Moies v. Economical Mut. Life Ins. Co.

• Decision Date: 22 February 1879
• Citation: 12 R.I. 259
• Parties: THOMAS MOIES, Administrator, v. THE ECONOMICAL MUTUAL LIFE INSURANCE COMPANY et als. CHARLES H. MERRIMAN, Receiver, v. SAMUEL CLARK, Receiver, et als.
• Court: Rhode Island Supreme Court

12 R.I. 259

THOMAS MOIES, Administrator, v. THE ECONOMICAL MUTUAL LIFE INSURANCE COMPANY et als.

CHARLES H. MERRIMAN, Receiver, v. SAMUEL CLARK, Receiver, et als.

Supreme Court of Rhode Island.

February 22, 1879

An insurance company has not an absolute right to collect the income of securities deposited with the general treasurer of the State under Gen. Stat. R.I. cap. 143, § 18, but may receive such income with the permission of the treasurer.

This permission the general treasurer will grant or refuse as the interests of the policy holders may require. In case of refusal, the income accrues to the principal of the securities to pay, 1st, the policy holders, 2d, the other creditors.

BILL IN EQUITY brought to establish a lien and to obtain a transfer of certain trust funds.

September 14, 1867, the Economical Mutual Life Insurance Co. issued a policy on the life of Horace Daniels, payable in case of his death to his wife, Matilda E. Daniels. Horace Daniels died December 14, 1876, and Matilda E. Daniels died January 3 1876. Thomas Moies, administrator on the estate of Matilda E Daniels, recovered a judgment against the Economical Mutual Life Insurance Co., October 2, 1877, upon this policy. Execution was issued and was returned unsatisfied, there being no property on which to levy it.

In accordance with the statute in force which now forms the following sections of Gen. Stat. R.I. cap. 143, the Economical Mutual Life Insurance Co. had deposited with the general treasurer of Rhode Island certain securities to protect its policy holders, the securities amounting to over $100,000.

" SEC. 17. In all cases in which the laws of any of the United States, other than this State, now require, and may hereafter require, that the insurance companies incorporated by the laws of other States, shall deposit with some officer of the State, in which such insurance company is incorporated stocks or other securities, in trust or for the benefit of policy holders of such companies, as a prerequisite to such companies transacting business in such other State, the general treasurer of this State is hereby authorized to receive from any insurance company incorporated under the laws of this State, stocks or other securities, in such amount as may be required by the laws of such other State or States, on deposit and in trust for the benefit of the policy holders of such company.

SEC 18. The general treasurer shall hold such stocks or securities so deposited as security for policy holders in said company, but any company so depositing may be permitted to receive and to collect the interest and dividends on its securities so deposited, and from time to time to withdraw such securities, on depositing with the said general treasurer other securities of the same character, the market value of which, at the time of such deposit, shall equal or exceed the amount required to be deposited.

SEC. 19. Whenever any insurance company shall have deposited the requisite stocks or other securities in conformity with the laws of the State or States in which such company is desirous of transacting business, the general treasurer shall furnish such company, at its expense, a certificate under seal, of such deposit for each State which shall require the same, which certificate shall embrace the items of security, and the amount of each thus deposited, and that he, said general treasurer, is satisfied that such stocks are of the market value represented; but no stock or other securities so deposited shall be withdrawn except as provided in the preceding section."

In 1873 the Economical Mutual Life Insurance Co. made an arrangement with the Republic Life Insurance Co. of Illinois, by which the latter was to receive all the assets of the former, and assume all its risks with the assent of the policy holders in the former company. In pursuance of this plan a majority in interest of the policy holders of the Economical Co. cancelled their claims by adjustment, lapse, or surrender, receiving new policies from the Republic Life Insurance Co.

November 24, 1877, Moies, as administrator, filed his bill against the Economical Mutual Life Insurance Co., the general treasurer of Rhode Island, and...