25 Haw. 141 | Haw. | 1919
This is an appeal by the respondents New York Life Insurance Company and Benson, Smith & Company, Limited, from a decree entered in favor of the petitioner-appellee, Emma Forsyth Rumsey, finding, that the said Emma Forsyth Rumsey “do have and recover of and from respondent New York Life Insurance Company the sum of five thousand dollars ($5,000.00) with interest thereon at eight per cent. (8%) per annum from the 15th day of August, 1910, to date. * * * That respondent Benson, Smith & Company, Limited, acted as trustee for petitioner in receiving and retaining the sum of five thousand nine hundred fifty-nine and 55/100 dollars ($5959.55), the proceeds of a judgment rendered and entered in the above entitled court on the -8th day of February, A. D. 1913, in an action entitled: ‘Benson, Smith & Company, Limited, an Hawaiian corporation, plaintiff, vs. New York Life Insurance Company, a corporation, defendant/ in favor of Benson, Smith & Company, Limited, respondent herein, and against New York Life Insurance Company, respondent herein, which judgment was paid on the 3rd day of April, A. D. 1913, and that said Benson, Smith & Company, Limited, holds said sum of money as trustee for petitioner” and must account, and pay over to her said sum less the sum paid by said Benson, Smith & Company to the New York Life Insurance Company as premiums on said policy.
The case was tried upon an agreed statement of facts, the parties stipulating that the same should be considered the evidence in the suit, provided that the court should have the right to disregard the stipulation where it found the testimony and depositions were in conflict with the same.
The record before this court discloses, among other
The circuit judge held that Benson, Smith & Company, Limited, had no insurable interest in the life of Rumsey;
In our opinion this conclusion is not supported or warranted by the facts in the case, that is, the agreed statement of facts, the affidavits and depositions — the only facts before the trial judge and necessarily the only evidence upon which he could predicate a decision.
The purpose of the insurance was to protect the interests of Benson, Smith & Company, Limited, against a sudden demand for funds in the event of the death of any of the three men, they virtually owning the entire business; that also was Rumsey’s understanding of the matter, and he regarded it as a perfectly legitimate business transaction and not that he Avas participating in a gambling scheme — nor was the contract in contravention of the rule of public policy against wager policies.
In Grigsby v. Russell, 222 U. S. 149, 154, the court says: “Of course the ground suggested for denying the validity of an assignment to a person having no interest in the life insured is the public policy that refuses to allow insurance to be taken out by such persons in the first place. A contract of insurance upon a life in which the insured has no interest is a pure wager that gives the insured a sinister counter interest in having the life come to an end. * * * But when the question arises upon an assignment it is assumed that the objection to the insurance as a wager is out of the case. * * * This being so, no't only does the objection to Avagers disappear, but also the principle of public policy referred to. * * * The danger that might arise from a gen
If a man can assign a policy of life insurance to one having absolutely no interest in his life, it would be absurd to assert that a man may not insure his own life in favor of one who has no insurable interest in it. This conception of the position of the parties is fully sustained by the authorities. Cooley’s Briefs on Insurance 252 and cases cited. If the policy was taken out by Rumsey for the benefit of Benson, Smith & Company, Limited, it to pay the premiums under an agreement between the three stockholders in said corporation, Smith, Rumsey and Gignoux, that each of the other stockholders, Smith and Gignoux, at the time take out similar policies, which they did, Rumsey would not afterwards be any more at liberty to change the beneficiary under said policy than he would have been to change an assignee to whom he had assigned a policy on his life for a valuable consideration.
From this Anew of the case, Avhich is entirely compatible with the records, the decision of the trial judge cannot be sustained.
That the insurance was taken out by Benson, Smith & Company upon the life of Rumsey in consequence of the agreement entered into by Smith, Rumsey and Gignoux can also be substantiated by the record. If such was the case, and we are of the opinion that this was the fact, the great weight of modern authorities hold
“An insurable interest exists whenever the relation between the assured and insured whether by blood, marriage or commercial intercourse_, is such that the assured has a reasonable expectation of deriving benefit from the continuation of the life of the insured, or of suffering detriment or incurring liability through its termination.” Yance on Insurance, p. 129.
“It may be said generally, however, that while the earlier cases show a disposition to restrict it to a cléai*, substantial, vested pecuniary interest, and to deny its applicability to a mere expectancy without any vested right, the tendency of modern decisions is to relax the. stringency of the earlier cases, and to admit to the protection of the contract whatever act, event, or property bears such a relation to the person seeking insurance that it can be said with a reasonable degree of probar bility to have a bearing u,pon Ms prospective pecuniary conditionMay on Insurance, Sec. 76.
“Where there are no ties of blood or marriage between the person whose life is insured and the person who procures the policy on such life there must be some pecuniary interest of the latter in the life of the former to sustain the insurance. But an Indirect advantage is sufficient, and a moral obligation will support the policy. It is enough that in the ordinary course of events pecuniary loss or disadvantage will naturally and probably result from the death of the one. whose life is insured to the person obtaining the policy.” 25 Cyc. 706.
“Indeed, it may be said generally that any reasonable expectation of pecuniary benefit or advantage from the continued life of another creates an insurable interest in such life. * * * The essential thing is, that the policy shall be obtained in good faith, and not for the purpose of speculating upon the hazard of a life in which the. insured has no interest.” Conn. M. L. Ins. Co. v. Schaefer, 94 U. S. 457, 460.
“Although, as was said by Mr. Justice Field, in War*149 nock v. Davis, 104 U. S. 775, it is not easy to define with precision what will constitute such an- interest, it may be stated generally to exist whenever the relations between the insured and the beneficiary are such as to justify a reasonable expectation that the continuance of the life of the former will result in advantage or benefit to the latter. It is not necessary, in order to create such an interest, that the insured shall be under any legal obligation, either financial or otherwise, to the beneficiary. It is not even necessary that kinship shall exist between the parties. If the insured is under a moral obligation to render care and assistance to the beneficiary in the time of the latter’s need, then the latter has an insurable interest, other than a mere pecuniary one, in the life of the former.” Thomas v. Nat. Ben. Assn. 84 N. J. L. 281, 282.
“One not the wife, child, parent, brother, sister or creditor of insured may have an insurable interest in his life.” Kentucky Life & Acc. Ins. Co. v. Hamilton, 68 Fed. 93.
The appellant, the New York Life Insurance Company, having paid the judgment rendered against it in favor of the beneficiary in said policy, Benson, Smith & Company, Limited, is absolved from any and all further liability under said policy.
The decree appealed from is reversed and the cause remanded to the circuit judge for such further action compatible to this decision as may be necessary.