Code (vol. 3), art. 23, sec. 230. 1912, ch. 824, sec. 2a.

230. (Lodge System Defined.) Any association having a supreme governing or legislative body and subordinate lodges or branches by whatever name known, into which members shall be elected, initiated and admitted in accordance with its constitution, laws, rules, regulations and prescribed ritualistic ceremonies which subordinate lodges or branches shall be required by the laws of such association to hold regular or stated meetings at least once in each month, shall be deemed to be operating on the lodge system.*

Code (vol. 3), art. 23, sec 231. 1912, ch. 824, sec. 3A. 1916, ch. 343.

231. (Representative Form of Government Defined.)—Any such association shall be deemed to have a representative form of government when it shall provide in its constitution and laws for a supreme legislative or governing body, composed of representatives elected either by the members or by delegates elected directly or indirectly by the members, together with such other members as may be prescribed by its constitution and laws; provided, that the elective members shall constitute a majority in number and not have less than two-thirds of the votes, nor less than the votes required to amend its constitution and laws; and provided, further, that the meetings of the supreme or governing body, and the election of officers, representatives or delegates shall be held as often as once in four years. The members, officers, representatives or delegates of a fraternal beneficiary association shall not vote by proxy.

Code (vol. 3), art. 23, sec. 232. 1912, ch. 824. sec. 4a.

232. (Exemptions.) Except as herein provided, such associations shall be governed by this Act, and shall be exempt from all provisions of the insurance laws of this State, not only in governmental relations with the State, but for every other purpose, and no law hereafter enacted shall apply to them unless they be expressly designated therein.

Members are governed by the by-laws as adopted from time to time and not merely those in force when a member joins the Association. Arnold vs. Heptasophs, 123 Md. 675.

Code (vol. 3), art. 23, sec. 232. 1912, ch. 824, sec. 5A. 233. (Benefits.) Sub-section 1. Every association transacting business under this Act shall provide for the payment of death benefits, and may provide for the payment of benefits in case of temporary or permanent physical disability, either as the result of disease, accident or old age; provided, the period of life at which the payment of benefits for disability on account of old age shall commence, shall not be made under seventy years; and may provide for monuments or tombstones to the memory of its deceased members, and for the payment of funeral benefits. Such association shall have the power to give a member, when permanently disabled or on attaining the age of seventy, all or such portion of the face value of his cer tificate as the laws of the association may provide; provided, that nothing in this Act contained shall be so construed as to prevent the issuing of benefit certificates for a term of years less than the whole of life which are payable upon the death or disability of the member occurring within the term for which the benefit certificate may be issued. Such association shall, upon written application of the member, have the power to accept a part of the periodical contributions in cash and charge the remainder, not exceeding one-half of the periodical contribution, against the certificate with interest payable or compounded annually at a rate not lower than four per cent. per annum; provided, that this privilege shall not be granted except to associations which have readjusted or may hereafter readjust their rates of contributions, and to contracts affected by such readjustment.*

Sub-section 2. Any association which shall show by the annual valuation hereinafter provided for that it is accumulating and maintaining the reserve necessary to enable it to do so, under a table of mortality not lower than the American Experience Table and 4 per cent. interest, may grant to its members extended and paid-up protection or such withdrawal equities as its constitution and laws may provide; provided, that such grants shall in no case exceed in value the portion of the reserve to the credit of such members to whom they are made.

* Mathieu vs. Mathieu, 112 Md. 625.

Code (vol. 3), art. 23, sec. 234. 1912, ch. 824, sec. 6A. 1916, ch. 343.

234. (Beneficiaries.) The payment of death benefits shall be confined to wife, husband, relative by blood to the fourth degree, father-in-law, mother-in-law, son-in-law, daughter-in-law, stepfather, stepmother, stepchildren, children by legal adoption, or to a person or persons dependent upon the member; provided, that if after the issuance of the original certificate the member shall become dependent upon an incorporated charitable institution, he shall have the privilege, with the consent of the association, to make such institution his beneficiary. Within the above restrictions, each member shall have the right to designate his beneficiary, and, from time to time, have the same changed in accordance with the laws, rules or regulations of the association, and no beneficiary shall have or obtain any vested interest in the said benefit until the same has become due and payable upon the death of the said member; provided, that any association may, by its laws, limit the scope of beneficiaries within the above classes.

1912, ch. 824, sec. 7a.

235. (Qualifications for Membership.) Any association may admit to beneficial membership any person not less than sixteen and not more than sixty years of age, who has been examined by a legally qualified physician, and whose examination has been supervised and approved in accordance with the laws of the association; provided, that any beneficiary member of such association who shall apply for a certificate providing for disability benefits need not be required to pass an additional medical examination therefor. Nothing herein contained shall prevent such association from accepting general or social members.

1912, ch. 824, sec. 8A.

236. (Certificate.) Every certificate issued by any such association shall specify the amount of benefit provided thereby, and the certificate the charter or articles of incorporation, or, if a voluntary association the articles of association, the constitution and laws of the association and the application for membership and medical examination, signed by the applicant, and all amendments to each thereof, shall constitute the agree

ment between the association and the member, and copies of the same certified by the secretary of the association or corresponding officer, shall be received in evidence of the terms and conditions thereof, and any changes, additions or amendments to said charter or articles of corporation or articles of association, if a voluntary association, constitution or laws duly made or enacted subsequent to the issuance of the benefit certificate shall bind the member and his beneficiaries, and shall govern and control the agreement in all respects the same as though such changes, additions or amendments had been made prior to and were in force at the time of the application for membership.*

1912, ch. 824, sec. 9A.

237. (Funds.) Sub-section 1. Any association may create, maintain, invest, disburse and apply an emergency, surplus or other similar fund in accordance with its laws. Unless otherwise provided in the contract, such funds shall be held, invested and disbursed for the use and benefit of the association, and no member or beneficiary shall have or acquire individual rights therein or become entitled to any apportionment or the surrender of any part thereof, except as provided in Sub-section 2 of Section 5A of this Act. The funds from which benefits shall be paid and the funds from which the expenses of the association shall be defrayed, shall be derived from periodical or other payments by the members of the association and accretions of said funds; provided, that no association, domestic or foreign, shall hereafter be incorporated or admitted to transact business in this State, which does not provide for stated periodical contributions sufficient to provide for meeting the mortuary obligations contracted, when valued upon the basis of the National Fraternal Congress Table of Mortality as adopted by the National Fraternal Congress August 23, 1899, or any higher standard with interest assumption not more than four per cent. per annum, nor write or accept members for temporary or permanent disability benefits except upon tables based upon reliable experience with an interest assumption not higher than four per cent. per annum.

* Mathieu vs. Mathieu, 112 Md. 625.

Sub-section 2. Deferred payments or instalments of claims shall be considered as fixed liabilities on the happening of the contingency upon which such payments or instalments are thereafter to be paid. Such liability shall be the present value of such future payments or instalments, upon the rate of interest and mortality assumed by the association for valuation, and every association shall maintain a fund sufficient to meet such laibility, regardless of proposed future collections to meet any such liabilities.

1912, ch. 824, sec. 10A.

238. (Investments.) Every association shall invest its funds. only in securities permitted by the laws of this State for the investment of the assets of life insurance companies; provided, that any foreign association permitted or seeking to do business in the State, which invests its funds in accordance with the laws of the State in which it is incorporated shall be held to meet the requirements of this Act for the investment of funds.

1912, ch. 824, sec. 11A,

239. (Distribution of Funds.) Every provision of the laws of the association for payment by members of such association in whatever form made, shall distinctly state the purpose of the same and the proportion thereof which may be used for expenses; and no part of the money collected for mortuary or disability purposes or the net accretions of either or any of said funds shall be used for expenses.

1912, ch. 824, sec. 12A.

240. (Organization.) Seven or more persons, citizens of the United States, and a majority of whom are citizens of this State, who desire to form a fraternal beneficiary association as defined by this Act, may make and sign (giving their addresses) and acknowledge before some officer competent to take ac knowledgments of deeds, articles of incorporation, in which shall be stated:

1st. The proposed corporate name of the association, which shall not so closely resemble the name of any association or insurance company already transacting business in this State, as to mislead the public or to lead to confusion.