Andrews v. Andrews

• Decision Date: 01 July 1938
• Docket Number: No. 11048.,11048.
• Citation: 97 F.2d 485
• Parties: ANDREWS v. ANDREWS.
• Court: U.S. Court of Appeals — Eighth Circuit

97 F.2d 485 (1938)

ANDREWS v. ANDREWS.

No. 11048.

Circuit Court of Appeals, Eighth Circuit.

July 1, 1938.

Leslie J. Lyons, of Kansas City, Mo. (Donald E. Lyons and Hoyt A. Poorman, both of Kansas City, Mo., on the brief), for appellant.

Paul V. Barnett, of Kansas City, Mo. (Henry N. Ess, Charles E. Whittaker, and Watson, Ess, Groner, Barnett & Whittaker, all of Kansas City, Mo., on the brief), for appellee.

Before GARDNER, SANBORN, and THOMAS, Circuit Judges.

GARDNER, Circuit Judge.

This is a proceeding in equity initiated by the New England Mutual Life Insurance Company, of Boston, Massachusetts, by the filing of a bill of interpleader under Act of Congress of January 20, 1936 (28 U.S.C.A § 41, subd. 26), naming as adverse claimants Cecille Andrews as Executrix of the last will and testament of Vernon D. Andrews, deceased, and Luella D. Andrews, the appellant and appellee respectively herein, for the purpose of enjoining the named defendants from instituting or prosecuting any suit against the insurance company on account of three life insurance policies issued by said company on the life of Vernon D. Andrews, who died March 13, 1937, while said policies were in full force and effect, and for the purpose of having determined the ownership of the proceeds of these policies which were fully described in the bill of complaint. Upon the filing of the bill of complaint, the insurance company deposited in the registry of the court $3,410.40, the aggregate amount due on the policies. An interlocutory decree was thereupon entered and the insurance company was discharged.

The claimants filed their respective answers, each claiming ownership in the proceeds of the policies. Luella D. Andrews bottomed her claim on the fact that the policies were made payable to her, she being named therein as the beneficiary. Cecille Andrews, as executrix, conceding that the policies on their face were payable to Luella D. Andrews, contended that Luella D. Andrews was precluded from asserting ownership in herself because of a contract of property settlement entered into between herself and the deceased in anticipation of a divorce. The lower court found the issues in favor of Luella D. Andrews, and from the decree entered Cecille Andrews as executrix prosecutes this appeal.

It appears from the findings of the court or the undisputed evidence that Vernon D. Andrews, the insured, and Luella D. Andrews were husband and wife, living together as such, when the policies in controversy were taken out. They lived together as husband and wife for upwards of twenty years, and they had four children. During this time Vernon D. Andrews had taken out at least six life insurance policies, including the three here involved. In all six of these policies he designated his wife, Luella D. Andrews, as beneficiary, but he reserved the right to change the beneficiary without her consent in all of the policies. These policies provided that at Mr. Andrews' death, the benefits thereunder should be payable "to his wife, Luella D. Andrews, if she shall survive him, otherwise to his executors, administrators or assigns." On July 27, 1932, Andrews and his wife, Luella, entered into a contract which recited, among other things, that certain "unhappy marital difficulties have occurred so that the parties can no longer live together," and that Luella D. Andrews "contemplates commencing divorce proceedings against second party in the District Court of Lancaster County, Nebraska." A decree of divorce was entered March 2, 1933, giving Luella D. Andrews custody of the four children and approving the property settlement between the parties. This contract recited that the parties desired to settle and adjust their property rights subject to the approval of the court, and that the property awarded to each should be free and clear of any claim of the other party. The contract disclosed that indebtedness had been incurred, payment of which was secured by liens upon certain specific properties; that money had been borrowed by Mr. Andrews from the insurance companies and the companies retained liens as security. It also set out that "all properties herein enumerated to be retained by either party shall be retained by said party subject to any encumbrance thereon or indebtedness thereon contracted by either of said respective parties, which said indebtedness the party receiving the same assumes and agrees to pay."

Each of the parties was represented by counsel in the drawing of the contract. The insurance policies were not specifically mentioned, but all of the six policies, including those here in controversy, remained in Mr. Andrews' possession, and he paid the premiums thereon. After the decree of divorce, Mr. Andrews changed the beneficiary in the three policies not here involved from Luella D. Andrews to his estate. He did not, however, change the beneficiary in any of the three policies here involved.

The contract between Mr. Andrews and Luella D. Andrews contained provision that, "Second party (Mr. Andrews) shall retain as his own property any notes, insurance, accounts, securities or mortgages made payable to him and in his possession."

The fact that Luella D. Andrews,...