Opinion
Argued January 17, 1907
Decided February 19, 1907
A.C. Wade for appellants.
Charles E. Hotchkiss and Julian C. Harrison for respondent.
The policy was the contract of Robert C. Bradshaw with the defendant. Both Robert C. Bradshaw and the defendant being competent to contract, were free to make such contract as they could agree upon.
Insurance, like other contracts, should be interpreted to carry out the intention of the parties, giving the language employed its common and ordinary meaning. If the policy had been made payable to Corrie J. Bradshaw in case she survived her husband, and in case she did not survive her husband then to the children of said Corrie J. and Robert C. Bradshaw, or in case said Corrie J. Bradshaw should not survive her husband and she should not leave a child or children her surviving, then to the executor or administrator of said Corrie J. Bradshaw, the contract would not only have been enforceable, but the intention of the parties in case Corrie J. Bradshaw did not survive her husband, and did not leave a child or children her surviving, would have been clear and it would not have required judicial interpretation.
If, on the other hand, the policy had provided that if Corrie J. Bradshaw should not survive her husband and she should not leave a child or children her surviving, then to the executor or administrator of said Robert C. Bradshaw, the contract would have been equally clear and enforceable.
Language was used in the policy about the meaning of which the parties to this action are in dispute and about which the defendant has apparently become doubtful since the correspondence with the insured in his lifetime.
It is conceded that had said Corrie J. Bradshaw been living at the death of Robert C. Bradshaw the policy would have been payable to her for her sole use in conformity with the statute. It is also conceded that if Corrie J. Bradshaw had left children of her marriage with said Robert C. Bradshaw the proceeds of the policy would have been payable to such children or their guardian for their use.
Corrie J. Bradshaw having died before her husband without leaving a child or children her surviving, where in the policy does it appear that the proceeds thereof would pass by her will?
There is no language in the policy which in itself expresses any such intention of the parties. It is claimed by the defendant that it is included within the provisions of the policy making it payable to Corrie J. Bradshaw for her sole use if living, in conformity with the statute. This makes it necessary for us to look at the statutes to see if there is anything therein that compels a construction which would seem to be contrary to the ordinary meaning of the language used.
Chapter 80 of the Laws of 1840 made it lawful "For any married woman, by herself, and in her name, or in the name of any third person, with his assent, as her trustee, to cause to be insured, for her sole use, the life of her husband." And it provided that in case of her surviving her husband the amount of the insurance "shall be payable to her, to and for her own use, free from the claims of the representatives of her husband, or of any of his creditors," except where the amount of the annual premium exceeds a sum stated. The act also provided 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 her death to her children for their use, and to their guardian, if under age."
Chapter 187 of the Laws of 1858 is, with the exception of certain verbal changes that are not now important, the same as chapter 80 of the Laws of 1840.
This court in Eadie v. Slimmon ( 26 N.Y. 9, 17) stated the reasons and purposes of such statutes. From the opinion we quote as follows:
"By the common law a person could insure his own life for any sum for which he might choose to pay the premium, and which the insurers would engage to insure; but if one desired to insure the life of another, he could only insure the interest which he had in such other life. If he undertook to insure a gross sum, and the contract was not susceptible of a construction which would limit the recovery to the actual damages sustained the contract would be void under the statutes against betting and gaming. This principle the legislature by the act of 1840 (Laws, p. 59) relaxed in respect to insurance as effected by a married woman, for any sum which she and the insurance company might see fit to contract for. It was provided that, in the case of her surviving her husband, the amount payable by the terms of the policy should be payable to her for her own use, free from all claims of the representatives of her husband or of his creditors. There is another feature in the act which shows that it was an enabling and not a declaratory provision. 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 lifetime 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. These features distinguish this case from that of an ordinary chose in action belonging to a married woman as her separate estate. The provision is special and peculiar and looks to a provision for a state of widowhood, and for orphan children; and it would be a violation of the spirit of the provision to hold that a wife, insured under this act, could sell or traffic with her policy as though it were realized personal property or an ordinary security for money."
Changes were made in these acts by chapter 70 of the Laws of 1862, chapter 656 of the Laws of 1866, chapter 277 of the Laws of 1870, and chapter 821 of the Laws of 1873. And when the policy in question was given the statutory authority of a married woman to insure the life of her husband for her sole use, so far as now material, remained the same as stated in said chapter 80 of the Laws of 1840, and the act as amended then provided that the policy "shall be payable to her, to and for her own use, free from the claims of the representatives of the husband, or of any of his creditors, or any party or parties claiming by, through or under him." (L. 1870, ch. 277 sec. 1.)
And the second section of the act provided that "Any policy in favor of a married woman, or of her and her children, or assigned in her, or in her and their favor, on written request of said married woman, * * * may be surrendered to and purchased by the company issuing the same in the same manner as any other policy. And such married woman may, in case she have no child or children born of her body, or any issue of any child or children born of her body, dispose of such policy in and by a last will and testament, or any instrument in the the nature of a last will and testament * * * which disposition lawfully made shall invest the person or persons to whom such policy shall have been so bequeathed, or granted and conveyed, with the same rights in respect thereto as such married woman would have had in case she survived the person on whose life such policy was issued, * * *." (L. 1873, ch. 821, sec. 2.)
All of these acts in terms relate to insurance on the life of a husband when taken by the wife in her name or in the name of a third person with his assent as her trustee for her sole use. All of these acts were repealed with the passage of the Domestic Relations Law (Chapter 272, Laws of 1896), and the substance of the several acts was codified, restated and somewhat modified by section 22 of said Domestic Relations Law.
Said section 22 of the Domestic Relations Law also provides: "A policy of insurance on the life of any person for the benefit of a married woman, is also assignable and may be surrendered to the company issuing the same, by her, or her legal representative, with the written consent of the assured." This was in part taken from chapter 248 of the Laws of 1879 which last act was also repealed with the passage of said Domestic Relations Law.
It will be seen, therefore, that the statutes authorize a married woman to enter into a contract with an insurance company for insurance in her name or in the name of a third person with his assent as her trustee on the life of her husband, and they also recognize that insurance may be taken by a person on his own life for the benefit of a married woman. It is an insurance contract of the former class that is referred to in the statutes that we have quoted giving a married woman power to dispose by will of such policy of insurance. The right to dispose of insurance by will is based upon the vested interest which the wife has in the insurance. The statutes providing that insurance taken by a wife on the life of her husband may be made payable after her death to her children for their use and to their guardian if under age is permissive, and when a policy is so made payable it is a contingent limitation upon the married woman's absolute title to the proceeds of the policy which has resulted from her individual contract.
Corrie J. Bradshaw's interest in the policy in question was never absolute but contingent. She did not have an unconditional assignable interest in the policy. The sole condition upon which the policy was ever to become payable to her or through her, was that she survive her husband.
In the policy under consideration the use of the words "In conformity with the statute" is necessarily related to the receipt of the proceeds of the policy in the lifetime of Corrie J. Bradshaw and of her holding the same free from the claims of the representatives of the husband or any of his creditors or any party or parties claiming by, through or under him.
By the statute in force when the policy was given a married woman who had no child or children could dispose by will of a policy which is governed by said statutes and is payable "in favor of a married woman, or of her and her children, or assigned in her, or in her or their favor, on written request of said married woman."
The difficulty with the defendant's position is that the policy in question does not come within the terms of the statute authorizing a married woman to dispose of such policy by will, and that the language of the policy shows that Corrie J. Bradshaw's interest in the policy was wholly dependent upon her surviving her husband.
Most of the authorities mentioned in the prevailing opinion of the Appellate Division on the decision of the appeal in that court ( 109 App. Div. 375), and which are relied upon by the respondent in this appeal, are referred to, and satisfactorily explained and distinguished from this case in the dissenting opinion therein.
That the interest of a married woman in a policy of insurance, even if construed under the statutes, is subject to such limitations as are contained in the policy is held in U.S. Trust Co. v. Mutual Ben. Life Ins. Co. ( 115 N.Y. 152); Walsh v. Mut. L. Ins. Co. ( 133 N.Y. 408), and Fidelity Trust Co. v. Marshall ( 178 N.Y. 468).
Corrie J. Bradshaw, having died before the insured, had no interest in the policy that survived her death.
The judgment should be reversed and a new trial granted, with costs to abide the event.
CULLEN, Ch. J., GRAY, EDWARD T. BARTLETT, VANN and WERNER, JJ., concur; HISCOCK, J., not sitting.
Judgment reversed, etc.