300 Mass. 147 | Mass. | 1938
This is an action of contract brought against an insurance company on seven insurance policies, in each of which the plaintiff was named as beneficiary, issued by the defendant on the life of the plaintiff’s husband, John C. Finegan, who died June 16, 1935. The defendant filed a petition of interpleader under G. L. (Ter. Ed.) c. 231, § 40, in which it admitted liability for the amount claimed in the declaration, alleged that this amount was claimed by Samuel Cabot Incorporated, and that the defendant had no interest in the subject matter of the controversy, and petitioned the court to order said Samuel Cabot Incorporated, herein referred to as the claimant, to be made a defendant. See Dixon v. National Life Ins. Co. 168 Mass. 48, 49. The original defendant paid into court the sum of $21,979.40, the undisputed amount of its liability under the policies. The claimant answered claiming the entire fund by virtue of assignments of the policies, and, in the alternative, the sum of $7,153.51, the amount — as the parties have agreed — paid by the claimant between February 20, 1929, and February 21, 1935, as premiums and interest on loans on the policies.
There was a pre-trial hearing, and, by the terms of the report, the “pre-trial agreement between counsel may be considered ... as part of the record.” See Fanciullo v. B. G. & S. Theatre Corp. 297 Mass. 44, 49-52. Eckstein v. Scoffi, 299 Mass. 573, 576. Thereafter there was a trial. (Nothing in the record suggests that the case was not tried in accordance with the “pre-trial agreement.” Compare Capano v. Melchionno, 297 Mass. 1, 14-15.) The plaintiff, at the close of the evidence, made a motion for a directed verdict in her favor in the amount of $21,979.47, and the claimant made a motion for a directed verdict in its favor in the same amount. The judge denied both
The pre-trial report was as follows: “It is admitted that the Prudential Insurance Company of America issued seven policies on the life of John C. Finegan, the dates, numbers and amounts of which are set forth in the various counts of the plaintiff's declaration. John C. Finegan died June 16, 1935. The amount due on these policies was $21,779.47 and this amount together with interest making the total amount $21,979.40 has been paid into court. The plaintiff was named the beneficiary in each of these policies and claims the entire fund as beneficiary. Samuel Cabot, Inc. claims the entire amount by virtue of assignments of each of the seven policies under date of February 26, 1929 ■— (which the plaintiff Finegan claims were not valid and subsisting as of the date of the death of John C. Finegan). These assignments will be produced by the defendant at the trial. No question is raised but these are each signed by both John C. Finegan and Anna G. Finegan. On March 2, 1929, John C. Finegan and Samuel Cabot Inc., entered into a written agreement which will be produced at the trial by the defendant. The issues, of fact to be tried are: 1. Was there any consideration for the assignment? 2. The amount of the indebtedness from the John C. Finegan Co. to Samuel Cabot, Inc. 3. Whether at the date of the death of John C. Finegan there was any indebtedness due from John C. Finegan Co. to the Cabot Co., and whether as of the date of the death the Cabot Co. had any interest in the John C. Finegan Co. So far as the
The amount due on the policies was payable to the plaintiff as the beneficiary named therein unless the claimant was entitled to the whole, or a part thereof, by reason of assignments of the policies or by reason of the payment by the claimant of premiums and interest on loans on such, policies. The burden of establishing its claim to the whole or any part of the amount due on the policies was on the claimant. See Kochanek v. Prudential Ins. Co. 262 Mass. 174, 179.
The effect of the ruling of the trial judge with respect to the disposition of the fund in controversy is that as matter of law the burden of proof resting on the claimant was sustained as to the amount paid by it as premiums and interest on loans, but that the agreed facts aud evidence did not warrant a finding that the burden was sustained as to any larger amount. The claimant contends not only that a finding in its favor for the entire amount of the fund was warranted, but also that such a finding was required as matter of law. The plaintiff contends that the agreed facts and evidence did not require or even warrant a finding in favor of the claimant in any amount.
A finding in favor of the claimant for the entire amount of the fund paid into court was required as matter of law.
First. There were assignments of the policies to the claimant binding on the plaintiff.
■ The record does not disclose that the policies in question were introduced in evidence at the trial. Nor is it shown that they were delivered to the claimant. However, a separate written assignment of each of these policies, dated February 26, 1929, admittedly signed by John C. Finegan and by the plaintiff, was introduced in evidence. The case appears to have been tried on the basis that these assignments were in the possession of the claimant. They were not under seal. Each of them, purported to be signed by John C. Finegan, as the insured, and by the plaintiff, his
There is no contention that any formal requisites of assignment set forth in the policies were not complied with, or that if any such requisites were not complied with the assignments were for that reason ineffective as between the plaintiff and the claimant. See Goldman v. Moses, 287
1. The principal contention of the plaintiff relating to the validity or binding effect upon the plaintiff of the purported assignments of her rights in the policies to the claimant is that there was no consideration for such assignments. Indeed, according to the pre-trial report, the only issue of fact relating to the validity or binding effect of the assignments was whether there was any consideration therefor. The claimant contends that there was consideration for the assignments by the plaintiff. On this issue the claimant
The recital in each assignment that the assignment was made “For Value Received” must be regarded as a recital by the plaintiff. This recital, being in the nature of an admission by her, was prima facie evidence of the fact recited — that she received “value” for the assignment. A recital in a written instrument of the receipt of a stated and sufficient consideration, even in the conventional phrase “one dollar and other valuable consideration,” is prima facie evidence of consideration, though it is not conclusive, where met or controlled by other evidence, as ordinarily is permissible. Cochran v. Duty, 8 Allen, 324. Way v. Greer, 196 Mass. 237, 244-245. Am. Law Inst. Restatement: Contracts, § 82. 1 Williston, Contracts (Rev. ed.) § 115B. Compare Farquhar v. Farquhar, 194 Mass. 400, 405; Budro v. Burgess, 197 Mass. 74, 76. We think the same rule applicable to the equally conventional but less definite recital “value received.” It has been said that these words in a promissory note “imported a consideration” (Tremont Trust Co. v. Brand, 244 Mass. 421, 422) and that they are prima facie evidence of consideration (Noxon v. DeWolf, 10 Gray, 343, 346, Chaltas v. Chronis, 261 Mass. 221, 224, see also Burnham v. Allen, 1 Gray, 496, 500), though a promissory note, by reason of its nature, even without such words, imports consideration. Townsend v. Derby, 3 Met. 363, 364. Dean v. Carruth, 108 Mass. 242, 244. In Parish v. Stone, 14 Pick. 198, 201, however, though the instrument before the court was in the form of a promissory note, it was said by Chief Justice Shaw that it “is now well settled, that to support a promise or other contract, not under seal, as a contract binding in law, there must be a legal consideration; and in the application of this rule it is quite immaterial whether the contract be by paroi or in writing. The law, however, attributes so much force and effect to the formal written contract, and to the words ‘value received/ as to presume, in the absence of proof,
The circumstances attending the transaction by which the plaintiff purported to join with the insured in assigning the policies are not shown, except that there was evidence that no representative of the claimant had any business dealings or other conversation with the plaintiff or paid anything to her. There could have been a sufficient consideration without any payment to her. Consideration for an assignment need not move to the assignor — in the ordinary sense of those words — if furnished in accordance with a bargain made by such assignor. See Palmer Savings Bank v. Insurance Co. of North America, 166 Mass. 189, 195-196; Hare & Chase, Inc. v. Commonwealth Discount Corp. 260 Mass. 134, 136; Am. Law Inst. Restatement: Contracts, § 75, subsection 2; 1 Williston, Contracts (Rev. ed.) § 113. See also Connecticut Mutual Life Ins. Co. v. Allen, 235 Mass. 187, 190; Worthen v. Burgess, 273 Mass. 437; Shea v.Aetna Life Ins. Co. 292 Mass. 575, 581. And such a bargain could have been made in behalf of the plaintiff by a person whom she had authorized or clothed with apparent authority to do so. Nothing in the evidence met or controlled the prima facie evidence of the receipt by the plaintiff of consideration for the assignment of her rights in the policies to the claimant.
Whether, in the absence of consideration for the assignments by the plaintiff of her rights in the policies, these assignments were, or could have been found to be, binding upon her need not be decided. See Herman v. Connecticut Mutual Life Ins. Co. 218 Mass. 181, 186-187.
It is the plaintiff’s contention that she is not bound by this “memorandum of agreement” and, also, that by accepting it the claimant relinquished the rights, if any, which it acquired by the assignment of the plaintiff’s rights under the policies. The plaintiff was not bound by the “memorandum"of agreement” to which she was not a party. The claimant’s rights under the plaintiff’s assignments could not be enlarged by such an agreement,, except as directly or indirectly the “interest” of the claimant in the John C. Finegan Company, within the meaning of the written assignments, was thereby enlarged. The rights of the claimant to the proceeds of the policies as against the plaintiff are fixed by the terms of those assignments. According to these terms, the “interest” of the claimant “in the John C. Finegan Co.” is the “interest” which “may appear” — obviously meaning such “interest” determined as of the date of the death of the insured, when the policies were to be paid. The statement in Atlas Reduction Co. v. New Zealand Ins. Co. 138 Fed. 497, 504, with respect to the words “as their interest may appear,” indorsed on a policy of fire insurance, when standing alone, is applicable. It was there said that these words “are plainly prospective, and refer, not to an interest existing at the time when the indorsement was written, but to such interest as may appear at the time of the loss, if any, without regard to the character of the interest, or the time when it may have arisen.” See Richardson v. White, 167 Mass. 58, 60. Consequently, even if as a result, direct or indirect, of the agreement embodied in the “memorandum of agreement” the “interest” of the claimant in the John C. Finegan Company was enlarged after the assignments by the plaintiff, the binding effect of such assignments was not destroyed thereby. And the provision in the “memorandum of agreement” that the insured’s interest in the policies is assigned as security for his personal guaranty of payment of the indebtedness of the John C. Finegan Company to
Second. In accordance with the terms of the plaintiff’s assignments whereby the claimant is entitled to the proceeds of the insurance policies “as their interest may appear in the John C. Finegan Co.” the claimant is entitled to the entire fund paid into court.
As already stated, the “interest” of the claimant “in the John C. Finegan Co.” is to be determined as of the date of the death of the insured, June 16, 1935. The claimant concedes that this “interest” is “the interest of the Cabot Company as a creditor of the John C. Finegan Company.” The plaintiff properly makes no contention that the “interest” referred to in the assignments does not include the “interest” of the claimant as such a creditor. See Richardson v. White, 167 Mass. 58. She contends, however, that, by reason of the bankruptcy of the John C. Finegan Company and also by reason of its dissolution, the claimant had no such “interest” at the date of the death of the insured. This contention cannot be sustained.
The parties agreed “that the open account standing on the books of Samuel Cabot, Inc. in February 1929 as being owed by John C. Finegan Company was $13,610.73. . . . that between February 23, 1929 and November 1929 there was paid by Samuel Cabot, Inc. to John C. Finegan Company or on its behalf and for its benefit, a total amount of $13,748.69; that during the same period from February to November 1929 the Finegan Company repaid the Cabot Company the sum of $2585, leaving a net amount paid on its behalf for the benefit of or to the John C. Finegan Company by Samuel Cabot, Inc. of $11,163.69.” There was evidence that “The $13,610.73 indebtedness of John C. Finegan Company was carried as an account receivable in the accounts receivable ledger and on July 26, 1929 the open account was closed and notes due in October 1929,
1. The “interest” of the claimant in the John C. Finegan Company, within the meaning of the plaintiff’s assignments, was not destroyed by the bankruptcy of that company. There was evidence that “John C. Finegan Company was adjudicated a bankrupt February 24, 1931, and upon the adjudication, Samuel Cabot, Inc. filed a claim in bankruptcy as an unsecured creditor and received a dividend of $414.25 on a claim of $25,105.92.” And it was agreed that there has been no discharge in bankruptcy of the company.
It is obvious, though the precise nature of the transaction in which the plaintiff’s assignments to the claimant were made does not appear, that such assignments were made to protect the “interest” of the claimant in the John C. Finegan Company — since this “interest” was the measure of the claimant’s right to the proceeds of the policies — and that such- “interest” was the obligation of the company to the claimant, rather than the amount which could be collected on account of such obligation. It is a necessary implication from the language of the assignments that they were given as security for such obligation. Neither the filing by the claimant, in the bankruptcy proceedings, of a claim as an unsecured creditor and the receipt by the claimant of a dividend thereon, nor a discharge in bankruptcy, would have cancelled the obligation of the company to the claimant to any extent beyond the amount of the dividend received,
2. The “interest” of the claimant in the John C. Finegan Company, within the meaning of the plaintiff’s assignments, was not destroyed by the dissolution of the John C. Finegan Company. There was evidence that “John C. Finegan Company was dissolved by Chapter 139 of the Acts of 1932. The effective date of the Act was March 31, 1932, and three years under the Statute expired March 31, 1935.”
Considerations similar to those already discussed in connection with the bankruptcy of the John C. Finegan Company are applicable to its dissolution. Though by reason of such dissolution the company ceased to exist, even for purposes of litigation, and its prior obligations to the claimant could not be enforced in legal proceedings against the company, such obligations were not so far cancelled that they cannot be used as the measure of the “interest” of the claimant in the company, within the meaning of the plaintiff’s assignments, which such assignments were designed to protect. See Thornton v. Marginal Freight Railway, 123 Mass. 32, 34; Cummington Realty Associates v. Whitten, 239 Mass. 313, 324-325. See also Boston Box Co. Inc. v. Rosen, 254 Mass. 331, 334.
Third. In view of the conclusion reached it is unnecessary to consider whether the claimant has established a
Fourth. The only exception to evidence argued by the plaintiff relates to the admission of a conversation which the claimant’s president had with the insured, prior to the execution of any written agreement with the insured, “regarding the account owed by Finegan Company to Cabot Company.” This conversation is not specifically identified in the record, but apparently was a conversation described in the record under the heading, “Summary of Testimony.” Since the right of the claimant to the fund is established as matter of law without reliance upon this evidence, its admission, even if erroneous, as we do not intimate, was not prejudicial to the plaintiff. And in view of the result of the case it is unnecessary to consider the claimant’s exceptions to the exclusion of evidence.
Since the rulings of the trial judge as to the disposition of the fund were not correct, under the terms of the report that in this event “such order may be entered . . . as justice may require,” judgment is to be entered in favor of the claimant, Samuel Cabot Incorporated, for the amount of the fund paid into court, subject to any appropriate orders with respect to the original defendant, The Prudential Insurance Company of America. G. L. (Ter. Ed.) c. 231, §40.
So ordered.