Marsh v. McNair

• Decision Date: 08 May 1885
• Citation: 99 N.Y. 174,1 N.E. 660
• Parties: MARSH v. McNAIR.
• Court: New York Court of Appeals Court of Appeals

99 N.Y. 174

1 N.E. 660

MARSH

v.McNAIR.

Court of Appeals of New York.

Filed May 8, 1885.

RUGER, C. J., dissenting.

E. A. Nash, for appellant, William A. McNair.

J. B. Adams, for respondent, Mary Marsh.

EARL, J.

In 1869 the plaintiff and her two sons, John R. and Charles H. Marsh, resided at Avon in this state. At the same time Chauncey W. Gibson resided at Lima, in the same county, where he carried on the business of a private banker under the name of the ‘Exchange Bank,’ and he was a local agent of the National Life Insurance Company. In April of that year John R. and Charles H., through Gibson, as agent of the company, procured two policies of insurance on their own lives for $5,000 each. The policy on the life of John R. was payable to Charles H., as the assured, and that on the life of Charles H. was payable to Mary Marsh, the plaintiff, as the assured. There policies remained in the possession of Gibson down to the twenty-third day of May, 1872, and during that time he advanced the money to pay the premiums upon them, John R. and Charles H. giving him their checks upon his bank for the amounts thet advanced; and during that time it appears that he had the policies as collateral security for a large indebtedness due from them to him. On the twenty-third day of May, 1872, the plaintiff assigned the policy on the life of Charles H., in which she was interested, to Gibson, by an assignment, absolute in form, for the expressed consideration of one dollar, ‘and for other valued considerations.’ On the same day and at the same place she, with her two sons, also executed an instrument of which the following is a copy:

‘This is to certify that in consideration of crediting C. H. Marsh, at the Exchange Bank of Lima, $353.72, paying mortgage (on property formerly deeded by J. R. Marsh in Avon to C. W. Gibson) given by William F. Russell to C. H. Marsh, $110.46, and indorsing $35.82 upon a note made by C. H. Marsh, June 8, 1871, for $300, we jointly and severally sell, assign, and transfer all our right, title, and interest in two policies, Nos. 4,277 and 4,287, upon the lives of Charles H. Marsh and John R. Marsh, issued by the National Life Insurance Company of the United States of America, to Chauncey W. Gibson, of Lima, N. Y.

‘J. R. MARSH,

‘C. H. MARSH,

‘MARY MARSH.

‘ Dated Avon, N. Y., May 23, 1872.’

In February, 1874, Gibson, having become insolvent, made a general assignment for the benefit of his creditors to the defendant, McNair, and assigned that policy to him as a part of his assets. McNair subsequently, by a suit against the insurance company, recovered the amount insured, and then in the year 1876, the plaintiff claiming that the assignment to Gibson was made merely as collateral security for an indebtedness to him of $500 due to him from her sons, tendered him that amount, and demanded the money recovered by him on the policy, and upon his refusal to pay she commenced this action. In her complaint she demanded, besides other relief, judgment against him that the instrument above set forth be reformed so as to conform to the agreement and intention of the parties thereto, by reciting and stating therein that the same was made and executed as collateral security for the payment to Gibson of the sum of $500 dollars and interest. The defendant in his answer claimed that the assignment was absolute, and not given as collateral security. Upon the trial the plaintiff gave parol evidence tending to show that the instrument was executed by the plaintiff upon an assurance that it was only intended as collateral security for $500, and that she signed it for that purpose. At the close of the evidence the defendant moved to dismiss the complaint upon several grounds, one of which was that the plaintiff was concluded by the agreement contained in the assignment executed by her and her two sons, for the reason that the contract made by the writing could not be varied or contradicted by parol evidence. The court denied the motion and defendant's counsel excepted. Whereupon the court made findings, among which is the following: ‘That the said assignments were, and each of them was, executed and delivered by the plaintiff upon the representations and agreements of the said Gibson and of his agents, who procured the same to be executed; that the same were intended to be held and used as collateral security for an indebtedness of the said J. R. Marsh and Charles H. Marsh to the said Gibson in the sum of $500, and for no other purpose;’ and he ordered judgment in favor of the plaintiff for the sum of $6,710.12, which was the balance of the money in defendant's hands received upon the policy, including interest, after deducting the $500 and the premium paid by Gibson, April 7, 1873.

There was no allegation in the complaint that the plaintiff was induced to execute the instrument by any fraud, or that it was executed by the parties under any mutual mistake of facts, and there was no finding by the trial judge that any fraud was perpetrated upon her, or that the parties labored under any mistake in executing the instrument. The finding was simply that the...