Tompkins v. Levy

• Decision Date: 29 May 1889
• Parties: TOMPKINS v. LEVY ET AL.
• Court: Alabama Supreme Court

6 So. 346

87 Ala. 263

TOMPKINS v. LEVY ET AL.

Supreme Court of Alabama

May 29, 1889

Appeal from chancery court, Mobile county; COLEMAN, Chancellor.

In 1878, Milton T. Brasfield took out a policy of insurance on his life for $5,000, payable to his wife, "Sallie A Brasfield, her heirs, executors, or assigns," and continued to pay the premiums on this policy out of his own funds until his death, which occurred in February, 1887. His wife, Sallie A. Brasfield, died eight years before he died and the policy was kept alive after her death in the same manner as during her life-time. On the death of Milton T Brasfield, the proceeds of the policy were collected by the defendant, Margaret J. Tompkins, as administratrix of the wife, Sallie A. Brasfield. This bill was filed in September 1888, by the appellees, as creditors of Milton T. Brasfield, whose debts were created partly during the payment of the premiums on the policy, and partly prior to the issuance of the policy. The bill seeks to condemn the proceeds to the payments of these debts. Complainants filed the bill in the name of their late copartnership, which existed at the time the cause of action accrued, and the names of the several individual partners are therein set forth. Defendant demurred to the bill on the following grounds: " First, because it is filed in the name of a mercantile partnership, which did not exist at the time it was filed; second, because the premiums paid by Milton T. Brasfield to keep up the policy of insurance described in the bill were paid with the knowledge, consent, and assistance of complainants, and were therefore no fraud on them; third, because the administrator of Milton T. Brasfield has not been made a party respondent; fourth, because the bill shows that the policy taken out by Milton T. Brasfield was for the benefit of his wife, and the annual premiums paid by him were less than five hundred dollars. Hence the proceeds of such policy are not liable to the claim set up in the complaint." The chancellor overruled this demurrer, and the defendant appeals. Austill & Erwin, for appellants.

Gregory L. & H. T. Smith and Judge & De Graffenried, contra.

SOMERVILLE J.

The purpose of the bill is to subject the proceeds of a policy of insurance on the life of Milton T. Brasfield, deceased, to the payment of certain debts of the decedent. The policy was made payable to his wife, "Sallie A. Brasfield, her heirs, executors, or assigns." The premiums were paid by the assured out of his own funds. He died in the year 1887, having survived his wife about eight years, she having deceased in the year 1879, leaving two minor children. It is claimed that these children are entitled to the fund under the provisions of sections 2733 and 2734 of the Code of 1876, authorizing married women to insure the lives of their husbands free from the claims of creditors, or the claims of the husband's personal representatives. The word "heirs," it is contended, must be construed to mean "children," and such a construction is asserted to entitle the two children to the fund under the statute. It is manifest that the fund is liable to the claims of the husband's creditors, unless it is rescued from such liability by the terms of the statute, which we have held to be in the nature of an exemption law, and, for this reason, to be liberally construed to effect the purpose of its enactment. Fearn v. Ward, 65 Ala. 33, 80 Ala. 555, 2 South. Rep. 114; Felrath v. Schonfield, 76 Ala. 199; Insurance Co. v. Webb, 54 Ala. 688; Appeal of Elliott's Ex'rs, 88 Amer. Dec. 525, 531. note.

The statute provides that a policy of insurance taken out under its provisions on the husband's life for the benefit of the wife shall be payable to her "in case of her surviving her husband." Code 1876, § 2733. It is further declared in the following section that, "in case of the death of the wife before the decease of her husband, the amount of the insurance may be made payable after death to her children for their use, and to their guardian, if under age." Code 1876, § 2734. The wife here has not survived her husband, and there is no clause in the policy making the amount of the insurance payable to the children in case of her death before his decease. It is too plain to admit of argument that the statute does not proprio vigore make such policies payable to the children, on the death of the wife before the husband, irrespective of the contract, but it only authorizes such a provision to be incorporated in the contract of insurance so as to rescue such contract from the taint of fraud, and exempt the proceeds of the policy from liability to creditors or administration. It is equally obvious that by the terms of the statute the wife's interest is contingent on her surviving her husband, and in event of her death before his it is gone. The New York statute of 1840, from which our own is substantially copied, has been construed by the court of appeals of that state to be enabling, and not declaratory of the common law. In Eadie v. Slimmon, 26 N.Y. 9, after holding that a policy upon the life of the husband for the benefit of the wife could not be assigned so as to destroy the right of the wife,-a point as to which we intimate no opinion,-the following language was used by DENIO, C.J.: "By the general rules of law a policy on the life of one sustaining only a domestic relationship to the insured would become inoperative by the death of such insured in the life-time of cestui que vie; or, if it could be considered as existing for any purpose after that event, it would be for the benefit of the personal representatives of the insured; but by this act the contract may be continued in favor of the children of the insured wife after her death."

The Connecticut statute is substantially like that of New York and Alabama. In ...