Souder v. Home Friendly Soc.

• Decision Date: 19 June 1890
• Citation: 20 A. 137,72 Md. 511
• Parties: SOUDER v. HOME FRIENDLY SOC. OF BALTIMORE.
• Court: Maryland Court of Appeals

20 A. 137

72 Md. 511

SOUDER v. HOME FRIENDLY SOC. OF BALTIMORE.

Court of Appeals of Maryland

June 19, 1890

Appeal from superior court of Baltimore city.

Argued before ROBINSON, IRVING, BRYAN, MCSHERRY, FOWLER, and BRISCOE, JJ.

John V. L. Findley and Thos. MacKenzie, for appellant.

William Daniel, Robt. D. Morrison, M. Munnikhuysen, and N. P. Bond, for appellee.

BRYAN J.

The appellant brought suit against the appellee to recover certain sums of money alleged to have become due and payable by reason of an insurance of the life of one Samuel Herman. The appellee demurred to three counts in the declaration, and the demurrers were sustained. We will give our opinion on the questions in controversy without, at present, making any particular examination of the pleadings. The facts on which our opinion is desired appear to be as follows: Herman, the deceased, was indebted to one Sibbet, who was his son-in-law. Sibbet, in 1877, insured Herman's life for $3,000 in the Home Mutual Life Association of Pennsylvania, and assigned the policy of insurance to the plaintiff, now appellant, to secure a large sum of money which he owed him. The plaintiff paid the dues and assessments on the policy, and continued to pay them until 1887, when the defendant, now appellee, agreed to assume the risk taken by the Pennsylvania Company on the life of Herman and in accordance with this agreement issued three certificates for the proceeds of an assessment to be levied at his death upon its surviving members, not to exceed $1,000 for each certificate; and they were declared by writing indorsed on them to be issued for the purpose of taking the place, in part, of policy No. 388, in the Home Mutual Life Association of Pennsylvania, which was thereupon surrendered. These certificates were made payable to W. H. Souder, assignee and creditor, if then living, within 90 days after satisfactory proof of the death of Herman. Herman is dead, and we understand that the sole question now in controversy is whether the plaintiff acquired a right of action on these certificates.

It is not questioned that Sibbet, as creditor of Herman, had the right to insure his life; and we regard it as fully settled in this state that he could assign the policy to Souder. This question has been decided differently elsewhere, but the opinion of this court in Rittler v. Smith, 70 Md 265, 16 A. 890, settles the law for us. In that case it was said: "In support of the view taken by the appellee's counsel, cases have been cited in which it has been held that the assignee of a life policy, who has no insurable interest in the life, stands in the same position as if he had originally taken out the policy for his own benefit. In other words, the contention is that the assured himself can make no valid, absolute assignment of his policy to one who has no insurable interest in his life. But our own decisions are opposed to this. It is settled law in this state that a life insurance policy is but a chose in action for the payment of money, and may be assigned as such under our act of 1829, c. 51. Insurance Co. v. Flack, 3 Md. 341; Whitridge v. Barry, 42 Md. 150. It is quite a common thing for the bond or promissory note of a private individual to be sold through a broker, to a bona fide purchaser, for less than its face value; and, when the latter takes an assignment of it without recourse, he becomes its absolute owner, and is not bound to refund to the vendor anything he may recover upon it over and above what he paid for it. So a life policy, being a similar chose in action, may be...