LAW REPORTS.

Dominion, Volume 7, Issue 1868, 30 September 1913, Page 11

LAW REPORTS.

SUPREME COURT. ANCIENT ORDER OF FORESTERS. IMPORTANT CASE. SUIT AGAINST DISTRICT COURT, An important action brought by tho trustees of a Friendly Socioty Court against the principal or District Court carao on in tlio Supremo Cqurt yesterday, and was heard' by His Honour the Chief Justice (Sir Robert Stout). The case was in the nature of an appeal against amondments made to the rulen of the Foresters' Order by the defendant society, providing that Courts which at the end of 1910 had.drawn cut of the funds more than they had paid in should refund the amount, and that ono-fourth of each member's contributions paid into the Court's sick and funeral fund be paid into tho central sick fund. An order was sought invalidating these two amended rules, and an in junction to restrain the defendant society from enforcing compliance with them or acting there\uider in relation to tho several funds.

Parties to tho Gaso, The plaintiffs were Thomas Timothy M Carthy, Garibaldi Isidore Clark, and Mathew Spriggs, trustees of Court Sir Charles Napier, A.0.F., and the defendants- were William Adam Donaldson, John Kennedy, and Alfred Oswald iUenepy, trustees of the Ancient Order of Foresters, Hawke's Bay District. Mr. C. P. Skerrott, K.U., with him Mr. H. B. Lusk, appeared for tho plaintiffs, and tho Hon. H. D. Bell, K.C., with him Mr. Woods and Mr. Evans, represented the principal or District Court.

What Plaintiffs Seek. The statement of claim set out that under the rules of the Order three separate and distinot funds wero provided for, for each of which a separate table of contributions had been adopted, viz., the District Funeral Fund, the Central Side Fund, to meet cases of sickness continuing after six months, and tho District Management Fund. Tho rules provided that separate accounts should bo kept of each rule. Under the rules of tho branch society a fund or funds, known as tho_ district sick and funeral fund, was provided for, and it was further provided that each Court should levy such sum per quarter per member as might bo necessary for the purposes of management, together with 6d. per member per quarter to tho central sick fund. Plaintiffs oonterided that tho objects and purposes of theso several funds wore separate arid distinct.' In February, 1911, tho principal society altered Rule 22 by inserting tho words, "Thoso Courts who hayo drawn out mora than they have paid ill shall refund the amount," and the next was that "one-fourth of each member's .. contributions paid into 1 tho Court's sick and' funeral fund shall be paid into the central sick fund." Thoso wero the two rules ho complained of, as thero was no foundation for them under the rules of tho socioty or under the statute. Tho amendments of the rules had been so ill-considered and wero based upon no certain principle that it would bo most advantageous to tho society if it were required to roconsider them. His questions' were: — Can a Friendly Society altor its rules so as to impose on a member or on a branch society tho obligation to repay the amount of benefits al- .. . ready actually received under tho existing rules of the society? Can a, Friendly Society by alteration of its rules require a branch society to transfer contributions of a separate and distinct fund to another fund of the .society haying objects and purposes not different in their general nature or genus yot materially different in practical scope from tho fir6t-mentioned fund? and . Whether theso questions aro not questions affecting tho constitution of the socioty and tho fundamental rights of members and branch societies, and was not within the jurisdiction of tho domestio forms established) by tho rules of the society? The amendments were brought forward at the annual meeting of delegates held at Norsowood, Hawke's Bay, but no notice of the intended' alteration of rules was given to tho delegates from tho, subordinate Courts until just prior to tho meeting, and no notice of tho intended alterations was given to tho Courts affected as provided by tho rulos. Plaintiffs further contended that tho amendments were accompanied by a declaration by the secretary of the principal society which was contrary to fact. Notwithstanding the alleged irregularities, the Registrar of Friendly Societies registered tho amendment and rules. Plaintiffs claimed that tho amendments were wholly ultra vires and void, and that tho defendants bo restrained from, enforcing compliance with such amended rules.

Nature of the Defence. Tho defendants submitted that each branch was called in tho rules, "ft Court," that each Court had a sick and funeral fund constituted of the contributions of tho members of the Court, that this was the only fund of a Court for purposes other than more management, and that moneys required for managemont expenses of a Court wore provided by levy. Tho district funds (vero made up of contributions from tho Courts, not from the members of tho Order. Tho management funds of tho Courts "were entirely inapplicable to tho purposes for which tho district funds were constituted. The district management fund was constituted out of moneys paid by the respective Courts out of a general levy of a fixed amount upon the members of the Court, but the district funeral fund and tho central siok fund of. a district were wholly constituted by moneys contributed, not by the members, but by tho Courts out of each Court's sick and funeral fund. The objects and purposes of tho district hinds othor. than tho district management funds wero not distinct and separate from tho objects and purposes of tho Court's sick and funeral fund; on the contrary, they wero. the same, and tho sourco of ali tho funds was the same, and the amounts whioh were contributed from tho Court's sick and funeral funds for tho purposes of maintaining district's several funds ivero proscribed by the rules, and might by law bo altered from tunc to timo.

The Older and Younger Courts. The Hon. H, D. 801 l pointed out that tho principal defect in the method prescribed by the rules before they were amended was that the olderestablished Courts, consisting of members who bad attained greater age, mado contributions on the same basis to tlie district charitable funds as the younger Courts of younger members, but as sickness and death occurred more frequently in the older Courts, the funds of the district were depleted without corresponding bonelit to the youhger Courts, and tho older Courts in some eases drew for their members more than they paid into tho central fluids, wllorens tho younger Courts' payments in largely exceeded tho drawings out. ' It was also submitted in defence that the matters brought into question wero matters which, by forco of tho Friendly Societies Act, 1009, and of the rules a.nd lawa of the society, must he fixolus.iveLy determined by tho

domestic forum of tlio society and not by tlio Supremo Court. The Registrar of Friendly Societies gavo evidenoo of tlio admission of the amended rules, and His Honour deferred judgment.