Lovinger v. Garvan

LEARNED HAND, District Judge (after stating the facts as above). [1] The beneficiary of a policy such as this has a contingent interest, which'becomes absolute upon the death of the insured, Irving himself. That interest is, however, subject to defeat by the reserved power of the insured to change the beneficiary and appoint another. Therefore in these cases the question is whether the power has been exercised, or, if not, whether the new beneficiary has the right to compel its exercise after the death of the insured. Where there is no valid contract made by the insured during his life, the rule has uniformly been, so far as I have found, that nothing short of an actual exercise of the power according to its conditions will effect a change. Thomas v. Thomas, 131 N. Y. 205, 30 N. E. 61, 27 Am. St. Rep. 582; Fink v. Fink, 171 N. Y. 616, 64 N. E. 506; Stafford v. Brotherhood, 224 N. Y. 653, 121 N. E. 892; Freund v. Freund, 218 Ill. 189, 75 N. E. 925, 109 Am. St. Rep. 283; Berg v. Damkoehler, 112 Wis. 587, 88 N. W. 606; Sullivan v. Maroney, 77 N. J. Eq. 565, 78 Atl. 150. This, as was observed in Thomas v. Thomas, supra, follows from the doctrine that equity will not intervene in favor of a donee to execute a power. The gift is incomplete until the power has been exercised, which means that its terms must be fulfilled. That is the analogue to the delivery of a gift. [2] However, if the new beneficiary is a promisee for consideration of the person having the power, he has a right to compel the specific performance of the power, which is not determined by the death of the promisor. If the whole transaction were carried out in detail, he could compel the executors of the promisor to execute the power, which would speak as of the date of the contract. Equity will disregard the formal steps, and treat the promisee as an already substituted beneficiary. Nally v. Nally, 74 Ga. 669, 58 Am. Rep. 458; Schoenholz v. N. Y. Life Ins. Co. (App. Div. 1st Dept.) 183 N. Y. Supp, 251. This does not, however, depend upon any vague theory of equity, nor is it based upon general motives of supposed justice. It rests upon the existence of an enforceable contract between the insured and the promisee, creating an obligation to use his reserved power. The case [301] at bar, therefore, turns absolutely upon the existence of such an obligation. [3] The plaintiff never gave any promise to Roza Molnar, but none was necessary, because the contract, if any was made, was unilateral. The critical question is whether the parties mutually understood that the promise was made'as a consideration for the performance. That is not always an easy question to decide; it depends upon whether the promise was intended to induce the promisee to perform, and whether she was in fact induced by it to do so. That is in turn a question of the actuating motives of the parties. In a case like this, where the performance is explicable in part, at least, from motives of kindness or charity, the question is whether, notwithstanding such motives, the performance was not in part actuated by the promise as well, and understood to be so actuated. The plaintiff’s story is not so probative of her case as her brother’s, some of whose language is hardly consistent with any other conclusion than that of a contract. Still I cannot rely upon the exact words which either puts into Roza Molnar’s mouth. It is certain that she intended to give the policy to the plaintiff, told her that she would do so, and tried to effect that result. Most of the services rendered by the plaintiff followed the promises, and could have been a consideration for them. I do not rely upon the will, except as corroboration of what had gone before. Now, it appears to me to fail in understanding the posture of these two women to each other, to read what they said as being nothing but .an expression of gratitude and kindness. That it included these is true enough, but I think it went further. The plaintiff was in narrow circumstances, and the presence of Roza Molnar in her home, sick and penniless, both must 'have known to be a serious incumbrance to her. It seems to me not in any sense, to impugn the kindliness of the plaintiff to suppose that Roza Molnar made the promise to insure her continued services, and that the plaintiff accepted the promise in the same sense. I find, therefore, that the parties were engaged in a bargain, though one into which other than selfish motives entered, and that there was therefore a contract which the plaintiff may enforce. [4] As to the necessity of bringing in Sandar Kamarony, I am in some doubt. If he be an alien enemy, the case ends, for any rights he had are lost; if he be not, he would be entitled to his day in court on the issue here decided. Strictly, he is entitled to it from any point of view. The difficulty is in giving him any real notice, for his whereabouts is absolutely unknown, except that'he was last supposed to be in Hungary. Advertisement in this city would accomplish nothing, except, perhaps, in a Hungarian newspaper. On the whole, I think that the best which can be done is to advertise in some newspaper in Buda-Pest and the next largest city in the present republic. This notice will be printed four times at weekly intervals, and will advise the supposititious claimant that he must file his appearance within six weeks of the last publication. Probably this is a futility, but it is the best possible substitute for actual notice, and in some way the «case must be decided. Decree for the plaintiff.