Heisinger v. Modern Brotherhood of America

179 N.W. 161, 192 Iowa 46
CourtSupreme Court of Iowa
DecidedOctober 2, 1920
StatusPublished
Cited by4 cases

This text of 179 N.W. 161 (Heisinger v. Modern Brotherhood of America) is published on Counsel Stack Legal Research, covering Supreme Court of Iowa primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Heisinger v. Modern Brotherhood of America, 179 N.W. 161, 192 Iowa 46 (iowa 1920).

Opinion

Preston, J.

The case is not before us on the merits, and the ultimate question whether, under the applications, the policies, and the by-laws, the rates could be raised, is not yet before us, unless, as we understand appellants to contend, this question may and should be now determined, as a matter of law. Appellees contend, on the other hand, that there are questions in the case as now presented which may not be so determined; that they are entitled to a hearing on the merits; and that the temporary injunction should be continued until final hearing. The issues as now presented, and as stated by counsel, are whether appellees were, in the first instance, entitled to the issuance of a temporary injunction; and second, whether, upon the face of the petition, answer, and affidavit on behalf of plaintiffs, the appellees are entitled to a continuance of the temporary injunction. The grounds of the motion to dissolve .were:

“First. Because said injunction was improperly and improvidently issued.

“Second. Because, upon the face of the petition and answer herein, plaintiffs are not entitled to injunctive relief.

“Third. Because, upon the pleadings filed herein, said temporary injunction is contrary to law.

“Fourth. Because the issues raised by the pleadings herein have all been adjudicated, and such former adjudication is a bar to the granting of injunctive relief here.”

The pertinent facts, stated as briefly as may be, under the very voluminous record, are, substantially, that the Modem Brotherhood of America is a fraternal beneficiary association, incorporated under Title IX, Chapter 9, of the Code of 1897. It has a ritualistic form of work. Its laws are made and its affairs 'controlled by its supreme lodge conventions. Appellee Sweeney became a member in 1898, Sandvig, in 1900, and Heis-inger and Detrick, in 1903. Their contracts of insurance contain an agreement 'that they will be bound, not only by the by-laws which were in force at the date of their application for membership, but by those which may be thereafter lawfully enacted. Their applications are a part of the certificates. Appellants allege that, prior to 1911, the society found that the rates of assessment were inadequate to enable it to meet its [49]*49obligation and mature its benefit certificates by their payment at the death of its members, and that the supreme convention, in August, 1911, by amendments to its by-laws, adopted a table of monthly rates of assessment, based upon the National Fraternal Congress Table of Mortality. The rates so adopted were higher than the former rates. Those who were then members, including hpp ellees, were given four options, whereby they could transfer and pay said increased rates. Appellee Heisinger’s certificate was for $1,000, and the assessment was 50 cents per month. It is alleged by appellees that he has paid all lawful assessments at all times, and without default, except the reserve deficiency special assessment of March, 1918, sent by the society to him, in the sum of $424.42. It is further alleged that certificates of other appellees, and approximately 10,000 others similarly situated, contain practically the same terms and conditions, except the name, amount, and rate; that appellants are wrongfully and illegally attempting to enforce the payment of said assessments, or create special liens against the certificates, in violation of the terms and conditions of the certificates, and thereby to deprive said members of their rights under their certificates; that said members have never consented to any change in the assessments, as shown by their certificates, nor to the attempted making of the reserve deficiency special assessments by the society; but that they have at all times objected to any change, either in the terms or rates; that appellants are attempting to impair the contracts of insurance of such members; that for appellants to carry out the terms of the reserve deficiency assessment would wrongfully confiscate the rights of appellees in and to the funds and promised benefits to the society, and at a great loss to them in having their certificates declared void, and would work irretrievable injury to such members; that they have no adequate remedy at law for such injuries, and for the threatened expulsion of such members. It is alleged further that the estimated increase in the rate is 350 to 400 per cent over the rates named in their certificates; that the society held its conventions in which the rates were raised, in Colorado, in 1911, and in Missouri in 1915, without the state of Iowa, and contrary to its articles of incorporation and the laws of Iowa; that no necessity existed to increase the [50]*50established rates; that, at the conventions of 1911 and 1915, the society authorized, unlawfully and illegally, the issuance of term policies, paid-up insurance, and extended insurance, contrary to and in violation of the laws of Iowa, and thereby g’ave preference to certain members, and created different options, in violation of the contract rights of appellees and other members similarly situated; that the appellant and its officers, sinée 1910, have recklessly and in an unbusinesslike manner, illegally and extravagantly, expended the funds of the society in their attempt to enforce the Table of Mortality against its members, and particularly against appellees and others similarly situated; that said table of rates is prohibitive, and has caused 100,000 members to drop out. It is further alleged by appellees, and admitted by appellants, that the defendant society was not insolvent.

In December, 1912, one Brown and another member of appellant society instituted an action in Clinton County, Iowa, against the defendant society and its officers, to enjoin the enforcement of said rates; and the decree entered therein in June, 1913, was favorable to the defendants. Appellees contend that this decree was collusive, fraudulent, and void, for that an attorney’s fee of $1,000 was paid plaintiffs’ attorney in that case, out of the trust fund of the society, and that no exceptions were taken to said decree, and that it was agreed, prior to the entry of said decree, that no exceptions should be taken, and that no appeal should be taken. But since appellants do not rely upon that decree as an adjudication, we shall not go into further detail as to it. At the convention of the supreme lodge, in August, 1915, the by-laws were again amended, extending to the members who had failed to transfer under the by-laws of 1911, three additional options. In December, 1914, one Bills and others brought an action at law in the district court of Linn County, against the defendant society and its officers. Thereafter, and on December 30, 1915, after the convention and proceedings of August, 1915, an amendment to the petition was filed, defendants filed answer thereto, and the cause was transferred to the equity calendar. The decree entered therein, dismissing the petition, is pleaded and relied upon by defendants as an adjudication of the questions involved in this case. It is alleged that the same ques[51]*51tions as now presented by these plaintiffs, in regard to the impairment of the contracts, the'legality of the rates, and so on, were adjudicated. The decree in that case, filed on the same date, to wit, December 30th, finds that the conventions were legally held; that, because of the inadequacy of the old rates, there is a large deficiency, and it was necessary for the society to amend the by-laws; that the rates are not exorbitant or excessive, but are reasonable and necessary; that the amendments to the by-laws do not impair the contracts.

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Bluebook (online)
179 N.W. 161, 192 Iowa 46, Counsel Stack Legal Research, https://law.counselstack.com/opinion/heisinger-v-modern-brotherhood-of-america-iowa-1920.