Kochanek v. Prudential Ins. Co. of America

• Decision Date: 07 January 1928
• Parties: KOCHANEK v. PRUDENTIAL INS. CO. OF AMERICA.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

262 Mass. 174

159 N.E. 520

KOCHANEK

v.PRUDENTIAL INS. CO. OF AMERICA.

Supreme Judicial Court of Massachusetts, Hampden.

Jan. 7, 1928.

Report from Superior Court, Hampden County; Henry T. Lummus, Judge.

Action by Stella M. Kochanek against the Prudential Insurance Company of America, in which the defendant filed a petition for interpleader under G. L. c. 231, § 40, naming Joseph Nalepa as claimant of the fund, who, on proper notice, appeared and was made a party defendant. On report from the superior court. Decree for plaintiff.George D. Cummings, George F. Leary, and Charles V. Ryan, Jr., all of Springfield, for claimant.

PIERCE, J.

This action of contract to recover the amount due upon a life insurance policy, issued on April 22, 1922, by the Prudentaial Insurance Company of America to Katie Nalepa upon her life, is before this court on report by a judge of the superior court. The plaintiff is the beneficiary named in the policy.

The record does not disclose when the assured delivered her policy to an agent of the insurance company for transmission to the home office of that company, and signed and sent to the insurance company a ‘proper written notice’ of the change in the beneficiary which she had determined to make. The change was not ‘indorsed on or attached to the policy [by the company] solely because the defendant or its * * * agent mislaid the policy and did not find it until after the insured died’ on April 22, 1923. The named beneficiary, as such, paid $90.46 as premiums, and it is agreed that this amount shall be allowed her if she does not obtain the proceeds of the policy as a whole.

The defendant, in a petition for interpleader, under G. L. c. 231, § 40, admitted the issuance of the policy, that the assured had died, that the proceeds of the policy were due and payable, that there is no dispute as to the amount; alleged that the amount due under the policy was claimed by the plaintiff and by one Joseph Nalepa, that it had no interest in the subject-matter of the controversy between the claimants; and paid the sum of $506.35 into court to await the final judgment of the court, Joseph Nalepa, upon notification, duly appeared, was made a party defendant, and made claim to whatever money is due from the defendant under the policy. After the filing of a stipulation of the plaintiff and claimant that the amount owed by the defendant was $506.35, the superior court by an ‘interlocutory decree’ ordered:

(1) ‘That this action is hereby discontinued as to the defendant, Prudential Insurance Company of America, and its liability in this action is hereby at an end.’ And (2) ‘costs in the sum of $25 are hereby awarded the defendant, Prudential Insurance Company of America, such costs to be charged upon and paid out of said fund of $506.35’

[1] The policy of the defendant insurance company contained a provision whereby the assured might, ‘by written notice to the company at its home office, change the beneficiary or beneficiaries under this policy, such change * * * to become effective only when a provision to that effect is indorsed on or attached to the policy by the company, whereupon all rights of the former beneficiary or beneficiaries shall cease.’ In these proceedings the burden of proof was upon the claimant to establish that there was in the lifetime of the assured a valid change from the beneficiary named in the policy to himself.

[2][3][4] The interest of the beneficiary or beneficiaries in a policy of life insurance of the character issued to Kathie (Katherine) Nalepa is a qualified vested interest, which is subject to be divested and defeated should the assured in his lifetime exercise the power given him to change a beneficiary in the manner prescribed by the contract between the insurer and the assured. In re Davies [1892] 3 Ch. 63; Douglass v. Equitable Life Assurance Society, 150 La. 519, 90 So. 834;Supreme Council of the Royal Arcanum v. Behrend, 247 U. S. 394, 38 S. Ct. 522, 62 L. Ed. 1182, 1 A. L. R. 966. A substantial compliance with the provision of the policy regulating change in beneficiaries must be followed. French v. Provident Savings Life Assurance Society, 205 Mass. 424, 91 N. E. 577;Begley v. Miller, 137 Ill. App. 278;Freund v. Freund, 218 Ill. 189, 75 N. E. 925,109 Am. St. Rep. 283. See Atlantic Mutual Life Ins. Co. v. Gannon, 179 Mass. 291, 60 N. E. 933;Daugherty v. Daugherty, 152 Ky. 732, 154 S. W. 9. And a mere unexecuted intention to change the beneficiary or beneficiaries will not be sufficient to bring about that result. Garner v. Bemis, 81 Fla. 60, 87 So. 426. The interest of a beneficiary in an ordinary life policy with power of change of beneficiary reserved to the assured is something more than a mere expectancy in anticipated benefits, as is the status of a beneficiary, or beneficiaries, in a mutual benefit certificate with rights to change the beneficiary conferred by statutory law. Marsh v. Supreme Council American Legion of Honor, 149 Mass. 512, 21 N. E. 1070,4 L. R. A. 382;Ryan v. Boston Letter Carriers' Mutual Benefit Association, 222 Mass. 237, 110 N. E. 281, L. R. A. 1916C. 1130; St. 1911, c. 628, § 6; Rosman v. Travelers' Ins. Co. of Hartford, 127 Md. 689, 96 A. 875, Ann. Cas. 1918C, 1047;Neary v. Metropolitan Life Ins. Co., 92 Conn. 488, 103 A. 661, L. R. A. 1918F, 306;Provident Savings Life Assurance Co. v. Dees, 120 Ky. 285, 86 S. W. 522;Christman v....