was construed by the highest court of such state, and the meaning and intent of contracts with the members of such organizations, so far as directed by such general law, must be as such highest court determines.

Respect for Construction at Home in Fraternal Insurance Cases.-Text books and encyclopaedias seem to have ignored the influence of the faith and credit clause in benefit society cases, and decision in its conflict, as between states, has passed on rights of members under their benefit certificates on independent questions of law, without any particular regard to the charter state of the company, whose contract was the subject matter of controversy.

I say particular regard, but I should add that a few cases have spoken of construction by the courts of the home state of the company as being entitled to great respect, but no case has pointedly declared that the foreign forum was bound to follow such construction, and at least one case has refused to follow it.2

In this case it appears that the fraternal company was organized under Missouri law and the opinion opens with the statement that: "The decision of this case involves interpretation and construction of the of the statutes of Missouri." The Court then proceeds in its own way to construe such statutes and says: "Appellant relies on the construction given to the act of 1897 by Missouri Court of Appeals in Supreme Council L. of H. v. Neidert, 81. Mo. App. 598." But because this Court's construction was viewed as "giving the act a retrospective operation," it rejected it. It is true Missouri Court of Appeals is not the highest court of that State, yet no point was made as to this, and it is admitted that the very statute involved was passed on.

An earlier Illinois case3 was where the company was a Massachusetts organization. and it was said: "We must respect the con

struction' given to this statute by the Massachusetts courts," and Massachusetts cases are cited.* and some indicating other companies involved than the one before the court, thus conclusively establishing that it was the general law whose construction was before the court. It is not distinctly stated, however, that the Massachusetts construction controlled, and Grimme v. Grimme, supra, appears to show that it was not intended to so say.

A Connecticut case" refers to much authority to sustain its construction of Massachusetts law under which the company party was organized and adds that "this seems to be the construction placed upon it (the statute) by the Massachusetts courts." It so happened that the Connecticut court took the same view, but it did not intimate it felt bound by the view of the Massachusetts courts, though the cases cited were by the highest court of that state.

A later Connecticut case speaks of a membership contract in a fraternal society, and in the course of discussion of its meaning reference is made to authority from various states and the Federal Supreme Court. It is observed that: "While the contract was a Connecticut contract, it was conditioned upon the laws of the society, and its laws, so far as valid, were in harmony with, and all of its contracts included the statute law of the state of its origin relating to fraternal benefit societies." Then are cited Massachusetts decision by its highest court, along with decisions from other states, but it is not intimated at all, that the former is given any precedence in value above the other, nor is any allusion made to state construction put upon its own statute, the company involved being a Massachusetts company. .

(4) Am. Legion of Honor v. Perry, 140 Mass., 580; Elsey v. Odd Fellows M. R. Assn., 142 Mass. 224.

(5) Sup. Lodge N. E. O. P. v. Hine, 82 Conn., 315, 73 Atl. 791.

(6) Sup. Colony Order Pilgrim Fathers V. Toune, 87 Conn., 644, 89 Atl. 264.

In a Michigan case, the company involved was organized under Missouri statute. In the briefs authority is cited from many states, Missouri included. Campbell C. J. in his opinion cites no cases whatever, but he does say that the company "is in all its contract relations, subject to the conditions imposed by" Missouri laws. He speaks of "the intent of the prohibition" in these laws but he gathers that intent from his own reading of the Missouri statute and not as decided by its courts.

In a New Jersey case as decided in its Court of Chancery, and afterwards in its Court of Errors and Appeals a Massachusetts corporation was involved. The lower court said: "It is important to ascertain the force of the words 'other relatives' found in the (Massachusetts) act of 1882. To this end it is proper to inquire what force has been given to that language found in other statutes of Massachusetts by the courts of that state, and in that examination we find two remarkable cases." The Court of Errors and Appeals after citing Massachusetts cases said: "These decisions of that (Massachusetts) court on the powers of corporations established under the Massachusetts statute and on the mode of exercising those powers have almost, if not quite, absolute authority," citing for this a Maryland case.10

This Maryland case, in speaking of a Massachusetts statute, under which the company before the court was organized, said: "What the statute of Massachusetts authorizes to be done under it has been settled by the decisions of Massachusetts courts, and those decisions are controlling as to the effect and meaning of the statute, and we should follow them as making a part of the law of the state, no matter whether they are entirely in harmony with decisions of other

(7) Sup. Lodge Knights of Honor v. Richardson, 60 Mich., 44, 26 N. W. 826.

(8) Tepper v. Sup. Council R. A., 59 N. J. Eq. 321, 45 Atl. 111.

(9) Same v. Same, 61 N. J. Eq. 638, 47 Atl. 460, 88 Am. St. Rep. 449.

(10) Am. Legion of Honor v. Green, 71 Md. 263, 17 Atl. 1048, 17 Am. St. Rep. 527.

states upon somewhat similar statutes or not." This statement does not expressly say, that the Maryland court was compelled to follow such decision even to the overruling of its own holdings in prior cases, or that all cases, though resting on similar statutes in different states, must be variously decided if ruling in the home states of companies were in conflict. There is, however, an implication to the latter effect in the ruling itself.

In a later case by Maryland Court of Appeals11 there is an inference merely, that the statute should receive construction outside of a state as to all members belonging to the order that it receives at home, because equality of treatment is necessary. The only way it is practical to have this is to take the statute as it is construed where it is enacted. This it is perceived is merely persuasive reasoning to accomplish the end intended. It is not the announcement of a hard and fast rule. In a case in Massachusetts 12 the company was organized under Connecticut law, and the question was of change in beneficiary and of the proper interpretation of the words claimed to authorize the change. The court said: "The case of Knights of Columbus v. Rowe, 70 Conn. 545, is almost identical with this case, and it was there held, without any statement of the reason for this part of the decision, that the widow of the member was entitled to the benefit, instead of his father, who was | designated as the beneficiary before the marriage. This construction of a statute of Connecticut by the Supreme Court of that state is entitled to great consideration, if it is not absolutely conclusive upon us.

9713

Effect of Foregoing State Cases.-It may be that expressions such as above may be found in other cases, but as they occur in the reasoning of opinions they are somewhat difficult to run down in digests. That the principle they lead to is vitally important

(11) Sup. Council R. A. v. Brashears, $9 Md. 244, 43 Atl. 866, 73 Am. St. Rep. 244. (12) Larkin V. Knights of Columbus, 188 Mass., 22, 73 N. E. 850.

(13) Italics are supplied.

in the very nature of such associations seems plain. Besides, if it be conceded, as the Towne case, supra, holds, that a member's contract, wherever it is made, is conditioned on the laws of the company so far as these are in correspondence to the laws of the state where it is organized, comity, if nothing else requires courts of other states to follow construction by the courts of the state enacting such laws. The federal courts admit the right of each state to construe its own statutes, and they claim independence of construction only in matters of general law. Shall one state concede less to a sister state than the federal judiciary concedes?

Expression by some of these courts appears to place them as being ready to say, if necessary, that, as a rule of interpretation, they are bound by a state's construction of its own statutes, independently of any bearing of the faith and credit clause on the matter. But rules of interpretation are subject to so many distinctions that they are not as safe guides as a rule of law, and this rule of law I think is found in the Green case, supra.

Faith and Credit Clause Protects State Construction of Its Laws.-Section 1 of Article IV of the constitution provides that: "Full faith and credit shall be given in each state to the public acts, records and judicial proceedings of every other state," and public acts are held to embrace statute law. But merely to construe the law of another state, while not questioning its validity, was held, with some exceptions, not to deny to it full faith and credit.14 Nor do courts of another state deny full faith and credit to a law of another state, where it considered it and decisions of its courts as to what that law meant.15 In another case16 it was held, that a ruling turning upon the meaning of a decision of a state court construing its own statute is not necessarily denying to

(14) Allen v. Alleghany County, 196 U. S. 458, 464. (15) 491.

Johnson v. N. Y. L. Ins. Co., 187 U. S.

(16) Finney v. Guy. 189 U. S. 335.

the statute full faith and credit, except that the construction of such decision be erroneous. In this case it was claimed, that a decision relied on by the court of the other state had been overruled, but it was held that this was not true.

But no more forcible illustration of the principle that it is state statute with state' construction which the faith and credit clause protects can be given than the Green case first above referred to, as shown in and of itself and by the state case1 which was reversed. In the latter case it was said: "The plaintiff's rights are not affected by the fact that the defendant is a corporation organized under the laws of Massachusetts, nor by the finding of the trial court that the statutory law, public acts of the commonwealth of Massachusetts, fraternal beneficiary organizations, of which the defendant supreme council is one, have power to change and amend their rate of assessment,, because (1) the trial court also found that the contract in all its essentials between the parties was entered into, made and completed in the state of New York, and (2) the statute of Massachusetts, under which the defendant claims the power to amend as to rates of assessment, was not enacted until 1902 and expressly provides that amendment, alteration or repeal shall not take away or impair any remedy which may exist by law."

18

The U. S. Supreme Court does not go into any consideration of the meaning of the orig. inal or amended Massachusetts statute, but takes as true and binding a Massachusetts case. It said: "The (Massachusetts) court, after a careful review of the general nature of the corporation, of the character of the fund, of the rights of its members as evidenced by the certificates, of the constitution and by-laws of the corporation, and the laws of the state applicable thereto, decided that the increase complained of was valid,

(17) Greene v. Sup. Council R. A., 206 N. Y. 591, 100 N. E. 411.

(18) Reynolds v. Sup. Council R. A., 192, Mass., 150, 78 N. E. 129, 7 L. R. A. (N. S.) 1154, 7 Am. Cas. 776.

impaired no contract right of the certificate holders and was entitled to be enforced."

Let us remember that the case thus referred to was not a case where any privity could be held to bind the plaintiff Green in the case before the court, and, therefore, the judgment, as a judgment, could claim no protection under the faith and credit clause. This principle was extended, as the chief justice shows, in another very recent case,19 where a suit was brought by representatives suing for themselves and all other members in the mutual benefit department of an insurance company. The chief justice is thus explicit as to this: "Coming, then, to give

full faith and credit to the Massachusetts charter of the corporation and the laws of that state to determine the powers of the corporation and the rights and duties of its members, there is no room for doubt that the amendment to the by-laws was valid if we accept, as we do, the significance of the charter and of the Massachusetts law applicable to it as announced by the Supreme Judicial Court of Massachusetts in the Reynolds case. And this conclusion20 does not require us to consider whether the judgment per se as between the parties was not conclusive in view of the fact that the corporation, for the purposes of the controversy as to assessments, was the representative of the members. Into that subject, therefore, we need not enter."

It is to be noticed that the reversed case held, that it was deciding the rights of a member of the company under a New York contract, and, therefore, there was merely construction of Massachusetts law and of interpretation thereof by Massachusetts courts, even if it is admitted that the New York contract was conditioned on Massachusetts law. But the reversing court upheld the controlling effect of the law of Massachusetts as established by the ruling of its highest court. The New York court appeared to deny this effect in a New York

contract conditioned on Massachusetts law. It did not admit it controlled, and then argue that the law as interpreted did not cover the case before the court. If it had done this its judgment probably would have come under the ruling of the Allen, Johnson and Finney cases supra. The faith and credit clause does not guard against mere reasoning by courts of other states, but there is presumption that they will respect, in good faith, its guaranties.

Faith and Credit Clause and Home State of Company. The enforcement of the prinfect of eliminating conflict of decision in ciple in the Green case cannot have the effraternal insurance company cases. Its only necessary effect is, that the members of a particular company, whether they reside at its home place of charter or in other states, and whether their contracts with it are where they reside or at the home place law-that made and construed in the state of charter, are all conditioned upon one which grants the charter. I will illustrate this by cases decided in the state of New York.

The Green case against the Royal Arcanum was decided erroneously, because it held that an increase in rates was in impairment of contract rights, when interpretation placed by Massachusetts courts on the law under which the defendant was organized held to the contrary. This same ruling by New York courts in another fraternal insurance case21 was right, if Michigan, its home state, rules the same way. I leave that question to local inquiry.

Another case22 holding the same way may be deemed correctly decided, because the defendant was a New York corporation and the ruling was on the principle of stare decisis. This case, like the Reynolds case. supra, could be taken as conclusive interpretation of New York law, upon which the

(21) Wright v. Knights of Maccabees. 196 N. Y. 391. 89 N. E. 1078. 134 Am. St. Rep. 838. (22) Dowdall v. Catholic M. B. A.. 196 N. Y. 405, 89 N. E. 1075.,

contracts of members are conditioned. The same may be said of another case.23

Another case was of a Massachusetts company, and though it might be thought to involve the same principle as the Reynolds case, yet the precise question was not involved. This case showed attempted reduction of amount of insurance. The Reynolds case showed increase of assessment. There would be room here to argue that this question was not covered and there would be no denial of faith and credit in refusing to apply the Reynolds case.

Another case25 in this volume concerned a Pennsylvania company. This case involved the question as to the operation, whether retrospective or not, of a suicide amendment. The opinion does not disclose any reference to Pennsylvania decision. This reasoning would seem under the Reynolds case to be wholly irrelevant, if there existed any Pennsylvania ruling on the point, by its highest court. I leave this to local investigation.

In a case concerning a New York corporation,26 the decision was right on the same principle that governed the Dowdall case, but the court refers to rulings in support rendered in suits against domestic and foreign corporations, without making any distinction between them, as required by the principle declared in the Green case. It only needed to refer to cases where domestic corporations had been sued.

The illustration of the operation of the faith and credit clause, as shown by my reference to New York cases, can be multiplied for every state. I do not attempt to show which of the rulings are right or wrong, but that some of them are right and others wrong is clear, for I believe it to be true that the different states, with such

(23)

Parish v. New York Produce Exchange, 169 N. Y. 51. 61. N. E. 977. 56 L. R. A. 149. (24) Langan v. Am. Legion of Honor. 174 N. Y. 266, 66 N, E. 932.

(25) Shipman v. Protected Home Circle, 174 N. Y. 398. 67 N. E. 83, 63 L. R. A. 347.

(26) Ayers v. Ancient Order United Workmen, 188 N. Y. 280. 80 N. E. 1020.

out of the ground. Lesamis v. Greenburg, U.

rare exceptions as hereinbefore pointed out," have not considered as important the question of the home place of the corporation. Those that have regarded this fact as important have done so either on the theory that rulings at the home state were more persuasive than others and because that state must have intended there should be uniform operation everywhere. This intention, however, might be viewed, as many courts have viewed the intention in uniform legislation, to be applied with many reservations and exceptions. These have crept into decision so much as seriously to hinder the commendable purpose in uniform laws. The faith and credit clause, however, in a case, where the question is properly raised, secures a constitutional right that the courts must enforce.

For a learned note showing the conflict of authority on the question in the Reynolds case, see 7 L. R. A. (N. S.), beginning at 754, and 1 Ann. Cas. 715, which may be useful for reference in suits brought ont benefit certificates in foreign companies. But, as above said, this involves inquiry into the law of home states, and the space allowed to this article cannot be extended to a showing of what is the law of every state that has authorized the incorporation of fraternal benefit societies.

St. Louis, Mo.

N. C. COLLIER.

ATTORNEY AND CLIENT-WHAT IS LAW

BUSINESS?

GROCERS & MERCHANTS BUREAU OF
NASHVILLE, Plaintiff in Error v. DR.
W. E. GRAY, Defendant in Error.

In the Court of Civil Appeals at Nashville, Tennessee. Nov. 29, 1915.

Where a collection agency, organized as a corporation, contracts for a consideration "to give legal advice" to its customers, it is engaging in law business and the contract so made is contrary to public policy and is therefore void and unenforceable.

HALL, J. This action originated before a Justice of the Peace of Davidson County, and was brought by the Grocers & Merchants Bureau of Nashville against the defendant in error to collect the sum of $10.00, growing out of a certain written contract filed as exhibit "A" to the