
    George Kirsop, Jr., Appellant, v. The Mutual Life Insurance Company of New York, Respondent. Mary J. Sweeney, Intervenor, Respondent.
    
      Interpleader—substitution of a party defendant — when a motion therefor should he denied.
    
    'The Mutual Life Insurance Company issued a policy on the life of William R. Sweeney, conditioned that if the said William R. Sweeney and Máry J. Sweeney, his wife, were living on March 14, 1903, the company would pay to Mary J: Sweeney the sum of §2,500. May 1, 1893, Sweeney and his wife executed to one Kirsop a written assignment of the policy absolute in form.
    Sweeney and his wife being alive on March 14, 1903, the date when the policy became due, Kirsop made a demand for the payment of the policy. The insurance company refused to comply with such demand, and on April 3,1903, Kirsop brought an action against the insurance company to recover the amount due under the policy.
    April 15, 1903, Mary. J. Sweeney notified the insurance company that the assignment to Kirsop was not absolute, but was intended as collateral security for the payment of an indebtedness, and that she claimed an equity in the policy to the extent of §400. The insurance company thereupon obtained an order permitting it to pay into court the money due upon the policy and to substitute Mary J. Sweeney as defendant in its place and stead. No attempt was made to show that the insurance company, at the time when the policy was payable ■or at the time when the action was commenced, had any knowledge or notice of the claim which was subsequently made by Mary J. Sweeney.
    
      Held, that the motion should not have been granted, as the insurance company could have paid the policy to Kirsop at the time he demanded payment without incurring any risk of financial loss, and as whatever hazard it would now incur by making payment to Kirsop was the result of its own act in unjustifiably withholding payment;
    That, in law, a defendant is justified in asking that a third party be interpleaded only when at the time of the commencement of the action there are diverse claimants, each demanding of the defendant, to the exclusion of the other, the same fund, and when it would be hazardous for the defendant to determine which one of the claimants is entitled to the fund, and the defendant’s position as stakeholder is brought about without his act or connivance.
    Appeal by the plaintiff, George Kirsop, Jr., from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 25th day of May, 1903, permitting the, defendant, The Mutual Life Insurance Company of New York, to substitute Mary J. Sweeney as defendant in the action in its place and stead, upon paying into court the amount due upon the policy in suit.
    On or about March 14, 1883, the Mutual Life Insurance Company, in consideration of certain premiums to be paid, issued its policy on the life of one William R. Sweeney, in which, among other things, it was agreed that if both he and Mary J. Sweeney, his wife, were living on March. 14, 1903, the company would then pay to Mary J. Sweeney the sum of $2,500. Both survived the , date named. Prior thereto and on May 1, 1893, the wife had executed a written assignment absolute in form transferring to the plaintiff herein for value all her' right, title and interest to the moneys which might thereafter-become due under the policy, which assignment was assented to in writing by her husband. William R. Sweeney also, by a writiri'g executed on the same day,, assigned all his right, title and interest in and to the policy to the plaintiff, and to this assignment his wife assented, and these assignments and consents were filed in the office of the ..defendant and thereafter the premiums were paid by the plaintiff until the due date of the policy which, as stated, was March 14,1903. The husband and wife being then alive and the money under the policy then due, the plaintiff made a demand on the company for payment, which was refused, and thereafter he commenced this action and served the complaint on the company April 3, 1903.
    On April 15, 1903, the company received a notice from Mary J. Sweeney, the wife, claiming that the assignment of the policy was made to the plaintiff under an agreement that the policy was to he collateral security for the payment of an indebtedness which her husband owed to the plaintiff and for money loaned to him at the time of the execution of the assignment and all sums of • money which-the plaintiff should thereafter pay as premiums on the policy, and, as near as she could estimate, she had ah equity left in the policy to the amount of about $400.
    On receipt of this notice from Mrs. Sweeney the company made a motion for the substitution of the Sweeneys as defendants in its place and stead, and this motion coming on to be heard was granted to the extent of substituting Mary J. Sweeney as party defendant and directing that on payment of the money due on the policy into court the company should be discharged. From this order the plaintiff appeals.
    
      Benjamin E. De Groot, for the appellant.
    
      Julien T. Davies, for the respondent.
    
      Thomas J. Mooney, for the intervenor, respondent.
   O’Brien, J. :

Substantially all the material statements in the affidavit of Mrs. Sweeney used upon the motion are upon information and belief, and the source of her information is said to be another affidavit which was filed by her husband with the defendant company, but which is not produced. We have nothing, therefore, in the record beyond the statements of Mary J. Sweeney on information and belief that the assignment to the plaintiff was by way of pledge as against the plaintiff’s positive statement to the contrary and a letter* showing the cash surrender value of the policy at the time when the. assignment was made, written to Mr. Sweeney by the company, which letter to some extent supports the plaintiff’s contention that the assignment was absolute in fact as it concededly is in form.

Apart, however, from this infirmity in the respondent’s papérs used upon the motion, a feature is here presented which we think should have resulted in a denial of the motion. We have called attention to the date of maturity, showing that on March 14, 1903, when the' policy became due and a demand for its payment was made by the plaintiff, the company without any risk or hazard could have paid over the amount thereof to the plaintiff. Instead, however, of complying with the obligation which was implied of making the payment promptly it delayed until, 'on April 15, 190.3, the Sweeneys intervened and filed the notice to which reference has been made;

Upon these facts we think the appellant’s contention is sound that in law a defendant is justified in asking that a third party be interpleaded only when at the. time of the . commencement of the action there are diverse claimants, each demanding of him, to the exclusion of the other, the same fund; and that it would be a hazard for him to determine which one of the claimants is entitled to the fund, and the then situation of the stakeholder and the condition is brought about without defendant’s act or connivance. Upon the motion no attempt was made to show that the company, at the time when the policy was payable or at the time when the action was commenced, had any knowledge or notice of the claim which was subsequently made by the Sweeneys. At neither time was the company in a position to bring an action of interpleader and vouch in the plaintiff and the Sweeneys as parties defendants, because at such times there was but one person, namely, the plaintiff, legally entitled to the moneys under the policy. Or, to express it differently, the company would have incurred no legal hazard or liability to the Sweeneys had it paid the plaintiff prior to April 15, 1903; and whatever hazard there was thereafter resulted from the company’s own act in withholding, without justification, payment from plaintiff.

We think it would be permitting the company to profit by its own neglect and wrong to accord the relief which has been granted and to substitute as a defendant one who, it is asserted (and nothing to the contrary appears), is an irresponsible, person, unable to pay the costs of the action if the plaintiff were finally successful. We think the order must be reversed, with ten dollars costs and disbursements, and the motion denied, with ten dollars costs.

Van Brunt, P. J., Patterson, Hatch and Laughlin, JJ., concurred.

Order reversed, with ten dollars costs and disbursements, and .motion denied, with ten dollars costs.  