Keystone Mutual Benefit Ass'n v. Norris ex rel. Spangler

Mr. Justice Gordon delivered the opinion of the court, March 16th, 1887. Jacob R. Spangler, the use plaintiff, had no insurable interest in the life of Mrs. Rausch, hence this policy, now in suit, which was taken for his use, in the name of Charles Norris, was but a wager on Mrs. Rausch’s life, and as such void [451] and of no effect. A single question and answer, selected from his own testimony, proves the nature of the transaction beyond cavil. Question: — “ And it was understood between you and Mrs. Rausch, before the insurance was taken, that it was to be taken in the name of Norris, and by Norris assigned to you ? Answer: — “ Yes sir.” If now, we admit that Norris had such an interest in the assured as would have warranted him in. taking a policy on her life, yet that fact cannot help out the plaintiff’s case since the policy was not founded on that interest, neither was it for the benefit of Norris, but for the benefit of one who had no interest whatever in the insured life. Norris’s name was used as a mere blind, and could deceive no one conversant with the facts; Spangler was the real beneficiary, and the policy would have been quite as efficient bad it been issued directly to him. The doctrine here advanced is supported by all our own authorities, one of the most recent being Corson’s Ap., 118 Pa., 438. As a case in point, we may also cite Warnock v. Davis, 104 U. S., 775; in which it was held, by Mr. Justice Field, that an insurable interest, such as will take the contract out of the wager class, must arise from the relation of the party taking the insurance to the insured, either as surety or debtor, or from the ties of blood, or marriage, so that from the relation thus established there may be some expectation of benefit or advantage in the continuance of the assured life. Otherwise the risk is to be regarded as a pure wager, in' which the interest of the policy holder is to be found rather in the cessation than the continuance of the life. On all authority, therefore, the court should have affirmed the defendant’s fifth, sixth and seventh points. Nor can we agree with the learned judge of the court below, that the running of the one year limitation prescribed by the policy was suspended by the York county suit. Passing by the fact that that suit was brought in the name of the equitable instead of the legal plaintiff, yet as it was instituted in a court not having jurisdiction of the defendant, it was wholly without effect. As a consequence, the analogy sought to be established between the plaintiff’s ease and the Act of the 27th of March, 1713, and the decisions under it, wholly failed, and so the court should have ruled. The judgment is reversed.