OFFICE OF THE ATTORNEY GENERAL OF TEXAS
AUSTIN
PosrU of fnsaranor l7ommlas~onerr
Auetln, Texas -.’ ~’
Gentlemen:
‘Phle depe&ment hae
Rn opinion.
Ye set out be10
‘There has been
ment by a dome
organized an
Bona, Kother, Father,
others, Orandfathrr8,
date oi enoh death, ~111 purohao@ at the attain-
ed age; minreet birthday, of suoh decea8bd atwur-
ed at the date of death aocordlng to a table of
premiums double the amount the netannual renew-
able term premluma baaed upon the Amerloan.Ex-~
perlenoe Table of Mortality end Crzigr Exten-
tion thereof for agse under ten years uith ln-
Ecard of Inruranoe Commierionera, Page 2
terest at three ,and one-hair per ocntum per
annum.* ., )
*The polioy alao provides amtonmtio oover- I
age as followe: *The lnauranoe benerite herein
provided ahall extend automatfoall~ to additlon-
32 assureda oomplylng with the terms of this
polloy after ltelffeotite date without the neo-
eesity of notloe to the Soalety. No death ahall
terminate the poltoy unless It be the laet re-
maining aoewed.’
*The law under whIoh thIe Sooiety operates
requires that the aooiety alla11 operate on a
lodge 6ystea-with a representative form or gov-
ernment, as is presorlbed fn Artioles 4320,
4921, and 4822.
“It is to be noted that lneuranoe protao-
tlon la granted undrr the polloy to a named
nesured and varloue members of hi6 family, but
only tie named aesured ie known to th6 Socletp,
unlecss or untll a death in the family occurs.
No other insured member8are known to the Society,
and any addltlons to the lnoupprd group are unknown
to the Soolety at the time euoh addttione become
effeotlve.
@Ybur opinion ie reaprotfully requested as
to whether or not It Is within the powers of R
fraternal bonefIt sooiety organlted under the
laws of thle Hate to 18aU8 suoh a policy, and
aleo whether or not in your..opInlon it irr poa-
slble for a fraternal benefit 8OOiety to grant
Insurance poveregs to an indIvldua1 who is not
a member of t5e soolety ineofar a8 belonging
to a particular lodgs or having a voioe in the
government of the soalety.P
Article 4020, Vernon’s Annotated Clvll Ststutes,
definer a rrsternal~benefit society aa iollowa:
*Any oorporat ton, society, order or volun-
tary aseoolatlon, without oapIta1 etook, organ-
Ized and carried on solely for the mutual benefit
Board of Insuranoe ComrnIee5onare, Page J
of It6 members and ~,theIr benefIaIar56e, and
not for profit, an+ having a lodge eystem and
repreaentatlve form of government, or whloh
limits its membership to a eeoret fraternity
having a lodge system snd representative form
of government, and mhIoh rhall make provlrlon
for the payment of bensilts In aooordance with
Ceotlon 4 hereof, Is hereby.deolareU to be a
Fraternal 36nefIt ?oolety.*
Article 4821, Vernon’s Annotated Clvll Statutes,
deflnee the term *lodge 6yetem*:
“Any society having B supreme governing
or legIelatIv6 body and subardlnsti lodger or
branches by whatever nane known Into which mem-
bers shall be admltted in aocordanoe with Its
constltutlon, laws, rltuel, rules and regula-
tlone, and whloh shall be required by the law8
of such society to hold periodical meetlngr,
shall be deemed to be operating on the lodge
6y6te5l.”
Article 4822, Vernon’s Annotated CIv51 Statutes,
orovldee :
“Any eoolety shall be deemad to have a rep-
reeeatatlve rorm of government when It shall
provide In 5ta constitution and law6 for a au-..
preae legislative or gov6rnIng body, oompoeed
of representatlvee 816oted either by the mem-
here or by delegates eleoted d5r6etly or In&I-
reatly by the m+mbers, together with such other
members ae may be preaorlbed by Ite constitution
and laws ; provided, that the eleotlve members
shall oonetitute a maJorlty In numbar and not
lees than the number of votes required to amend
Its oonstltutlon and laws; end provided, further,
that the meetlnqa of the supreme or governing
body, and tha eleotlon of officers, representa-
tives or delegates shsll be held ae often es
onoe In foun calendar years. No mbmber under
age elxteen shall have voice or vote In the
management of the eoolety. No members, off Ioerl,
representative or delegate ehnll vote by proxy.
ijonrd of Ineuranoe Commissioners, Page 4
Artlole 4831, Vernon’s Annotated Cl011 Statutes,
In part, reads as follows:
‘Any person may be admitted to beneflolal,
or general, or sooial membership ln any soolety
in such manner and upon s;roh showing of ellgl-
blllty as the laws of the snoiety may provide,
and any beneficial member may dlreot any bene-
fit to be paid to auoh 2ereon or persons, entity,
or ~Sntereet as may be permitted by the lava of
tne sooiety; Y * ey
As the name tmpllea, the plan or aoheme which a
frdernsl benefit eocitty operates upon la one where *the
a?tibere mutually oontribute to the payment of loeset and
ernenses, and in whioh the indemnity or benefit to aocrue
1~ conditioned in sny mrnner upon persons holding similar
contract8 * * **. See: ,l Couch, Cyo of Ins. Scot. 250.
It is seen that a&the rarlolls Rctlvltiea of a
benevolent soolety Is between the corporate body and the
lnaividual unite composing it; t&wit, its members.
Are the specified *members of said named assured’s
fzml1.y” members of the eoolety within the statutory meaning
of that word? We think not.
The term *member* as used by the Legislature ap-
parently means a real membership or an actue.1 afflliatlon
with the organization and not an ind%redt’ relationship ao-
qulred through mere genealogloal oonneotion with an actual
member who hna been fo rmally chosen as a cop>orate unit
of tbe 8oolety. A memberehlp in the eoolety Implies, not
only the enjoyment of it8 prlvlleges, but aotual subJeotlon
to the governting rules.
A fraternal benefit sooiety can issue no certifi-
cute of membershig -other than those expres8lg provided for
in its oharter, oonstitution, and by-laws. Any attempt to
extend or grant benefits beyond ttiese~estsbliehed bounds
Is ultra vlree the society and thurc rendered void. 1 Couoh,
cyo. of Ins., Jeot. 256, Wlrtz v. 3overelRn Q%mp, X.0.x.,
114 Tex. 471, 263 S. k’., 436, end cases oited therein.
Here, we conclude. The epeclfled 'members of the
named assurea’s family’ are not members of the society. The
?oard of Ineuranoe ~OIIUSls5iOnerS, Page S
certifloatt seeks to extend benefits beyond the legal soopa
thereby maklng~sald oertlfioates UltFA vlres the 8OoiOty.
We trust this answers your inquiry.
Very truly yours
ATTQDANEY
GERERAL
OF TEXAS
APPROVEDm 27, 1941
ATTORNEY Gl3NERP.L
OF TEXAS