In the most recent case decided in this country sustaining the right of a society to defend against an unauthorized promise to pay an "endowment" it is held that a payment out of the benefit fund of the society to a member not under disability in his lifetime is an attempt to create a third class of beneficiaries not authorized by statute and therefore an unlawful expenditure of trust funds. This proposition seems to have been advanced only in the one case. It is a controlling principle, however, in every state which limits the fraternal societies to the payment of benefits to persons standing in named degree of relationship to the member upon his death or to the member himself when suffering disability.

In such states there are but two lawful classes of beneficiaries. Every dollar of benefit assessment collected by a society is a trust fund which the state by its visitorial and sovereign powers affirmatively requires shall be expended solely for the relief of individuals in one or the other of those two classes. The attempt to make a payment to a member in his lifetime is an attempt to create a third class of beneficiaries. It is no more sufficient to say that the claimant is the member but he is not disabled; than to say that the claimant is the wife of a member but the member is not dead. In the one class of beneficiaries relationship of the claimant plus the death of the member must be shown. In the other class of beneficiaries membership plus disability within the statutory provisions must be shown. Membership standing alone is no more sufficient to entitle one to participate than is relationship standing alone.

The by-laws of a corporation must be within its charter provisions; the charter within the statute of the state and the statute within the limits of the state constitution. A valid certificate evidencing membership in a fraternal corporation must, therefore, be in all respects within the provisions of these. A promise in excess is without authority and void. The application made by individuals desiring membership in fraternal societies usually contain a provision to the substantial effect that the member will be governed and his contract controlled by subsequently enacted by-laws. It has been recently held that no question can exist concerning the right of a society to amend its by-laws by striking out promised benefits under such an application when the effect of the amendment is to bring the benefits promised within the statutory limits fixed by the state for participation in the benefit fund.

The weight of authority is that reference in the application to subsequently enacted by-laws refers to every phase of membership, financial as well as social. Authority is not wanting, however, to the effect that such provisions refer only to the social or lodge features.

It is believed that no case is to be found in the books holding that an incorporated fraternal society is without power to modify its by-laws relating to the payment of benefits in outstanding certificates when such modification is necessary to bring its benefit payments within the limits fixed by statute. And this without regard to whether the promise is made prior or subsequent to the enactment of the statute. If this be not the law then the society is wholly without power either to interpose a lawful defense against the claim for such benefit or to provide the funds with which to make payment. Immediately corporate dissolution with the wiping out of its lawful insurance protection as a going concern is the necessary result of any other holding.

An exhaustive examination of the authorities from the English speaking courts warrants the following conclusions relative to the law. governing those old "endowment" promises:

1.

Unless authorized specifically or by necessary implication such provisions are Ultra Vires, and uninforceable for lack of corporate capacity to make or assume an agreement to pay an "endowment."

2. If within corporate powers when made or assumed such promises, except those permitted by statute, became void and uninforceable upon the adoption by the State, under its police power or its reserved right of charter amendments of any of the present regulative fraternal acts.

3. Promising payment of "endowment" to a living member, not disabled, without statutory authority therefor, is an attempt to create a third class of beneficiaries and therefore uninforceable.

4. A non profit corporation has an inherent right to amend its by-laws and modify benefits, not yet accrued, to conform to the statute law of its domicile, and such amendments and modifications are binding upon all continuing members.

5. An act of a corporation concerning the rights and obligations of its membership, valid in the state of its domicile, under the full faith and credit clause of the Federal Constitution, is binding in every other state without regard to the law of the place of contract.

In all jurisdictions in which the foregoing propositions are or may be upheld it follows that a society is wholly without right to disburse in excess of statutory authority any portion of its benefit fund to a

living member not under disability; and if in fact a society should make such payments the disbursing officers may be amenable therefore. Any member is doubtless entitled to an injunction to prevent such a threatened disbursement of the trust funds of the society collected from its members for the purpose of meeting lawful death and disability claims. For such a disbursement the State would have a right to implead the society in an action of ouster abuse of its corporate privileges; or in those jurisdictions in which a limited ouster is provided, to take control of the affairs of the corporation and protect its membership and assets until the corporate abuses were corrected.

The larger part of our membership has come into existence since these old "endowments" were promised. The maximum benefit under these new certificates lawfully issued as death and disability protection The holders of the old "endowment" have enjoyed all these years the same protection. Their contracts have been good as an agreement for life insurance but void as a speculative agreement for profit at the expense of their fellows. They have no just ground for complaint either against the State or the Society, for they have been deprived of nothing; but only prevented from reaping an unfair advantage over their fellows.

While our societies are still in a formative condition the movement is far beyond the experimental stage. No economic enterprise is of greater importance than this. Fraternal Insurance, despite the many early mistakes, has proved its ultimate right to exist. "By their fruits ye shall know them" says the inspired writer. The annual payment of millions in benefits to tens of thousands of bereaved homes at the minimum of administrative cost is the incontrovertible answer to those who decry the work in which we are engaged.

No censure should now be meted out to the officers of the societies which in past years made "endowment" promises. Those men and women doubtless acted in good faith and to the full measure of the understanding and light then obtainable. They are neither more nor less culpable than was their membership which authorized every promise made. It is our duty now as their successors and the executive officers of our respective societies charged with the duty of working out and perpetuating the great scheme of fraternal protection, fearlessly and honestly, as God shall give us power to see and know the right, to do those things which our years of experience and observation teach us must be done if the fraternities shall continue. The welfare in a hundred homes is an equity superior to the clamor of a supposed right of a fancied grievance in one home.

ARE WE BURDENED WITH TOO MANY LAWS?

By Hon. Wm. Lloyd Harding.

Read Before Law Section August 24, 1910, Minneapolis, Minn.

The number of the laws, under which we live, has, I believe, attracted serious attention from almost all of our people who are in any way actively engaged in the work of the world.

The word "law" suggests something fundamental; something enduring; the laws of nature are fixed and permanent. The same is true of spiritual laws.

The laws of man, however, are only the feeble and fallible efforts of men to discern the laws of nature and God, and to apply them to the worldly affairs of men. In their original and true conception, they form a more or less consistent body of ethics, seeking to regulate man's conduct so that he shall have the greatest measure of happiness and freedom possible without inflicting injury on his fellows, or interfering with their happiness and freedom. Whether particular laws are best adapted to accomplish this end depends obviously on the state of the society to which they apply, and the degree of accuracy with which those who frame them are able to appreciate and express the moral and economic consequences of thousands of isolated and unrelated acts and habits of the citizen.

If one is impressed at all by this conception, it is first by a sense of the gradual nature of the process by which such a body must be formed, if it is not to betray its purpose. The slow accretion of the years by which rivers form great alluvial lands by minute and imperceptible deposits, is the perfect analogy by which such a body of laws should be formed-a broad plain of equity and fairness upon which men may safely go about the business of each day, adding constantly to its secure and fertile extent by no violent or observable process, but by the slow deposit of the stream of man's patient study and experience.

With this persepctive, contemplate the total number of laws there are in this country. The Federal laws fill four or five large volumes. Each of the States has one or two large volumes of laws, and the local communities have their ordinances that fill volumes. These laws cover almost every conceivable subject, almost every human activity, and go into the minutest detail. In the States, we have more law factories than any other country in the world. I think the name "law factory" is none too severe a term by which to designate our modern Legislatures. The Congress of the United States is in session nearly all of the time, and is busy grinding out new laws. Each of the States has a Legislature, and it works faithfully at the business of making new laws. Then the cities and towns, the counties and townships, have bodies that meet as often as once a month to write a few local ordinances to regulate the dogs and chickens.

To illustrate-In the prairie State of South Dakota, the Legislature, in its profound wisdom and moral superiority, passed the following law:

1. It shall be unlawful for any person to do, or attempt to do, or take part in, certain forms or kinds of dances, commonly known or called the "Hoochie Koochie," "Grizzly Bear," "Turkey Trot," "Snake Wrestle," or "Bunny Hug," or any suggestive or immoral dances.

Like many things advocated today as "progress, these measures are not new. Man's habits have been confounded with his virtues before. Juvenal exhausts his vocabulary of invective in denouncing the atrocious criminality of a certain noble, who in the very first year of his consulship did not hesitate to drive his own chariot along the public road. Seneca was scandalized by the shocking and unnatural luxury of those who adopted the custom of cooling different beverages. by mixing them with snow. According to Pliny, the most monstrous. of all criminals was he who first devised the luxurious custom of wearing golden rings Apollonious was compelled to defend himself for having eulogized tooth-power, and did so by arguing that nature had justi fied it, for crocodiles, he said, were known periodically to leave the waters of the Nile, and to lie with open jaws upon the banks, while certain birds proceeded to clean the teeth of the crocodiles with their beaks.

For the last ten years we have experienced the greatest and most notable reaction toward this policy of indiscriminate regulation, and strangely enough, have willingly swallowed this ancient nostrum,