Kruger v. Life & Annuity Ass'n
Before: Belcher
Synopsis
Mutual Benefit Association—Endowment Certificate—Foreclosure of Lien—Demurrer of State Treasurer.—In an action to enforce the payment of an endowment certificate in a life and annuity association, and to enforce a lien upon its funds in the possession of the state treasurer, a complaint which alleges a full performance of all the conditions of the contract on the plaintiff’s part, and a breach of the contract on the part of the association, and that the association has on deposit with the state treasurer an amount fully sufficient to pay the demand and claim of the plaintiff, is not subject to a demurrer by the state treasurer as a party defendant, on the ground that it does not state facts sufficient to constitute a cause of action; nor on the ground that the court has no jurisdiction of the person of the state treasurer.
Id.—Insufficiency of Funds to Pay All Matured Coupons—Matter of Defense.—The insufficiency of the funds of a mutual benefit society to pay all endowment coupons of the same class cannot be relied upon by way of demurrer to the complaint of a plaintiff suing upon a matured coupon to enforce payment out of a sufficient fund to pay the claim of plaintiff, and if there are any other claimants to the same fund whose rights to the assets defendants are authorized to assert, the facts must be set up by way of defense in the answer, and if not so set up, either by the association or by the state treasurer, the latter cannot avail himself of it on appeal from a judgment overruling his demurrer to the complaint, and enforcing a lien in favor of the plaintiff.
Id.—Parties—Securities Deposited With State Treasurer—State not Interested.—The statute requiring that the bonds or securities of a mutual benefit association, of the value of five thousand dollars, he placed with the state treasurer and held by him. in trust for the holders of contracts with the corporation, and creating a lien upon all the property of the corporation for payment to the beneficiary of the amount specified in the contract, if not invalidated by fraud or breach of its conditions, does not give the state any property or interest in the securities, but simply makes the state treasurer the custodian of the securities placed in his possession, and the plaintiff having a lien upon them for payment has a right to enforce that lien and to make the state treasurer, as custodian of the securities, a party to the action, and such action is not against the state.
Belcher, C. The plaintiff was admitted to membership in the defendant corporation on the twenty-sixth [100]day of February, 1886. A certificate of membership was then issued to her, by which it was stipulated and agreed that “if the said Mary Kruger shall fully comply with the laws and regulations of said association, and shall pay to said association the annual dues, at the rate of two dollars for each one ^thousand dollars benefit provided by this certificate, and shall pay within thirty days after notification each assessment made and levied by said association, in accordance with its by-laws, she shall be entitled to a benefit of ten thousand dollars, to be paid in five equal installments or endowments, at periods as follows, to wit: First endowment April 26, 1893,” etc.
Attached to the certificate were endowment coupons, the first of which stated “ that Mary Kruger is entitled to receive the sum of two thousand dollars as the first payment of her endowment certificate, etc., on April 26, 1893.”
After the maturity of the said first coupon plaintiff presented the same to the defendant corporation at its office, and demanded payment of the amount due thereon, but payment was refused. She thereupon commenced this action, alleging, among other things, that she had duly kept and performed all the conditions of the said contract to be by her kept and performed; that on the twenty-seventh day of April, 1893, the said corporation had and ever since has had a sum of money in its beneficiary, coupon, endowment, and reserved funds fully sufficient to pay the demand and claim of the plaintiff, and that it then and ever since has had on deposit with the state treasurer of the state of California, in bonds and securities, an amount equivalent to the sum of five thousand dollars, as required by section two of an act of the legislature of this state, entitled “An act relative to life, health, accident, and annuity or endowment insurance on the assessment plan, etc., approved March 19, 1891”; and a'so that prior to the commencement of the action plaintiff served notice in writing upon J. R. McDonald, state treasurer, of her said claim and the [101]denial of all liability therefor by said corporation, and that she claimed a lien upon the funds, property or moneys deposited with said treasurer, as provided by section 4 of the said act of March 19, 1891./
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