellee is a social and beneficial order having a lodge system and conducting itself for the sole benefit of its members with no attempt at profit making. Its funds are raised by mutual and voluntary assessments and contributions.
2nd. The contract between the appellant's husband and the appellee is embodied in his application for membership, the certificate of membership and the laws of the defendant order, the latter of which are declared to be binding upon the applicant and his beneficiary.
3rd. Under said laws the Grand Executive Committee of the order was required to pass upon and decide whether payment should be made of the claim of the appellant.
4th. That under section 32 of the laws of the appellee any beneficiary who considers the decision of said Grand Executive Committee against him in respect to a claim for benefits is unjust and not in accordance with the order, is required to appeal in the following manner, that is "from the decision of the Grand Executive Committee to the Grand Council within sixty days after the decision is rendered." *Page 456
5th. The appellee made application for the payment to her of benefits in the amount of three thousand dollars ($3,000). The Grand Executive Committee, acting upon the application, came to a decision (upon the evidence offered to prove that the deceased died by such accidental means as was within the intent and meaning of the laws of the order) that, under the laws of the order, the appellant was entitled to one hundred and fifty dollars ($150) and no more.
6th. The decision of the Grand Executive Committee was immediately made known to the appellant, and she was further notified that if she was not satisfied with the decision she should appeal as prescribed in section 32 of the laws of the order. The appellee refused to appeal, which, in effect, was a refusal to exhaust her remedies before the tribunals of the defendant order."
The demurrer to this plea was overruled and judgment being entered for the plaintiff for the amount awarded, the plaintiff has appealed.
The legal question raised on the demurrer and the one submitted for our decision, is whether a beneficiary in a certificate of fraternal insurance to whom the policy is payable, is precluded from bringing a suit in a Court of law to recover her claim by reason of the existence of the laws of the order, which require any beneficiary who considers the decision of the Grand Executive Committee as unjust and not in accordance with the laws of the order, to appeal from the decision of the Grand Executive Committee to the Grand Council within sixty days after the decision is rendered.
Now whatever may be the decisions of the Courts elsewhere, and it may be conceded they are not in accord, the question here raised, has been settled in this State by the decisions of this Court, in Anacosta Tribe v. Murback, 13 Md. 94, and OseolaTribe v. Schmidt, 57 Md. 98. These cases were relied upon and adopted in the recent case of Triesler v. Wilson, 89 Md. 177, and it is there said that in private beneficial institutions, operating on the members only, they may, for reasons of policy and convenience affecting their welfare and *Page 457 perhaps their existence, adopt laws for their government to be administered by themselves, to which every person who joins them assents, and which require the surrender of no right that a man may not waive. And that a by-law, in the absence of fraud, would be held conclusive on the member.
In the case at bar, it will be seen, that "the laws of the order as then in force, and to be hereafter enacted by the Grand Council" were specifically made a part of the contract of assurance and the fund was payable in accordance with and under the laws of the order as stated in the certificate of membership. The law of this association provided an appeal by the beneficiary from the decision of the Grand Executive Committee to the Grand Council within sixty days after the decision was rendered against her, and the rule being a valid and reasonable one, the appellant was clearly bound by it.
But it is urged upon the part of the appellant that the rules and regulations of beneficial and voluntary associations regulating appeals to its tribunals are only valid in so far as they relate to questions of doctrine and the internal management of the order, and have no reference to property rights. We do not so construe the cases upon this subject. In Vandyke's case, 2 Whart. 312, the Supreme Court of Pennsylvania held that where a beneficial society decided under its by-laws that a member was not entitled to benefits, the decision was conclusive upon him. This case was cited with approval by this Court in OsceolaTribe v. Schmidt, 57 Md. 98.
Applying the principle settled by these cases to the one now before us, there seems to be no valid reason why the rule should not apply to a beneficiary as well as to the member insured. The contract of membership is made with reference to the by-laws and regulations of the association and these are treated as part of the contract. Section 32 of the laws of the order provides that it shall apply to any member, beneficiary, or other claimant, and as these by-laws constitute a part of the contract between the company and the insured, and as the benefit fund is made payable to the beneficiary, "in accordance *Page 458 with and under the provisions of the laws governing the order," the appellant must be held subject to them.
Finding no error in the rulings of the Court, the judgment will be affirmed.
Judgment affirmed with costs.
(Decided June 30th, 1903.)