
    BICKERTON v. JAQUES.
    
      N. Y. Supreme Court, First Department; General Term,
    October, 1882.
    Submission of Controversy.—Insurance, Right to Surrender Life Policy and Change Beneficiary.
    One who takes out a policy of insurance on his own life as a gratuitou benefit to another, to whom the loss is payable, may, upon the death of such beneficiary defeating the intent of the insurance, surrender the policy and take out another,,payable to a different person, freed from any claim on the part of the personal representatives of the deceased beneficiary.
    
    
      II. obtained an insurance policy upon his own life, payable to his sister E., retained its possession, and paid premiums thereon until E’s death. He thereupon surrendered it to the company, and in place of it received another, payable to D. Held, that the intention of the original insurance having failed, H. had a right as against the personal representatives of E., to make the substitution.
    Submission of controversy by Joseph P. Biclcerton, as administrator &c., of Elizabeth Jaques, deceased, against David Jaques and the Mutual Life Insurance Company of New York, pursuant to section 1279, &o., of the Code of Civil Procedure, to determine the right to the amount of a policy of insurance upon the life of Henry H. 3 agues, deceased.
    The facts sufficiently appear from the opinion.
    
      F. G. Salmon (Angel & Salmon, attorneys), for plaintiff.
    
      Chas. D. Jacot and William H. Hagaman, for defendant Jaques.
    
      Davies & Work, for defendant Mutual Life Insurance Company.
    
      
       Where O. H. R. became a member of a mutual benefit association, and a certificate of membership was issued to him, reciting that he “ is entitled to all the rights and privileges of membership in the Ancient Order of United Workmen, and to participate in the benefi-' ciary fund of the order to the amount of $2,000, which sum" shall, at his death, be paid to his wife, Eva K. Richmond,”—Held, that because of the right in the member under the by-laws of the association, “ to hold, dispose of, and fully control said benefit at all times,” his appointment of his wife to receive the benefit was revocable, and until it was revoked she had only an expectancy, dependent on his will and pleasure, which terminated when she died before he did, and did not pass to her representative. Richmond v. Johnson, 28 Minn. 447; S. C., 10 Northw. Rep. 596.
    
   Daniels. J.

The controversy between the parties relates to the right to insurance monies payable under a policy of insurance issued by the Mutual Life Insurance Company of New York, to Henry H. Jaques, payable to his nephew David Jaques, the principal defendant in this proceeding. Before this policy was issued, Henry H. Jaques obtained from the company a policy for the sum of $2000 payable by its terms upon the death of Henry H. Jaques, to Elizabeth Jaques, his sister. She died during his lifetime, and after her death he surrendered this policy and in place of itreceived the other, payable on the occurrence of the same event, but to his nephew. His act in making such a surrender is deemed a fraud by the plaintiff as the administrator of the sister, to whom the first policy was made payable on the death of Henry H. Jaques, and if the administrator is right in that position it follows that he is entitled to recover in this proceeding. Bub if he is not, then judgment must be ordered in favor of the defendant David Jaques, to whom the second policy has become payable by the decease of the person on whose life it was issued.

No decisive authority has been found in favor of the position taken by the plaintiff. The cases affecting the right of the person obtaining the policy to surrender it and receive another payable in a different manner in lieu of it having generally arisen under the terms of the statute made for the benefit of the widow and children., These cases are not applicable to the present controversy, because the language of the statute is not broad enough to include it. Its disposition is therefore dependant upon the legal principles necessarily applicable to such a transaction. And according to them it should be governed by the intention of the. person obtaining the insurance, so. far as that is capable of being gathered from the attending circumstances. That he did not intend to place the insurance irrevocably beyond his own control, is manifested with reasonable clearness by the fact that he always retained the possession of it himself, and he, and not Ms sister, paid all the premiums which were paid upon it. And after such payments were made the insurance was kept up by the dividends which had been declared and credited to it under the rules and regulations of the company.

In addition to these circumstances the person to' whom the first policy was made payable, was the sister of Henry H. Jaques by whom it had been obtained. She had lived with him, taking care of his household and family for many years prior to her own decease, and she was entirely dependant upon him for her support and maintenance. It is reasonably plain from these facts that his intention in procuring the policy was to provide for her after the time of his own decease, and when by reason of that event he would be incapable of affording her any further maintenance.

This was probably the sole and only intention by which he was actuated in procuring the insurance, and from that, it must necessarily follow that her right to it was designed to be contingent upon her surviving him. That is the only fair and rational construction to be placed upon the transaction. It embodied a provision for her support when by his decease he would be unable to provide it, and the occurrence of her death before his own defeated the object and purpose by which he had been actuated in taking out the insurance. Her administrator had no special claim upon his bounty, neither did any of her next of kin, and no reason therefore can be discovered for the existence of any disposition on his part to provide for them in case that she failed to become entitled to the money. His primary and substantial purpose was to secure the ! means of sustaining his sister, after his own decease, and as that purpose was defeated he was left at liberty to deal with the insurance as he himself deemed it to be proper,-—subject to the benefit intended to be secured by it to his sister after his own decease, it was his own property, the premiums had been paid upon it by him, and as it could not, be used as he intended it should when he obtained it, and during the time he made these payments upon it, he had the authority to give it another and different direction.

This point was considered in Clark v. Durand, 12 Wis. 223, where it was held that so much as this was certainly within the authority of the person obtaining the policy over it, and that case was approvingly followed in Kernan v. Howard, 23 Wis. 108. In Games v. Counant Ins. Co., 50 Mo. 44, the court went still further in its decision than is now required to sustain the defendants’ title to the insurance moneys. For there the policy had been taken out by the husband', for the benefit of his wife and her legal representatives, its terms in this respect being equally as broad as those included in the policy issued for the benefit of this deceased sister. The wife of the party died before he did, and upon his marrying again he procured the insurance to be changed so as to confine its benefits to a subsequent wife, and that was held to be within the authority he had over the policy. Without such a change it might be inferred from the omission to make it that the person holding the policy intended to continue it for the benefit of the personal representatives of the individual in whose name it should be made payable and that was practically what was decided in Hudson v. Merrifield, 51 Ind. 34.

These authorities are decidedly against the plaintiff’s claim, and with the intention that probably actuated the person who procured the insurance, .and the control over it resulting from that intention after the decease of his sister, warrant the conclusion that he was empowered to surrender the policy as he did, and take out the other in favor of his nephew. And the fact that the latter had, no particular claim upon him, will not interfere with, or affect the transaction as it was finally consummated (Olmsted v. Keyes, 85 N. Y. 593, 598). For the assured had the right to take out the policy as he did, and make it payable as long as he chose to do so, to the contesting defendant in this proceeding.

Other cases have been referred to as incidentally affecting or indicating the propriety of a different disposition of this controversy, but they contain no principle whose application would require a different disposition of the case to be made.

The plaintiff is not entitled to judgment for any part- of the monies in controversey, but the right of David Jaques to them has- become complete by the decease of his uncle, through whose acts and payments the fund in dispute has been created. Judgment should therefore be ordered for him in the case:  