51 A. 838 | Md. | 1902
The Court below sustained a demurrer to a declaration filed in a suit instituted by the appellant against the appellee and, the plaintiff having refused to amend, judgment on the demurrer was entered in favor of the defendant. From that judgment this appeal was taken. The declaration alleges that on the 18th of December, 1888, the defendant, in consideration of the payment by Albert W. Clement of a premium of $249.45, and of a like sum to be paid annually thereafter during his life, agreed in writing, not under seal, to insure the life of said Clement for the term of twenty years, in the sum of five thousand dollars "to be paid to Margaret Clement, mother of the said insured, Albert W. Clement, or her legal representatives, thirty days after due notice and satisfactory evidence of the death of the insured." The death of the mother in the lifetime of the insured and his subsequent death, as well as some letters written by him to the agent of the company, which will be considered later, in connection with the claim of the appellant that the appellee is estopped to deny the liability, are also alleged. The appellant being the executor of the insured claims the amount of the insurance, and the appellee, while not denying its liability on the policy, contends that the money is payable to the legal representatives of Margaret Clement, and not to the executor of the insured.
"In ordinary life insurance, where no power of divestiture is reserved, the general doctrine prevails that the issue of the policy confers immediately a vested right upon, and raises an irrevocable trust in favor of the party named as beneficiary, a *112
right which no act of the insured can impair without the beneficiary's consent." 3 Am. Eng. of Law (2nd ed.) 980. The great number of authorities cited in the notes to sustain that statement of the law will relieve us from the necessity of quoting from them, or discussing those in conflict with it. But Margaret Clement, the beneficiary named, having pre-deceased the insured, the appellant contends that upon her death all her interest ceased, and upon the death of the insured the insurance passed to his executor. It is said that we must be governed by the intention of the parties to the contract, the insurance company and the assured, as evidenced by the policy when read in the light of the surrounding circumstances, and that Albert W. Clement only intended to make provision for his mother in case she survived him, and he could have no object in providing for her executor or administrator. If by a proper construction of the terms of the policy it could be seen that the intention of the parties was to give Mrs. Clement the benefit of the insurance if she survived the insured, and, if she did not, that it was to go to his estate, there would of course be no question about the right of the appellant to recover. But there is nothing in the policy to justify us in reaching that conclusion. If such had been the intention, it could very easily have been expressed. That was not only not done, but by the terms of the policy the money was to be paid to Margaret Clement "or her legal representatives." Although we do not deem it necessary to have such words, in order to sustain the position taken by the appellee, they do, according to some authorities, strengthen that contention. They certainly negative to some extent the theory contended for by the appellant, that the intention was only to provide for the beneficiary named, and not for those representing her estate. It was said in Robinson v. Hurst,
On page 987 of the volume of Encyclopedia of Law already referred to many cases are cited to show that the proceeds of policies payable to beneficiaries become assets of their estates when they die before the insured, and it is said that "Particularly if the policy is made payable to the `executors, administrators and assigns' of the beneficiary, as well as to the latter himself, it vests an absolute title which passes at death to the parties thus named." As said in Robinson v. Hurst,supra, the words used in this policy "ordinarily signify executors, or administrators," and, as there is nothing to indicate they were used in a different sense, that meaning should be given them.
The appellant has urged as an objection to this construction the fact that the mother of the insured had an insurable interest in his life, while her legal representatives did not have. It would serve no good purpose to enter into an extended discussion of the authorities, as to who have such an interest in the life of another as will authorize them to insure it. Even *114
in those jurisdictions where the line is most closely drawn against insurance by those who have not what is recognized as an insurable interest in the lives of the insured, the doctrine is modified by exceptions which make it of little use in ordinary cases. In the first place they for the most part hold that when the insured contracts directly with the insurer, he can designate as his beneficiary one who has no insurable interest in his life, and then the insurable interest of the beneficiary having once attached need not, as a rule, be continuous. Numerous cases are cited on page 959 of 3 Ency. of Law, but our own decisions are sufficient. In Rittler v. Smith,
It was also stated at the argument that the policy contained a clause providing that at the end of twenty years, if the insured was then alive, the said sum of five thousand dollars should be paid to him, and that the application for the policy (made part of it), provided that on the surrender of the policy its surrender value should be paid to him. The declaration did not contain those allegations, but we are asked to remand the case for amendment, if we are of the opinion that they would make the declaration good and that it was not good without their insertion. But neither of those contingencies happened, and therefore they are immaterial. The rule that a beneficiary acquires a vested right at the inception of his contract between the insurer and the insured is applied to endowment as well as ordinary policies. Pingrey v. National Life InsuranceCompany,
But the principal question has been conclusively settled in this State in Thomas v. Cochran,
The only remaining question we are called upon to consider is whether the appellee is estopped to deny the right of the appellant to recover. The declaration contains two letters written by A.W. Clement to an agent of the company after his mother's death. On March 26th, 1898, he wrote to the agent acknowledging receipt of a letter from him and expressing surprise that the money went to his mother's heirs, as he supposed that on his death it would go to his heirs, and added "I wish to change the policy to read this now. It certainly would seem that I can do it without asking my brothers about it. I have no idea that they would object, but it seems to me just as well that if possible they know nothing of it. I await your check. Look this matter of heirs up before writing them." And again on April 6th he wrote "your check for $777.73 received today. I am very much obliged. I suppose that you found out about the payment of policy in case of death by the destruction of assignments. If it does not pay my legal heirs, please have it changed so that it does." The declaration alleges that after the receipt by the agent of those letters he received additional premiums on the policy from Mr. Clement. It is upon those facts that the appellant relies for the alleged estoppel. As a result of the rule announced above as to the vesting in the beneficiary of the right to the insurance money, it follows that the insured cannot assign or surrender the policy or change the beneficiary without the consent of *117
those originally named unless he has reserved that power or the policy so provides, as will be seen by many of the cases cited in the Encyclopedia of Law above referred to. See also pages 984 and 985 of that volume. That being so it is manifest that the insurer cannot make the change for him, and the appellee cannot be estopped from denying liability for not doing what it was absolutely powerless to do. It matters not that the insured may be under no legal obligations to continue the payment of the premiums. If he refuses to do so the beneficiary, or someone on his behalf, may pay them and continue the policy in force.Pingrey v. National Life Insurance Company,
Being of the opinion that the appellant, the executor of Albert W. Clement, is not entitled to this insurance money, the judgment will be affirmed.
Judgment affirmed, the appellant to pay the costs.
(Decided April 1st, 1902.) *118