Mutual Life Insurance Company of New York v. Rodney

• Decision Date: 28 March 1921
• Citation: 114 A. 163,12 Del.Ch. 294
• Court: Court of Chancery of Delaware
• Parties: THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK, v. HARVEY B. RODNEY and ROSA M. RODNEY, Administratrix of Robert L. Rodney, deceased

114 A. 163

12 Del.Ch. 294

THE MUTUAL LIFE INSURANCE COMPANY OF NEW YORK, v. HARVEY B. RODNEY and ROSA M. RODNEY, Administratrix of Robert L. Rodney, deceased

Court of Chancery of Delaware, New Castle

March 28, 1921

This cause came before the Chancellor on a petition and motion by the complainant for leave to pay into court money due under a policy of insurance on the life of Robert L. Rodney deceased. The facts are sufficiently set forth in the opinion of the Chancellor.

Herbert H. Ward, for complainant.

John M Richardson and Andrew J. Lynch, for defendants.

OPINION

THE CHANCELLOR

A bill has been filed by a life insurance company for leave to pay into court the principal of an insurance policy and to bring in the two persons who have asserted conflicting claims to it to interplead concerning it. No cause being shown, a decree of interpleader is sought, and the only question is one raised informally and argued as to whether the complainant must also bring into court interest on the amount admittedly due under the policy. The insured died in 1913, and on May 6 1913, the company ordered payment of the loss. In his lifetime the insured assigned the policy and both the administrator and assignee of the assured claim the money. Must the complainant be ordered to bring in interest from May 6, 1913, as well as the $ 1,000.00, the amount payable under the policy?

There is nothing in the policy or statutes of the State bearing on the subject. In general, interest is not due unless there be an agreement to pay it, or default be made in payment of the principal debt when due, and in the latter case interest is allowed as damages for detention. When there is a legal contest between persons other than the debtor, rendering it doubtful to whom the debt should be paid, the debtor is not generally chargeable with interest during such contest. 22 Cyc. 1558, and cases. This also applies where the debt has been attached (22 Cyc. 1559), or there be an injunction against payment (22 Cyc. 1560). Under such circumstances the debtor, being in court respecting the disposition of the money he owes, may always relieve himself of any further duty as to it by paying into court the money he owes. Some cases hold that, when moneys have been attached, he is chargeable with interest unless he brings the money into court. 22 Cyc. 1560. But unless there be such litigation a debtor, such as the complainant in this case, has no way of paying the money into court, and cannot safely pay it to either claimant. His only relief is to bring a bill of interpleader, and by it obtain leave to pay in the money. Does his omission to bring in the claimants by a bill constitute an unreasonable delay on his part in making payment? I think not.

If the debtor be solvent it is theoretically of no advantage to the claimants to have the money paid into court. Their duty to litigate to enforce their rights is not decreased thereby. They may prefer and expect to compose their differences without...