Lehman v. Gunn

• Decision Date: 07 February 1900
• Citation: 27 So. 475,124 Ala. 213
• Parties: LEHMAN ET AL. v. GUNN ET AL.
• Court: Alabama Supreme Court

27 So. 475

124 Ala. 213

LEHMAN ET AL. v. GUNN ET AL.

Supreme Court of Alabama

February 7, 1900

Appeal from chancery court, Jefferson county; John C. Carmichael Chancellor.

Bill by Charles T. Lehman and others against William R. Gunn and another. From a judgment dismissing the bill, plaintiffs appeal. Reversed.

The bill in this case was filed by the appellants, as creditors of George T. Winton, deceased, against William R. Gunn and the Mutual Benefit Life Insurance Company of Newark, N. J. The purpose of the bill and the facts of the case are sufficiently stated in the opinion.

H. K White and Jas. A. Mitchell, for appellants.

H. C Selheimer and A. Latady, for appellees.

DOWDELL J.

The bill in this case is filed by the creditors of George T Winton, deceased, and seeks to subject to the payment of their claims and demands as such creditors the proceeds of a policy of life insurance issued on the life of said Winton by the Mutual Benefit Life Insurance Company of Newark, N. J., in December, 1895, and in which said policy T. J. Winton and Sarah F. Winton, the father and mother of the insured, were named as beneficiaries. A motion was made to dismiss the bill for want of equity, which was sustained by the chancellor, and from that decree this appeal is prosecuted.

The bill charges that at the date of the issuance of the policy the said George T. Winton was indebted to complainants in the sums and manner alleged, and also that he was at that time wholly insolvent, and that the making of the policy payable to his father and mother was a voluntary conveyance or gift of the insurance covered by said policy, and therefore fraudulent and void as to creditors. The bill also avers that the policy was applied for, purchased, and received by the said George T. Winton, and that the premium thereon, which was divided into quarterly installments, was paid for in the following manner: The first installment, being for the sum of $29.65, was divided into a cash premium of $20.76, and a premium loan of $8.89; that for the cash premium the insured gave to one Halstead, the local agent of the defendant company, and through whom the insurance was negotiated, his personal check on the Berney National Bank, with which the insured did his business, and for the premium loan executed his promissory note to the insurance company. It is also averred that at the time of the giving of the check for the cash premium the said Halstead remitted the amount of the cash premium to his company, out of his own funds, holding the check as his individual claim against the said George T. Winton. On the 15th of January, 1896, within a month after the policy was taken out, Winton died; and at the time of his death the check in question had not been paid, but for what reason is not stated in the bill. Letters of administration were granted in February, 1896, on the estate of Winton to the respondent W. R. Gunn, who immediately entered upon the discharge of his duties as administrator. It is alleged that Gunn knew that his intestate's estate at that time was totally insolvent, and he was also notified and informed that the creditors were claiming the insurance covered by the policy in question; and it is also charged that the defendant insurance company likewise had knowledge of the claims of these creditors at the time and before it made the compromise settlement charged. Shortly after the grant of letters of administration the said Gunn sought out Halstead, and took up the check which Winton had given, paying for the same out of his own funds, and, it is charged in the bill, for the purpose of preventing said check being presented as a claim against the estate of Winton. In March following the grant of administration, the administrator, Gunn, having the policy of insurance in his possession for collection, went to the state of Tennessee, where the beneficiaries named in the policy resided, and there received on said policy from an agent of the defendant company $2,500 (that being one-half of the amount of said insurance) in settlement of said policy, and delivered the said policy up to the company. Out of the $2,500 so collected he (Gunn) retained $1,000, paying over the remainder, $1,500, to T. J. and Sarah F. Winton, the beneficiaries named in the policy. Subsequently the estate of George Winton was decreed insolvent, and a final settlement of his administration was made by Gunn, but no accounting was had by him for any money collected on said policy. The bill also charges that the settlement had by the insurance company with said Gunn and the beneficiaries in the state of Tennessee was a collusive one. We have not undertaken to set out here all of the averments of the bill, but only so much as we deemed necessary for the application of the legal principles involved in the controversy.

It will be observed from the foregoing statement of facts that there is nothing to bring the case within the influence of either section 2535 or section 2607 of the Code of 1896. The beneficiaries named in the present policy fall without the class of persons named in the former section, and the transactions, the subject of this suit, arose prior to the enactment of the latter statute. So the solution of this case must depend upon the law as it is, independent of these statutes. That, as against existing creditors, a voluntary conveyance by the debtor is in law, per se, fraudulent and void, without regard to the intention of the debtor, is a proposition too familiar and well settled to require citation of authority. The nature and form of the conveyance, or the ways and means employed in bestowing the gift or donation, are immaterial. It is enough if the thing given be liable to the satisfaction of...