Opinion by
Judge O’Rear
Affirming.
The nature of this case is fully shown by the opinion delivered on the former appeal. (117 Ky., 418, 78 S. W., 201, 25 Ky. Law Rep., 1510.) The question there decided was as to the effect of a by-law adopted by appellant, a fraternal benevolent society, upon a benefit certificate, a form of life insurance, issued to one of its members, Gustave Hunziker, December 27, 1888. In the original certificate there was no provision concerning self-inflicted, death. The by-law adopted September, 1896, provided that if death of a member of the fourth class (to which Gustave Hunziker belonged), whether admitted before or after that date, was the result of suicide, whether such member was sane or insane, the supreme lodge would pay only a certain part of the sum written in the certificate. The original application made in 1888 contained a provision by which the applicant agreed to be controlled by all the rules and regulations of the order governing that rank then in force or that might thereafter be enacted. The court held that as section [36]*36679, Ky. Stats. 1903, enacted in 1893, was in force when the by-law was adopted, the latter being in addition to the terms of the contract made after the enactment of the statute, was subject to the terms of the statute, which provided that by-laws of such societies were not to be deemed part of certificates of insurance unless such by-laws were printed upon or attached to the certificate. The point is made here that the enforcement of' the statute as to contracts then in existence was- not contemplated by the statute, and, besides, would be an impairment of the obligation of the contract, a repugnance to the Constitution of the United States. The same point seems to have been urged on the former appeal, which was disposed of by the court upon the conclusion that the statute applied as affecting only the remédy, and would not, therefore, be within the vice contemplated by the section of the Federal Constitution invoked. It was further remarked: “Counsel for appellee (appellant now) contends that the statute, because of the words ‘all policies hereafter issued,’ etc., has no application to a policy (certificate) that, like the one on the life of Gustave Hunziker, was issued before its enactment. ' That question is not now before us for adjudication.”
From the foregoing quotation appellant now argues that the question presented on this appeal was expressly reserved and not decided. But counsel are mistaken in this construction of that portion of the opinion which is set out above. The court was then speaking alone of those cases where the by-laws had been passed, as well as where the certificate had been issued, before the enactment of the statute. This is made clear by the next sentence following the quoted language, which is: “We have only decided that the statute does apply to the by-laws relied on by appel[37]*37lee, as it was adopted after the enactment of the statute, and its purpose and effect was to materially alter the original contract of insurance, for which reason it was required by the provision of .the statute to be attached to the original contract or certificate.” The former opinion is, therefore, the law of this case, though we should have felt ourselves unable to longer adhere to the principle in its application to other cases. But as the original opinion was selected by the court for official publication as declaratory of the law for all similar cases, and as it is so earnestly urged that the effect of the statute, if applied to preexisting contracts, is to impair their validity, we have re-examined the question.
It is true that the statute itself excludes prior contracts from its operation. This meant completed contracts. There could have been no other purpose on the part of the Legislature to exclude prior contracts of insurance than to respect their obligation as it then was. The mischief aimed at by the statute was to prevent fraud and oppression being practiced upon insured persons. For, although the insurer might be a co-operative concern, it was recognized that its governing body, whether representative or not, might overreach his understanding, and unjustly impose on him by secret regulations or bylaws, made part of the contract by reference only. This pernicious practice had obtained to some extent. The idea was to curb it, to make it impossible in future. The provision in the old policy that it should be subject to by-laws then in force, or that might thereafter be adopted, left the contract open for amendment in the future. How it was to be amended, further than it was to a “rule or regulation” of the society, was not stated. Now the State, after that kind of open contract was made, has, [38]*38by the statute alluded to, required in effect and! intent, that all future engagements of insurance of this class should conform to a prescribed procedure, or else they should be void. It did not affect any previous contract, in so far as its obligation had been fixed. But we see no reason why the statute should not apply to alterations or changes of such contracts. Such alterations are in a sense new contracts, although it had been previously provided that they might be entered into. The new matter was never before an obligation. When it came to be attached to the original contract as an obligation of the parties, a police regulation of the State required certain prerequisite formalities before it became their act. This did not impair the obligation of the old contract, but dealt alone with the attempt to alter that contract.
The new matter could not have been added at all, as was done, except for the provision of the old certificate that let it in. That provision gave the right to the insurer to alter the terms or conditions of the original agreement of the parties, at any time in the future, by the adoption of a new rule or regulation of the co-operative society affecting it. Now, if the statute took away that right, then it would seem to impair that obligation. But it did not. The right to alter or amend by-laws and rules, or to adopt new ones, is. untouched by the statute. Hence it can not be said that it was impaired. The new law, leaving the old contract precisely as it was found, laid hold of the parties, and said, in effect, “When you make alterations of this contract, as you may do by the adoption of by-laws or rules, the sovereign power of this State, in the exercise of its duty to prevent oppression and fraud in insurance effected in this State, requires that [39]*39a copy of such, by-law shall be indorsed on or attached to the certificate or policy of insurance. ’ ’
It is pointed out in argument that as there is no provision in the statute for serving upon a policy holder a copy of the after-enacted by-law, and as he might refuse to surrender his policy or certificate that such a copy might be attached or indorsed upon it, or such policy holder might be abroad and inaccessible to either notice or contact, it could not have been contemplated that after the delivery of such policy or certificate the statute would apply. Hence it is reasoned the statute has not covered the case of policies issued before its enactment and made sub-, ject to by-laws adopted afterwards. The statute makes no provision, it is true, for serving a copy of such amended or new by-law upon a policy holder to whom a policy had been delivered. But this omission applies as well to new as to old policies, to those issued after as well as to those issued before the statute was passed.
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Opinion by
Judge O’Rear
Affirming.
The nature of this case is fully shown by the opinion delivered on the former appeal. (117 Ky., 418, 78 S. W., 201, 25 Ky. Law Rep., 1510.) The question there decided was as to the effect of a by-law adopted by appellant, a fraternal benevolent society, upon a benefit certificate, a form of life insurance, issued to one of its members, Gustave Hunziker, December 27, 1888. In the original certificate there was no provision concerning self-inflicted, death. The by-law adopted September, 1896, provided that if death of a member of the fourth class (to which Gustave Hunziker belonged), whether admitted before or after that date, was the result of suicide, whether such member was sane or insane, the supreme lodge would pay only a certain part of the sum written in the certificate. The original application made in 1888 contained a provision by which the applicant agreed to be controlled by all the rules and regulations of the order governing that rank then in force or that might thereafter be enacted. The court held that as section [36]*36679, Ky. Stats. 1903, enacted in 1893, was in force when the by-law was adopted, the latter being in addition to the terms of the contract made after the enactment of the statute, was subject to the terms of the statute, which provided that by-laws of such societies were not to be deemed part of certificates of insurance unless such by-laws were printed upon or attached to the certificate. The point is made here that the enforcement of' the statute as to contracts then in existence was- not contemplated by the statute, and, besides, would be an impairment of the obligation of the contract, a repugnance to the Constitution of the United States. The same point seems to have been urged on the former appeal, which was disposed of by the court upon the conclusion that the statute applied as affecting only the remédy, and would not, therefore, be within the vice contemplated by the section of the Federal Constitution invoked. It was further remarked: “Counsel for appellee (appellant now) contends that the statute, because of the words ‘all policies hereafter issued,’ etc., has no application to a policy (certificate) that, like the one on the life of Gustave Hunziker, was issued before its enactment. ' That question is not now before us for adjudication.”
From the foregoing quotation appellant now argues that the question presented on this appeal was expressly reserved and not decided. But counsel are mistaken in this construction of that portion of the opinion which is set out above. The court was then speaking alone of those cases where the by-laws had been passed, as well as where the certificate had been issued, before the enactment of the statute. This is made clear by the next sentence following the quoted language, which is: “We have only decided that the statute does apply to the by-laws relied on by appel[37]*37lee, as it was adopted after the enactment of the statute, and its purpose and effect was to materially alter the original contract of insurance, for which reason it was required by the provision of .the statute to be attached to the original contract or certificate.” The former opinion is, therefore, the law of this case, though we should have felt ourselves unable to longer adhere to the principle in its application to other cases. But as the original opinion was selected by the court for official publication as declaratory of the law for all similar cases, and as it is so earnestly urged that the effect of the statute, if applied to preexisting contracts, is to impair their validity, we have re-examined the question.
It is true that the statute itself excludes prior contracts from its operation. This meant completed contracts. There could have been no other purpose on the part of the Legislature to exclude prior contracts of insurance than to respect their obligation as it then was. The mischief aimed at by the statute was to prevent fraud and oppression being practiced upon insured persons. For, although the insurer might be a co-operative concern, it was recognized that its governing body, whether representative or not, might overreach his understanding, and unjustly impose on him by secret regulations or bylaws, made part of the contract by reference only. This pernicious practice had obtained to some extent. The idea was to curb it, to make it impossible in future. The provision in the old policy that it should be subject to by-laws then in force, or that might thereafter be adopted, left the contract open for amendment in the future. How it was to be amended, further than it was to a “rule or regulation” of the society, was not stated. Now the State, after that kind of open contract was made, has, [38]*38by the statute alluded to, required in effect and! intent, that all future engagements of insurance of this class should conform to a prescribed procedure, or else they should be void. It did not affect any previous contract, in so far as its obligation had been fixed. But we see no reason why the statute should not apply to alterations or changes of such contracts. Such alterations are in a sense new contracts, although it had been previously provided that they might be entered into. The new matter was never before an obligation. When it came to be attached to the original contract as an obligation of the parties, a police regulation of the State required certain prerequisite formalities before it became their act. This did not impair the obligation of the old contract, but dealt alone with the attempt to alter that contract.
The new matter could not have been added at all, as was done, except for the provision of the old certificate that let it in. That provision gave the right to the insurer to alter the terms or conditions of the original agreement of the parties, at any time in the future, by the adoption of a new rule or regulation of the co-operative society affecting it. Now, if the statute took away that right, then it would seem to impair that obligation. But it did not. The right to alter or amend by-laws and rules, or to adopt new ones, is. untouched by the statute. Hence it can not be said that it was impaired. The new law, leaving the old contract precisely as it was found, laid hold of the parties, and said, in effect, “When you make alterations of this contract, as you may do by the adoption of by-laws or rules, the sovereign power of this State, in the exercise of its duty to prevent oppression and fraud in insurance effected in this State, requires that [39]*39a copy of such, by-law shall be indorsed on or attached to the certificate or policy of insurance. ’ ’
It is pointed out in argument that as there is no provision in the statute for serving upon a policy holder a copy of the after-enacted by-law, and as he might refuse to surrender his policy or certificate that such a copy might be attached or indorsed upon it, or such policy holder might be abroad and inaccessible to either notice or contact, it could not have been contemplated that after the delivery of such policy or certificate the statute would apply. Hence it is reasoned the statute has not covered the case of policies issued before its enactment and made sub-, ject to by-laws adopted afterwards. The statute makes no provision, it is true, for serving a copy of such amended or new by-law upon a policy holder to whom a policy had been delivered. But this omission applies as well to new as to old policies, to those issued after as well as to those issued before the statute was passed. Either one of two courses must be deemed to have been contemplated by the Legislature in that event: Either that such new by-laws could not be adopted, or that a service of a copy by offering to deliver and attach it to the policy would suffice. As the former would tend to cripple the power of such societies to impose their conditions by prudent amendments to their by-laws, as well as beget a variety of liabilities in the same class of contracts and among its members having equal rights in its assets and equally liable to its assessments, it must be rejected, because it would be at war with the whole scheme of mutual co-operative life insurance, which is recognized by the statutes as a legitimate business. On the other hand, as the view just discussed is rejected, it must be that a.n offer to- do what one is bound to do, if tendered in season, and the offer is [40]*40maintained, will always be accepted as a compliance with that part of the obligation. It will not do, though, to make the tender years after it should have been done, and, as in this case, after the liability of the insurer had been completed under the original contract.
A pleading filed upon the return of the case, in addition to the matter just discussed, pleaded that the contract was an Illinois contract, made and to be performed in that State, and that the statute of this State could have no extraterritorial force there. The statute applies to persons insured in this State by companies doing business in this State. Appellant does not deny that it is, and then was, doing business in this State. It had no right to come into the State to do an insurance business, nor to stay here, except upon such terms as this State might impose. Appellant can not apply its business here as an insurance society without making its contract of insurance with citizens of this State, to be effective in this State, wherever entered into, subject to the statute of Kentucky regulating the form and enforcement' of such contracts, when they come to be enforced in the counts of this State.
Another matter pleaded is that the appellant is a “Federal corporation,” having been organized in the District of Columbia under an act of Congress. Just what effect that plea was intended to have in the case is not made clear. There was no motion to transfer the case to the United States Circuit Court. But, whether created under an act of Congress or of any State, appellant’s presence in Kentucky as an insurance corporation is subject alone to the will of Kentucky, and its contracts are to be construed and enforced by the courts of Kentucky, when it is sued in [41]*41our courts, according to their understanding of the law and merits of the case, whatever be its domicile.
We conclude that the demurrer to the rejoinder of appellant was properly sustained.
Judgment affirmed.