First Nat. Bank v. Simpson

• Decision Date: 12 December 1899
• Citation: 54 S.W. 506,152 Mo. 638
• Parties: FIRST NAT. BANK OF FT. SCOTT v. SIMPSON et al.
• Court: Missouri Supreme Court

54 S.W. 506

152 Mo. 638

FIRST NAT. BANK OF FT. SCOTT v. SIMPSON et al.

Supreme Court of Missouri, Division No. 2.

December 12, 1899.

CREDITORS' BILL — INSURANCE — PAYMENT OF PREMIUMS BY INSOLVENT — EVIDENCE — DEMURRER — MARRIED WOMEN — SEPARATE PROPERTY — GIFTS BY HUSBAND.

1. A widow's testimony that while her husband was solvent he purchased a home in her name, and that certain capital stock was given to her by a corporation for which her husband had rendered services, on which she received dividends, and that after her husband became insolvent she sold the home and part of the stock, and, with the money received, paid premiums on her husband's life insurance; that her husband attended to her business, and that she could not tell by whom the premiums were paid; and that her reason for stating she paid them was that, as they were paid, her means grew less, — was sufficient to support a finding that she had separate means with which to pay such premiums, and that they were either paid by her husband with his own means while solvent, or by her, through him, with her separate means, after he became insolvent.

2. The effect of a demurrer, when interposed to plaintiff's evidence, in either an equity or law case, is to admit every material fact to be true which the evidence tends to prove, as well as every reasonable inference deducible therefrom.

3. In determining whether or not a demurrer to the evidence was properly overruled, the supreme court may consider competent and legal evidence offered on the trial, and excluded subject to exception, if incorporated in the bill of exceptions.

4. The proceeds of life insurance policies on the life of a husband, payable to his wife, are not subject to the payment of his debts, where the premiums thereon were paid by the husband so long as he was solvent, and thereafter by the wife out of the proceeds of the sale of property which her husband gave her while he was solvent, and which was always thereafter treated by both of them as her separate property.

5. Payments made by an insolvent debtor of premiums on a policy of life insurance on his own life, for the benefit of his wife, are voluntary gifts to the beneficiary, and are conclusively fraudulent and void as to creditors existing at the time of such payments.

6. Where a widow testified that she received money from the sale of the home purchased by her husband in her name while solvent, and from the sale of capital stock given to her by a corporation for services rendered by her husband before he became insolvent, and that from such funds she paid premiums on her husband's life insurance, such evidence rebuts the presumption that premiums paid during coverture were paid by the husband, and any imputation of fraud as to the husband's creditors arising from the relation of the parties.

Appeal from circuit court, Jackson county; Ben T. Hardin, Special Judge.

Creditors' bill by the First National Bank of Ft. Scott, Kan., against. Mary E. Simpson and others, to subject proceeds of life insurance policies to the payment of its judgments. From a judgment in favor of defendants, plaintiff appeals. Affirmed.

This is an equitable proceeding by plaintiff, a judgment creditor of George E. Simpson, deceased, who was the husband of the defendant Mary E. Simpson, against her and her co-defendants, in the nature of a creditors' bill, to subject to the payment of its debt, $4,848.48 (being the amount of two judgments rendered in favor of plaintiff against the firm of Donnell, Lawson & Simpson in the circuit court of the city of New York in October, 1886, and interest thereon, and which were allowed by the probate court of Jackson county, Mo., in favor of plaintiff, against the estate of said George E. Simpson, deceased, on the 4th day of September, 1893), a sufficient amount of money for that purpose, out of $61,000 alleged to have been received by Mrs. Simpson on eight different policies of life insurance on the life of said George E. Simpson, issued in her favor, and turned over by her to her co-defendants as trustees for her, the premiums on all which are alleged to have been paid by him when he was insolvent, in fraud of his creditors, in which Mary E. participated. The policies are of the dates, companies, and amounts as follows:

                September 1, 1863. Manhattan Life Insurance
                  Company ..................................    $ 5,000
                June 3, 1873. Equitable Life Assurance
                  Society ..................................      5,000
                August, 1874. Connecticut Mutual Life
                  Insurance Company ........................     10,000
                December 10, 1883. Penn Mutual Life
                  Insurance Company ........................     10,000
                April 30, 1881. Equitable Life Assurance
                  Society ..................................      1,000
                February 28, 1884. Providence Savings
                  Life Assurance Society of New York .......     10,000
                December 7, 1886. New York Life Insurance
                  Company ..................................     10,000
                December 7, 1886. New York Life Insurance
                  Company ..................................     10,000
                                                                _______
                     Total .................................    $61,000
                

George E. Simpson died April 11, 1893, insolvent. He left a will, which was admitted to probate in the probate court of Jackson county, Mo., by which Mary E. Simpson is made sole legatee. She qualified as executrix under the will, but no property or money came to her as said executrix. The answer admits the issuance of the policies of insurance, and the receipt of the sum of $59,000 thereon, and avers that other creditors, prior in point of time to the plaintiff, having demands against George E. Simpson aggregating more than $20,000, instituted and had suits pending against her therefor. It avers that she was a creditor of Donnell, Lawson & Simpson in the sum of $15,816.66, and prayed that, if it be found that George E. Simpson had paid any premiums in excess of $500 per annum, the same be applied to the payment of her debt, and denied every other allegation in the petition. The answer of Frank Simpson and Frank Groves was a general denial. The reply was a denial of the new matter set up in the answer of Mrs. Simpson.

The facts as disclosed by the record are about as follows: The defendant Mary E. Simpson and her husband, George E. Simpson, moved from the state of Missouri, where they formerly resided, to the city of New York, in 1862, where they resided until 1871, when they moved to New Jersey, and lived there until the latter part of the year 1892, or the early part of 1893, when they moved back to Jackson county, Mo., where George E. Simpson died, as before stated. George E. Simpson prospered in business from 1858, the time of his marriage, up to 1889, unless it was from 1884 to 1889. From 1863 to 1871 he was connected with Northrup & Chick and Kearney & Simpson, and from 1871 to 1889 with Donnell, Lawson & Co. and Donnell. Lawson & Simpson. On the 14th day of May, 1884, the firm of Donnell, Lawson & Simpson made an assignment for the benefit of their creditors; but by the consent of their creditors their assets were returned to them, and they resumed and continued business until 1889, when they were forced to suspend business. At the time of their assignment their total assets, not including their respective personal estates, inventoried $5,792,187.31, while their liabilities amounted to $3,641,216.64. The private estate of George E. Simpson was at that time of the estimated value of $110,259, with a liability of $2,500. In October, 1886, two judgments were rendered in the circuit court of the city of New York in favor of plaintiff and against the firm of Donnell, Lawson & Simpson for the aggregate amount of $3,438.64, which were allowed as a demand in favor of plaintiff, and against the estate of George E. Simpson, by the probate court of Jackson county, Mo., on the 4th day of September, 1893, for the total sum of $4,848.48, no part of which has ever been paid.

The defendant Mary E. Simpson was made a witness by plaintiff, and testified substantially as follows:

"We bought a home in Orange, New Jersey, in 1880. My husband bought the home. I don't know what the value of the home was, but my husband did not own that property at the time of his death. My husband built a home in East Orange in 1880. I would say that the property I referred to in Orange was not my husband's, but belonged to me. My father's name was James Stinnett Young. I had some money at the time I was married, but can't say that it was as much as $500. Did not get any means from my father's or mother's estate after marriage. Our home in Orange was a comfortable home. The cost of it, about $20,000. I sold it since we came West. some months before my husband's death. When the home in Orange was purchased the title to it was taken in my name. The entire place (house and lot) cost my husband $20,000. We sold it for about $35,000. I can't say what the means I possessed at marriage consisted of. I had some little money. I can't say it was as much as $250. In 1862 we moved to New York City. I received as a gift from the National Waterworks Company 400 shares National Waterworks stock. It was given to me by the waterworks company. I don't know what officer of the company gave it to me. My husband was at the time an officer of the company and he rendered services for the company as a consideration for the gift. The value of that stock was $40,000. I sold $20,000 worth of the stock, — I don't remember what year, — and I received a hundred dollars a share. The money was turned over to me, probably, about 1887. The sale was effected by my husband. He managed and controlled it for me. The proceeds of the sale of this stock were deposited in bank, but I could not say what bank. It was deposited to my credit. I could not say what bank. I had accounts with the National Bank of the Republic and with the Orange Bank, but I don't say that it was deposited in either of...