Condon v. N.Y. Life Ins. Co. of N.Y.

• Decision Date: 16 February 1918
• Docket Number: No. 31629.,31629.
• Parties: CONDON ET AL. v. NEW YORK LIFE INS. CO. OF NEW YORK ET AL.
• Court: Iowa Supreme Court

183 Iowa 658

166 N.W. 452

CONDON ET AL.

v.NEW YORK LIFE INS. CO. OF NEW YORK ET AL.

No. 31629.

Supreme Court of Iowa.

Feb. 16, 1918.

Appeal from District Court, Cherokee County; Wm. Hutchinson, Judge.

On August 5, 1889, the defendant insurance company issued an ordinary life policy for $3,000 on the life of John J. Condon, making the same payable to Mary J. Condon, his wife, and Nellie, Louis, and Geraldine M. Condon, his children, or to their executors, administrators, or assigns, share and share alike. The insured died June 24, 1908, and Nellie Condon, whose name at the time of her death was Nellie Condon Gilbert, died in 1907 survived by a daughter. On the 8th day of May, 1908, the insured executed a written assignment to Mary J. Condon, as follows:

“Original to Attach to Policy--Executed in Duplicate.

Assignment of Part of Policy No. 326452.

Amount of Policy $3,000.00. Date of Policy, August 5th, 1889.

On the life of John J. Condon, of Cherokee, Iowa, in the New York Life Insurance Company, of New York, U. S. A.

For value received, I, John J. Condon, farmer, of Cherokee county, Iowa, do hereby assign, transfer, and set over all that part of the above-described policy of insurance payable to my daughter Nellie Condon (she having died), and all sum or sums of money, interest, benefit, and advantage whatsoever, now due or hereafter to become due, by virtue thereof, unto my wife, Mary J. Condon, if living at the maturity of this policy by the death of the insured, subject to all the terms and conditions expressed therein, otherwise this assignment to be void. In case this policy matures as an endowment, this assignment to be of no effect.

Witness my hand and seal, at Cherokee, Cherokee county, Iowa, on the 8th day of May, A. D. 1908.”

On March 5, 1909, defendant paid three-fourths of the amount due on said policy, but declined to pay the balance, amounting to $1,418.32, to Mary J. Condon, assignee, for the reason that it claimed said assignment was ineffectual to pass the interest of Nellie Condon Gilbert, as beneficiary, to Mary J. Condon, but that, as her interest as beneficiary under said policy vested immediately upon its execution, the share that would otherwise be payable to her belonged to her executors, administrators, or assigns, and not to Mary J. Condon.

Plaintiff brings this action as assignee, and is joined therein by Louis and Geraldine M. Condon, the two remaining beneficiaries named in said policy. This action was first brought at law, and subsequently a substituted petition was filed alleging that the insured, in the application for said insurance, designated the above-named persons as beneficiaries, but that the defendant, by mistake or oversight, made said insurance payable to said beneficiaries, or their executors, administrators, or assigns, and that the insertion of the words, “or executors, administrators, or assigns,” was contrary to the request of the insured in said application, and wholly without authority, and prayed that said policy be reformed so as to express the true intention of the parties.

An administrator was appointed for the estate of Nellie Condon Gilbert, and he was made party defendant, and appeared herein and filed answer and cross-petition, alleging that Nellie Condon Gilbert, designated as beneficiary in said policy, died possessed of a vested interest therein, and that the balance due on said policy, which would have gone to her had she survived, belonged to cross-petitioner as the administrator of her estate, and asks judgment therefor.

The defendant for answer admits the execution of the policy, the receipt of a copy of the alleged assignment from the insured to his wife of the interest of Nellie Condon Gilbert, that there is a balance due and owing on said policy of $1,418.32, but avers that same is payable only to the administrator of the estate of Nellie Condon Gilbert, and tenders payment of said sum to the person found entitled thereto.

The court dismissed plaintiff's petition, and entered judgment against defendant in favor of cross-petitioner for the amount claimed therein and taxed the costs to appellant. Affirmed.Wm. Mulvaney, of Cherokee, for appellants.

Milchrist & Scott, of Sioux City, for appellee New York Life Ins. Co. of New York.

A. R. Molyneux, of Cherokee, for appellee E. D. Huxford, Adm'r.

STEVENS, J.

The policy in suit is an ordinary life policy containing provisions for settlement, cash surrender value, paid-up policy, and other provisions giving options to the insured, and is therein designated as a nonforfeiting, free tontine policy.

The decision of this case turns upon the question whether the interest of Nellie Condon, as beneficiary, vested upon the execution and delivery of said policy. It is earnestly contended by counsel for appellant that as the insured might, if he had survived the 20-year tontine period, have availed himself of any one of several settlements, or have surrendered the policy and made full settlement with the company, no interest vested in any of the beneficiaries while such right existed and belonged to the insured, and relies upon Carpenter v. Knapp, 101 Iowa, 712, 70 N. W. 764, 38 L. R. A. 128, to sustain this contention.

[1] It is held by the great weight of authority that the interest of a designated beneficiary in an ordinary life policy vests upon the execution and delivery thereof, and, unless the same contains a provision authorizing a change of beneficiary without the consent thereof, the insured cannot make such change. Wilmaser v. Continental Life Ins. Co., 66 Iowa, 417, 23 N. W. 903, 55 Am. Rep. 277;Townsend v. Fidelity & Casualty Co., 163 Iowa, 713, 144 N. W. 574, L. R. A. 1915A, 109;Phillips v. Carpenter, 79 Iowa, 600, 44 N. W. 898;In re Estate of Conrad, 89 Iowa, 396, 56 N. W. 535, 48 Am. St. Rep. 396;Central Nat. Bank of Washington v. Hume, 128 U. S. 195, 9 Sup. Ct. 41, 32 L. Ed. 370;Indiana Nat. Life Ins. Co. v. McGinnis, 180 Ind. 9, 101 N. E. 289, 45 L. R. A. (N. S.) 192;Franklin Life Ins. Co. v. Galligan, 71 Ark. 295, 73 S. W. 102, 100 Am. St. Rep. 73;Perry v. Tweedy, 128 Ga. 402, 57 S. E. 782, 119 Am. St. Rep. 393, 11 Ann. Cas. 46;Hooker v. Sugg, 102 N. C. 115, 8 S. E. 919, 3 L. R. A. 217, 11 Am. St. Rep. 717;Foster v. Gile, 50 Wis. 603, 7 N. W. 555, 8 N. W. 217;Millard v. Brayton, 177 Mass. 533, 59 N. E. 436, 52 L. R. A. 117, 83 Am. St. Rep. 294;Preston v. Conn. Mut. Life Ins. Co., 95 Md. 101, 51 Atl. 838;Phœnix Mut. Life Ins. Co. v. Dunham, 46 Conn. 79, 33 Am. Rep. 14;Garner v. Germania Life Ins. Co., 110 N. Y. 266, 18 N. E. 130, 1 L. R. A. 256;Laughlin v. Norcross, 97 Me. 33, 53 Atl. 834;U. S. Casualty Co. v. Kacer, 169 Mo. 301, 69 S. W. 370, 58 L. R. A. 436, 92 Am. St. Rep. 641;Ferdon v. Canfield, 104 N. Y. 143, 10 N. E. 146;Irwin v. Travelers' Ins. Co., 16 Tex. Civ. App. 683, 39 S. W. 1097;Mutual Benefit L. Ins. Co. v. Willoughby, 99 Miss. 98, 54 South. 834, Ann. Cas. 1913D, 836;Mut. Benefit Life Ins. Co. v. Swett, 222 Fed. 200, 137 C. C. A. 640, Ann. Cas. 1917B, 298.

And this applies to a policy to which there are attached the incidents of a loan value, cash surrender value, and automatic extensions by premiums paid. Mutual Benefit Life Ins. Co. v. Willoughby, supra; Re Succession of Leonce Desforges, 135 La. 49, 64 South. 978, 52 L. R. A. (N. S.) 689; Preston v. Mut. Life Ins. Co., supra; Lockwood v. Mich. Mut. Life Ins. Co., 108 Mich. 334, 66 N. W. 229;Pingrey v. Nat. Life Ins. Co., 144 Mass. 374, 11 N. E. 562; Bacon on Life & Accident Ins. § 377, and cases cited.

[2] In case the beneficiary dies before the insured, without...