Opinion
June, 1911.
John W. Shea, for plaintiff.
Wilson, Cobb Ryan, for defendant.
The proofs given on the trial show that on October 26, 1903, one Horace M. Ellis, of the city of Syracuse, N.Y., at the solicitation of one of the defendant's agents, made an application in writing for the policy in question, and, on October thirty-first next following, he was duly examined by one of the defendant's medical examiners, who certified as to the risk. Both the application and the examiner's report were signed by Ellis. Before Ellis signed the said application or was examined he stated to defendant's agent that he did not want any insurance; and the agent replied that he was desirous of getting a certain number of applications before a certain day in order to get a promotion and, if the application should be made, Ellis would never hear of the matter again, and no policy would be issued to him.
Sarah A. Hall, the deceased, was a resident of the said city at the time the application of Ellis was made and resided there with her husband, Richard Hall, until her death in the month of January, 1911. Upon her death there were found among her papers a policy of the defendant for $500 upon the life of Ellis and two premium books, showing that there had been paid upon the said policy to the defendant's agent or agents the said sum of $262.48; and the inference is fair that the policy, at about its date, November 2, 1903, was delivered to the said deceased with a premium receipt book, and that payments were regularly made by the deceased upon the said policy from week to week until the book was filled, when another one was delivered to her in which payments were entered down to the time of her death. After her death the plaintiff, having been appointed her executor, continued payments of premiums for the period of four weeks. Shortly after the last payment, the plaintiff made demand upon the local superintendent of the defendant for the return of the moneys that had been paid, which was refused, the defendant claiming that the policy was a valid one.
At the time said policy was issued, Ellis, the insured, was not related to Mrs. Hall, the deceased, and was in no way indebted to her.
One of the provisions of the policy reads as follows:
"2d. Facility of payment. — The Company may make any payment provided for in this Policy to any relative by blood or connection by marriage of the Insured, or to any other person appearing to said Company to be equitably entitled to the same by reason of having incurred expense in any way on behalf of the Insured, for his or her burial or for any other purpose, and the production by the Company of a receipt signed by any or either of said persons or of other sufficient proof of such payment to any or either of them shall be conclusive evidence that such Benefits have been paid to the person or persons entitled thereto, and that all claims under this Policy have been fully satisfied."
It is urged by the learned counsel for the plaintiff that, as the plaintiff's deceased wife had no insurable interest in the insured, the policy never had any legal inception, that the application for it was not made in good faith, and that it was issued solely for the benefit of the defendant and its solicitors to enable it or them to obtain money from the deceased without any consideration therefor, and that recovery can be had as for moneys had and received. Many authorities are cited to sustain this proposition, but an examination of them does not satisfy me that his contention is well founded. The complaint contains no allegations of fraud or mistake; but, even if so, the plaintiff doubtless would have failed in that respect for the reason that the deceased is not here to tell exactly what the transaction was with the person or persons who delivered to her the policy and received payments of premium thereon.
In actions for money had and received, the complaint must set forth the actual transaction between the parties so that the court can see that the defendant has money which belongs to the plaintiff, and the proofs must show that the defendant had failed to account for the moneys and refused to return the same upon demand therefor. Here, so far as the proofs show, Mrs. Hall voluntarily paid the moneys in question without any mistake on her part or fraudulent representations on the part of the agent or agents of the defendant. No other presumption can be indulged in, because both mistake and fraud, like other facts, must be proved and cannot be surmised or inferred from transactions or circumstances of doubtful meaning or concerning which there are no proofs at all. It may well be that Mrs. Hall was imposed upon, but at the same time instead, all the facts may have been truthfully represented to her and this in the absence of proof the law will presume.
It is also urged that payments by Mrs. Hall were without consideration. To this I cannot agree. The defendant carried the risk during the period mentioned; and, in case Ellis had died, it would without doubt have been obliged to pay to his estate; or it might have paid Mrs. Hall under the option clause quoted. It is said, however, that under this option clause payment could not be enforced by one situated as Mrs. Hall was; but Wokal v. Belsky, 53 App. Div.. 167, seems to be an authority to the contrary.
The policy unmistakably insured the life of said Ellis with the option of making payment as stated; and, upon the death of Ellis, the amount of the policy would be payable to his estate and could be enforced by it, unless the defendant had made payment to Mrs. Hall or some other person under the "optional or facility of payment" clause. Judge O'Brien, in delivering the opinion of the court in the Wokal case cited, in speaking of the optional clause, said: "The right granted is distinctly an option to be exercised under certain conditions, but not to be used to defeat the purposes of the insurance, it being a general rule that an obligation of an insurance company cannot fail for want of a particular payee," citing Walsh v. Mutual Life Ins. Co., 133 N.Y. 408. Further writing, he said: "The defendant must, by the terms of the policy, pay the amount of it to such person as has become entitled to it by reason of having incurred expense on behalf of the insured or for his burial." It is, therefore, clear that the defendant, in case of the death of Ellis, might pay to Mrs. Hall or to her executor the amount of money paid to keep the policy in life and, it would seem, would be obliged to make payment upon proofs being furnished that the premiums were paid by the deceased or her legal representatives. To the same effect are the cases of Thompson v. this defendant, 119 A.D. 666, and Cohen v. John Hancock Mutual Life Insurance Company, 135 A.D. 776.
I think, further, that the contention that the policy was never delivered to the assured and is, therefore, void cannot be sustained. The application was regular in form, and the defendant presumably upon the faith of it issued its policy. If it did not know that it was not actually delivered to the assured, it acted in good faith and should be protected; while if it knew the facts and received and continued to receive premiums from Mrs. Hall, it would, I think, be estopped from defending as against her or her legal representatives on the ground that she had no insurable interest in the assured. Coulson v. Flynn, 181 N.Y. 62, 66. Discussion of this point, however, is unnecessary; and, be it as it may, I think the plaintiff cannot have applied or enforced here the doctrine of money had and received for which he contends.
Beyond what has been said, I am of opinion that, upon the death of Ellis, the assured, should the policy be then in force and the defendant refuse payment, the plaintiff could by proper action establish a lien against the policy to the extent of the premiums paid by him and his deceased wife. Morgan v. Mutual Benefit Life Ins. Co., 132 A.D. 455; Nolan v. Prudential Ins. Co. 139 id. 166-168.
Further discussion of the questions raised on the argument I deem unnecessary, since I have arrived at the conclusion that, the policy in question having been regularly applied for and issued, it duly attached; and, having attached, the law seems to be settled that premiums paid cannot be recovered at law. McElwain v. Metropolitan Life Ins. Co., 50 A.D. 63.
The plaintiff's complaint is, therefore, dismissed, with costs. Findings may be prepared accordingly.
Complaint dismissed.