158 S.E. 517 | W. Va. | 1930
This appeal involves an effort of creditors of William G. Wilson, deceased, to reach funds which have been paid to his *686 widow, Mabel Fout Wilson, under policies of insurance on his life. The contention of the creditors was presented by their petition filed in a chancery suit which had been instituted by Mabel Fout Wilson, administratrix, c. t. a., of the estate of William G. Wilson, deceased, for the purpose of subjecting the real estate of said decedent to the payment of his debts and of settling his estate. The petitioners appeal from a decree of the circuit court dismissing their petition.
William G. Wilson died November 16, 1925. The appraised value of his estate was $98,818.71. His primary indebtedness was about $100,000.00. His secondary indebtedness was about $117,000.00, but the ultimate liability of the estate under the latter class remains to be determined. He was greatly involved financially for many years preceding his death. We are enforced to believe from the record, and we find therefrom that at no time for at least five years prior to his death was his estate sufficient to satisfy his indebtedness.
The decedent was married to Mabel Fout Wilson April 22, 1908. Soon after their marriage, he undertook to assign to her certain policies of life insurance which he had theretofore purchased. Certain of these assignments are attacked because in the assignments themselves the insured reserved the right to revoke the same at any time by notice to the company. It is also said that at least one of the policies purported to be assigned was not delivered to Mrs. Wilson by the insured. Passing over the question raised as to whether these two propositions are sufficiently presented by the pleadings, we shall consider them on their merits. The record does not disclose whether the policies with the assignments thereon were delivered by the insured to his wife or whether they were found among his papers after his death. In the absence of proof of actual delivery we will assume that they were found among the decedent's papers. There is no evidence that Mrs. Wilson knew about the assignments until after her husband's death. Under requirements of the insurance companies, the assignments were executed in duplicate by Mr. Wilson and forwarded to the respective companies which approved the same, retained one copy of each and returned the other to the *687 insured. This was sufficient to constitute delivery to his wife. Manual delivery was not necessary.
Where there is an attempted assignment of a life insurance policy to a stranger, there is generally a rigidity of requirement of physical delivery to the assignee.Spooner v. Hilbish, (Va.)
As to the proposition that certain of the assignments are ineffectual because the assignor reserved the right to revoke the assignments, it is sufficient to note that an assignee of a life policy under an assignment containing such reservation occupies as secure a position as does a beneficiary under a policy wherein the insured expressly reserves the right to *688
change beneficiaries at his election. True, some authorities make a distinction between "change of beneficiary" in a policy and "assignment" by the insured of his interest therein, the latter resting on contract and the former on the power to appoint. VII Cooley's Briefs on Insurance, p. 6443;Ehlerman v. Bankers' Life Co., (Iowa)
In the recent case of Webster v. Telle, (Ark.)
Numerous other cases reiterate the principle that assigning a policy is tantamount to changing the beneficiary.Judson v. Walker, (Mo.)
Section 5, chapter 66, of the Code, as it existed prior to the amendment of 1929, reads: "It shall be lawful for any married woman, by herself and in her name, or in the name of any third person, with her assent, as her trustee, to cause to be insured for her sole use, the life of her husband, for any definite period, or for the term of his natural life; and in case of her surviving her husband, the sum or net amount of the insurance becoming due and payable by the terms of the insurance, shall be payable to her, and for her own use, free from the claims of the representatives of her husband or any of his creditors; but such exemption shall not apply where the amount of premium annually paid out of the funds or property of the husband shall exceed one hundred and fifty dollars." We are not concerned here with the 1929 amendment. *690
Apropos of this section as quoted, it is urged on behalf of the petitioners that the proceeds of all insurance purchased with the excess of $150.00 per year should be held liable for the indebtedness owing by W. G. Wilson at the time of his death.
It will be noted that the above section refers specifically to the purchase of insurance on the husband's life by the wife "in her own name, or in the name of any third person, with her assent, as her trustee." It does not specifically include insurance purchased by the husband himself for the benefit of his wife. Should the statute be construed to apply to insurance so purchased by the husband? Such has been the construction of the courts of some of the states where there are similar statutes. VII Cooley's Briefs on Insurance, p. 6511;Houston v. Maddux, (Ill.)
Alternative of the last above contention of petitioners it is urged by them that in any event the proceeds of insurance collected by Mrs. Wilson "should be charged with the sum of $6,416.20, the amount paid by W. G. Wilson, during the five years immediately preceding his death, as premiums upon insurance and which said sum was a fund paid by said Wilson, while insolvent, as a voluntary donation or gift to his wife." To sustain this position would be in disregard to the well recognized right of an insolvent husband to make reasonable provision through insurance on his own life for the maintenance of his dependent wife after his death. "The doctrine is *692 supported by the weight of authority that an insolvent husband may insure his life in a reasonable amount for the benefit of his wife and children, without any right on the part of his creditors to claim that the premiums for such insurance were paid in fraud of creditors, if there is no actual fraudulent intent on his part." 31 A.L.R. 52, note, and cases cited. This is not a universal rule but we give it our approval because we deem it more consistent with sound reason than is the opposing doctrine. The question next arising, then, is, what is a reasonable amount to be used by an insolvent husband in the purchase of insurance on his own life for the benefit of his wife? What standard should be employed in determining the reasonableness of the amount he may divert from his creditors and use for the payment of insurance premiums for the benefit of his wife, there being no children? The legislative standard is reasonable and in the absence of a satisfactory showing to the contrary, may safely be followed, by analogy. Under the statute, prior to 1929, if the insurance was purchased by the wife and paid for by the insolvent husband, he might employ his funds to the extent of $150.00 per year for that purpose. This is the legislative expression as to reasonable amount to be diverted from creditors under such circumstances. There is no reason why, in this case, a larger amount should be permitted to be diverted for the benefit of the wife merely because it happens that the husband himself purchased the insurance. We are therefore of opinion that there should be subjected to the payment of the debts of W. G. Wilson, deceased, to be paid out of the insurance money collected by his widow, so much of the total amount paid by him in discharge of life insurance premiums within five years preceding his death, with interest, as exceeds $150.00 per year during that period. Under the rule sustained by authorities already cited, creditors are not entitled to the full extent of premiums paid by the husband. Adjustment on the basis stated should not include premium notes executed by the insured within said period and deducted by the insurer from proceeds of insurance after the death of the insured. And for the purpose of ascertaining and decreeing the proper *693 amount as indicated, this cause will be remanded to the trial court.
It is further insisted by Mrs. Wilson that in no event should she be required to account for any of the insurance money collected by her under policies on her husband's life without giving her credit for $8600.00 for which she says her husband, an active executor of the last will of her father, J. H. Fout, deceased, failed to account to her as part of her share of said estate; and that as to said sum, with interest, she is a preferred creditor of her husband's estate under provision of sec. 25, chap. 85, Code, which gives debts due by a decedent in his capacity as a personal representative preference over all other indebtedness except that which is due the United States, and taxes and levies assessed upon the decedent prior to his death.
A party to a suit may not assume inconsistent positions therein. McDonald v. Long,
Under date of August 5, 1927, Mrs. Wilson and her sister, Mrs. Christhilf, executed, under seal, a release and discharge of Mabel Fout Wilson, as administratrix with the will annexed, of J. H. Fout, deceased, she having qualified as such subsequent to the death of her husband. In this latter release reference is made to the fact that William G. Wilson and Frank D. Christhilf, executors of the last will of J. H. Fout, deceased, had been released and discharged as such executors by the above mentioned release theretofore executed by Mrs. Wilson and Mrs. Christhilf. Now, while the first release may not be legally binding upon Mrs. Wilson and her sister because of want of consideration, the instrument not being under seal, the recitals and statements contained in the two releases strongly evidence the fact that Mrs. Wilson then considered the J. H. Fout estate as definitely settled and acted accordingly.
After all of these things had been done, the petition of Clay County Bank and others was filed February 1, 1928. In March of the same year, Mrs. Wilson filed her answer to the petition. Therein she alleges by way of new and affirmative matter that her deceased husband as active executor of the last will of J. H. Fout, deceased, had failed to pay to her a large sum of money, amount not specified, part of her share of said estate. She further asserts in said answer that the release of August 5, 1927, was without consideration, but that at the time she executed the same, she was willing to release her husband's estate from liability on account of the amount due to her by him as executor of her father's estate, because she had received the proceeds of the policies of insurance on her husband's life. *695
Mrs. Wilson's whole course of conduct prior to the filing of this answer is inconsistent with the position she seeks to take therein. That course of conduct included (1) absence of allegations from her bill as administratrix with reference to any failure on the part of her husband as executor of the Fout estate to make proper accounting to her; (2) failure on her part to answer said bill and set up such claim; (3) failure by her to except to the commissioner's report ascertaining the indebtedness of her husband's estate and fixing priorities; (4) the execution by her of the release of January 20, 1927; (5) the execution by her of the release of August 5, 1927, confirming the former release, and on the basis of the said two releases effecting a settlement of her stewardship as administratrix, c. t. a., of the estate of J. H. Fout, deceased. In the light of this course of conduct based definitely upon the position that there had been full settlement of the Fout estate, she cannot now be heard to say that because she is called upon to account for a portion of the proceeds of insurance policies upon the life of her husband she will repudiate all of said prior course of conduct and assert a preferred claim against her husband's estate with reference to something as to which her very conduct was consistently such as to lead everybody connected with the case to believe there had been a final settlement.
For the foregoing reasons we reverse the decree of the trial court and remand the cause for further proceedings to be had in accordance herewith.
Reversed and remanded. *696