Lewy v. Gillard

• Decision Date: 04 March 1890
• Citation: 13 S.W. 304
• Parties: LEWY <I>et al.</I> <I>v.</I> GILLARD <I>et al.</I>
• Court: Texas Supreme Court

13 S.W. 304

LEWY et al.

v. GILLARD et al.

Supreme Court of Texas.

March 4, 1890.

Appeal from district court, Galveston county; WILLIAM H. STEWART, Judge.

Scott & Levi, for appellants. W. B. Denson, for appellees.

HENRY, J.

Appellees filed suit against appellants to recover the balance of proceeds of a policy of insurance on the life of John Cavanaugh, after deducting a debt due by Cavanaugh to appellants, and the premiums paid on the policy by appellants, and expenses of collecting the insurance money. Trial was before the court without a jury. There was a judgment in favor of appellees for the amount sued for, and this appeal is to reverse the judgment. Appellants were merchants doing business in Galveston, and for years had a running account with Cavanaugh, of dimensions varying from $500 to $2,500. Cavanaugh was in Galveston in October, 1888, and appellants called in a life insurance agent to effect insurance on his life for $5,000 in favor of appellants. The agent informed them (appellants and Cavanaugh) that his company only wrote policies in favor of blood relations of the insured, but that their purpose could be accomplished by taking the policy payable to Cavanaugh, and then by his assigning it to appellants. This form of proceeding being acceptable, the agent took the application, and at the same time Cavanaugh signed and delivered to the agent duplicate assignments to appellants of the policy, which might be issued on the application. These assignments were complete, except in respect of their date and the number of the policy, which were to be filled in by the agent after the policy was issued, and when its number could be known. The agent subsequently did this, giving the assignments a date subsequent to that of the policy, and carried the policy, with the assignments thereof duly filled, as above stated, to appellants, who paid the premiums, at the same time taking the policy and assignments together from the agent. The policy was by its terms payable to John M. Cavanaugh, his executors and administrators. After receiving the policy, appellants and Cavanaugh entered into a written agreement reciting and stipulating the manner, purpose, and terms of the insurance as between them, viz.: That the application for insurance and the policy were made and obtained at the instance, and for exclusive account and benefit, of appellants, as creditors of Cavanaugh; that, notwithstanding the form of the policy, appellants were, at their own...