Mutual Life Ins. Co. v. Blair

• Decision Date: 01 June 1904
• Docket Number: 4,898.
• Citation: 130 F. 971
• Parties: MUTUAL LIFE INS. CO. OF NEW YORK v. BLAIR et al.
• Court: U.S. District Court — Eastern District of Missouri

130 F. 971

MUTUAL LIFE INS. CO. OF NEW YORK v. BLAIR et al.

No. 4,898.

United States Circuit Court, E.D. Missouri, Eastern Division.

June 1, 1904

On the 8th day of January, 1902, complainant and James L. Blair entered into a contract of insurance upon the life of said James L. Blair. This contract among others, contains the following stipulations and agreements of parties:

'The Mutual Life Insurance Company of New York in consideration of the application for this policy, which is hereby made a part of this contract, insures the life of James L. Blair of Kirkwood, in the County of St. Louis, state of Missouri hereinafter known as the insured, in the sum of two hundred thousand dollars, for the benefit of his wife, Apolline M Blair, the beneficiary. Upon acceptance at the head office of the company in the city of New York of satisfactory proofs of the death of said insured during the continuance of this policy, and on the surrender of this policy at said office, the said insurance will be adjusted in instalments, without interest, by the issuance of an annuity contract in lieu hereof as hereinafter provided.'

Under the 'provisions, requirements and benefits,' set forth in the contract, there is found the following stipulation as to the annuity contract:

'Annuity Contract. Upon the surrender of this policy after acceptance by the company of satisfactory proofs of the death of the insured the company will issue a nonparticipating annuity contract, the single premium for which shall be entered in the company's books as a death claim under this policy. The said annuity contract shall provide as follows:

'(a) If the beneficiary be living at the date of said annuity contract, the company will pay to the beneficiary on such date a first instalment equal to five per cent. of the face amount of this policy, and thereafter on each anniversary of said date an instalment of like amount without interest, until twenty such instalments shall have been paid, and furthermore, the company will continue the payment of such annuity in like instalments throughout the remaining lifetime of said beneficiary.

'Should the beneficiary die during the continuance of said annuity contract and before the completed payment of said twenty annual instalments, the company will pay the remainder thereof, as they become due, to the executors or administrators of the insured.

'(b) If the beneficiary be not living at the date of said annuity contract, the company will pay twenty instalments only, as above described, to the executors or administrators of the insured.'

Thereafter, by agreement of the parties, the following modification of the terms of the contract was indorsed upon the policy:

'By mutual consent and upon the request of all the parties to this contract it is understood and agreed that in the event of the death of the beneficiary subsequent to the death of the insured, and prior to the completion of the payment of the twenty annual installments, the remainder of said instalments shall be paid when due to the insured's children, Percy A. and Francis P. Blair, share and share alike, or the survivor of them. If neither survive, then to insured's executors, administrators or assigns. A. Klamroth, Assistant Secretary.'

Thereafter, and on the 5th day of November, 1903, complainant filed its bill of complaint in this court against the assured, his wife, Apolline M. Blair, and his two sons, Percy A. Blair and Francis P. Blair, beneficiaries under the terms and modifications of the contract, for the purpose of obtaining a decree rescinding the contract, and directing its cancellation and return to complainant upon the grounds of fraudulent representations by assured in the procurement of the contract, and concealment of crimes theretofore by him committed, averred to be material to the risk incurred by complainant in the issuance of the contract.

The voluntary appearance of James L. Blair and Apolline M. Blair, his wife, was entered at the December, 1903, rules, and on January 4, 1904, a guardian ad litem was appointed for Percy A. and Francis P. Blair, they being minors. On the 16th day of January, 1904, defendant James L. Blair died testate, and on February 3d thereafter, in pursuance of the stipulation of the parties, an order of revivor was entered, and the executor of the estate of assured, theretofore duly appointed and qualified, entered his appearance. On the 4th day of April, by leave of court, complainant filed its substituted bill of complaint, and defendant Apolline M. Blair withdrew her demurrer filed to the original bill, and all defendants were given until May rules to plead to the substituted bill of complaint. At the May rules, defendant Apolline M. Blair, widow, and John F. Lee, executor of the estate of James L. Blair, filed their plea in due form, setting forth the death of the assured, and the bringing in the state court by the widow an action at law to recover the sum of $10,000-- the first installment alleged to be due and payable under the terms of the contract-- and further alleging therein a compliance with all the terms and conditions of the policy requisite to be performed by the beneficiaries therein, the removal of that action by complainant herein (defendant therein) into this court, and praying an order dismissing the substituted bill of complaint, for that, by reason of the subsequent death of assured and the institution of the action at law, there has accrued and is now available to complainant a plain, adequate, and complete remedy at law by way of defense in such action. This plea was by complainant set down for hearing on the 3d day of this month, and has been fully presented to the court in oral argument and upon briefs filed, and taken and held under advisement until this day.

Henry T. Kent and J. F. Lee, for the plea.

McKeigham & Watts, Frederick H. Bacon, Julien T. Davis, and Edward Lyman Short, opposed.

POLLOCK District Judge.

The office of the plea in this case is to bring before the court the fact of the death of the assured, and the subsequent bringing and pendency of the action at law upon the policy as distinct facts in bar of this suit. Farley v. Kittson, 120 U.S. 303, 7 Sup.Ct. 534, 30 L.Ed. 684; Hughes v. Blake, 6 Wheat. 453, 5 L.Ed. 303; Rhode Island v.Massachusetts, 14 Pet. 210, 10 L.Ed. 423; Mitford on Pleading (4th Ed.) Secs. 14, 219, 295; Story, Equity Pleading, Secs. 649, 652. This plea does not bring before the court for consideration the want of equity in complainant's bill. Rhode Island v. Massachusetts, supra; National Bank v. Insurance Company, 104 U.S. 54, 26 L.Ed. 693; Farley v. Kittson, supra. In the consideration of this plea, the answer of defendants not having come in, the averments of the bill are treated as confessed. Hence, in case facts stated in the plea, though verified, are in any material respect in conflict with the averments in the bill, in such matter the averments in the bill must control. Roche v. Morgell, 2 Sch.&Leff. 721; Farley v. Kittson, supra.

The questions arising for consideration upon this plea are: (1) Conceding the complainant now has, by reason of the death of James L. Blair and the commencement of the action at law now pending in this court, a plain, adequate, and complete remedy at law by way of defense thereto, as this remedy did not exist at the time of the commencement of this suit, will complainant be compelled to now abandon this suit, wherein jurisdiction over the persons and subject-matter of the controversy has once rightly attached, and resort to its defense in the action at law? If so, (2) is it shown by the facts stated in the plea taken in connection with the averments of the bill admitted because unanswered, that complainant now has a plain, complete, and adequate remedy at law by way of defense in the law action now tendered complainant by the plea as equivalent to, and a substitute for, this suit in equity?

From a consideration of the many adjudicated cases referred to in argument by solicitors for the respective parties, and without undertaking a review thereof, it must, I think, be conceded that this court had jurisdiction to entertain a bill filed for the purpose of obtaining a decree rescinding the contract in question, and directing its cancellation and delivery to complainant at the time the original bill was filed in this suit; the assured at the time being alive, and no other remedy for wrongs averred to have been done complainant then existent. Riggs v. Union Life Insurance Company (C.C.A.) 129 F. 207; Conn. Mutual Life Insurance Company v. Home Insurance Co., 17 Blatchf. 138, Fed. Cas. No. 3,107; New York Life Insurance Co. v. Statham, 93 U.S. 24, 23 L.Ed. 789; Home Insurance Co. v. Stanchfield, 1 Dill. 424, Fed. Cas. No. 6,660; 2 Joyce on Insurance, § 1678; 2 Phillips on Insurance, p. 574.

It is conclusively settled that, had this suit been instituted after the death of assured, this court would not have taken jurisdiction, unless, perhaps, a state of facts peculiar and extraordinary in their nature were set forth in the bill, constituting a defense to the contract, neither available nor presentable in a court of law. Cable v. U.S. Life Insurance Co., 191 U.S. 288, 24 Sup.Ct. 74, 48 L.Ed. 188; Riggs v. Union Life Insurance Co., supra.

The question presented by this plea, as now considered, is the effect of the death of assured upon this pending suit after the commencement of an action at law upon the policy, wherein all defenses that may be made to the enforcement of the contract are available. The difference in the right of choice of forums and remedy pursued, clearly recognized and firmly established by the adjudicated cases, would appear to be controlled entirely by the date of the death of...