Dennis v. Equitable Life Assur. Soc.
| Decision Date | 25 November 1935 |
| Docket Number | No. 4-4054.,4-4054. |
| Citation | 88 S.W.2d 76 |
| Parties | DENNIS v. EQUITABLE LIFE ASSUR. SOC. et al. |
| Court | Arkansas Supreme Court |
A. L. Rotenberry, of Little Rock, for appellant.
D. K. Hawthorne, of Little Rock, for cross-appellants.
Rose, Hemingway, Cantrell & Loughborough, of Little Rock, for appellee, Equitable Life Ass. Soc.
Moore, Gray, Burrow & Chowning, of Little Rock, for appellee Standard Oil Co. of Louisiana.
On November 18, 1934, Ernest E. Dennis died in Little Rock from a self-inflicted gunshot wound. He left surviving him Pearl Dennis, his widow, the appellant in both of the cases on appeal here, and eight children by a former marriage. The children are all minors. The suits for their interests are prosecuted by their respective guardians. The subject-matter in the suit against the Equitable Life Assurance Society was the amount alleged by the plaintiff to be owing to her by reason of a group insurance contract made by the insurance company insuring employees of the Standard Oil Company of New Jersey and its subsidiaries, including Standard Oil Company of Louisiana. The second suit grew out of a contract, whereby the Standard Oil Company of New Jersey provided for certain benefits to be paid upon the death of employees to surviving beneficiaries. The litigation in both of these cases does not arise out of any denial of liability on the part of the insurance company, or of the Standard Oil Company of Louisiana, of which company the said Ernest E. Dennis was an employee at the time of his death. Premiums were paid to the insurance organization by an authorized deduction from the salary of the employee. The Standard Oil Company of New Jersey and its subsidiaries, including Standard Oil Company of Louisiana, sued here, made no charge against its employees for such benefits as might accrue upon the death of the employees who had been employed for a sufficient length of time to be entitled to these benefits. No deductions were made from salaries or wages, though the amount of the benefits was determined by the length of time the employees had been in the service of the Standard Oil Company.
At the time Ernest E. Dennis agreed to accept the benefits of the group policy of insurance, he was a widower, and the same statement may be made in regard to the other fund created by his employer. Mr. Dennis' application for insurance in the group policy was in the following form:
"S. O. Form G. 214
"Group Life Insurance Plan
"Acceptance of Preference Beneficiary
Schedule
To Standard Oil Co. of La
(Name of employing Company)
Name of Employee Ernest E. Dennis Ck
or P. R. No. 775
Marital Status.....Widower
(Married, single, widowed, divorced)
No. of children living.....8
No. of natural parents living......Father
I hereby agree that in the event of my death while insured under the "Group Life Insurance Plan" of the Standard Oil Company (N.J.), the insurance shall be payable to the person or persons in the first of the following classes of preference beneficiaries of which a member or members shall survive me:
(a) Widow or widower
(b) Children
(c) Parents
(d) Brothers and sisters
(e) Executors or administrators
I reserve the right to change this beneficiary agreement.
Date December 11th, 1931
Witness W. M. Rogers.
Ernest E. Dennis, signature of employee."
The principal issue to be determined arises out of the acceptance of this preference beneficiary schedule. It is apparent that the beneficiary must be determined as of the date of the death of the insured, when the rights of the proper beneficiary would become fixed or vested, but prior to that time no particular individual or designated beneficiary had any vested right or interest in the policy. The order of preference of the beneficiary is set out in the schedule; the benefits being payable first to the widow or widower, or, that beneficiary failing, to the children of the insured; that class failing, then the parents of the insured. It is apparent that beneficiaries could not be determined by the insurance organization by a mere examination of the policy of insurance, but recourse must be had to extraneous proof for a determination of the preferred beneficiary in the class surviving the insured. The children of Ernest E. Dennis, through their proper guardians, were insisting that since their father was not married at the time this policy was issued, they were the first of the preference beneficiaries then in being; that the contract was made for their benefit; and that without some affirmative act on the part of the insured, their father, that they continued as preferred beneficiaries; that he had the right to change beneficiary, but not having done so, that the proceeds of the insurance policy were payable to them.
Mrs. Dennis made proof of death, insisting upon payment of the policy to her, and upon the insurance company's delay in paying over the money filed suit in the circuit court of Pulaski county, Ark., to recover the proceeds of the insurance policy, for the 12 per cent. penalty, and for attorney's fee. The appellee insurance company then filed its answer, wherein it admitted the liability for the amount of the insurance, but stated that the children of Ernest E. Dennis, through their respective guardians, were asserting claims to the proceeds of the insurance policy, and asked that its answer be treated as an interpleader, for a transfer to the chancery court, and offered to pay the money into the registry of the court, and also asked that it be discharged.
Substantially the same procedure was had as to the fund in controversy, for which the Standard Oil Company of Louisiana was sued, and that company in like manner interpleaded and paid into the registry of the court the amount of money there involved; a small indebtedness owing by Dennis to the company having been deducted from the amount sued for.
The difference in the two cases arises out of a slight difference in the designation of preference beneficiaries. That difference will be shown later in this opinion.
The chancery court, upon a final hearing of the case, discharged the insurance company without requiring it to pay the 12 per cent. penalty or attorney's fee, but required it to pay interest from the date proof of death was filed until the fund was deposited. Mrs. Dennis, appellant, has appealed from the action of the court in refusing to charge the penalty and attorney's fee in her favor against the insurance company, and the insurance company has cross-appealed on account of the charge of interest, and the minor children of the insured have prayed a cross-appeal, alleging that the court erred in awarding the fund to Mrs. Dennis, their stepmother.
The first matter with which we deal is a determination of the proper beneficiary under this insurance policy. As intimated above, the vague, uncertain, and indefinite designation of a beneficiary makes it necessary to determine or decide certain facts, and then to declare the law in relation thereto.
Mrs. Pearl Dennis and Ernest E. Dennis were married shortly after this insurance policy was issued. Mrs. Dennis says that they discussed as between themselves, prior to her marriage, the fact that he had applied for this insurance, and that upon their marriage it would be for her benefit in the event of his death. It is not necessary that we decide the case upon this kind of claim or presentation, as all of the matters here in controversy may be put upon a more substantial footing for a determination of the facts necessary to a decision and the declaration of law in relation thereto.
The answer of the guardians alleged that the second marriage of Mr. and Mrs. Dennis, which occurred on October 14, 1934, was illegal because the license therefor was issued upon Sunday. This question of legality, however, has not been briefed, and we assume has been abandoned. From the evidence, it may be said that Dennis and his wife had been married a little more than a year prior to his death, although they were divorced in July, 1934, and were again married on October 14, 1934, and lived together after the second marriage continuously until Dennis' death.
After the insurance policy was issued, had Dennis then died prior to their marriage, the proceeds of the policy would have been payable to his children. Upon their marriage, however, a preferred...
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