Burges v. New York Life Ins. Co.

• Decision Date: 20 June 1899
• Citation: 53 S.W. 602
• Parties: BURGES v. NEW YORK LIFE INS. CO. et al. (CAMERON, Intervener).<SMALL><SUP>1</SUP></SMALL>
• Court: Texas Court of Appeals

53 S.W. 602

BURGES v. NEW YORK LIFE INS. CO. et al. (CAMERON, Intervener).¹

Court of Civil Appeals of Texas.

June 20, 1899.

Appeal from district court, El Paso county; A. M. Walthall, Judge.

Action by Richard F. Burges, administrator of George F. Miller, deceased, against the New York Life Insurance Company and J. O. Cameron, as guardian of Alice May Miller, intervener. Defendant company admitted its liability, and offered to make payment to the party entitled, and from a judgment in favor of the intervener plaintiff appeals. Reformed and affirmed.

W. S. Smallwood, for appellant. A. A. Freeman and D. A. Richardson, for appellee.

STAYTON, Special Judge.

This suit was originally instituted by Richard F. Burges, administrator of the estate of George F. Miller, deceased, on the 12th day of July, A. D. 1898, against the New York Life Insurance Company, to recover the sum of $2,000 on a life policy issued to said Miller. On the 28th day of September, A. D. 1898, J. O. Cameron, as guardian of the estate of Alice May Miller, a minor adopted daughter of George F. Miller, intervened, and sought to recover the amount of said life policy, on the ground that Miller, during his lifetime, had assigned said policy to the said minor. On the 3d day of October, A. D. 1898, the New York Life Insurance Company answered, admitting its liability, and offered to pay into court the amount of the policy, to be paid over to the rightful party. On the 1st day of December, A. D. 1898, the appellant filed a first supplemental petition, denying all the allegations of the intervener's petition, and alleged, in answer to the intervener's demand, that at the time of the issuance of the insurance policy sued upon, and at the time of the alleged assignment of said policy by Miller to his adopted daughter, Alice May Miller, said Miller was indebted to various parties in large sums, and that there were then outstanding valid claims against the estate of the said Miller amounting to about the sum of $400, which had been allowed by the administrator, and approved by the county court; and further alleged that there were other valid outstanding claims against said estate, and that the estate was wholly insolvent, and was so at the time of the alleged assignment of the life policy to said Alice May Miller, and that said alleged assignment was made in fraud of the creditors of said Miller, and, if enforced, would deprive said creditors of their just and legal rights. On the same day the intervener filed his first supplemental petition in answer to appellant's first supplemental petition, setting up: (1) A general demurrer thereto; (2) a special exception on the ground that the deceased, Miller, was authorized and entitled by law to make the alleged assignment, and his creditors, if any he had, had no interest in the subject-matter of the policy, or any part thereof; (3) on the ground that at the date of the assignment of said policy it was of no cash value; and (4) a denial of the material allegations of said supplemental petition. On the 2d day of December, A. D. 1898, the cause came on to be heard by Hon. A. M. Walthall, judge of the district court of El Paso county, and, no jury being demanded, all issues of fact as well as of law were submitted to the court. The court sustained the special exceptions interposed by the intervener to so much of appellant's supplemental petition as set up debts against the estate of Miller, deceased, as being a defense to intervener's claim, and upon a hearing of the facts rendered judgment in favor of the intervener, as guardian of the estate of Alice May Miller, against the New York Life Insurance Company, for the face of the policy, $2,000, and interest at the rate of 6 per cent. per annum from the 30th day of April, A. D. 1898, until paid, and decreed that appellant take nothing by his suit, and that the intervener and the New York Life Insurance Company recover of and from the appellant all costs to be paid in due course of administration. From this judgment, appeal has been taken to this court.

In his first assignment of error the appellant complains of the action of the court in sustaining the special exception of the intervener to appellant's first supplemental petition, in which the indebtedness and insolvency of Miller's estate was alleged as a defense to the claim of intervener. By this supplement the appellant sought to recover the amount of the life policy for the use and benefit of Miller's estate, on the theory and allegation that the assignment of the policy to Alice May Miller was made in fraud of the rights of creditors. The trial court ruled as follows: "Intervener's special exception to so much of plaintiff's supplemental petition as sets up debts against the estate of Miller, deceased, as being a defense to intervener's claim," is sustained. It is not clear as to what the court meant by this ruling, in view of the fact that two special exceptions were urged to the first supplemental petition,—one to the effect that Miller had a legal right to assign the policy, and that creditors had no interest in the subject-matter of the policy; and, second, that at the date of the alleged assignment the policy was of no cash value. If the court intended, by its ruling, to sustain the first special exception, then the court was in error, for the appellant sought to subject the policy to the administration for the payment of debts, upon the theory that the assignment thereof was made during insolvency, and in fraud of the rights of creditors, thus attacking the legal right of the intestate, Miller, to assign the same; and the exception merely traversed this allegation by claiming that Miller was authorized and entitled by law to make such assignment, thus raising merely a defensive issue of fact by exception, and not an issue of law, as to the sufficiency of the pleading attacked. And the same may be said of the latter portion of the exception setting up that the creditors of Miller's estate had no interest in the subject-matter of the policy, for this raised a mere question of fact, and did not go to the question of the sufficiency or insufficiency of appellant's pleadings, or raise the question as to whether or not the appellant, in his capacity of administrator, could contest the assignment, on the ground of fraud, for the use and benefit of the estate or of its creditors. If the court intended, by its ruling, to sustain the second special exception, it equally erred, for the reason that this exception only raised a question of fact, to wit, as to whether or not the life policy in question was a thing of value. However, under the state of pleading disclosed by the record, the errors of the trial court above referred to should not affect the result of the trial, for we are of the opinion that the general demurrer of the intervener to appellant's first supplemental petition should have been sustained; and, if we are correct in this, nothing set out therein could have been considered by the court as affecting the right of intervener to recover the amount of the life policy, if the same in fact should have appeared to have been properly assigned, as alleged, to intervener's ward, and as will be discussed hereafter.

The appellant, as administrator of the estate of George F. Miller, deceased, sought by his first supplemental petition to defeat the claim of the intervener under an assignment of the life policy by the intestate on the ground that such assignment was made during insolvency, and in fraud of the rights of creditors. It has been repeatedly held by our supreme court that only creditors or innocent purchasers can attack a conveyance for fraud, and that an administrator cannot be heard to attack the act of...