Chartrand v. Brace

Mr. Justice Hayt delivered the opinion of the court. The amended answer admits, by failing to deny, the facts as stated in the complaint, and for the purposes of this appeal the new matter set up in this answer must also be taken as true. Upon these facts the position of appellee is that upon the death of the insured the right to the fund vested absolutely in the wife, Ella A. Bouse, and that upon her death the right to the uncollected fund passed as part of her estate to her administrator, to be by him disposed of as other assets of the estate. The contention of appellant is that, as the fund had not been paid over or collected at the time of the death of the wife, the right thereto became vested in the children under the terms of the policy. The certificate is, in legal contemplation, a policy of life insurance, and to be construed as such. That the amount can only be collected by assessment upon members of the association after due notice of death, and the payment of such assessment is purely voluntary, can make no difference. The association, so far as it is engaged in the business of life insurance, must be treated in law as a mutual [23] life insurance company. The certificate is to be regarded as a written contract, and, so far as it goes, it is the measure of the rights of all parties. Bolton v. Bolton, 13 Me. 299; Com. v. Wetherbee, 105 Mass. 149; State v. Association, 18 Neb. 281; Wiggin v. Knights of Pythias, 31 Fed. Rep. 122; Knights of Honor v. Nairn, 60 Mich. 11; Insurance Co. v. Horner, 11 Colo. 391. Turning to the policy executed in this case, we find the disposing clause to be couched in the following language: “ Which sum shall at his death be paid to his wife, Ella A. Bouse, and in case of her death to Mary E., Clara D. and Anna L. Bouse, children.” It Would be difficult to find language to more clearly and definitely fix the time at which the right to this money vested in Ella A. Bouse than the words “ at his death.” It is claimed, however, that the words following, “ in case of her death, to Mary E., Clara D. and Anna L. Bouse, children,” qualify the words immediately preceding, and that when construed together they give to the children a right to the fund so long as the same is capable of practical identification and control, and has not been otherwise appropriated by the wife, although the wife in fact survives the husband. But the plain intent of the language of the policy is against such construction. The words, “ which sum shall at his death,” fix the time at which the right to the fund is to be determined, and the words following provide for the payment to the children in case the wife shall not be living at that time. The children were only to receive the money upon the happening of certain contingencies. The risk taken by the association was upon the life of the assured. By his death the policy became fixed, and the right to the fund vested. The wife having survived the husband, her right became absolute by .the express terms of the policy. This construction finds support not alone in the language of the contract, but is also in accordance with the settled policy of the law, which is to favor vested, rather than contingent, estates — the first, rather than the second, taker. King v. Trick (Pa.), 19 Atl. Rep. 951; [24] Smith's Appeal, 23 Pa. St. 9; Womrath v. McCormick, 51 Pa. St. 504; Felton v. Sawyer, 41 N. H. 202; 2 Redf. Wills, *253; Association v. Montgomery, 70 Mich. 587. A policy of life insurance is in the nature of a testament, and, although not a testament, in construing it the courts will, so far as possible, treat it as a will. Bolton v. Bolton, supra. In King v. Trick, supra, an absolute devise was made by a father to his son, followed by a proviso to the effect that, in case the devisee should die without children, grandchildren or wife living, the estate should go over. The words “ die without children,” etc., were held to refer to the death of the son in the life-time of the testator, and the son having survived the testator was declared the owner of the fee. The case of Association v. Montgomery, supra, is in some respects quite analogous to the case at bar. It was provided by the certificate issued in that case that the insurance should be paid to the son and daughter of the insured equally, if living, and, if not living, to his heirs; in case of the death of either the son or daughter, the full amount was to be paid to the survivor; and the court held the provision as to survivorship related to the time of the death of the donor. And it appearing that both beneficiaries were living at that time, although one had died before the payment of the benefit, his executor was entitled to the share, and not the survivor. In the course of the opinion the court said: “ The scheme of the corporation is to raise a fund which shall pass to designated beneficiaries at the death of a member. The right, which before was inchoate and contingent, becomes upon the death of the member fixed and certain in the beneficiary. * * * The time of payment provided for, namely, ninety days after the death of the member, has no reference to who shall take as survivor.” So, in the case at bar, we are of the opinion that, by the express terms of the policy, the right to the fund became vested in Ella A. Eouse upon the death of her husband. Consequently, upon her death, the fund should pass to the [25] administrator as a part of her estate. There is nothing in the constitution or by-laws of the association, as pleaded, to change this result. Whatever rights, if any, may have been reserved to the society by these instruments, have been waived by it, and the fund deposited subject to the order of the court. While we feel that our conclusion as to the party entitled to the fund must necessarily follow as a matter of law, in answer to the argument of counsel based upon the duty of the deceased father to provide for his children, it may be .said that it was equally his duty to provide for his invalid wife. She was the person having the strongest claim upon his estate and bounty. If the construction contended for by counsel be adopted, the wife could not use the fund, no matter to what extremity she may have been driven in the final sickness intervening between the death of her natural and legal protector and her own death. She could not, by anticipating the payment of the legacy, surround herself 'with the things that might have been absolutely necessary to sustain her life from.day to day. In addition to this, it would place the beneficiary primarily entitled to the fund to a great extent within the power of the insurer. Bor instance, by withholding payment, the beneficiary would be compelled to bring suit for the money, the ultimate decision of which might be delayed for years; and if, during the time, the wife should die, others would receive the reward of her endeavors without sharing the expense. Under such, circumstances, it is easily to be seen that the insurance corporation or association could compel the wife, in many instances, to accept less than the face of the policy, rather than institute a suit, no matter how clear her right of recovery might be. We think the judgment of the district court is right, and it is accordingly affirmed.1 Affirmed. Footnotes [1] The former opinion of the court delivered by Mr. Justice Elliott is withdrawn.