In re Smallwood's Estate

• Decision Date: 03 December 1927
• Citation: 300 S.W. 572
• Parties: In re SMALLWOOD'S ESTATE.
• Court: Tennessee Supreme Court

Page 572

300 S.W. 572

In re SMALLWOOD'S ESTATE.

Supreme Court of Tennessee.

December 3, 1927.

Appeal from Chancery Court, Sevier County; Ben Robertson, Chancellor.

In the matter of the estate of Bruce Smallwood, deceased. Contest by the brothers and sisters of the deceased to determine the right to the insurance fund. From the decree, part of the claimants to the fund appeal. Affirmed, and cause remanded for further proceedings.

Fred C. Houk, of Knoxville, for petitioners.

G. L. Zirkle, of Sevierville, guardian ad litem.

McKINNEY, J.

Prior to his death in 1918 Bruce Smallwood procured from the United States of America two policies of insurance upon his life, in the sum of $5,000 each. The mother of the insured was named as sole beneficiary therein. The federal statute (38 Stat. 711, as amended), under which said policies were issued, provided that upon the death of insured the insurance should be payable in 240 equal monthly installments. Such payments were made to the beneficiary until her death in 1919. Thereafter, monthly payments were made to the father of insured, and the husband of the beneficiary named in said policies, until his death in 1926.

The insured, who died intestate, was survived by one brother and two sisters of the whole blood.

In 1921 the father of insured was again married, the result of the union being the birth of a son and two daughters.

Upon the death of the father the United States of America paid to the administrator of Bruce Smallwood, conformably to statute, the balance due under said two policies or certificates, to wit, $7,132, and the contest is over this fund. The brother and sisters of the half blood insist that they are entitled to share said fund equally with the brother and sisters of the whole blood, while the latter insist that they are entitled to the entire fund. The chancellor decreed that the fund be equally divided between the brothers and sisters of the whole and half blood, and, in our opinion, his decree was correct.

If the beneficiary named was entitled to the proceeds absolutely, then upon her death, intestate, in 1919, the fund would go to her husband, notwithstanding the Married Women's Emancipation Act (Acts 1913, c. 26). Baker v. Dew, 133 Tenn. 126, 179 S. W. 645.

Upon the death of the father, intestate, in 1926, the fund would be distributed among his children, which would include children born of both marriages. Shannon's Annotated Code, § 4172.

It is stipulated that the controlling statutes are section 402 of the War Risk Insurance Act, passed in 1914 (U. S. Comp. St. § 514uuu), and section 303 of the World War Veterans' Act, passed in 1924, as amended by the Act of Congress of March 4, 1925 (38 USCA § 514 [U. S. Comp. St. § 9127½ — 303]). The former section is as follows:

"That the director, subject to the general direction of the Secretary of the Treasury, shall promptly determine upon and publish the full and exact terms and conditions of such contract of insurance. The insurance shall not be assignable, and shall not be subject to the claims of creditors of the insured or of the beneficiary. It shall be payable only to a spouse, child, grandchild, parent, brother or sister, and also during total and permanent disability to the injured person, or to any or all of them. The insurance shall be payable in two hundred and forty equal monthly installments. Provisions for maturity at certain ages, for continuous installments during the life of the insured or beneficiaries, or both, for cash, loan, paid-up and extended values, dividends from gains and savings, and such other provisions for the protection and advantage of and for alternative benefits to the insured and the beneficiaries as may be found to be reasonable and practicable, may be provided for in the contract of insurance, or from time to time by regulations. All calculations shall be based upon the American Experience Table of Mortality and interest at three and one-half per centum per annum, except that no deduction shall be made for continuous installments during the life of the insured in case his total and permanent disability continues more than two hundred and forty months. Subject to regulations, the insured shall at all times have the right to change the beneficiary or beneficiaries of such insurance without the consent of such beneficiary or beneficiaries, but only within the classes herein provided. If no...