Fleming v. Grimes , 142 Miss. 522 ( 1926 )

^* Corpus Juris-Cyc. References: Death, 17 C.J., p. 1179, n. 82; Life Insurance, 37 C.J., p. 580, n. 52, 53, 58; Presumption of survivorship among those who perish in common calamity, see note in 51 L.R.A. 863; Disposition of life insurance, which, by terms of policy is dependent upon survivorship, where there is no presumption or proof of survivorship, see note in 5 A.L.R. 797; 8 R.C.L., p. 716; 2 R.C.L. Supp., p. 645; 4 R.C.L. Supp., p. 570. The suit is in equity, and the proceeds of a life insurance policy is the subject-matter of the litigation.

The question presented for our decision is whether the legal heirs of the beneficiaries in the policy shall take the proceeds, or whether the proceeds go to the heirs of the insured, where the beneficiaries and the insured all died in a common disaster, under a policy in which the right to change the beneficiary was reserved in the insured but not exercised by him, and it being impossible to prove otherwise than that all died at the same time.

The determination of the question is to be reached by the solution of the problem as to whether the burden of proof is upon the heirs of the beneficiaries or the heirs of the insured to show whether the beneficiaries died before, or survived, the insured, under the clause of the policy which provides that, "if any beneficiary shall die before the insured, the interest of such beneficiary shall vest in the insured."

It is conceded by all, and we so hold, that there is no presumption that any one of the deceased parties survived the other, in the absence of proof, and that all died at the same moment; so we thus put that question out of the way in the beginning.

The insurance company paid the proceeds of the policy into court, and the claimants proceeded with their cause to ascertain whom the impounded funds should go to; that is, whether the heirs of the insured or the heirs of the beneficiaries should take the funds. The chancellor considered the cause, and held that the burden of proof was upon the heirs of the beneficiaries to show that the beneficiaries survived the insured, whereupon the representatives of the beneficiaries excepted to the ruling of the court, and this appeal was prosecuted to settle the question as to the burden of proof.

The case arose in this way:

John A. Broadway, on the 27th day of February, 1924, took out a policy of insurance in the Metropolitan Life Insurance Company of New York, payable to his wife, Mrs. Clarice M. Broadway and his daughter, Effie I. Broadway, payable one-half to each. On the 27th day of May, 1924, three months after the policy was issued, a tornado destroyed the home of the insured, and he and his wife and child were all killed. The policy of insurance was blown away and destroyed.

On the 27th day of December, 1924, Mrs. Effie Grimes, a sister of the deceased, and administratrix of his estate, filed her bill of complaint in the chancery court of Clarke county for discovery and also to have established and determined the contents and stipulations of said lost policy, and for a decree against the insurance company for the amount due under the policy. The insurance company answered, filed a copy of the policy, and interpleaded the representatives of the wife and child and the insured, and the insurance company paid the money into court and was discharged.

Mr. Broadway was twice married; the wife named in the policy was his second wife, and the child named was by his first wife. He had three sisters, who were his only heirs, Mrs. Effie Grimes, Mrs. Onie B. Thompson, and Mrs. Lora Harris. Administration on the estate of his wife was taken out by her people, and likewise an administration on the estate of his little girl, Effie. The representatives of the respective claimants propounded their claims to the impounded funds.

On the hearing, the chancellor held that the burden of proof was on the representatives of the estates of the beneficiaries, wife and child, and directed them to proceed to introduce their evidence, which they declined to do, whereupon the court rendered a decree that the impounded funds go to the heirs of the insured, since the representatives of the beneficiaries had no proof that the beneficiaries survived the insured. Now, if the chancellor was correct in this ruling, the case should be affirmed; otherwise it must be reversed so that the administratrix of the insured may introduce her evidence, if any, to show that the insured survived the beneficiaries.

The case turns largely, if not wholly, upon one clause in the policy which provides:

"This policy is written with the right of the insured to change the beneficiary. . . . If any beneficiary shall die before the insured, the interest of such beneficiary shall vest in the insured."

The representatives of the beneficiaries contend that under his clause of the policy the burden of proof was on the representative of the insured to show that he outlived the beneficiaries named in the policy, or that he survived them in the tornado; that, since there is no presumption as to who survived, the language in the policy, "if any beneficiary shall die before the insured," casts upon the representative of the insured the burden of proof as to the survivorship; that, even though the policy gave the insured the right to change the beneficiaries, and the assumption being that the insured and the beneficiaries each died at the same instant, in the absence of proof, the representatives of the beneficiaries took under it, even though the insured did not predecease them or either of them.

We may here dispose of one point involved in the above contention so as to clear the way for a decision of the main question in the case, and that is, we hold that under the decisions of this court there was no vested interest in the beneficiaries under the terms of the policy which reserved the right in the insured to change the beneficiary; that such interest did not, and could not, vest in the beneficiaries except by the death of the insured. Lamar Life Ins. Co. v. Moody, 84 So. 135, 122 Miss. 99; Bank v. Hodges, 96 So. 97, 132 Miss. 238. This leaves yet for decision the main question as to whether the beneficiaries took under the policy, where they and the insured died at the same moment.

The sisters of the insured (his heirs) contend that, when the facts and circumstances are considered, it was the clear intent of the insured, in taking out the policy, that his wife and child should not have the right to take thereunder unless they survived to enjoy and use his benefaction; that, unless they did survive to take and enjoy the proceeds of the policy, it should then revert to him, and through him to the natural objects of his bounty, his own blood, his heirs at law.

The appellees, heirs of the insured, urge their right to the proceeds of the policy upon, we may say, two theories. One is that the insurance policy should be viewed as testamentary in its nature, and should receive the liberal construction that is applied to wills, and that, when the policy is considered in that light it will appear plain that the intent and purpose of the insured was to leave the proceeds to his wife and child, if they were living at the time of his death, so that they might enjoy and use the funds; otherwise it was his wish and purpose that his own blood kin take the proceeds at his death. The argument in support of this theory is both interesting and convincing, and finds support in the authorities from other jurisdictions; but we shall omit passing on this proposition, because our decision of the case upon the other theory will make it unnecessary to do so.

The other theory presented by appellees to sustain their position, is that the provision of the policy, "if any beneficiary shall die before the insured, the interest of such beneficiary shall vest in the insured," must be construed to mean that the beneficiaries will not take under the policy unless they survive the insured; that is, they must be living at the time of the death of the insured, otherwise no interest in the proceeds can vest in them, and as the heirs of the beneficiaries must inherit through the beneficiaries, and, as the beneficiaries took no interest because not living to take it, the heirs of the beneficiaries can take no interest, but the proceeds, under the provision of the policy, must go to the heirs at law of the insured.

We think the contention of the appellees, heirs of the insured, is sound and must prevail in this case. This view is based upon the reasoning that the contract of insurance contemplates the survival of the beneficiary, in order to take under the policy.

The interest of the beneficiaries was contingent upon the death of the insured while the beneficiaries were living. Their interest was subject to defeat in two ways, viz.: By a change of the beneficiaries by the insured, or by their failure to survive the insured.

The interest of the beneficiaries in this case was contingent and personal, and never became vested, because there was no beneficiary living to take at the death of the insured. At the moment of the death of the insured, the beneficiaries were also dead; therefore it was impossible for the interest to vest in the latter as was contemplated, in our opinion, by the contract of insurance. To put it in different words, we think the survival of the beneficiaries was a condition precedent to the vesting of the interest in them, and therefore the burden was upon the heirs of the beneficiaries to establish this condition precedent.

The appellants, the heirs of the beneficiaries, contend that, under the provision of the policy mentioned above, the burden was upon the heirs of the insured to prove that the beneficiaries died before the insured, and that, since they died at the same time, their claim to the proceeds must fail because the interest vested in the beneficiaries at the death of the insured, as the insured failed to change the beneficiaries in the policy during his lifetime.

The case of Watkins v. Home Life Insurance Co., 208 S.W. 587, 137 Ark. 207, 5 A.L.R. 791, a case recently decided by the supreme court of Arkansas, is cited and relied upon to sustain the contention. That case fully supports the theory of the appellants here, and, if it were not a case contrary to the weight of authority in other jurisdictions, and was sound in principle, we probably would be inclined to follow it; but, after a careful consideration of the opinion of Judge HART, the organ of the court, we think he went counter to the rule as announced by a great majority of the courts of America. In short, that case holds that, where the insured and the beneficiary die at the same time, "the result is the same as though the insured died first, on the theory that the beneficiary did not die in the lifetime of the insured." But we disagree with the logic upon which this conclusion is reached. We do not think the policy of insurance here involved, which is the same kind of policy involved in the Arkansas case, contemplates that the heirs of the beneficiaries should take in a case where the beneficiaries died at the instant the insured died, but they take only "if living."

There is good authority to the effect that, where the beneficiary and the insured die at the same instant, it is equivalent to saying that the beneficiary died first, because the insured had no intention of leaving the proceeds to the kinsmen of the beneficiaries, but his purpose was to bestow a bounty upon his wife and child, who died at the same time he died. Where the insured and the beneficiary die at the same time, and there is no provision to cover such event, the circumstance is so unusual that we think the intention of the parties to the insurance contract may be ascertained from the facts and circumstances surrounding and connected with the contract, and looked to as a guide in construing the policy.

It is said in the Arkansas case, supra, that the provision of the policy involved does not mean that the beneficiary takes only in the event he survives the insured, but that the interest vests in the beneficiary before the death of the insured, and that he takes unless the insured survives him, or changes the beneficiary, and therefore, where they die at the same time, the heirs of the beneficiary take, because the insured has not survived the beneficiary. But we think the reasoning is faulty, in that, as we have pointed out above, the interest in the proceeds does not vest in the beneficiary until the death of the insured, and if, at the death of the insured, there is no living beneficiary to take, then the proceeds go to the heirs of the insured. The policy here involved is a New York contract, and the decisions of that state are pertinent. McGowin v. Menken,119 N.E. 877, 223 N.Y. 509, 5 A.L.R. 794; Y.W.C. Home v. French (Foul v. French), 23 S.Ct. 184, 187 U.S. 401, 47 L.Ed. 233; Paden v. Briscoe,17 S.W. 42, 81 Tex. 563; 5 A.L.R. 797, note.

In view of these conclusions, we think the holding of the lower court was correct, and the decree therefore is affirmed.

Affirmed.

ETHRIDGE, J., dubitante.