Connecticut Mutual Life Insurance v. Burroughs

Carpenter, J. In 1850 the Connecticut Mutual Life Insurance Company issued a policy of insurance on the life of George Kendall for the sum of five thousand dollars, payable to his wife, Mary E. Kendall, “ her executors, administrators or assigns, for her sole use, within ninety days after due notice and proof of the death of the said George Kendall, deducting therefrom all notes taken for premiums unpaid at that date.” The policy then provided as follows: — “And in case of the death of the said Mary E. Kendall before the decease of the said George Kendall, the amount of said insurance shall "be payable after her death to her children for their use, or to their guardians if under age,” &o. On the first day of September, 1862, Mary E. Kendall executed a paper, purporting to be an absolute assignment of said policy to Jarvis E. Burroughs. She died on the 6th day of October 1864, and her husband died on the 10th day of the same month, leaving one son. The insurance money is now 1 claimed by the assignee on the one hand, and by the son of the assured on the other. The claim of the assignee must depend upon the validity of the assignment; for if the assign- or, at the time of the assignment, had no assignable interest in the policy, or if she had an assignable interest which was contingent merely, and that interest has been defeated by the happening of her death before that of her husband, it seems quite clear that the assignee has no valid claim to the fund in question. In the case of Eadie v. Slimmon, 26 N. York, 9, a policy was issued to a married woman on the life of her husband, similar in its provisions to the one now under consideration. The statute of New York on this subject is substantially like our own. She assigned the policy during the life-time of her husband and survived him. In a suit to which she was a party, the court held that the instrument had no assignable [314] quality. If we are to adopt the doctrine of that case as the law of this state, it conclusively settles the question now before us. For the reasoning of the court seems to go so far as to hold that a policy of this description, prior to the decease of the husband, is absolutely and under all circumstances unassignable by the wife. That such should be the law applicable to a policy the premiums on which were paid by the husband, certainly seems reasonable and just; while on the other hand, if the wife paid the premiums from her own separate estate, it is difficult to suggest a reason why she should not have the same power to assign her interest in the policy that she has to assign any other chose in action belonging to her. But in one respect that case is distinguishable from this. There, the contingent interest of the wife became absolute by the death of the husband during her life; here, that interest was defeated by her death during the life-time of the husband. This distinction renders it unnecessary for us to determine the principal question involved in that case. For if it be conceded, on the one hand, that Mrs. Kendall had an assignable interest in the policy in question, it must be conceded on the other hand that that interest was a contingent one, and that the contingency upon which it was to become absolute never has happened and never can happen. By a reference to the policy it will be seen that it was payable to her only in case she survived her husband; and in case her husband survived her it is expressly provided that the policy shall be payable to the children. By the terms of the policy the mother’s interest ceased and the child’s interest, which before was contingent, became fixed and certain by the death of the mother before that of the father. Unless therefore the assignee took a greater interest than the assignor had in the policy, the rights of the assignee terminated on the death of the assignor. But it is suggested that the clause in the policy making it payable to the children, “ is simply the indication of her purpose at that time to give the sum specified in the policy to them in case she deceased before her husband;” and again, that “ it must be held to be on her part an expressed but un= [315] executed intention to give this sum to the children,” which purpose she could abandon at pleasure, and make a different disposition of the fund. This argument is ingenious but not sound. The intention was not to give- a sum of money to these children, but to make a life policy, in a certain event, payable to them. The intention was not only expressed but executed. The contract was complete, and the money, when due, was payable to the children without any further act on her part. But we do not regard the transaction as a gift. The charter of the company and the statute law required the policy to be made as it was, in order to protect it from the claims of creditors and the representatives of the husband. The object of the legislature was to authorize a reasonable provision to be made for the family of the husband ; for the widow, if living, if not, for the children. Mrs. Kendall, when she purchased this policy, undoubtedly intended to secure the benefits of this statute not only for herself, in case she survived her husband, but for her children in case she did not, and to that end caused the policy to be made payable according to the requirements of the statute. Having done so, and the contract relations between the company and the children having thereby become fixed, it was not in her power to defeat the purpose of the legislature in respect to the children, and the manifest intention of the parties to the contract, by an assignment of the policy during the life of the husband. In addition to this it may be observed, that there was at least a moral obligation resting upon her to make this provision for her children. In doing so we must regard her, not as indicating a purpose to bestow a gift, but as discharging a moral, if not a legal duty. Nor is there any force in the suggestion that the instrument is testamentary in its nature, and therefore revocable. It is not a will, but a contract, authorized and regulated by statute ; and when once entered into, it is no more revocable than a promissory note would be, which was made payable to the children after the death of the mother. But it seems that the assignee paid one premium on this [316] policy, amounting to $109.74. We think it equitable that the money thus paid should be refunded. The superior court is therefore advised that the assignee is entitled to the sum paid for premium, together with the interest thereon from the date of payment, and that the balance of the fund should be paid over to the guardian of the son. In this opinion the other judges concurred.