109 Ky. 51 | Ky. Ct. App. | 1900
OPINION OK THE COURT BY
REVERSING.
In May, 1895, J. S. Morehead obtained a policy of life insurance for $5,000, payable on his death to his executors or administrators. Some years before 1895, he had taken a policy for a like sum, payable to his wife, appellee herein. On December 6, 1895, after having been ill with typhoid fever some five weeks, J. S. Morehead assigned the policy dated in May, 1895, to his wife, now Mary A. Mayfield, she having since his death married one Mayfield. The only consideration for this assignment was love and affection. Morehead died December 9th, after the assignment. After his death appellee qualified as administratrix, and collected both policies, — the one originally made payable to her and the one assigned just before her husband’s death. Ap-pellee, as administratrix, instituted an action to settle the estate of her husband, and in that action it developed that J. S. Morehead at the time of his death was insolvent. In that action of settlement certain creditors of J. S. More-head sought to charge appellee as administratrix, with the proceeds of the two policies of insurance on the ground that the ássignmemt t.P appellee of December 6, 1895, was fraudulent and void that decedent at that time did not have mental capacity, by reason of his long and serious
We are of opinion that the proceeds of the old policy,, payable by its terms to appellee, and extended, belong to appellee absolutely, and appellant has no interest or estate therein. The provision for extension was paid for by the payment of premiums, and appellee was entitled to all the-rights and benefits arising thereunder.
Section 654, Kentucky Statutes, in force July 1, 1893, provides: “A policy of insurance on the life of any person expressed to be for the benefit of, or duly assigned, transferred or made payable to any married woman, or to any person in trust for her, or for her benefit, by whomsoever such transfer may be made, shall inure to her separate use and benefit, and that of her children, independently of her husband or his creditors, or any other person effecting or transferring the same or his creditors. . . But if the premium on any policy in this section mentioned is paid by any person with intent to defraud his creditors, an amount equal to.the premium so paid, with interest thereon, shall inure to the benefit of said creditors, subject, however, to the statute of limitations.” By this section, which was originally enacted as part of the act of 1870, it is provided that a husband may take out a policy of life insurance for the benefit of his wife, or that he may transfer or assign a policy of life insurance to his wife or for her benefit, and that all such policies shall inure to the benefit of the wife, to the exclusion of any creditor of the husband, except as to premiums paid under certain conditions. It is clear to us that this statute means that an assignment of a policy to a wife or for her benefit can not be held to be fraudulent as to creditors, except as to premiums paid when the husband was insolvent. We conclude, therefore, that Morehead, being of sufficient mind, could assign the policy to his wife, appellee, and that she would be entitled
It is insisted, however, that, if Morehead could have assigned the policy, he did not do so, so as to legally pass title as against creditors, because, as it is said, the assignment was not recorded as provided by section 2128, which reads: “A gift, transfer or assignment of personal property between husband and wife shall not be valid as to third persons, unless the same be in writing, and acknowledged and recorded as chattel mortgages are required by law to be acknowledged and recorded; but the recording of any such writing shall not make valid any such!' gift, transfer or assignment which is fraudulent or voidable as to creditors or purchasers.” There is no pretense that the assignment was acknowledged or recorded. Counsel for appellee suggests that this policy of life insurance, or, indeed, any chose in action, is intended to be included in section 2128, stipra, as personal property, and cites authority holding that a mortgage of choses in action are not recordable instruments. While there is force in this position, we do not think it necessary to a decision of this case to determine the question as to what . particular kinds of property are embraced in the term “personal property,” as used in the statute. We think the statute meant to include property of a tangible, substantial nature or right, having at the time an ascertainable value, and thus an appreciable part of the husband’s estate. We do not think the statute includes any mere possibility, expectancy, or contingency, but its- aim and purpose is to cover some kind of property that, at least, a creditor might subject by attachment to his debt, or that would pass by a deed of general assignment for the benefit of creditors. This policy, at the date of -the assignment, had no surrender value,
We are also of opinion that under section 654, supra, the premium paid by decedent, Morehead, for the policy in May, 1895, was paid in fraud of creditors, — at least, this was the effect of the assignment to appellee, — and under that section the creditors are entitled to this premium so paid, with interest. The provision of the section is: “But if the premium on any policy in this section mentioned ■is paid by any person with intent to defraud his creditors,” etc. And while at the time of the payment, in May, 1895, there may have been no intention to defraud creditors, yet the assignment to appellee would have defeated the purpose of this provision, if the amount of this premium' be not refunded to the estate. Such a device can not be resorted to to defeat the provisions of this section. We ■hold that while decedent might lawfully assign to appel-lee, his wife, the policy in question, and that the proceeds would vest in her, yet this was the same, in effect, as if the policy had originally been taken for her benefit. The creditors of decedent are entitled to an amount equal to the premiums paid. For this error alone the judgment is reversed, and cause remanded, with directions to render judg