
    HANNAH S. BRICK, Respondent, v. ROBERT CAMPBELL, Appellant.
    
      Assignment—Married woman—Legal and equitable poioer of disposition of her separate property—Policy of insurance on the life of husband payable to the wife, the premiums being paid by the husband—Consideration and construction of the statute, Laws 1873, chap. 821, § 2.
    The nature of the gift of a policy of insurance by the husband on his life as a provision for the wife after her husband’s death, raises the question, whether these facts do not limit the power of the wife to dispose of it during the husband’s lifetime. Also whether as against creditors the husband had the right to use his money in payment of the premiums, if such use were fraudulent as to the creditors. In the latter case the statutes on the subject of these insurances make it legal and not fraudulent as to creditors for the husband to take out these policies, to a certain amount or for the wife to take them out, the premiums to a certain amount to be paid out of the husband’s property. Said statutes make no provision as to the wife’s power of disposition, but they declare that such policies in favor of the wife shall be her sole property.
    Prior to the Act of 1873, chap. 821, page 1235, the courts held that it was the implied intent of the statutes, that the wife should not assign insurance, taken out under tire statutes (Eadie v. Slimmon, 26 N. Y. 15, and other cases following), but since the Act of 1873, the statutes do not imply such an intent in respect to a policy, made payable to a married woman, and in which children have no legal or equitable interest. In such a case, the wife during life, is solely interested. Olmstead v. Keyes, 85 N. Y. 593.
    In this case the plaintiff respondent made an instrument which on its. face was an assignment of polices which had been issued under the statute. The assignment was made as security for advances made on the faith of it to her husband. After the death of plaintiff’s children the policies were not re-delivered to the defendant assignee. They remained in his possession from the time of the assignment. By the testimony the indications were that the plaintiff assented to the possession of the policies by the defendant after the death of the children. From January, 1882, no child was living. In June, 1884, the plaintiff first made a demand for them.
    
      Held, That the inference is, that during the intervening time, plaintiff had assented to the claim of defendant, and that the policies were effectively assigned, and assigned for a valuable consideration.
    
      Before Sedgwick, Ck. J., Freedhak and Ingraham, JJ.
    
      Decided April 13, 1887
    Appeal by defendant from judgment, entered upon findings at special term.
    The relief demanded by the complaint was that the defendant re-assign and deliver five policies of insurance of the life of her husband, which had been assigned by her to the defendant. Judgment in accordance with, this demand was entered, after a trial.
    The opinion rests upon the construction of the following statute, ch. 821, Laws of 1873, p. 1234, § 2 : “ Any policy in favor of a married woman, or of her and her children, or assigned in her, or in her and their favor, on written request of said married woman, duly acknowledged before a commissioner of deeds, or other officer authorized to take acknowledgments of deeds in the same manner as required by law, to pass her dower right in lands of her husband, and on the written request of the policy holder, may be surrendered to and purchased by the company issuing the same, in the same manner as any other policy. And such married woman may, in case she have no child or children born of her body, or any issue of any child or children born of her body, dispose of such policy in and. by a last will and testament, or any instrument in the nature of a last will and testament, or by deed duly executed and acknowledged before an officer authorized to take acknowledgments of deeds, in the same manner as required by law to pass her dower right in lands of her husband, which disposition lawfully made shall invest the person or persons to whom such policy shall have been so bequeathed, or granted and conveyed, with the same rights in respect thereto .as such married woman would have had in case she survived the person on whose life such policy was issued, and such legatee or grantee shall have the same right to dispose of such policy as herein conferred on such married woman.”
    The instrument made by the plaintiff and claimed by the defendant to be a valid assignment of the policies, was acknowledged in the manner required by the statute.
    
      George W. YanSlyck, for appellant.
    
      Jacob F. Miller, for respondent.
   By the Court.—Sedgwick, Ch. J.

Four of the policies assigned by the plaintiff were in terms payable to her executors and administrators, and not in any contingency to children. These choses in action were her separate property. In equity, she had exclusively the power of disposition of her separate property in general, when it was personal, if the grant of it to her or perhaps the nature of her interest in it did not express or imply a hmitation of her power of disposition. Seymour v. Fellows, 77 N. Y. 178 ; Rawson v. Penn. R. R. Co., 48 N. Y. 216, and other cases; Olmsted v. Keyes, 85 N. Y. 593. The statutes of this state give a legal power of disposition of separate property to a married woman. If there be a doubt of whether these statutes comprise the case of a gift of the husband to the -wife, there is no doubt, that in equity, she has the same power over such gifts, as over any other kind of separate property.

In the instance of a¡ policy of insurance of the life of a husband, payable to the wife, the premiums being paid by the husband, there would be a question as to whether the nature of the gift as a provision for the wife after the husband’s death, did not limit her power to dispose of it, in her lifetime. Beyond this, as against creditors, the husband would have no right to use his money in payment of the premiums, if such use were fraudulent as to the creditors.

The statutes on the subject of these insurances, make it legal 'and not fraudulent as to creditors, for the husband to take out these policies to a certain amount, or for the wife to take them out, the premiums to a certain amount to be paid out of the husband’s property. These statutes make no provision as to the wife’s power of disposition. They declare that the policies, in favor of the wife, shall be her sole property.

The courts have held in Eadie v. Slimmon, 26 N. Y. 15, and in the cases that follow it, that it was an implied intent of the statutes, that the wife should not assign insurances taken out under the statute.

Since the act of 1873, ch. 821, p. 1235, the statutes do not imply this intent in respect of a policy, made payable to the married woman and in which children have no legal or equitable interest. In such a policy the wife during life is solely interested. Olmsted v. Keyes, supra. If a married woman, provided she have no children living at the time, can assign a policy payable to her and partly or contingently to children, there can be no room for arguing that the implied prohibition against assigning when there is a child living, is made for her benefit. The benefit to children which the statute relates to, is of the slightest possible kind. There is no provision which contemplates that the widow on death of the husband shall use for the benefit of children any part of the money, her sole property collected from the policy.

The doubt that the latter part of the section was intended to apply to policies that are payable to the married woman and children, or to her or children, and not to policies payable to her alone, cannot be entertained under the decisions as I understand them.

In Brummer v. Cohen, 6 Abb. N. C. 409, the policy was made payable to the wife, or her executors, administrators or assigns. There were children living at the time of the action and these children were in being at the time of the assignment. The court, in first instance, held that the policy was unassignable and that as the plaintiff had children at the time she assigned the policy to the defendant, the act of 1873, chap. 821, did not help the assignment. The Court of Appeals said in the case, “ The legislature in conferring by subsequent acts a limited power of assignment, have recognized the policy, attributed to the legislation of 1840. Ch. 821, Laws of 1873, chap. 248, Laws of 1879. The assignment in this case was not within the authority conferred by these acts.

It is proper to state here that it may be assumed that the statute of 1873, intended that there should be no assignment without its execution being acknowledged by the married woman, as at the time was necessary to a conveyance to pass her dower right.

If there is no difference between this case and that of Brummer v. Cohn, the plaintiff here had a right to a judgment, that the assignment made by her was invalid. In the present case the difference of fact is, that while at the time of the assignment there were children, they had afterward died and before the action.

Was it possible for her to make a valid arrangement, which might bind her, which would not operate during the lifetime of the children, but upon their death would operate as an assignment ? It seems clear that in their lifetime she had a property interest in the policy, which in its nature was assignable. There was no objection to her making any grant of her interest which would not contravene the intent or policy of the statute, which was that she should remain in possession of her interest while any child was living. But she could not make any instrument, on its face a grant, which would operate as a grant during the lifetime of the children. The plaintiff did make an instrument which on its face was an assignment. If after the death of the children she should re-affirm this and then procuring the piece of paper on which the chose in action was written, deliver it to the assignee named, there would be no doubt in the case. The instrument would be at least what is called a precedent declaration, which would be effective as a grant upon the policy coming to the assigned after the death of children. McCaffrey v. Woodin, 65 N. Y. p. 462 et seq. The notes to Ryall v. Bowles, W. & T. Leading C. in Eq. 2 vol. 1611, illustrate this principle.

It is assumed that during the life of the children she might by act or verbally, annul the instrument, so that it would cease to be effective. The judge below found that on or about the 29th day of May, 1880, and at several other times before the commencement of this action, the plaintiff demanded the re-transfer and re-delivery of the said policies to her. The testimony shows that the demand referred to, was made by the husband of the plaintiff. He did not use the word demand. He asked for the policies and said it was about time they were given up—about time they were surrendered. The connection in which this testimony was given shows that this was not a denial, of the efficacy of the assignment, but a claim that the purpose for which it had been given, as security, had been fulfilled. The policies were to be surrendered because the debt, to secure which they were assigned, as the witness assumed, had .been paid. There was no other demand made until July, 1884, after the death of the children.

The facts were, as the judge has found, that the consideration of the assignment was the assumption by the defendant of the obligation of the husband, and the assignment was made as security for the defendant’s reimbursement of any sums he should pay, under the assumption; that the defendant had paid on account of these obligations, for which he had not been reimbursed, a sum exceeding the face value of the policies, that is, $14,100.

It is the fact that after the death of the children, the policies were not re-delivered to the defendant. They remained from the assignment, in the possession of the • defendant. If they remained so for any time with the plaintiff’s consent, under his claim to them, the assignment became finally operative. The taking and giving them again, would have been a mere form. It is not necessary to decide that the defendant could not, against the wish of the plaintiff, have held the policies and subjected them to the operation of the assignment. So far as that is referred to by the testimony the indications are that the plaintiff assented to the possession by the defendant under the assignment, after the death of the children. These indications are the nature of the assignment which was never revoked or recalled during the lifetime of the children; the not revoking the assignment and the moral obligation on her part growing out of thé payments made by the defendants, as she had in fact requested, which would be a motive to her to assent to his holding the policies after the death of' the children. The presumption of fact would be that she acted in accordance with the motive until there was evidence that she ceased to be influenced by it. In June, 1884, she first made a demand. From January, 1882, no child was living. The inference is that in the intervening time, she had assented to the claim of the defendant and that the policies were then effectually assigned.

The facts that have been stated disclose that the policies were not assigned as security for an antecedent indebtedness of the husband to the defendant, but for. money, that the defendant should thereafter pay on account of the husband’s indebtedness.

Another policy was payable to the plaintiff for her sole use if living, in conformity with the statute, and if not living to the children of said person whose life is hereby insured, or their guardian for their use.” The statute that has been examined, does not say and probably does not imply, that an assignment by the wife, at the time when there is no "child living, would cut off the interest in the policy, which by the terms of the contract might belong to a child, after the death of the husband and born after the assignment. It permits in the case . provided that the wife may assign. The interest passing would be such as would be ascertained by her living after her husband’s death. The reasoning that has been applied to policies payable solely to the wife is properly applicable to this policy. The assignment of it became operative when there was no living child, and the policy remained thereafter in the hands of the assignee, with the consent of the wife.

For these reasons 1 am of opinion there snould be a new trial.

Judgment reversed and new trial ordered with costs to abide the event.

Freedman, J., concurred.

Ingraham, J. (dissenting).

It issettled in this state by the case of Olmsted v. Keyes, 85 N. Y. 600, that one to whom a policy of life insurance is payable or to whom such policy has been assigned, may with the consent of the insurer, deal with a valid life policy as he can with any other chose in action, selling it, assigning it, disposing of it and bequeathing it by will, except so far as such transfer is prohibited by statute.

It is also settled that chapter 80 of the Laws of 1840 as amended, prohibits the assignment of policies of insurance issued under the provisions of section 1, of that act except as such transfers are allowed by section 2 of the act, as amended by chapter 821 of the Laws of 1873. An assignment of such policy is therefore void unless made in compliance with the terms of the second section of that act. Barry v. Equitable Life Assurance Co., 59 N. Y. 592; Brummer v. Cohen, 6 Abbott’s N. C., 411.

A policy of insurance which insures the life of a married man for the benefit of his wife, or in case of her death before the decease of her husband, for the benefit of her children, is a policy issued under the provisions of section 1 of the act of 1840, and can only be assigned, or transferred as allowed by section 2 of the act.

The policies Exhibit A, New York Life Insurance Co. for $3,100, Exhibit C, Mutual Life Insurance Co. for $2,000, and Exhibit.E, Washington Life Insurance Co. for $4,000, were plainly issued under the statute above named. The insurance is to be paid to the wife of the person whose life is assured, and the prohibition contained in the statute applies.

The power to assign these policies must be found, if it exists, in section 2 of the Act. That section provides that any such married woman may, in case she has no child born of her body, or any issue of any child or children born of her body, dispose of such policy.”

In order to make such assignment valid therefore, it must appear that such married woman to whom the policy was payable, at the time of the execution of the assignment had no child or children or issue of any child or children, and if such fact does not appear, the authority given by the section to make a transfer of the policies does not apply.

The fact that subsequent to the assignment of such a policy a child living at the time the assignment was executed, was dead, would not validate the assignment void when made. The ground upon which the prohibition has been applied is, “ That the act was special and peculiar, and looking to a provision for a state of widowhood and orphanage, and that it would be a violation of the spirit of the provision to hold that a wife insured under that act, could sell or traffic with her policy as though it was personal property or ordinary security for money. Barry v. Equitable Ass. Society (supra).

I think it would be as clearly opposed to the spirit of the statute to allow assignments or transfers to be made, the validity of which would depend upon the death of children of the person for whose benefit the policy was made, and the terms of the amendment of 1873, is explicit that a transfer can be made only in case there should be no child.

There is nothing in this case that would- estop the plaintiff from claiming that the assignments are void. It does not appear that defendant paid anything on the faith of the assignment of these policies after the death of the child, or that he had suffered in any way by the failure of the plaintiff to sooner assert her claim.

I am of the opinion therefore that the assignments of policies marked Exhibits A., C. and E., were void, and that so far as the judgment directs the re-assignment of such policies to the plaintiff the judgment should be affirmed. As to the policy Exhibit B., it was issued by a Massachusetts corporation, dated at Boston, Massachusetts, payable at Boston, Massachusetts, and provides that the contract should be governed and construed by the laws of Massachusetts.

As to Exhibit D., the policy is made payable to R. A. Brick, the plaintiff’s husband, or his representatives. The policy is not payable to the plaintiff, and does not comply with the terms of the act of 1840.

It is clear that an assignment of that policy to the plaintiff by her husband, fraudulent as to creditors, would not be protected by the terms of the act of 1840.

It is very clear from this provision that this policy could not have been issued in compliance with the act of 1840, and thé prohibition contained in that act does not therefore apply. These policies therefore come under the rule as laid down in Olmsted v. Keyes (supra) and are assignable.

I am unable therefore to agree with the chief judge, that the assignment of all the policies^ was invalid.

The judgment should be reversed and a new trial ordered as to the two policies marked Exhibits B. and D., but the judgment should be affirmed as to the three policies, Exhibits A. C. and E.  