Smooth v. Metropolitan Life Ins. Co.

• Decision Date: 29 October 1934
• Docket Number: 15018
• Court: Court of Appeal of Louisiana — District of US
• Parties: SMOOTH v. METROPOLITAN LIFE INS. CO

157 So. 298

SMOOTH v. METROPOLITAN LIFE INS. CO

No. 15018

Court of Appeal of Louisiana, Orleans.

October 29, 1934

Rehearing denied Nov. 14, 1934. Writ of certiorari denied Jan. 7, 1935.

Henry J. Wyman, of New Orleans, for appellant.

Spencer Gidiere, Phelps & Dunbar and Wood Brown, all of New Orleans for appellee.

OPINION

JANVIER Judge.

James Smooth, alleging himself to be the beneficiary named in two policies of industrial life insurance, issued by Metropolitan Life Insurance Company on the life of Virginia Dutton, and alleging that the said insured has died and that all necessary proof has been furnished and all requirements of the policies complied with, seeks judgment against the said company for $ 390.81, the amount admittedly payable under the said policies to the person rightfully entitled thereto.

Defendant resists the claim of Smooth on two grounds. It contends that under the stipulations in the policies he cannot maintain an action and it denies that all requirements and conditions precedent have been complied with.

The matter was submitted under an agreed stipulation of fact, and, from a judgment for defendant, Smooth has appealed.

The two policies are identical in form. In the printed portion of each there appear two paragraphs to both of which we direct our attention. The first reads as follows:

"The Metropolitan Life Insurance Company (3)5C does further agree, subject to the conditions aforesaid, if the insured shall die prior to the date of the maturity of the endowment to pay upon receipt of proofs of the death of the insured made in the manner, to the extent and upon the blanks required herein and upon surrender of this policy and evidence of premium payment hereunder, the amount stipulated in said schedule to the executor or administrator of the insured, unless payment be made under the provisions of the next succeeding paragraph."

The second of the said paragraphs, commonly known as the facility of payment clause, provides that:

"The Company may make any payment or grant any nonforfeiture privilege provided herein to the Insured, husband or wife, or any relative by blood or connection by marriage of the Insured, or to any other person appearing to said Company to be equitably entitled to the same by reason of having incurred expense on behalf of the Insured, or for his or her burial; and the production of a receipt signed by either of said persons, or of other proof of such payment or grant of such privilege to either of them, shall be conclusive evidence that all claims under this Policy have been satisfied."

It will be noticed that under the first paragraph the proceeds of each policy are made payable in the event of death "to the executor or administrator of the insured." Therefore, Smooth, the present plaintiff, being neither the executor nor the administrator of the estate of the insured, manifestly cannot maintain this action unless given the right to do so in some other part of the policy. Nor does the facility of payment clause create in any individual the right to sue for the proceeds of the policy. Crump v. Metropolitan Life Insurance Co. (La.App.) 156 So. 35; Dorsey v. Metropolitan Life Insurance Co. (La.App.) 145 So. 304. That clause is designed merely to afford to the insurer protection in the event payment is made to one of the persons designated therein even should it later appear that some one else was in fact possessed of a superior right to the proceeds.

But Smooth relies upon an indorsement which appears on each of the policies, not printed therein, but apparently stamped thereon. It reads as follows: "Subject to the provisions of the policy authorizing payment at the Company's option to other persons, James Smooth, grandson has been designated beneficiary to receive death benefit only." The contention of plaintiff is that this indorsement names him as beneficiary. The insurer, on the other hand, maintains that the proceeds of the policies are payable to the executor or administrator of the estate of the insured and that the only effect of the indorsement is to place Smooth among those persons referred to in the facility of payment clause with the result that the insurer may make payment to him if it sees fit, but that it is under no legal duty to do so. In making this contention, great relience is placed upon a decision rendered by the Court of Appeal of Alabama in the matter of Allbright v. Metropolitan Life Ins. Co., 229 Ala. 378, 157 So. 488, decided May 22, 1934, and in which that court was concerned with an insurance policy almost, though not quite, identical in its printed terms and in indorsement with those now involved here. There the first two paragraphs (1) providing for the payment to the administrator or executor and (2) providing for the facility of payment were the same as those before us, but the indorsement read as follows: "Under the provisions of the policy authorizing payment at the Company's option, to other...