Tateum v. Ross , 150 Mass. 440 ( 1890 )

KsrowLTOR, J.

The rights of the parties in this case depend upon the meaning of the contract, a copy of which is annexed to the plaintiff’s bill. The defendant contends that, under the contract, his right to the policy was absolute, and that he was entitled to all the proceeds of it, unless Thomas E. Tateum in his lifetime availed himself of lus right to have it upon payment of the debt due the defendant, together with the premiums and the expenses of obtaining and continuing the insurance. The plaintiff, on the other hand, contends that the contract shows the existence of a debt, payment of which the policy was given to secure, and that the right of the defendant was simply to hold the policy or the proceeds of it as collateral security.

A careful examination of the contract sustains the contention of the plaintiff. If the theory of the defendant were correct, that his title was absolute, subject to the contingency that Tateum might pay the debt and have an assignment of the policy at any time during his life, on Tateum’s failure to pay in his lifetime the defendant’s title would become perfect, and he would retain the five thousand dollars, while the debt would remain unpaid and Tateum’s estate would be liable to pay it. Such a result cannot be presumed to have been contemplated by the parties; and a construction of the contract which would lead to it should not be adopted unless the language requires it. The whole tenor of the writing is inconsistent with this view. The defendant is said to have effected the insurance “ for the purpose of securing the payment of his said debt,” and the five thousand dollars “is made payable to the said Ross . . . for the purpose of securing the payment of said Ross’s debt as aforesaid, also so to secure the payment of all death assessments which may be paid by said Ross,” etc. On payment of his debt and expenses, the defendant agrees to assign “to said Tateum or his legal representatives,” using language applicable in case of a redemption of the insurance after Tate urn’s death; and he recognizes the existence of an interest in the insurance belonging to Tateum, separate from his own, when he uses the words “ all his [Tateum’s] interest in said insurance which I have, together with all my right, title, and interest in and to said insurance policy on the life of said Tateum.”

There is no doubt that the defendant’s agreement was upon a sufficient consideration; for the writing expressly recites that his undertaking was in consideration of the facts previously stated, and the policy, which is made a part of the case, shows that Tateum assisted in procuring it, answered interrogatories propounded to him, and signed the application.

We are clearly of opinion that the plaintiff has a right to redeem the insurance under the contract.

The defendant contends that, at all events, the plaintiff is not entitled to relief in equity, and that her remedy, if she has any, is at law. But it appears that the defendant stood in a relation of trust to Tateum, with authority to pay out money from time to time on account of the insurance in which Tateum had an interest, and that Tateum had no means of knowing what payments were so made, except by an account which it was the duty of the defendant to render. Without the account which the defendant refused to give her, the plaintiff could not know for what sum to bring an action at law. The demurrer was rightly overruled, and the decree was well warranted by the facts proved.

Decree affirmed.