Miller v. Miller
| Decision Date | 24 November 1925 |
| Docket Number | 36755 |
| Citation | 205 N.W. 870,200 Iowa 1070 |
| Parties | WILLIAM H. MILLER et al., Appellants, v. MARTHA A. MILLER et al., Appellees |
| Court | Iowa Supreme Court |
Appeal from Black Hawk District Court.--H. B. BOIES, Judge.
ON May 31, 1923, the defendants, Martha A., J. J., and Clyde S Miller, who had in their possession or control a considerable sum, the proceeds of several insurance policies on the life of Lewis Miller, deceased, were garnisheed on execution issued out of the district court of Black Hawk County on a judgment entered February 15, 1923, against Martha A. Miller for $ 17,650. Answers were filed by the garnishees, and same were controverted by plaintiff. On September 25, 1923, the other parties named, who are the children of Lewis Miller deceased, filed a petition in intervention, setting up the terms and provisions of the will of their father disposing of the funds in controversy in trust to Martha A. Miller, as trustee, and J. J. and Clyde S. Miller, as advisory trustees and asking that the terms and provisions of the will be carried out. Issues were joined upon the petition in intervention, amendments thereto, and other pleadings filed, and by agreement of the parties these were consolidated and tried to the court upon a stipulation of facts. The court rendered judgment in favor of the garnishees and interveners, and dismissed the garnishment proceedings. From the judgment thus entered, plaintiffs appeal.
Affirmed.
Clark & Clark and Pickett, Swisher & Farwell, for appellants.
P. H. Paulsen and Stipp, Perry, Bannister & Starzinger, for appellees.
At the time of his death, on November 21, 1921, Lewis Miller held six policies of insurance upon his life, as follows: two in the Union Central Life Insurance Company for $ 10,000 each,--one payable to "my estate, if living at my death, otherwise to my administrators, executors or assigns," and the other to "the administrators, executors or assigns of the insured;" two policies in the New England Mutual Life Insurance Company for $ 10,000, each payable to "the executors, administrators or assigns with right of revocation;" two policies in the John Hancock Mutual Life Insurance Company for $ 5,000 each, payable to the "executors or administrators if living, or to such other beneficiary as may be finally substituted under the conditions hereof."
By his will he disposed of the proceeds of his life and accident insurance as follows:
"All of the rest, residue and remainder of my property, of whatever kind and description, both real and personal, which I may own at the time of my death, including my life and accident insurance policies payable to myself or to my estate, and all of the proceeds therefrom including my homestead, subject to Item I hereof, I give, devise and bequeath in equal shares to my eight children, Mary Grace Labarre, Clyde S. Miller, Glenn W. Miller, Max W. Miller, Paul S. Miller, Martha June Miller, Julia Abigail Miller, and Lewis Junior Miller, to be held in trust as hereinafter mentioned and to be administered as a trust as hereinafter mentioned and to be administered as a trust as hereinafter specified."
The testator was survived by his wife and all of the children named as legatees in the will, several of whom were and still are minors. The will was duly admitted to probate in Black Hawk County, and Martha A. Miller qualified as executrix, and also as trustee, as provided by the will. The two sons named as advisory trustees also qualified as such, and assumed the duties thereof. Martha A. Miller elected to take under the terms of the will. Insurance in the sum of $ 47,362.72 was paid to the executrix, and, at the time of the garnishment, she was administering the same as trustee, the estate having been closed. All of the policies provided that the beneficiary named therein might be changed at any time by written notice to the company at its home office, upon forms furnished thereby. The policies of the New England Mutual Life and the John Hancock Mutual Life further provided that the change of beneficiary should become effective only upon indorsement thereof on the policy. Each of the policies specifically reserved the right of revocation to the insured. Appellees do not controvert the claim of appellant that, unless the disposition made of the proceeds of the insurance policies by the will is carried out, a substantial amount, which would otherwise go to the surviving widow, under Section 1805 of the Code of 1897, is subject to garnishment, and should be so disposed of by the court. On the other hand, appellants do not claim that, if effect be given to the terms of the will, the ruling complained of is erroneous.
I. The theories of counsel for the respective parties are widely divergent: counsel for appellants contending that the attempt of the insured to dispose of the proceeds of the policies in the manner stated was, in effect, nothing more than an attempt to change by will the beneficiaries named in the policies. The law is well settled in this state that, where a method of changing beneficiary is contained in the policy, such method is exclusive, and must be followed; and that a change cannot in such case be made by will. Wendt v. Iowa Legion of Honor, 72 Iowa 682, 34 N.W. 470; In re Estate of Ensign, 181 Iowa 1081, 165 N.W. 319; Brotherhood of Am. Yeomen v. Shine, 196 Iowa 554, 194 N.W. 362; Brinsmaid v. Iowa St. Trav. Men's Assn., 152 Iowa 134, 132 N.W. 34; Townsend v. Fidelity & Cas. Co., 163 Iowa 713, 144 N.W. 574; Hull v. Brotherhood of Am. Yeomen, 199 Iowa 356, 202 N.W. 6; Ehlerman v. Bankers' Life Co., 199 Iowa 417, 200 N.W. 408, and cases cited.
But, if the policy does not prescribe a method for changing the beneficiary, a change thereof may, under some circumstances at least, be made by will. Brinsmaid v. Iowa St. Trav. Men's Assn., supra; Townsend v. Fidelity & Cas. Co., supra.
As has already been observed, all of the policies in question were made payable to the estate, or to the executors or administrators of the insured. The argument of counsel for appellees proceeds on the theory that the avails of the policies were a part of the estate of the insured, and, like any other personal property, subject to be disposed of by will, under the provisions of Section 3270 of the Code of 1897. The term "estate" has been, in some instances, held not to include life insurance (Golder v. Chandler, 87 Me. 63 ); but this definition, it seems to us, is too narrow to give effect to the usual and ordinary meaning of the word. Wolf v. Wolf, 152 Iowa 121, 131 N.W. 882.
It is true that the proceeds of an ordinary life policy payable to the estate of the deceased can never come into his possession, and are payable to his executors or administrators only after his death. Nevertheless, it is a valid and subsisting contract, and ripens immediately upon his death into a chose in action; and, unless the distribution thereof is controlled by statute, the proceeds of a policy payable to the estate or executors or administrators of the insured would pass, under the general statute of descent, to his heirs. The executors or administrators of the estate of the insured are not beneficiaries, but in their representative capacity the proceeds are payable to them for the purpose of distribution to the beneficiaries. It seems to us, therefore, quite clear that the will in question did not attempt merely to effect a change of beneficiaries, but that it operated upon the estate of the insured, and must be given full effect as a testamentary disposition thereof, unless the proceeds of life insurance policies can in no case be disposed of by will, or unless the disposition attempted in this case is prohibited by Section 1805 of the Code of 1897. We shall dispose of these questions in order.
II. The question as to whether the insured may dispose of the avails of insurance on his life by will has never been passed upon by this court. We have held, however, in effect, that, where the policy is payable to his personal representatives, the proceeds are a part of his estate. McClure v. Johnson, 56 Iowa 620, 10 N.W. 217; Kelley v. Mann, 56 Iowa 625, 10 N.W. 211; Rauen v. Prudential Ins. Co., 129 Iowa 725, 106 N.W. 198.
Language is to be found in McClure v. Johnson and Rauen v. Prudential Ins. Co., supra, which apparently assumes, but does not decide, that life insurance, when not payable to another than the insured or his personal representatives, may be disposed of by will. The disposition of life insurance is controlled in many jurisdictions by statute, and but few cases in point have been called to our attention. The right to do so is recognized by text-writers. 1 Underhill on the Law of Wills, Section 56; 2 Joyce on the Law of Insurance (2d Ed.), Section 736.
To what extent, if at all, the holding in the following cases, which sustain the right of testamentary disposition, was controlled by statute, is not disclosed by the opinions. Blouin v. Phaneuf, 81 Me. 176 (16 A. 540); Catholic Knights v. Kuhn, 91 Tenn. 214 (18 S.W. 385); Watson v. Watson, 183 Ky. 516 (209 S.W. 524); German-American St. Bank v. Godman, 83 Wash. 231 (145 P. 221); Fox v. Senter, 83 Me. 295 (22 A. 173); Pruner's Estate, 222 Pa. 179 (70 A. 1000); Haynes v. Walker, 111 Tenn. 106 (76 S.W. 902); Hamilton v. McQuillan, 82 Me. 204 (19 A. 167). Under some of the above cases, the holding of the court is qualified, while others may not be exactly in point.
The decisions in the following cases sustaining the right of testamentary disposition of life insurance are based upon provisions of the policy or legislative enactments, but the discussion may be helpful. Stoelker v. Thornton, 88 Ala. 241 (6 So. 680); Aveling v. Northwestern Masonic Aid Assn., 72 Mich. 7 ...
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