Freeman v. National Benefit Society — 5 N.Y. St. Rep. 82

Majority

p. 82

Susan M. Freeman, respondent, v. The National Benefit Society of New York, appellant.

(Supreme Court, General Term, Third Department,

Filed December, 1886.)

Headnote

1. INSURANCE (Life) — Construction of clause in policy — Suicide not a crime — Penal Code, § 373.

Where a life insurance policy provided that it should he void if the member named therein “ shall die ... in violation of or attempt to violate any criminal law ... of any State or country in which the member herein may he ; ” the insured committed suicide. Held, that the deceased did not die in violation of or attempt to violate any criminal law of the State, although the attempt to commit suicide is made a crime, Penal Code, § 173, yet if successful it is suicide and no crime. (SeeDarrowY. Family Fund Society, & N. Y. State ft. 745.

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2. Same — Measure op amount to be paid in case of death.

The certificate of insurance contained a contract on the part of the insurer to pay to the plaintiff in ninety days after due proof of the death of the member, “a sum equal to the amount received from a death assessment, but not to exceed $3000.” No assessment was levied by the insurer to meet the claim of the plaintiff, hut it was proved that if such assessment had been levied and collected it would have exceeded $3000. Held, that the contract was to pay a certain sum, not to cause it to be levied and collected; it was not an agreement to pay from a special fund to be provided, but to pay absolutely, and the reference to the “ amount received from a death assessment ” is one of the methods of measuring the amount to be paid.

3. Same — To whom loss may be made payable.

Where the charter of the insurer or the statute under which it was insured does not forbid the insured to make the policy payable to whomever he may appoint, and there is no evidence tending to impeach the good faith of the transaction, a policy on the life of the insured made payable in case of death to another, though not having an insurable interest, must be paid by the insurer.

Louis P. Levi, for app’lt; Pond, French & Brackett, for resp’t.

The insured was the same person who was insured in the case of Darrow v. Family Fund Society, and the language of the policy respecting the death of the insured in the violation of, or attempt to violate any criminal law, is identical with the language in the policy in that case. Our decision in that case, that suicide did not come within the terms of the language, employed is decisive of the same question here.

The certificate of insurance in this case contains a contract on the part of the society to pay to the plaintiff in ninety days after due proof of the death of the member, “ a sum equal to the amount received from a death assessment but not to exceed $3000.”

No assessment was levied by the society to meet the claim of the plaintiff, but it was proved that if such assessment liad been levied and collected, it would have exceeded $3000.

The defendant objects that an action at law will not in such case lie to recover the $3000, but only an action in equity to compel the society to levy and collect the amount and then pay it to the plaintiff.

But the contract was to pay a certain sum, not to cause it to be levied and collected; it was not an agreement to pay from a special fund to be provided, but to pay absolutely, and the reference to the “ amount received from a death assessment,” is one of the methods of measuring the amount to be paid. Whether that assessment shall be levied in each case of death is a matter for the society to determine. Here it is shown that the amount payable is less than an assessment fully collected would realize. Whether there is in the death fund an accumulation of like margins from previous assessments is best known to the defendant. The printed rules of the defendant provide that “no assessment.

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is to be made in either class while there remains unclaimed in the death fund of the class, a sum sufficient to pay the maximum amount of benefit.” That no assessment was made with reference to this case is some evidence that none was necessary.

The objection that the plaintiff was not shown to have an insurable interest in the life of the insured was met by the recital in the application that she was a creditor. This was the only evidence upon the point and therefore was not contradicted. But the plaintiff did not procure the insurance; the insured did that, and named the plaintiff as beneficiary.

There was nothing in the charter or statute under which this society was organized forbidding the insured to make the policy payable to whomever he should appoint, and there is no evidence tending to impeach the good faith of the transaction on the part of the insured. The defendant therefore must pay as it has agreed. Olmstead v. Keyes, 85 N. Y., 593 ; Bickerton v. Jaques, 28 Hun, 119 ; Massey v. Mutual Relief Soc., 102 N. Y., 523 .

The act of the legislature under which the defendant was organized was examined in the case last cited, and nothing found in it requiring the insured to restrict his beneficiary to a person having an insurable interest in his life.

The judgment should be affirmed with costs.

Bockes, J. concurs.

Since the important question in the case has been decided in plaintiff’s favor in the case of Darrow v. Family Fund Society, contrary to my own views I concur in this opinion.