Wirgman v. Miller, &C.

• Decision Date: 25 January 1896
• Parties: Wirgman v. Miller, &c.
• Court: Kentucky Court of Appeals

98 Ky. 620

Wirgman v. Miller, &c.

Court of Appeals of Kentucky.

January 25, 1896.

APPEAL FROM JEFFERSON CIRCUIT COURT, CHANCERY DIVISION.

JOSEPH A. SANDERS FOR APPELLANT.

BARNETT, MILLER & BARNETT FOR APPELLEES.

JUDGE Du RELLE DELIVERED THE OPINION OF THE COURT.

The appellant brought suit against the appellees upon a note executed since the act of March 15, 1894, as to the property rights of husband and wife, went into effect. Two of the appellees, the makers of the note sued on, are alleged to be husband and wife, and the other appellees are their childeren. The first paragraph of the petition seeks a personal judgment against both husband and wife. In the second paragraph it is alleged that, to secure the payment of the note, the husband and wife pledged to plaintiff a policy and its proceeds in the Northwestern Mutual Life Insurance Co., payable on the death of the husband to the wife, if she shall be then alive; and, in case of her death prior to that of her husband, then to the executors, administrators or assigns of the husband; that the note contained an agreement that in case of default in the payment thereof at maturity the makers would request the company to pay the cash surrender value of the policy to the payee of the note, to the extent of the debt and interest. This paragraph also alleges that the other appellees, the children of the makers of the note, claimed that the makers had no authority to pledge the policy of insurance, and that, in the event of the death of the wife prior to that of her husband, the proceeds of the policy would pass to the children. The petition prays that the makers of the note be compelled to request the payment of the cash surrender value of the policy. The note sued on is as follows:

                "$500.                   LOUISVILLE, Ky., July 2, 1894
                

"One year after date we promise to pay to the order of H. Wirgman the sum of five hundred dollars, with interest from date until paid, at the rate of six per centum per annum, and, as security for said debt, we hereby pledge policy No. 137, 135, or its proceeds, in the Northwestern Mutual Life Insurance Company, dated September 25, 1885, for $10,000, issued to Virginia H. Miller on the life of her husband, Mancil G. Miller. And if we fail to pay said note at maturity, we agree and bind ourselves to request said insurance company, in writing, to pay to said Wirgman the cash surrender value of said policy to the extent of said debt and interest, and the balance to us. "MANCIL G. MILLER,

                                                      "VIRGINIA H. MILLER."
                

The wife demurred to both paragraphs of the petition, and the other appellees demurred to the second paragraph, and both demurrers were sustained.

It is contended for appellees that sections 654 and 655, Kentucky Statutes (which are in substance sections 30-31 of the act of March 12, 1870), give to the children of the wife a vested interest in the policy which can not be divested by the act of the husband and wife. The sections are as follows:

"§ 654. 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. * * *"

"§ 655. When a policy of insurance is effected by any person on his own life, or on another life in favor of some person other than himself, having an insurable interest therein, the lawful beneficiary thereof, other than himself or his legal representative, shall be entitled to its proceeds against the creditors and representatives of the person effecting the same. * * *"

In support of this contention of appellees the case of Central National Bank of Washington v. Hume, 128 U. S., 195, is cited, in which the general rule is stated that the right to a policy of insurance, and the money to become due under it, vests immediately upon its issual in the person named in it as the beneficiary; and that this interest, being vested, can not be transferred by the insured to any...