Opinion
4 Div. 131.
May 9, 1940. Rehearing Denied June 27, 1940.
Appeal from Circuit Court, Bullock County; J. S. Williams, Judge.
Miles S. Hall and Norman T. Spann, both of Montgomery, and Moseley McIlwain, of Union Springs, for appellant.
The beneficiary named in a benefit certificate does not have a vested right precluding the member from changing the beneficiary, the naming of the beneficiary conferring merely an expectancy. Miller v. Sovereign Camp, W. O. W., 207 Ala. 551, 93 So. 526; Slaughter v. Grand Lodge, 192 Ala. 301, 68 So. 367. Public policy which forbids one having no insurable interest to take out insurance on the life of another does not prevent one who procures insurance on his own life from making the benefit to another who has no insurable interest in it, unless restricted by statute or by charter or by-laws of insurer, and insurer can bind itself to pay to the beneficiaries named therein although they have no insurable interest in the life of the insured. Barnett v. United Bros., c., 10 Ala. App. 382, 64 So. 518; 2 Couch, Cyc.Law of Ins., 813, § 307. There are no restrictions as to beneficiaries in the laws of the State or under the constitution and by-laws of the insurer, and appellant is eligible as a beneficiary. Code 1923, § 8445, as amended by Gen.Acts 1931, p. 72; Morey v. Monk, 145 Ala. 301, 40 So. 411.
Cope Cope and Andrews Andrews, all of Union Springs, for appellees.
For appellant to be an eligible beneficiary she can only be so under the bylaw provision "and such other beneficiary as may be permitted by the laws of the state in which the camp is located of which the applicant originally becomes a member." This provision has reference, not to the general law of the state, but to the fraternal insurance laws. 7 C.J. pp. 1053-1055; Code 1923, §§ 8439-8508; Gen.Acts 1931, p. 55; Gen.Acts 1935, p. 549. Prior to amendment, Code, § 8445, limited the beneficiaries of death benefits. The amendment of the statute was intended to remove the limitation fixed by the statute and permit such beneficiaries as should be named by the society as eligible. The bylaw read in its entirety names the eligible beneficiaries, and appellant is not within the class so named.
The bill in this case is filed by the surviving children of Charlie C. Stroud, deceased, who left no widow.
The demurrer is to paragraph 2 of the bill, and it was overruled, and respondent appeals and assigns the decree as error.
In paragraph 2 an attack is made upon the right of decedent to name appellant as the beneficiary in a fraternal life insurance policy, and it is controlled in this respect by section 8445, Code, as amended by the Gen. Acts of 1931, page 72, § 4, so that the beneficiary in such a policy is not confined to those named in its provisions as it appears in the Code, but "any * * * member may direct any benefit to be paid to such person or persons, entity, or interest as may be permitted by the laws of the society; provided, that no beneficiary shall have or obtain any vested interest in the said benefit until the same has become due and payable in conformity with the provisions of the contract of membership, and the member shall have full right to change his beneficiary, or beneficiaries, in accordance with the laws, rules, and regulations of the society."
Section 8445, Code, before it was amended, restricted the right of a member in naming his beneficiary, so that he must belong to one of the classes there designated. As amended, the statute does not confine the beneficiary to any class of persons, but permits the member to name any person permitted by the laws of the society to be such.
The laws of the society make no restriction to any class of persons, but only provide that the benefits shall be paid to the person named as beneficiary, which shall be one of certain named classes of persons related to the member, "and such other beneficiaries as may be permitted by the laws of the State." Section 8445, supra, as amended, is the only statute on that subject. It now opens the door to the society to limit the classes of persons who may be beneficiaries, but itself does not prescribe a rule. There is therefore no statutory law which makes a specific limitation. So that the only State law is that applicable to life insurance generally. The law of this State on that subject makes any one eligible to be the beneficiary of a policy procured by the assured who names him as beneficiary, and there need be no insurable interest under such circumstances. Henderson v. First National Bank, 229 Ala. 658, 159 So. 212; Metcalf v. Montgomery, 229 Ala. 156 (9), 155 So. 582; 12 Alabama Digest pages 326, 327, Insurance, § 114.
The by-laws also provide that if the beneficiary designated in the certificate of insurance be unauthorized by law to receive the benefits, and no new designation has been made, the benefits shall be paid to the surviving children when there is no surviving wife.
These complainants sue by virtue of such feature of the by-laws, both in the aspect of the bill under attack and also in that aspect which charges appellant with fraud and undue influence in procuring her designation. No question is here raised as to the right of complainants under the by-law in question to make the contest, nor in any respect on the aspect which charges fraud and undue influence.
We think the demurrer which is only addressed to that feature of the bill contained in the second paragraph should have been sustained, and a decree will be entered accordingly.
Reversed, rendered and remanded.
GARDNER, C. J., and THOMAS and BOULDIN, JJ., concur.