American-Traders' Nat. Bank v. Henderson

• Decision Date: 12 March 1931
• Docket Number: 6 Div. 746.
• Citation: 133 So. 36,222 Ala. 426
• Parties: AMERICAN-TRADERS' NAT. BANK ET AL. v. HENDERSON.
• Court: Alabama Supreme Court

133 So. 36

222 Ala. 426

AMERICAN-TRADERS' NAT. BANK ET AL. v. HENDERSON.

6 Div. 746.

Supreme Court of Alabama

March 12, 1931

Appeal from Circuit Court, Jefferson County; Wm. M. Walker, Judge.

Bill by Emma O. Henderson, as administratrix of the estate of S. H Henderson, deceased, against the American-Traders' National Bank, as administrator of the estate of Alse W Bell, deceased, and American Central Life Insurance Company to reform a contract of life insurance. From a decree overruling a demurrer to the bill, the defendant administrator appeals.

Affirmed.

Horace C. Wilkinson, of Birmingham, for appellant.

W. A. Weaver and R. B. Evins, both of Birmingham, for appellees.

BROWN J.

This is a bill filed by Emma O. Henderson, as the administratrix of the estate of S. H. Henderson, deceased, against the American Central Life Insurance Company, and the American-Traders' National Bank, as the administrator of the estate of Alse W. Bell, deceased.

Subsequent to the decree overruling the demurrers of the defendant American-Traders' National Bank, that bank, in pursuance of the authority granted by the laws of the United States authorizing such consolidations, was consolidated with the First National Bank of Birmingham, and the latter was then appointed as the administrator de bonis non of the estate of said Bell, and sued out this appeal as authorized by the statute. Boshell v. Phillips, 207 Ala. 628, 93 So. 576; Petition of Worcester County Nat. Bank, 263 Mass. 444, 162 N.E. 217; Ex parte Worcester County Nat. Bank, Appt., 279 U.S. 347, 49 S.Ct. 368, 73 L.Ed. 733, 61 A. L. R. 987.

The other defendant, American Central Life Insurance Company, has not appeared or joined in the appeal of the bank as administrator de bonis non.

The bill as amended presents the case in three aspects. First, to reform an insurance policy on the life of the complainant's intestate, issued by the defendant American Central Life Insurance Company, in the sum of $10,000, in which A. W. Bell, employer, is named as the beneficiary. Second, to declare a constructive trust in the policy arising from the fraud of Bell practiced on Henderson, the complainant's intestate; and, third, to redeem the policy from a pledge made to secure an indebtedness due from Henderson to Bell, and for an accounting to ascertain the sum of the indebtedness secured by such pledge.

The demurrer, which was overruled, is not addressed to any aspect of the bill, but goes "to the bill of complaint as amended, and to each paragraph thereof, separately and severally," and under the rulings of this court is to the bill as a whole, and the demurrer was properly overruled, if the bill as amended in any of its aspects was not subject to the demurrer. Oden v. King et al., 216 Ala. 504, 113 So. 609, 54 A. L. R. 1413; Kelly v. Carmichael, 217 Ala. 534, 117 So. 67.

The ground on which the complainant seeks relief is fraud and deceit on the part of Bell in misrepresenting to Henderson the contents of the application for the issuance of the policy at the time Henderson signed the application, the contention of complainant being that it was Henderson's purpose to apply for insurance on his life, payable to his (Henderson's) estate.

The bill, after showing by the averments of the second paragraph that a relation of trust and confidence in fact existed between Bell and Henderson, with Bell occupying the position of dominance, and that, prior to the occasion in question, Bell operated an insurance agency and acted for the defendant American Central Life Insurance Company in procuring from Henderson an application for life insurance, as a predicate for relief in this case, avers: "That on to-wit, January 21st, 1925, the said Bell approached said Henderson relative to taking out further insurance on Henderson's life, and presented to said Henderson an application for insurance with the American Central Life Insurance Company, which said application had been prepared by the said Bell, or under his directions, before being presented for the signature of the said Henderson; that said application was not prepared in the presence of the said Henderson, and that he did not read or hear the same read. That the said Henderson inquired of Bell if said application was such as to make the proceeds of the policy payable to his estate in the event of his death, and stated that he desired any contract of insurance taken out by him to be made payable to his estate. That thereupon the said Bell represented to the said Henderson, at the time he signed said application, that it was drawn in such form that the insurance contracted for would be issued payable to Henderson's estate, as Henderson had requested; that thereupon, the said Henderson relying on said representation, signed the said application, which was dated January 14, 1925, under which policy #132,787 was issued."

In the application, a copy of which was attached to and made a part of the bill, it is stated: "I wish policy payable at my death to A. W. Bell, related to me as employer." And it is further averred "that instead of said application directing that the policy be issued in the name and for the benefit of said Henderson's estate, that there was in said application a provision directing the policy to be issued naming said Alse W. Bell, employer, as beneficiary; that the said Henderson relied on the representation of the said Bell, as to said application, and that because of such misrepresentation, as aforesaid, Henderson was induced to sign the same."

It is further alleged that the policy was issued by the insurance company, delivered to Bell, and kept by him until the death of Henderson; that the respondent bank, as administrator of Bell, claims an interest in said policy of insurance, and the proceeds thereof, under and by virtue of a purported assignment by the said Henderson to said Bell during their lives, as collateral security for an indebtedness of $20,000; that Henderson was not so indebted to the said Bell, but, in the alternative, if he was, the claim of indebtedness is in excess of the true amount; that the matters pertaining to said indebtedness were matters within the knowledge of Bell and unknown to Henderson.

These averments show fraud on the part of Bell in procuring the signature of Henderson by misrepresenting the contents of the application, and mistake of fact on the part of Henderson that would entitle the complainant to maintain the bill to reform the contract, if it appeared that Bell was acting as the agent of the insurance company in taking the application. But this does not appear, except by possible intendment. This is not sufficient on demurrer, where the averments of the bill must be considered most strongly against the pleader. Cudd v. Wood, 205 Ala. 682, 89 So. 52; 2...