U. B. Mutual Aid Soc. v. McDonald

Oiumm, Mr. Justice Clark: This suit was brought on a policy of life insurance, issued by the U. B. Mutual Aid Society, etc., March 22, 1882, upon the life of Roger MeDevitt. The application for the policy provided that “ the certificate of membership should be issued in favor of and be payable to Michael McDonald,” who was “ to pay all dues and assessments.” The policy itself, after stating that Mr. Roger MeDevitt “ had paid $24 as his annual payment” and had become a member in said IT. B. Mutual Aid ■Society of Pennsylvania, etc., provides that “this membership entitles Michael McDonald, his heirs and assigns, upon the ■death of said Mr. Roger MeDevitt to $3,000.” Had Michael McDonald such an interest in the life of Roger MeDevitt as would support the policy ? It cannot be pretended that the mere fact that McDonald was a step-son of- MeDevitt would create an insurable interest; no case has been brought to our notice which carries the rule to that extent. It is a rule founded in public policy, and is of [330] general application, that the contract of life insurance must be based upon an interest in the subject insured; in the absence of an insurable interest the policy, having nothing upon which to operate, must be regarded as a mere wager upon human life. In all cases, as we said in Corson’s Appeal, 113 Pa. 445, there must be a reasonable ground, founded in the relations of the parties, either pecuniary or of blood or affinity, to expect some relief or advantage from the continuance of the life of the insured; otherwise the contract is a mere wager by which the party taking the policy is directly interested in. the early death of the assured. Such policies having a tendency to create a desire for the event are, independently of any statute on the subject, condemned as being against public policy. The foundation of the doctrine is that no one shall have a benefit of any kind in a life policy, who is not presumed to be interested in the preservation of the life of the insured: Gilbert v. Moose, 104 Pa. 78. Roger McDevitt was married to McDonald’s mother, but she had died some years before the policy issued. McDonald was a married man; he had a separate home and family of his own; he was a step-son but was not otherwise related to McDevitt, either by blood or marriage. Nor was he a creditor of Mc-Devitt or in any way dependent upon him or responsible for his support or otherwise. The plaintiff testifies they had helped each other at times but that McDevitt owed him nothing ; he says that he had a stroke of paralysis, and Ms wife got Mm to take out the policy to protect her if he died; she thought he was likely to die first, but it was for the benefit of whichever lived the longest. And although the policy states that the first annual payment of $24 was paid by McDevitt, the plaintiff unequivocally testified that he paid all the money that was paid on it. It is very plain from all the testimony that McDevitt simply suffered the use of Ms name; that the insurance was effected at the suggestion of McDonald or McDonald’s wife, at their own expense, for their exclusive benefit. We fail to discover any insurable interest Michael McDonald had in the life of Roger McDevitt, there is, therefore, nothing to support the policy. It is the absence of this insurable interest which gives to the policy the character of a wager contract; there can arise in [331] such case no question of motive or good faith: Downey v. Hoffer, 110 Pa. 109. The rule, applicable alike to life and fire insurance, rests in public policy for the protection of human life and property: Stoner v. Line, 16 W. N. 187; Keystone Mut. B. Ass’n v. Norris, 115 Pa. 446. The motive and intentions of Michael McDonald may have been good, but the fact remains that he had no interest in the life of Roger McDevitt, and having no such interest, as we said in Seigrist v. Schmoltz, 113 Pa. 326, the sooner that life was extinguished the better it was, in a pecuniary point of view, for the beneficiary. Whether the policy was taken out for the purpose of a wager or speculation, that is to say whether or not this was the motive and intention of the beneficiary named in it, under the circumstances of this case, was not a question for the jury; in the absence of any insurable interest whatever the law will presume this to be so. The judgment is reversed.