Northern Life Ins. Co. v. Burkholder

• Decision Date: 14 January 1930
• Parties: NORTHERN LIFE INS. CO. v. BURKHOLDER ET AL.
• Court: Oregon Supreme Court

283 P. 739

131 Or. 537

NORTHERN LIFE INS. CO. v. BURKHOLDER ET AL.

Supreme Court of Oregon

January 14, 1930

In Bank.

Appeal from Circuit Court, Multnomah County; Louis P. Hewitt, Judge.

Interpleader by the Northern Life Insurance Company against Thelma Marie Burkholder, W. P. Snook, administrator of the estate of Fred Marti, deceased, and another, wherein defendant first-named filed a cross-complaint. Decree in favor of defendant Snook and defendant Burkholder appeals. Reversed, with modifications.

This suit was begun by the plaintiff by a complaint in the nature of a bill of interpleader, setting forth substantially that the plaintiff is a life insurance company.

II. "That on or about the 15th day of April, 1926, plaintiff issued and delivered to Fred Marti, then a resident of Corbett, Oregon, its policy of insurance bearing said date and numbered M--30241, whereby in consideration of the full payment of the premium therein provided, plaintiff insured the life of said Fred Marti in the sum of three thousand dollars ($3,000.00), and further providing that on proof that his death occurred while said policy was in force and effect and upon the surrender of said policy, the plaintiff would pay to the estate of said Fred Marti, or his executors administrators or assigns, the sum of three thousand dollars that said Fred Marti in his application for said policy expressly reserved the right to change the beneficiary of said insurance policy; that on or about the 19th day of August, 1926, Fred Marti died at Corbett, in Multnomah county, Oregon, and at said time said policy was in full force and effect, and by the terms thereof plaintiff was liable to pay the said sum of three thousand dollars less the balance of unpaid first year's premium thereon, as hereinafter alleged."

III. "That after the death of said Fred Marti it was discovered that the beneficiary under the said policy of insurance had been apparently changed, but without any knowledge of or notice to plaintiff; that plaintiff is informed that at some time subsequent to the delivery of said policy to said Marti by plaintiff, he attempted to and in effect did alter or change the beneficiary from the original manner in which the policy was issued by inserting thereupon in handwriting on said policy the name 'Telma Maria Burkholder' in the place for 'beneficiary' and it has been represented to this plaintiff that said handwriting is that of said Fred Marti and that he intended to and thereby did name said Thelma Marie Burkholder, of Corbett, Oregon, as the beneficiary under said policy; that under the rules and regulations of this plaintiff and the terms of said policy, a notice of change of beneficiary should have been sent to plaintiff together with the policy for proper indorsement but plaintiff is willing to have the proceeds of said policy paid over to whomsoever may be determined to be legally entitled thereto."

It is further alleged that defendant Thelma Marie Burkholder claims the proceeds of said policy on the ground that she is the beneficiary under said policy as the fiancée of deceased; that Brandenberger claims the proceeds of the policy as a representative of certain brothers and sisters of deceased, who reside in Switzerland, and of which nation Brandenberger is consul at Portland, and that defendant Snook claims the proceeds as administrator of deceased. The complaint proceeds as is usual in suits in interpleader showing the difficulty in determining which of the three claimants is entitled to the fund, and brings the fund into court depositing it with the court asking that the claimants be required to interplead; that plaintiff have the sum of $350 from the fund as its costs and attorney's fee arising herein, and that it be discharged from further litigation herein. No question is raised by any of the claimants as to the propriety, or form of the complaint. On motion, the interpleader was allowed. Thereupon the defendant Brandenberger answered, admitting the capacity of the plaintiff in interpleader and the issuance of the policy as alleged in the complaint, and further answered as follows:

"For answer to paragraph III of the bill of complaint this defendant admits that after the death of Fred Marti it was discovered that the deceased had attempted in his lifetime to change the beneficiary named in the policy; that in the policy of insurance the beneficiary was named as the estate of Fred Marti, his executors, assigns or administrators; that by the terms of said policy it was provided that the insured might change the beneficiary in said policy by obtaining such endorsement on the policy by the president or the secretary of the company; and that this became and was a condition of making such a change; that without notice to the company, and without obtaining an endorsement of such change of the policy by the president or secretary of said company, the name of Thelma Marie Burkholder as beneficiary was found to have been written in said policy in place of the estate of said Marti, but said Marti never notified the company of said attempted change and the company did not know thereof until after his death; and that said change was made without the consent or knowledge of the estate of said deceased, or of his executors, or administrators, or of his heirs hereinafter named, who were and are entitled to receive the proceeds of said policy from his estate; and that said attempted change of beneficiary was illegal and without effect; and that the plaintiff is without authority to waive the failure of the deceased to comply with the terms of the policy in respect to the manner of changing the beneficiary therein."

Omitting matters, not material here, said defendant further answered as follows:

"Answering paragraph VI, this defendant alleges that he is the duly and regularly appointed consul of the republic of Switzerland and that he is stationed and resides at Portland, Oregon, and denies that he is claiming the proceeds of said policy be paid to himself, but alleges that he has a power of attorney from the brothers and sisters of said Fred Marti, deceased, who are his only heirs at law, the said Fred Marti having been unmarried and at the time of his decease having had no father or mother living, which power of attorney authorizes and directs this defendant to collect the proceeds of said policy for the benefit of said heirs who are entitled to the same, but this defendant alleges that he expects to make such collection through W. P. Snook, the duly appointed administrator of the estate of said Fred Marti, deceased, and this defendant joins with said administrator in the defense of this suit as against the claim of the defendant, Thelma Marie Burkholder."

The allegations in regard to attorney's fees were denied, and other allegations of the complaint, not above noted, were admitted. The answer prayed that defendants Snook and Thelma Marie Burkholder be required to interplead and settle the disposition of the fund between themselves, and an order was made accordingly.

Thereupon Thelma filed her answer and cross-complaint admitting the paragraphs of plaintiff's complaint heretofore quoted, except as set up in her cross-complaint, and excepting formal denials of matters not important here. Her cross-complaint, after stating the character of the plaintiff and its business as an insurance company, the italics appearing therein, which indicate the most important features of the cross-complaint, being retained as they appear in the abstract, continues as follows:

"That on or about, to wit: the _______ day of December, 1925 this defendant, Thelma Marie Burkholder, became betrothed to said Fred Marti, and at the time of his death he was negotiating for the building of a house for their home when they should be married and said betrothal or engagement to marry continued unto the death of said Fred Marti, and at the time of his death this defendant was the promised wife of said Fred Marti.

"That on, or about, the 15th day of July, 1926, said Fred Marti told this defendant that it was his intention to make over said policy of insurance to her, and have it made payable to her, so that in case of his death she would be the beneficiary therein and thereunder, and again, on, or about, the 11th and 15th days of August, 1926, he again spoke to her of his intention and again told this defendant that he was going to make her the beneficiary in said policy, and would cause said policy to be, at once, made payable to her, instead of to his executors, administrators or assigns.

"That said Fred Marti departed this life on the 19th day of August, 1926, at which time all premiums and moneys due and payable to plaintiff, as premiums on said policy, at that time were fully paid.

"That immediately prior to the death of said Fred Marti, and about the time he informed this defendant of his said intention to make over said policy of life insurance to this defendant, his intended bride, and to make her the beneficiary in said policy, he the said Fred Marti, by his own handwriting, wrote in on the face of said policy, and in the space where the name of the beneficiary is usually and generally written, the full name of this defendant, besides her postoffice address, by which act he intended to and believed he was actually making over said policy, and did make over said policy to his intended wife, this defendant, changing the beneficiary from his estate to his intended wife, this defendant, and by said act did make her the beneficiary of the proceeds of said policy.

"That on the 19th day of August, 1926, plaintiff was duly notified of the death of said Fred Marti, and proper and complete proofs of death have been furnished plaintiff, and defendant Thelma Marie...