Embry's Adm'r v. Harris

• Decision Date: 11 October 1899
• Citation: 52 S.W. 958,107 Ky. 61
• Parties: EMBRY'S ADM'R v. HARRIS. [1]
• Court: Kentucky Court of Appeals

52 S.W. 958

107 Ky. 61

EMBRY'S ADM'R v. HARRIS. ^[1]

Court of Appeals of Kentucky.

October 11, 1899

Appeal from circuit court, Madison county.

"To be officially reported."

Action by J. P. Embry's administrator for a settlement of his intestate's estate. Judgment awarding to John D. Harris the proceeds of a policy of insurance on the life of plaintiff's intestate, and plaintiff appeals. Affirmed.

Bennett & Chenault and Wm. Herndon, for appellant.

Burnam & Moberly, for appellee.

WHITE J.

J. P Embry in his lifetime became indebted to the Richmond National Bank, with appellee as his surety. The debt was renewed several times, and in November, 1894, it had swollen to the amount of $3,587.71. At this time appellee, before signing the renewal, required some sort of security. It was finally arranged that Embry should take out a policy of insurance on his life in the New York Life Insurance Company for the sum of $5,000, payable by its terms to the estate of Embry. This policy was delivered, without any written assignment, to appellee, Harris, as collateral security to indemnify him against loss by reason of the suretyship to the bank. Harris deposited the policy in the bank for safe-keeping. In August, 1895, Embry died, and appellant was duly appointed and qualified as his administrator. By agreement of Harris, appellant, as administrator, took the policy and made settlement with the insurance company; and the proceeds thereof, some $4,704, are in appellant's hands. Appellant brought this action to settle the estate of Embry, and made appellee, Harris, a party defendant. Appellee by answer pleaded the fact of his suretyship, and the pledge of the insurance policy to him as collateral, and the subsequent collection of same by appellant by his consent and then asked the court to direct appellant, out of the proceeds of the policy, to pay the bank debt in full by reason of the lien created thereon. Appellee presented proof of the facts above set out, which were not seriously denied, and, upon hearing, the court adjudged that appellee had a lien on proceeds of the policy to the extent of the bank debt, and directed the appellant to pay the bank debt in full out of the proceeds of the policy, and from that judgment this appeal is prosecuted.

Appellant contends that the policy was not assignable, being payable to the estate of Embry; that Harris had no insurable interest and therefore the assignment or pledge to him is void; and that there was no valid transfer of the policy to appellee at all, not being in writing, nor the written consent of the insurer obtained, as the policy provides. The note of the bank was filed in the action as a claim due the bank properly proven by its cashier. We are of opinion that appellee, Harris, had an insurable interest in Embry's life, to the extent of the suretyship. Counsel admits the general rule to be that a creditor has an insurable interest in the life of the debtor, but insists that in such cases the debt is due direct, while here the debt is due the bank, and appellee is mere surety. So...