In re Grilk's Will

• Decision Date: 23 June 1930
• Docket Number: 40179
• Citation: 231 N.W. 327,210 Iowa 587
• Parties: IN RE WILL OF CHARLES GRILK
• Court: Iowa Supreme Court

231 N.W. 327

210 Iowa 587

IN RE WILL OF CHARLES GRILK

No. 40179

Supreme Court of Iowa, Des Moines

June 23, 1930

Appeal from Scott District Court.--C. L. ELY, Judge.

Objections by creditors to executors' report and inventory, on the ground that decedent left a large amount of life insurance payable to the estate or to the personal representatives which, as objectors allege, is by the will made subject to payment of debts, but which by the report is listed as not subject to debts. The widow was adjudged entitled to such proceeds, clear of all claims of creditors. Objectors appeal.

Affirmed.

W. H Shorey and Albert W. Hamann, for appellant.

Charles H. Wilson and Bollinger & Block, for appellees.

MORLING C. J. EVANS, STEVENS, DE GRAFF, ALBERT, and WAGNER, JJ., concur. FAVILLE, KINDIG, and GRIMM, JJ., dissent.

OPINION

MORLING, C. J.

The only question presented is whether the effect of the will is to appropriate the proceeds of the life insurance to the payment of debts. The will reads:

"I will and direct that all my just debts * * * be first paid out of my estate. Item II. [By this item testator makes three legacies of $ 500 each to employees.] Item III. All the rest, residue and remainder of my estate, real, personal and mixed, of whatsoever kind and nature, and wherever situated, I hereby give, devise and bequeath unto my beloved wife, Marion E. Grilk, to have and to hold the same unto her and her heirs and assigns, absolutely and forever."

The will appoints the widow and another as executors, with power to sell and convert into cash "all stocks, bonds, and all property I may own at the time of my death, be the same real, personal or mixed, in accordance with their judgment and discretion, including all real estate * * * without any application to * * * the probate court * * * intending that my executors shall have the same right, power and authority in the premises as I myself have while living."

The objecting creditors contend that the life insurance payable to the estate or personal representatives is a part of the estate (citing Miller v. Miller, 200 Iowa 1070, 205 N.W. 870); that, as the will directs payment of debts out of the estate, and bequeaths the residue of the estate to the widow, its legal effect is to subject or appropriate the proceeds of the life insurance to the payment of debts (citing In re Estate of Caldwell, 204 Iowa 606, 215 N.W. 615). In the Miller case it was held, in substance, that the avails of life insurance policies payable to the estate, or to the personal representatives, belonged to the estate, and were subject to disposition by will. The Caldwell case holds that a clear purpose evinced by the will to provide for payment of debts out of the proceeds of such life insurance will be given effect. In both cases, the will in specific terms bequeathed the life insurance.

By Section 8776, Code, 1924 (Code, 1897, Section 1805), it is provided:

"A policy of insurance on the life of an individual, in the absence of an agreement or assignment to the contrary, shall inure to the separate use of the husband or wife and children of said individual, independently of his creditors. The proceeds of an endowment policy payable to the assured on attaining a certain age shall be exempt from liability for any of his debts. Any benefit or indemnity paid under an accident policy shall be exempt to the assured, or in case of his death to the husband or wife and children of the assured, from his debts. The avails of all policies of life or accident insurance payable to the surviving widow shall be exempt from liability for all debts of such beneficiary contracted prior to the death of the assured, but the amount thus exempted shall not exceed $ 5,000."

Section 11919 (Section 3313, Code, 1897,) declares:

"The avails of any life or accident insurance, or other sum of money made payable by any mutual aid or benevolent society upon the death or disability of a member thereof, are not subject to the debts of the deceased, except by special contract or arrangement, and shall be disposed of like other property left by the deceased."

These statutes,...