Phoenix Mut. Life Ins. Co. v. Cummings, 493.

• Decision Date: 05 August 1946
• Docket Number: No. 493.,493.
• Parties: PHŒNIX MUT. LIFE INS. CO. v. CUMMINGS et al. (CUMMINGS, Intervener).
• Court: U.S. District Court — Western District of Missouri

67 F. Supp. 159

PHŒNIX MUT. LIFE INS. CO. v. CUMMINGS et al. (CUMMINGS, Intervener).

No. 493.

District Court, W. D. Missouri, S. D.

August 5, 1946.

COPYRIGHT MATERIAL OMITTED

Henry J. Eager and Roy P. Swanson, both of Kansas City, Mo., and Ray Bond, of Joplin, Mo., for plaintiff.

Paul E. Bradley and George W. Wise, both of Joplin, Mo., for defendant Elsie Mabel White Cummings and J. J. Cummings.

Roy Coyne, of Joplin, Mo., for defendant Mildred E. Cummings

RIDGE, District Judge.

This interpleader action instituted in this Court by virtue of T. 28 U.S.C.A. § 41 (26), involves the proceeds of a life insurance policy issued on the life of James D. Cummings, who gave his life in defense of his country, in time of its greatest need.

James D. Cummings and Mildred E. Cummings were married in 1937. In the year 1939 James D. Cummings took out a policy of insurance on his life, naming his then wife, Mildred E. Cummings, the beneficiary therein. The right to change the beneficiary so designated in said policy was reserved. While James D. Cummings was on active duty, as a member of the United States Marine Corps in 1943, Mildred E. Cummings obtained a decree of divorce. At the time said divorce was granted Mildred Cummings had possession of the policy of insurance in question. Her testimony is that James D. Cummings disposed of certain furniture and personal property accumulated during their marriage, and that he gave her possession of said policy at the time of their separation. However, she also testified that said policy was given to her the day that it was taken out, and that she has retained possession of said policy ever since. She states that no demand has ever been made upon her for the surrender of said policy. Very shortly after obtaining her divorce Mildred E. Cummings married one Mark D. Kent. Subsequent to her remarriage, and during the life time of James D. Cummings, Mildred Cummings Kent wrote a letter to a friend of James D. Cummings', one Helen Lickty, in which she stated, in part, as follows:

"Helen about the things Jimmie wanted I don't know exactly what he means about a scrap book unless it is our pictures—as you know Jimmie paid no attention to my wishes as to giveing (sic) me our things that I wanted so I have a few things that I'll send to you. When you write him tell him his promotion papers—Insurance papers, & divorce decree are in the box. He must have written his Mother once to get them but never would I give them to her so I'll send what I have to you." * * *

She explains the reference to "insurance papers," mentioned in said letter, as alluding to the Government insurance of James D. Cummings which, she contends, she assigned over to James D. Cummings at the time of their separation.

In May, 1944, when James D. Cummings was on duty in the South Pacific, as a member of the Marine Corps, he executed the following document and sent it to his father:

"29 May 1944

"Dear Dad:

"I am writing this today I should have done it a long time ago.

"This war is a dangerous business at best and while I have been Lucky so far one never knows. So I am going to give you all the dope on what you are to do in the event of my getting in the way of a well aimed slug. KEEP THIS LETTER FOR REFERENCE

"First, I have 10,000 Dollars in Insurance in the VETERANS ADMINISTRATION, WASHINGTON D. C. this names mother as my next of kin. I have a policy with Phenoix Mutal (sic) but I think Mildred allowed that to laspe. (sic) At the time of our divorce she would not mail it to me, but sent it to a friend of ours I am having them sent to you. If this policy can be saved without the addition of a war risk clause, I will have it changed.

"Now as my next of kin mom can at my death apply for the insurence (sic) which at her age will net around 50 a month for the rest of her life and will revert to you if she should die befor (sic) you.

"Also she should apply to the Chief paymaster US MC for my back pay and the six months pay due to her as my next of kin.

"Any money or prorerty (sic) which I may have at my death are to be divided equally between you and mom.

"This letter will serve as your authority for the transfer of the money to you It has been read and my signature witnessed by a Commissionsd (sic) Officer of the Marine Crop. (sic) serving with the Armed Forcses (sic) overseas.

"As ever, love "your son "(s) James D. Cummings "James D. Cummings "I have Witnessed this signature "J. M. Venard 2nd Leiut. (sic) U SM CR "Corp J D Cummings "Engr. Co. 22nd Marines (Reinf.) "1st Prov Marine Brigade co Fleet p.o "San Francisco Calif.

"P.S.—If you need any advice on what to do to get the money—see your Local Red Cross Administrator. He or she will have complete information on this."

July 24, 1944, James D. Cummings met his death "caused by wounds received in the attack at Guam Island."

After the death of James D. Cummings, Mildred Cummings Kent instituted an action in the Circuit Court of Jasper County, Missouri, to recover the proceeds of the policy of insurance here involved. Prior thereto the defendants, Elsie Mabel White Cummings and J. J. Cummings, the mother and father of James D. Cummings, made claim against the Phoenix Mutual Life Insurance Company, which issued said policy, for the proceeds thereof. The claims so filed resulted in the institution of this interpleader action and payment, by said Insurance Company, of the proceeds of said policy ($1,009) into the registry of this Court. Upon payment of such proceeds into Court the Phoenix Mutual Life Insurance Company, by interlocutory decree, was discharged from further liability under said policy.

Interpleaders Elsie Mabel White Cummings and J. J. Cummings premise their claim to the proceeds of the insurance policy in question, upon the following proposition: They contend that the document above set forth, executed by James D. Cummings, is a "soldier's will" and, as such, is a sufficient designation of them as beneficiaries of the policy of insurance in question, so as to entitle them to recover the proceeds of said policy, deposited in this action. In making that contention they assert that James D. Cummings, during his lifetime, demanded surrender of his life insurance policy, in the Phoenix Mutual Life Insurance Company, from Mildred Cummings Kent, for the purpose of changing the beneficiary therein; that Mildred Cummings Kent failed and refused to surrender said policy; that had she surrendered said policy when so demanded, James D. Cummings would have named them as beneficiaries in said policy; that he was prevented from so doing by the willful acts of Mildred Cummings Kent, which now estop her to claim that she is entitled to the proceeds of said policy. Mildred Cummings Kent contends that her designation as beneficiary in the policy of insurance in question, together with her possession of said policy under the circumstances as above stated, entitles her to receive the proceeds of said policy.

As a general proposition, in order to effect a change of beneficiary in a policy of life insurance the mode prescribed by the policy must be adhered to. Nance v. Hilliard, 8 Cir., 101 F.2d 957. The provision contained in a policy of life insurance, respecting the mode of changing a designated beneficiary, is one for the benefit of the insurance company, and may be waived. Reid v. Durboraw, 4 Cir., 272 F. 99; Dunnavant v. Mountain States Life Ins. Co., Mo.App., 67 S.W.2d 785; Mutual Life Ins. Co. of New York v. Tuemler et al., Mo.App., 251 S.W. 727. An insurance company is held to waive such provision, so far as it is concerned, when it files a bill of interpleader and deposits the insurance money in Court, and pleads a willingness to pay the insurance fund to whichever one of rival claimants the Court may decide to be rightfully entitled thereto. Metropolitan Life Ins. Co. v. Richardson, D.C., 27 F.Supp. 791; Gnekow v. Metropolitan Life Ins. Co., Mo. App., 108 S.W.2d 621, loc. cit. 625; Frakes v. Brotherhood of Locomotive Firemen et al., Mo.App. 204 S.W. 26. Where a life insurance policy, by its terms, gives the insured the right to change the beneficiary, or assign the policy, the beneficiary, so far as the policy contract is concerned, has only a contingent interest therein. Morgan v. Penn Mutual Life Ins. Co., 8 Cir., 94 F.2d 129; Fendler v. Roy, 331 Mo. 1083, 58 S.W.2d 459, loc. cit. 464; McKinney v. Fidelity Mutual Life Ins. Co., 270 Mo. 305, 193 S.W. 564. When an insurance company waives compliance with the provision in its policy of insurance, respecting mode for change of beneficiary, and pays the proceeds thereof into Court, if it is established by convincing evidence that the insured, in said policy, manifested an unequivocal intention to change the beneficiary designated in said policy, but was prevented from carrying such intention into effect by some act of the named beneficiary, such beneficiary will be estopped from claiming the proceeds of said policy, and equity will decree to be done that, which in good conscience ought to be done, and award such proceeds to the person or persons insured intended should receive the same. Doering v. Buechler, 8 Cir., 146 F.2d 784; Prudential Ins. Co. of America v. Moore, 7 Cir., 145 F.2d 580; Frakes v. Brotherhood of Locomotive Firemen, Mo.App., 204 S.W. 26; Supreme Tent, etc. v. Altmann, 134 Mo.App. 363, 114 S.W. 1107; Mutual Life Ins. Co. of Baltimore, Md. v. Burger, Mo.App., 50 S.W.2d 765; McDonald v. McDonald, 212 Ala. 137, 102 So. 38, 36 A.L.R. 761.

In the case at bar the evidence is not convincing that James D. Cummings made a completed gift of the policy of insurance here involved to Mildred Cummings, or that said policy was delivered to her in consideration of any property settlement effected with James D. Cummings at the time...