
    William A. Bradshaw and Almet N. Broadhead, as Executors, etc., of Robert C. Bradshaw, Deceased, Appellants, v. The Mutual Life Insurance Company of New York, Respondent.
    Fourth Department,
    November, 1905.
    Insurance payable to wife — when wife who dies before husband may dispose of same by will — recovery of premiums paid by husband on invalid agreement with insurer — when insurer not estopped by such agreement.
    A policy of life insurance, taken out by a husband who paid the premiums, 'which is made payable at his death to the wife for her sole use, if living, “in conformity with the statute,” and if not living to their children, vests a title in the wife, and the proceeds* belong to her. estate and pass under her will at her death without children even though she die before her husband.
    
      
      It seems, that such policy, being made “ in conformity with the statute,” is subject to the Laws of 1840, chapter.80, as amended by Laws of 1866, chapter 656; Laws of 1870, chapter 277, and Laws of 1873, chapter 821, then in force, which provided that a married woman without children may dispose of such policy by will.
    When the insured, under such policy, has, after the death of his wife, without children, entered.into a néw agreement with the insurer to continué the payment of the premiums and the insurer agreed that such policy shall be'payable to his estate, his executors may recover, of the insurer the premiums paid after the Wife’s death with interest.
    The fact that, after the wife’s death, the insurer agreed that the policy should be payable to the husband’s' estaté, does not estop it from questioning its liability to said estate. The invalidity of the agreement is.a,matter of law which both parties were bound to know and there was no mistake or misunderstanding as to facts. ' ' ■ ,
    McLennan, P. J., and Nash, J,, dissented'with opinion.
    Appeal . by the plaintiffs,. William A. Bradshaw and another, as executors, etc., of Robert C. Bradshaw, deceased, from a judgment of'the Supreme Court in favor of the plaintiffs, entered in the office of the- clerk of the county of Chautauqua on the 13th day of March, 1905, upon the decision of the court rendered. after a trial at the Chautauqua Trial Term, a jury having been waived.
    
      A. C. Wade, for the appellants.
    
      Charles. E. Hotchkiss, JuUem C. Harrison and Davis, Stone & Auerbach, for the respondent.
   Williams, J,:

. The' judgment should be affirmed, with costs.

The action is to recover the amount of an insurance policy issued by the defendant to the plaintiffs’ testator, Robert C; Bradshaw, payable at his death to his wife Corrie f. for her sole use, if living ,• in., conformity with the statute, and if not living,, to their children Or their guardian for their use.

. The policy was issued January 16, 1882. The Bradshaws were then husband and wife and continued such until the wife died July 3, 1896. They nevér had any children. Mrs. Bradshaw left a will by which she made no specific disposition of this policy, but ' disposed of all her property, including this policy, provided she had power to dispose of it by will.. Her will was duly admitted to probate and an executor appointed thereunder, who duly qualified, and who claims the money payable upon this policy.

The husband, Bradshaw, negotiated for this policy himself and retained it and paid the premiums thereon until his wife died. Immediately after her death he agreed with the defendant to pay the future premiums during his life, in consideration of which agreement the defendant agreed to make the policy payable to his estate, and notified him in writing that it had done so, and he did thereafter pay the premiums until his death, April 19, 1901. He left a will, which has been admitted to probate,'under which plaintiffs are executors.'

The court held that^upon the issue of the policy the title thereto vested in the" wife and remained so until her death, and then belonged to her estate and passed under her will; that the plaintiffs were entitled to recover from'the defendant the premiums paid by the husband under the agreement of the defendant, with interest, but had no right to the amount of .the policy.

It will be seen, therefore, that the question involved in this appeal is whether under the statute the wife had title to the policy at her death and the power to dispose of the same by will.

The statute under which the policy and the money payable thereon are claimed by the wife’s representatives is chapter 80-of the Laws of 1840, as amended by chapter 187 of the Laws of 1858 ; chapter 656 of the Laws of 1,866 ; chapter 277 of the Laws of 1870, and chapter 821 of the Laws of 1873. ' Since the amendment of 1858 the act has been entitled, “ An act for the benefit.of married women in insuring the lives of their husbands.”

The amendments of 1866,1870 and 1873 were in force when this policy was issued. All these statutes were repealed by section 90 of the Domestic Relations Law (Laws of 1896, chap. 272), which took effect October 1,1896 (Id. § 91), and section 22 of that law, which is still in force, was enacted in place of the' act of 1840 and its amendments. It was provided by section 1 of the act of 1840, as amended in 1870, in brief, that it should be lawful for a married woman to cause the life of her husband to be insured for her sole use, arid that should she survive the period or term of the insurance the amount of the insurance should be her own property, free from any claims of the representatives of the husband or of his creditors or persons claiming by, through or under-him provided that the yearly premium in excess of $500 paid out of the|property or funds of the husband, with the interest thereon, should inure to the benefit of the creditors of the husband. By section 2 of said act, as amended in 1866, it was provided that.“the amount of the insurance may be made payable in case of the death of the wife before the period at which it becomes due to her husband or to his, her or their children, for their use, as shall be provided in the policy of insurance aiid to their guardian if under age.” By sectibn 2 of the act of 1870, as amended by the act of 1873, it was provided: “Any policy in fa.vor of a married woman, or of her and her children, * * * maj* be surrendered to and purchased by the company issuing the same", in the same manner as any other policy. A.nd 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 instrmpent'in the nature of a last will and testament or by deed duly- executed and acknowledged * * * which disposition lawfully made, shall in vest ‘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.”

There seems to be no provision in the sections quoted, as to the pre-. cise form in which the policy may be issued. The provision in section 2 of the act of 1870, as amended in 1873, is. that any policy that had been issued in favor of a married woman or of her and her children might be .surrendered or disposed of by will or assignment. Section ■ 22 of the Domestic Relations Law re-enacts section 1 of the old law, as amended, in substance, though' not in words^ and then provides a substitute for section 2 of the principal act and section 2 of the act of 1870, as amended, viz.: “The policy may provide that the insurance, if the married woman dies before it becomes due and without disposing of it, shall be paid ;to.her-husband, or to his, her- or their .children, or to or for the use of one. or more of those persons * * *. The married woman may dispose of such policy by will or written acknowledged assignment, -to take effect on her death, if she dies thereafter, leaving no descendant surviving. After the will or the assignment takes effect the legatee or assignee takes such policy absolutely.” The section further provides for the assignment of the policy and for the surrender thereof to the company issuing the same, by the married woman, or her legal representative, with the written consent of the assured.

The policy in question was issued under the old act of 1840 and its amendments, and that act was still in force when the wife died in July, 1896, the repeal taking effect in October, 1896. Very likely the Domestic Relations Law has nothing to do with the question we are here considering, but it is interesting to observe the change made thereby in the statute of 1840 and its amendments.

It is said that the policy did, not conform to the language of the statute, that it was not one for the sole use of the wife under section 1 of the statute as amended in 1870, nor was it one in favor of the wife or of her and her children under section 2 of the.act of 1870, as amended in 1873 ; that it was one for her sole use, if living, at the death of her husband, and if not then living, for the benefit of their children.

The policy, however, by its language, expressly" provided it was in conformity with the statute, and this reference could only have beeii made to the provisions of the amendments of 1866; 1870 and 1873 above referred to.

We "can hardly adopt the reasoning of appellants’ counsel that the policy is not within the provisions of these statutes, in view of the language used in the policy referring to the statute, and of the decisions of the courts, hereinafter referred to. The policy was one under section 2 of the act of 1870, as amended in 1873 “in favor of a married woman * * * and her children.”

It is said this policy was not one procured by the wife, but by the husband; that he caused it to be issued; kept it in his possession and paid all the premiums thereon until the death of his wife, and, therefore, the policy is not within the provision of the statute. But it was held in Whitehead v. N. Y. Life Ins. Co. (102 N. Y. 143) that “ where a husband procures a policy of insurance upon his life for the benefit of his wife, or in case of her death before his, of their children, in procuring.it and in doing whatever is necessary tp perfect and' continue the rights of the assured, he acts simply as their agent, and by force of the statute authorizing such insurance (Chap. 80, Laws of 1840), they acquire a vested interest in the policy at the' moment of its delivery to the insured; and this-although no knowledge of the existence of the policy comes to them until after,his death; their claim to the fruits of the insurance is a ratification of the act by which it was obtained. The assured, therefore, acquire and hold their ownership irrespective of the question whether the policy has been actually delivered to them.” The same doctrine was held in Dayton v. Olaflin Co. (19 App. Div. 120,124) arid Shipman y. Protected Home Gvrcle (174 N. Y. 398). -

It does not seem to-be essential that the policy shall use the precise. words of the statute, in order to' be regarded as within its provisions. If it is issued upon the life of the husband for. the benefit of the wife or wife and children it is covered by the. statute.

In Brummer v. Oohn (86 N. Y. 11) it was said by the court: The act does not require that it should appear by the policy that it was. issued under the act,, in order that the insured .should have the benefit of its provisions. There are -no restrictive terms. The act is remedial, and was passed for the benefit of married women and their children, and the intention of a' married woman ¿ in insuring the life of .her husband to avail herself of its provisions, is inferable from its beneficial nature.” . • - ■

In Whitehead v. N. Y.. Life Ins. Co. (supra) the policies were payable to the wife, or in case -of her death before the husband, then to their children, and they were held to be within the statute.

In Walsh v. M. L. Ins. Co. (133 N. Y. 408) the policy was payable to the wife, if living, if not living, to her children, and' it was held to be within the statute. . ....

■ In Haney v. Van Cott (71 Hun, 394; affd. on opinion below, sub nom. Haney v. Wright, 149 N. Y. 579) the policy was payable to the wife, or if she should not be living, then to her children ; and it was held ■ to be within the statute. In that case the wife died before the husband leaving ho children. She left a will wherein her husband was one of • the executors. The will contained no specific disposition of the policy, but there was a residuary -clause. The husband, as executor of his wife, sold the policy to a purchaser, who -thereafter paid the premiums. After the death of the husband the money was claimed by his personal representatives and also by the residuary legatee under his wife’s will and by the purchaser of the policy. It was held that the policy passed under the residuary clause in the wife’s will, and the purchaser from her executor, the husband, got good title to it, and was entitled to the moneys payable thereon.

This policy being within the provisions of the statute at the death of the wife, without children, it passed under the residuary clause in her will, and her personal representatives are entitled to the moneys payable thereon.

We think no estoppel was established against the defendant’s interposing its defense. If the agreement between the husband and the defendant was invalid, it was so as a matter.of law, and the husband, as well as the defendant, was bound to know the law. There was no .mistake or misrepresentation of the facts. ■ They were all kno wn to the husband as well as to the defendant. The plaintiffs •procured a judgment for all moneys paid by the deceased to the defendant as premiums, pursuant to the agreement, with interest, which .was as favorable a result as they were entitled to.

Without discussing the other objections to this defense made by the defendant, we think no error was committed in respect to this branch of the case.

Ho other questions raised on the appeal need be discussed.

All concurred, except McLennan, P. J., who dissented in an opinion in which Nash, J., concurred.

McLennan, P. J. (dissenting);

'The policy in question was issued to, purchased, owned and paid for by the husband. He had a perfect right to cause it to be made payable to such person or class of persons as he saw fit, or to his estate. There is no statute which in any manner restricted his discretion in that regard. If the policy had in terms been made payable to the wife of the insured if living at the time of his death, and if not, then to his estate, it would hardly be claimed that, under any provision of the statute referred to in the prevailing opinion, the insurance would belong to the estate of the wife in case she died before the insured. We think the provision in this policy is exactly to the same effect. Its language is: In consideration, etc., the insurer promises to pay at its Home Office in the City of Hew ■ York, unto Corrió J. Bradshaw, wife of Robert C. Bradshaw, of . Jamestown, in the County of Chautauqua, State Of New York, for her sole use, if living, in conformity with the statute, and if not living, to their children, or their guardian for their use, One Thousand Dollars, (any indebtedness to the Company on account of this contract to be first deducted therefrom), in sixty days after satisfactory proof at its said office of the death of said Robert C. Bradshaw, during the continuance of this policy.” There were no - “.children,” and, therefore, it is proposed to construe the policy as if the words '“ if living, * * * and if not living, to their children,' or their guardian for their use,” had not been used, and had contained the words “ ail'd if dead to her executors or administrators.” We think no case can be found which is authority for such a constrnotion. The decision in the case’ of Whitehead v. N. Y. Life Ins. Co. (102 N. Y. 143) and what was said in the Opinion of the. court had reference to a contract of insurance máde with the wife and not by the husband as in the case at bar. In that case it was held that it Was’ competent for a wife to insure the life of her husband for her sole benefit or for the benefit of herself and children, and that just that Was done in that case and, therefore, that the estate of the husband had no interest in the fund. The terms of ■the contract, the situation of the parties and the conclusion reached by the court are most admirably and tersely stated by Judge Finch. He said : All three of the life insurance policies sought to be revived and enforced in this action purport on their face to be contracts "with the wife as the party assured, and not at all with the husband, who’stands in the policies as simply the life insured, his conduct and death furnishing the contingencies upon which the liabilities of the insurer are made to depend. As the relation was tersely described on- the argument, the contract is about the husband but not with him. He,. therefore, in procuring the policies to be made, in paying the premiums, in receiving and acting upon notices, and in doing whatever was necessary to perfect and continue the’ rights of the assured, must stand iii the attitude of an agent,, acting for and representing the assured (Baker v. Union Mut. I. Ins. Co., 43 N. Y. 283) and as having ho-interést in thé policies, unless, possibly, áfter the death of all of the assured. And it makes no difference that they' have been kept in total ignorance of the existence of the- policies for their benefit until after the death of the insured, for their claim to the fruits of the insurance must necessarily be a ratification of the acts by which it was obtained: The wife, therefore, in this case had a vested interest in the policies at the moment of their delivery to the insured by force of the statute which permitted them to be made in their existing form. (Laws of 1840, chap. 80.) Prior to that enactment and at common law it was open to question whether the wife and children had an insurable interest in the life of the husband and father (Bliss on Life Ins. § 10; Ruse v. Mut. Ben. L. Ins. Co., 23 N. Y. 516), and whether lie could protect them save by taking out policies in his own name, and for the benefit of his estate which in the end would go to them.. But this made the insurance liable for his debts, and left it impossible for those who needed assistance most to obtain it at all. (Ruppert v. Union Mut. Ins. Co., 7 Robt. 155, 156.) The statute was intended to and does remedy the difficulty. " It expressly authorizes the wife and children to insure the life of the husband and father, and hold the provision without liability for his debts, and the policies here purport to have made exactly that contract. They created a vested interest in the wife, and one also in the children, by force of the clause providing 'for payment to them if the wife should die before the maturity of the policy. * * * So that the wife held the insurance for her own benefit if she survived her husband, and the children if she died befor'e him. These persons were the assured, with whom through the husband as agent the contract was made, and they acquired and held their ownership irrespective of the question whether the policies had been actually delivered to them. * * * ' These policies, therefore, at the moment of their execution, vested in the wife and children as the assured under the provisions of the statute. Their interest was in the whole contract and not merely from year to year, and so far only as it was executed.” •

The language quoted in the prevailing opinion was not employed by Judge Finch in that case, and we think does not fully express the holding of the court. .

In the Whitehead case it is clearly pointed out that the contract of insurance was the wife’s contract; was made by her; that whatever the husband did in-the premises was as her agent; that it was made solely for her benefit or of her children, if any, and, therefore, of course, it was held that the estate of the husband took no interest in the proceeds. In that case it Was recited in one of the policies, the three being practically alike except as to the amount óf the premium and the amount of insurance, as follows:

“ Witnesseth, that the Hew York Life Insurance Company, in, consideration of the sum of one hundred and sixty-five dollars and fifty cents, to them in hand paid by Mrs. Mary A. Davis, wife of George Davis, and of the annual premium of one . hundred -and .sixty-five dollars and fifty cents, to be paid on the seventh day' of June in every year during continuance of this policy, do assure the life of George Davis, * *• *, for the sole use of the said Mrs. Mary A.: Davis, in the amount of five thousand dollars for the .term .of his natural-life, commencing on the .seventh of June, 1851, at noon. And the said company do hereby promise and agree to and With the said assured,. her executors, .administrators and assigns, well-and-truly to pay' -or cause- to be paid the said sum insured to ■ the -said Mrs. Mary A. Davis, or her legal representatives, within sixty days after due notice and proof ..of the • death of the said George Davis;. And in case, of the death of the said Mrs. Mary A.. Davis before the decease Of the said George Davis, the amount' of the said insurance shall be payable after her death to her children, for their use, or to their guardian if under age.” In the' case at bar the contract was''the husband’s,, was made'by him to provide for the wife in -case she survived him, and. if not, then for their children, if any, and- if' not, then for the benefit- of his estate. The contract contains no language indicative- of an intention to benefit his wife’s estate to the extent of the proceeds of Ms life insurance. .

We cannot discover that the decision in Dayton v. Caflin Co. (19 App. Div. 120), cited in the prexxailing opinion, has any bearing upon the question here involved. There the insurance company issued two policies upon the life of one Dayton, plaintiff’s husband, each for $5,000, one payable directly to the wife and the- other' to the husband himself, but. by him assigned to. his wife. The defendant claimed that it was entitled to the whole of the insurance because the moneys with which the premiums Were paid were -stolen from it by the insured. It was held in substance that if all the moneys so used in payment of premiums had been stolen from the defendant it would be entitled to the whole of the insurance, but that if the wife paid any part 'of the premiums, or if the husband made such payments with moneys not so stolen, the wife would be entitled to receive such proportion of the entire fund as the amount of premiums paid by her bore to the entire amount of premiums paid.

Brummer v. (John (86 N. Y. 11) was a case in which the policy was made payable at a certain date, but provided : “ Or should he (the insured) die previous thereto, in sixty days after due notice and proof of his death, to her (his wife, the plain tiff) or her executors, administrators or assigns.” The court held that under such a policy the wife was entitled to the benefit of the provisions of the statute, although in that case the question now being considered was in no manner involved. If the policy in suit had been made payable to the wife, if living, and if not, then to her executors, administiators or assigns, appellants’, counsel practically concedes the proceeds of the insurance Would belong to the wife’s estate, there being no children.

■In Walsh v. M. L. Ins. Co. (133 N. Y. 408) the policy was issued upon the life of the husband for the sole use of the wife, the amount to be paid upon his death to her, if living, “ and if not living, to her children.” The wife died leaving children her surviving, and after-wards the insured died. It was held that the children alone were entitled to participation in the insurance fund. It was held, as stated in the head note, “ that upon the death of the mother all interest in the policy vested at once in her children then living.”

At the time of her death, in the case of Harvey v. Van Cott (71 Hun, 394; affd., sub nom. Harvey v. Wright, 149 N. Y. 579), Mrs. Mary Van Oott held a policy of insurance for $2,000 upon the life of her husband, Edward B. Van Oott, payable “to her or her legal representatives upon his death, or, if she should not be then living, payable to her children or their guardian if under age.” It was held that the insurance money under that policy belonged to the wife and passed under her will. It is difficult to see how any other decision could have been reached, because by the express terms of the policy it was made payable to her if living, and if not, to her legal representatives, tinder no circumstances could: the estate of the husband have any interest in it unless the wife failed to make disposition of it in her lifetime. That decision is not in conflict with .the contention of the appellants in the case- at bar. Here- the insurance was payable to her only in case she survivéd her husband.

We- think the provisions' of the ’ statutes to which attention is called in the prevailing opinión have no reference,to a policy issued as:;was the..one in question:,'""hut that those provisions relate to insurance .effected by the wife or children upon the life of the bus-, bund or father. It was provided that such a. contract made by the wife should be legal; that, in Case- she survived the period or term of the insurance, any sum obtained under it should be her property, freg. from any claims of the representatives of the husband or of his: creditors or of any person or persons claiming by, through or Under him, provided that the yearly premium in excess of $500 paid put of the property or funds of the husband, with the interest thereon, should inure to the benefit of tlie creditors of the: husband.’ (Laws of 1840, chap. 80, § 1, as amd, by Laws of 1858, chap. 187, § 1, as amd. by Laws of 1870, chap. 277.) It was then provided that a married woman in case she have no -child or children born of her body or any issue of any such child or children-, -may dispose of such insurance as she may see fit, by will,, assignment or otherwise (Laws, of 1870, chap. 277, § 2, as amd. by Laws of 1873, chap. 821. See, also, Laws of 1879, chap. 248); and by section 2 of the act of 1840 or- 1858 (as amd. by Laws of 1866, chap. .656) she is authorized, to make 'provision for its disposition in the policy itself. 1 can find no language in the “act” which indicates ati intention to prevent, a person from insuring his life for the benefit of - his wife, if living at, -the time of his death, and if not then for the benefit of his estate. We think the ^policy in -question is of that character and aptly expresses just that intention on the part of the insured. In other words, that he intended to provide for his wife if she survived him, but if . she did not and no child or children were left surviving, -or their issue, he did not intend such insurance should become a part of the estate of his deceased wife rather, than of his own. ‘ ' -

■In view of the conclusion above indicated it is tinrieeessai’y to discuss the question as to whether pr not the agreement made with the defendant subsequent to the death of the wife was binding or effectual as an estoppel against it.

■ The judgment should be reversed and a new trial granted, with costs to appellants to abide event, upon questions of law only, the facts having been examined and no error found therein.

Nash, J., concurred.

Judgment affirmed, with costs.  