Wages v. Wages

• Decision Date: 17 April 1947
• Docket Number: 15790,15791.
• Citation: 42 S.E.2d 481,202 Ga. 155
• Parties: WAGES v. WAGES (two cases).
• Court: Georgia Supreme Court

42 S.E.2d 481

202 Ga. 155

WAGES v. WAGES (two cases).

Nos. 15790, 15791.

Supreme Court of Georgia

April 17, 1947

Syllabus by the Court.

1.Count one of the petition as amended alleging that the plaintiff's intestate, the insured, assigned a life insurance policy to the defendant as security for a loan, and that after the death of the insured the defendant was paid the proceeds and became a trustee for the amount in excess of money advanced by him for the insured, and count two alleging that the assignment of the policy to the defendant for the full amount of the proceeds was a wagering contract, and that he became trustee for the amount of the proceeds of the policy received by him in excess of money advanced by him for the insured, sufficiently alleged the creation of a constructive trust and a cause of action good against the general and special grounds of demurrer.

2.Error, if any, in admitting over objection testimony relating to conversations between the defendant and the deceased insured was rendered harmless by similar testimony of another witness afterwards admitted in evidence without objection.

3.The charge of the court, 'If you should find the policy of insurance * * * lapsed because of the nonpayment of premiums and that [the insured] voluntarily caused the same to be reinstated, and in good faith had [the defendant] named as beneficiary, intending in the event of his death that [the defendant] should have the proceeds of the policy, and this was not done simply to permit [the defendant] to speculate on the life of the [insured], then the defendant would be entitled to prevail and that would be true even though it appeared that [the defendant] was [to pay?] and did not pay the premiums necessary to reinstate and keep the policy in force,' correctly stated the applicable principles of law and was not error for any reason assigned.

4.The record not disclosing any contention that the relationship of the defendant to the insured as half first cousin constituted an insurable interest, the court did not err in failing to give the requested charge that a cousin or half cousin has no beneficial interest in the life of the insured simply by reason of that relationship, that is, the fact that the defendant is the half first cousin of the insured would not give the defendant an insurable interest in the life of the insured.

5.The evidence was sufficient to support the verdict.

Mrs Kathryn C. Wages filed in Dougherty Superior Court a petition against Marvin E. Wages.Count one of the petition as amended alleged substantially the following: John T. Wages, Jr., the petitioner's husband, died intestate on August 29, 1943 and she was appointed temporary administratrix of his estate.On February 24, 1925, the Prudential Insurance Company issued a $5,000 life insurance policy to the petitioner's husband payable immediately upon proof of death.The policy originally named the mother of the insured as beneficiary, and provided that if there was no beneficiary living at the death of the insured, the proceeds from the policy should be payable to the insured's executors, administrators, or assigns, unless otherwise provided.No contrary provision was contained in the policy.The policy also gave the insured the right to change the beneficiary.Registered on the policy was an endorsement showing a change of beneficiary on August 26, 1931, to the petitioner.On October 17, 1938, the insured requested the company to change the beneficiary so as to make the policy payable to the defendant who was a cousin of the insured.The requested assignment was for the purpose of assigning the policy as collateral security to the defendant for any amount he might put up to protect the policy and keep it alive.The insured became physically and mentally sick and was a patient in Allen's Invalid Home from December 18, 1938, to February 3, 1939.During the time he was a patient, and on January 20, 1939, he signed the following printed form requesting a further change of beneficiary: 'If this policy matures by death, the proceeds shall be payable to [the defendant] beneficiary, cousin of the insured, if living, otherwise to the executors or administrators of said estate;' and on the next day, January 21, 1939, the insured on the printed form of the company signed the further request for change of ownership: 'All legal incidents of ownership in the policy, including the rights, benefits, and advantages which the printed provisions thereof purport to confer on the insured, shall, anything in the policy to the contrary notwithstanding but subject to any limitation herein set forth, belong to [the defendant], cousin of the insured, the executors or administrators' of the defendant.The policy was endorsed on January 26, 1939, so as to make the defendant, cousin of the insured, or his executors or administrators, the beneficiary.The insured was in a highly nervous state when he signed the two endorsements, all of which was known to the defendant, and he was induced to do so by the defendant to protect an advance of approximately $489.89.The defendant was not dependent upon the insured and had no insurable interest other than as a creditor.Subsequently the defendant collected the proceeds of the policy.The petitioner has sought an accounting with the defendant regarding the same, but the defendant has steadfastly refused to divulge any details, and has declined to inform her what indebtedness, if any, was owing to him by the insured at the time of his death.The assignment of the policy was made to the defendant as collateral security for a debt, and when he collected the proceeds of the insurance, he became trustee of such fund, and the petitioner is entitled to an accounting.The petitioner is also entitled as temporary administratrix to the entire proceeds of the policy less any unpaid balance of the indebtedness which the assignment of the policy secured.There was no new consideration for the two requests for assignment on January 20th and January 21st, 1939.By these requests the insured had no intention to change the status of the policy other than to furnish collateral security to the defendant for the aforesaid advance.It would not have been necessary for the petitioner to be appointed administratrix and to incur the expense of filing this suit had the defendant frankly informed her of the status of the policy and made a proper accounting to her, and the defendant has caused the petitioner unnecessary trouble and expense.The prayers in count one were: 1.That the defendant account to the petitioner for the proceeds of the policy; 2.That the court decree that the defendant is a trustee of the funds which he received as proceeds of the policy on the life of the insured, and as trustee must account to the petitioner; 3.That the court decree that the proceeds of the policy constitute money had and received by the defendant for the benefit of the estate of the insured, and that the petitioner as the personal representative of the estate is entitled thereto; 4.That a judgment be passed awarding to the petitioner all of the proceeds of the policy which remain after the deduction of the indebtedness secured by the policy; 5.That because of his stubborn litigiousness the defendant be required to pay all of the expenses to which the petitioner has been put in order to obtain an accounting, including the costs of this proceeding and a reasonable attorney's fee; 6.That process issue; 7.That the petitioner have such other and further relief as to the court seems meet and proper.

Count two contained allegations similar to those in count one, except that instead of alleging that the policy was delivered as collateral security, and that the insured was induced to sign the two endorsements in favor of the defendant to protect an advance of approximately $489.89, it was alleged: At the time the request was made, the policy had lapsed by reason of the insured's failure to pay the premiums and the same was reinstated by the defendant with the understanding that he would be named beneficiary and pay the premiums on the policy as they became due and pay all costs or amounts necessary to reinstate the policy, and in the event of the insured the defendant should receive the proceeds of the policy.The defendant paid no other consideration for the assignment of the policy and the change of the beneficiary.The assignment and change of beneficiary were made to circumvent the law against wagering policies.The defendant at the time of the assignment and change of beneficiary intentionally entered into a speculation upon the life of the insured, wagering the premiums to be paid by him against large profits he would receive on the death of the insured, the defendant having no insurable interest in the life of the insured.Therefore, the assignment of the policy and change of beneficiary constituted a wagering contract, which is illegal and void and the defendant holds the proceeds received from the policy as trustee for the petitioner.Count two contained prayers similar to those in count one, except there was no prayer for general relief and instead of praying that the court decree that the proceeds of the policy constituted money had and received, it was prayed that the agreement under which the defendant received and held the policy be declared a wagering agreement prohibited by law.

The defendant filed to the original petition a demurrer on general and special grounds.After the petition was amended the defendant filed a second demurrer renewing his original grounds and adding additional grounds.The defendant also filed an answer admitting that the insurance company issued a $5000 policy to the insured; that the insured died intestate that the...