Travelers Insurance Company v. Fred Gebo

• Decision Date: 06 February 1934
• Citation: Travelers Insurance Company v. Fred Gebo, 170 A. 917, 106 Vt. 155 (Vt. 1934)
• Parties: TRAVELERS INSURANCE COMPANY v. FRED GEBO ET AL
• Court: Vermont Supreme Court

170 A. 917

106 Vt. 155

TRAVELERS INSURANCE COMPANY v. FRED GEBO ET AL

Supreme Court of Vermont

February 6, 1934

January Term, 1934.

Appeal in Chancery---Question for Consideration Where No Bill of Exceptions Filed---Insurance---Rights of Beneficiary---Circumstances Creating Equitable Interest in Beneficiary---Husband and Wife---Status of Contracts between Husband and Wife at Law and in Equity---Presumptions on Appeal To Support Decree---Sufficiency of Facts To Show Equitable Right in Wife To Proceeds of Insurance Policy on Husband's Life, Notwithstanding Attempted Change in Beneficiary---Sufficiency of Consideration To Support Implied Contract between Husband and Wife That She Would Receive Proceeds of Insurance Policy on His Life---Superior Equity of Wife Named as First Beneficiary in Insurance Policy on Husband's Life under Implied Contract over Subsequent Second Beneficiary Who Was Mere Volunteer---Effect of Priority of Time as to Equal Equities---Questions of Fact---Sufficiency of Allegation To Support Decree.

1.On appeal in chancery, where no bill of exceptions has been signed and filed, exceptions to findings made and to failure of chancellor to find as requested are not before Supreme Court, only point for consideration being whether decree is warranted by pleadings and supported by findings.

2.Where contract of insurance so provides, beneficiary may be changed at instance of insured, and no vested right, but mere expectancy, exists in beneficiary, in absence of facts or circumstances tending to establish equitable interest in proceeds of policy; but, when sound equities exist in favor of beneficiary, such rights will be protected against substitution of second beneficiary who is volunteer or who has no superior equities in his favor.

3.Equitable interest of beneficiary in proceeds of life insurance policy may arise as result of contract between beneficiary and insured, and, where designation of beneficiary is made in pursuance of agreement founded upon sufficient consideration, person designated acquired vested interest, and, unless by reason of countervailing equities cannot be displaced.

4.Common-law disability to make contracts with her husband held to be still effective, notwithstanding G. L. 3521 permitting her to contract with persons other than husband.

5.Although contract between married woman and her husband is void and unenforceable at law, it is, if fair and just, valid and enforceable in equity.

6.On appeal in chancery, every reasonable intendment is in support of decree, and Supreme Court will assume that chancellor drew such inferences in favor of prevailing party.

7.Where chancellor's findings warranted inference that wife had tacit understanding with her husband that she would be compensated for expenditures made and to be made by her on his behalf by proceeds of insurance policy on his life, and such expenditures were made, held that she acquired equitable right to proceeds of insurance.

8.Consideration of implied contract between husband and wife that wife would receive proceeds of insurance policy on his life,

held sufficient, where it consisted of future as well as past expenditures by her on his behalf.

9.Claim of second beneficiary, who was mere volunteer, to proceeds of life insurance policy, held not to override equitable, but vested interest of wife of insured as first beneficiary to proceeds of such policy, acquired under implied contract supported by consideration consisting of future as well as past expenditures by her on her husband's behalf.

10.Where equities are in other respects equal, priority in time gives better right.

11.Act of wife in leaving husband, held not, as matter of law, to have broken contract with him, under which by virtue of future as well as past expenditures by her on his behalf she acquired equitable interest in proceeds of insurance policy on his life.

12.Allegation that change of beneficiary in life insurance policy from wife of insured to his brother was inequitable unjust, voidable, and ought to be set aside, held sufficient to support decree in favor of wife, as against claim of second beneficiary that decree did not conform to pleadings alleging fraud on wife because no fraud was found.

APPEAL IN CHANCERY.Bill of interpleader was brought by plaintiff in the court of chancery, Orange County, against Fred Gebobrother of insured, personally, and as administrator of the Estate of Dominic Gebo, and Delia A. Gebo, wife of insured, who were rival claimants to the proceeds of a life insurance policy issued by plaintiff to Dominic Gebo, now deceased.Defendants were ordered to interplead, for the purpose of determining which of them is entitled to the proceeds of such policy, which had been paid into court.Heard on the pleadings and findings of fact by the Chancellor at the June Term, 1933, Addison County, Sturtevant, Chancellor, who decreed the funds to Delia Gebo.Fred Gebo, personally, and not as administrator, appealed.The opinion states the case.

Decree affirmed, and cause remanded.

Jones & Jones for Fred Gebo, appellant.

H. A. Bailey, A. Pearley Feen, and W. E. Brisbin, for the appellee.

Present: SLACK, MOULTON, THOMPSON, and GRAHAM, JJ.

OPINION

MOULTON

These defendants are rival claimants for the proceeds of a life insurance certificate issued by the plaintiff to Dominic Gebo, now deceased.They have been ordered to interplead for the purpose of determining which one of them is entitled to the fund, which has been paid into court.A hearing has been had, the facts have been found and the chancellor has decreed the fund to Delia Gebo.Fred Gebo(individually, for he does not claim as administrator of Dominic's estate) has appealed.

Following are the material facts as found by the chancellor:

Fred Gebo was the brother and Delia is the widow, of Dominic.The certificate in question, in which Delia was the beneficiary, contained a provision enabling the insured to change the beneficiary at any time, upon written request made in a prescribed manner.It was a so-called group insurance under a plan in force for the benefit of the employees of the Fro-Joy Ice Cream Company for which concern Dominic was working, and the premiums were paid by certain sums deducted from his wages.

Delia and Dominic were married in 1929, before the policy was taken out.Dominic was then employed by his father at a wage of $ 40 a month.Delia had about $ 1,000 on deposit in a savings bank, of which she withdrew about $ 300 to purchase household furniture, which she still has.Before the marriage Dominic had undergone an operation for a serious abdominal ailment.Soon after the marriage, while the two were living on a farm owned by Dominic's father, the latter proposed to sell the farm to them.Delia opposed the purchase, holding that the price was excessive, and their indebtedness would be too large, and this opposition caused a coolness between her and her husband's parents.In the spring of 1930, Dominic and his wife removed to Winooski, where they lived with Delia's sister-in-law under an arrangement whereby Delia did the housework, and, with her husband, paid one-half of the expenses of the table, but they were under no charge for rent.Dominic obtained employment by the Fro-Joy Ice Cream Company, and during the same year he was transferred to the company's plant in Springfield, Mass., where he had a return of his illness, and the two returned to Vermont, where another operation was performed in February, 1931.After having sufficiently recovered, Dominic went back to work for the ice cream company, and remained in its employ until January, 1932, when a third operation became necessary.The incision from this operation never healed, and it was necessary to keep it drained and dressed.Likewise the incision of the prior operation did not permanently heal, and here again drainage and dressing were required.Dominic suffered pain and was irritable when so afflicted.His physical condition grew worse and he died in September, 1932.

Delia and her husband were an affectionate couple, both being thrifty and good workers.Because of Dominic's illness and his necessary confinement in the hospital, the family expenses were heavy and Delia withdrew practically all her money to pay bills from the hospital and for nursing and surgical operations, as well as for general household purposes.She obtained employment in various places, at one time working for the ice cream company, and her earnings were used in the payment of the expenses.She also helped her husband in paying for an automobile, which there was due, at that time, between $ 700 and $ 800.At the time of his death there was some $ 400 still unpaid."Delia," says the chancellor, "was loyal to her husband, worked hard to care for him and to keep bills paid, used practically all of her available funds for this purpose and was kind and considerate in her treatment of her husband.All this was much appreciated by Dominic and at times he expressed this appreciation to Delia and told her in effect that he was glad he had two insurance policies because if anything happened to him, she, Delia, would have these two policies to make up what she had spent for him.The second policy referred to here was a policy for one thousand dollars in the New York Mutual Life Insurance Company and the proceeds on this policy were paid to Delia after Dominic's decease."

After this conversation she continued to work, and use her earnings and available funds for general family expenses, believing that the proceeds of the two policies were to be hers.

In June, 1932, in accordance with Dominic's wish, the couple went to the farm in Ferrisburgh to live with his mother, his father having deceased.In ...