Where an unmarried man procures a life-insurance policy on his own life in which his mother is named beneficiary, and the policy gives the insured the right to change the beneficiary at any time, and subsequently as a consideration for marriage he agrees to substitute his wife as beneficiary in the insurance policy and tells his wife that he has made the change, but later dies without ever having attempted to have the beneficiary changed, the mother is vested with title to the proceeds of the policy upon the death of the insured, and nothing that the insurer can do thereafter can destroy or impair the mother's title thereto; and a court of equity is required, in a contest between the mother and the wife, to award the proceeds of the insurance policy to the mother.

No. 16189. MAY 11, 1948. REHEARING DENIED JUNE 18, 1948.

Mrs. Julia F. Loyd brought suit in Fulton Superior Court against The Union Central Life Insurance Company and Mrs. Gracie Loyd, the petition alleging substantially the following: The petitioner was the mother of Vernon Loyd, deceased, and was named as beneficiary in an insurance policy upon his life, issued by the defendant insurance company, for $2500. The policy was in full force and effect upon the death of the insured. She had complied with all the requirements of the policy as to proof of loss and had demanded payment in accordance with the terms of the policy. The insurer conceded that she was the named beneficiary in the policy and had issued a check payable to her for the proceeds, but the defendant, Gracie Loyd, had made demand upon the insurer for the proceeds of the policy, and thereupon the insurer had refused to pay the petitioner. Thus alleging a controversy, the petitioner prayed for a declaratory judgment as to the rights of the parties in the case, and that the court declare that the petitioner was entitled to the proceeds of the policy, and that Gracie Loyd is not entitled to any part thereof, and that the petitioner have judgment against the insurer for the full amount of the policy.

The insurer filed an answer, attaching a copy of the policy, in which answer the insurer admitted that the petitioner was named as beneficiary under the policy and that she survived the insured, that the amount of the policy was that stated in the petition, and that the petitioner was claiming the benefits of the policy by reason of her being named beneficiary therein; but that the defendant, Gracie Loyd, was also claiming the proceeds of the policy, because she contended that she married the insured upon his promise, as an inducement and consideration for the marriage, that he would make her the beneficiary in the policy, that he had told her that he had made her the beneficiary therein, and that she had paid a part of the premiums on the policy. The insurance company alleged that, because of these conflicting claims, it was in doubt as to which claimant was entitled to be paid, and that the claimants should be required to interplead and set up their respective claims. The insurer prayed to be allowed to pay into court the proceeds of the policy and be absolved from any and all liability upon the policy, that the policy be canceled and surrendered to it, that the claimants be enjoined from prosecuting any action upon the policy, and that they be required to assert in this action whatever claim they had to the fund.

By the judgment of the court the insurance company was allowed to pay the proceeds of the policy into the registry of the court, thereupon releasing the insurer from all liability, canceling the policy, and directing the claimants to interplead and set up any and all claims either of them had to the proceeds of the policy. Another order of the court on the same day recited that the insurer had paid the proceeds of the policy into court, and it was discharged from all liability and dismissed as a party to the case. This order was consented to by all the parties.

On the same day Mrs. Gracie Loyd filed pleadings, in which she in effect admitted that Mrs. Julia F. Loyd was the mother of the insured, that the mother was originally named as beneficiary of the policy, the proceeds from which were $2500, but she denied that the mother was entitled to the proceeds, and she claimed the same for herself upon the ground that when the insured took out the policy in 1927 he was an unmarried man, that several years later she married him, and as an inducement to their marriage he agreed that, if she would marry him, she would be made the beneficiary in all of his insurance policies, and that in reliance upon his promise and agreement she married the insured. Thereafter the insured told her that he had made arrangements to have her named the beneficiary in all of his insurance policies, and that in the event of his death she would receive the proceeds of such policies. She and her husband maintained a joint bank account, in which both deposited their salary checks, and out of their joint account all of their expenses, including premiums on his insurance policies, were paid. She did not learn until the insured's death that he had not carried out his express intention of changing the beneficiary in his policies, substituting his wife for his mother. The policy contained a provision authorizing the insured to change the beneficiary by written notice to the company at its home office at any time. She also set up a cross-action against Mrs. Julia F. Loyd, seeking to recover the proceeds from another insurance policy, insuring the life of the petitioner's husband for $2500, which proceeds had already been paid to the named beneficiary, Mrs. Julia F. Loyd. In this claim substantially the same facts relating to the marriage contract and the obligation of the insurer to substitute the wife as beneficiary in the policy were alleged. It was alleged that Mrs. Julia F. Loyd was a resident of New Mexico, but that she had submitted herself to the jurisdiction of the court. Judgment against her for $2500 was prayed. A copy of these pleadings was delivered to the attorney for Mrs. Julia F. Loyd.

Mrs. Julia F. Loyd filed a motion to dismiss the cross-action upon the ground that the court was without jurisdiction over the person of the movant, who was a nonresident of the State. Subject to the motion, which was on the jurisdictional ground, demurrers both general and special to the answer and the cross-action of Mrs. Gracie Loyd were filed by Mrs. Julia F. Loyd. Mrs. Julia F. Loyd also filed a pleading in response to the order of the court, in which she virtually reiterated the allegations of her original petition and claimed the proceeds from the insurance policy.

On January 7, 1948, the court sustained the motion to dismiss the cross-action, upon the ground that the court was without jurisdiction, and dismissed the cross-action in so far as it related to any matter except the insurance policy involved in this action. The court sustained the general demurrer to the answer of Mrs. Gracie Loyd, in which she made claim to the proceeds of the insurance policy paid into court by the insurance company; and thereupon passed an order reciting that the insurance company had paid the proceeds of the policy into court, and that the insured never made any effort to change the beneficiary named in the policy, and decreeing that Mrs. Julia F. Loyd was entitled to the proceeds of the insurance policy, and ordering the clerk to pay the same to her. Mrs. Gracie Loyd filed a bill of exceptions to this court, assigning error upon the judgment sustaining the motion and dismissing the cross-action upon the jurisdictional ground, and upon the judgment sustaining the demurrer to her answer and the final judgment awarding the proceeds of the insurance policy to Mrs. Julia F. Loyd.

DUCKWORTH, Presiding Justice. (After stating the foregoing facts.)

In Smith v. Locomotive Engineers c. Ins. Assn., 138 Ga. 717 ( 76 S.E. 44), this court dealt with facts very similar to those here involved, the only difference being that there the insurer appears to have disputed the claim of the wife, while here the insurer was indifferent as to which claimant should prevail, paid the money into court, and was discharged. In that case it was held that, because the insured had made no effort to have the beneficiary changed, the named beneficiary was entitled to the proceeds of the policy. That ruling must control here, since the insured in the instant case made no effort to have the beneficiary changed in the policy, unless it can be held that the action and attitude of the insurer, being different in the two cases, constitute a material factual difference which affects the rights of the claimants. Can we so hold upon sound reason and legal principle? While during the life of the insured he was authorized by the terms of the policy to change the beneficiary, the named beneficiary had no vested interest but a mere expectancy, dependent upon whether or not the insured failed to exercise this authority and died without making any change, the named beneficiary had a vested interested in the proceeds of the policy. The law would protect this vested interest. "Equity is ancillary, not antagonistic, to the law; hence equity follows the law where the rule of law is applicable, and the analogy of the law where no rule is directly applicable." Code, § 37-103. As a prerequisite to an interference with this prima facie legal right, equity would require the existence of circumstances and facts that in good conscience would demand the forfeiture of this vested legal right. It is not charged in this case or even claimed that the named beneficiary is guilty of acts or conduct relating to this matter which in any wise subjects her to censure or criticism. Neither is the insurer charged with fault or responsibility for the condition of the policy at the death of the insured wherein the mother remained the named beneficiary. The wife makes no claim that either the insurer or the named beneficiary is responsible in any respect whatever for the failure to change the name of the beneficiary. Her answer shows unmistakably a breach of the contract upon the part of the insured. During the life of the insured she could have in equity required specific performance of the contract by the insured, or may have accepted the breach and have sued for damages. She did neither and now after his death it is sought to require the mother to compensate the wife for such damage. During the life of the insured the wife chose to rely upon his promise and neglected to take appropriate action to avoid the injury which she suffered. Equity requires diligence. Code, § 37-211; Archer v. Kelley, 194 Ga. 117 ( 21 S.E.2d 51). It is plain, therefore, that under the facts here shown equity must follow the law and grant to the named beneficiary her full vested rights under the policy and award the proceeds to her. West v. Pollard, 202 Ga. 549 ( 43 S.E.2d 509).

There are decisions of this court which in the absence of clear analysis might be erroneously construed to be in conflict with what we have held above. In Nally v. Nally, 74 Ga. 669 (58 Am. R. 458), the facts were in all material respects identical with the facts in the present case except that there the insured did everything required of him to effect a change of the beneficiary, and the named beneficiary, having knowledge of his efforts, refused his request to deliver the insurance policy, while here the insured made no attempt to change the beneficiary. It was there held that the insured had done all he could, and the ministerial act of the insurer in changing the beneficiary would not be allowed to defeat his desire, and the wife was awarded the proceeds from the insurance policy as against the beneficiary named in the policy. This court attempted, in Dell v. Varnedoe, 148 Ga. 91 ( 95 S.E. 977), to reconcile the decision in Nally v. Nally, supra, with that in the Smith case, supra, upon the ground that in the former the insurer paid the money into court and assumed an attitude of indifference as to which claimant should prevail, whereas in the latter the insurer was a party to the case and was not indifferent. It was asserted that by paying the money into court the insurer waived its right to require compliance with the provisions of the policy respecting the change in beneficiary and left the court to decide the issue between the two claimants upon the basis of their respective equities; whereas in the latter there was no such waiver upon the part of the insurer. In the first place, it should be observed that in Dell v. Varnedoe, supra, the insured had substantially met the requirements of the policy for effectuating a change of beneficiary, and it thereupon became the contractual duty of the insurer to perform the ministerial act of making the change of beneficiary in the policy to conform to the known wishes of the insured. We think that the distinction in the two cases quite definitely is found in the conduct of the insured and not in the conduct of the insurer after the death of the insured. In so far as the rights of the insurer are concerned, it might have made waivers which would have affected such rights, but obviously it was not within the power of the insurer to forfeit or even impair the vested rights of the beneficiary by any act or waiver subsequently to the death of the insured. If the ruling we make required further support, that support might be found in the Smith case, supra, where it is said: "If, however, the insured has done substantially all that is required of him, or all that he is able to do, to effect a change of beneficiary, and all that remains to be done is ministerial action of the association, the change will take effect though the details are not completed before the death of the insured. Ib. [Cooley's Brief on Insurance] 3769; Nally v. Nally, 74 Ga. 669 (58 Am. R. 458); Brown v. Dennis, 133 Ga. 791 ( 66 S.E. 1080); Brown v. Dennis, 136 Ga. 300 ( 71 S.E. 421). Some affirmative act, however, on the part of the member to change the beneficiary is required; his mere intention will not suffice to work a change of beneficiary." What interest could the insurer possibly have as to which of the two claimants should be awarded the proceeds of the policy, when all are in court and judgment awarding the fund constitutes full and complete protection to the insurer as against any further claim by the losing claimant? What difference would it, therefore, make in fixing the rights of the claimants whether the insurer was manifesting an indifference or was contesting the right of either claimant, since in either case the court's judgment, regardless of which claimant prevails, is full protection to the insurer against further claims of either claimant? There is no conflict in the decisions in Nally v. Nally, supra, and the Smith case, supra. The material difference in the facts authorized diametrically different rulings. In the former, the insured, because of his efforts, was entitled to have the beneficiary changed; whereas, in the latter, the insured, because of a total absence of effort to change the beneficiary, was not entitled to have the change made; and equity in each case required to be done that which ought to have been done. Many other cases following the respective rulings in these two cases, too numerous to be listed here, are explained upon this basic principle.

However wrongful the insured's treatment of his wife may have been, and however much compensation for damages the law might exact of him, or his estate therefor, the wife's injury can not be repaired by allowing her to excuse him and his estate, and by this procedure collect for such damages from the mother, who took no part in his wrongdoing. We think that lawful contracts are still binding upon the parties, and that courts should uphold them unless the conduct of the contracting parties has been such that in equity and good conscience they have forfeited their rights thereunder. Courts take long risks of doing an injustice when by judgment they allow mere verbal statements to nullify written documents, by substituting the unwritten for the written contract.

For the reasons stated the court did not err in dismissing the answer of Mrs. Gracie Loyd claiming the fund in court, and in awarding that fund to Mrs. Julia F. Loyd. This ruling makes it unnecessary to rule upon the exception to the dismissal of the cross-bill of Mrs. Gracie Loyd, in which it was sought to recover judgment for the proceeds of another policy upon precisely the same grounds that the claim to the proceeds here was prosecuted.

Judgment affirmed. All the Justices concur.