Harris v. Metropolitan Life Insurance Co. , 330 Mich. 24 ( 1951 )

330 Mich. 24 (1951) 46 N.W.2d 448

HARRIS
v.
METROPOLITAN LIFE INSURANCE COMPANY.

Docket No. 20, Calendar No. 44,855.

Supreme Court of Michigan.

Decided March 1, 1951.

William C. O'Keefe and Gerald B. Rosseau, for plaintiff and defendant Stine.

James M. Davis, for defendant Ostrander.

DETHMERS, J.

This is a suit to determine who is entitled to the proceeds of a life insurance policy. Henry Marx became insured for $2,000 under a group life insurance policy issued by defendant insurance company to his employer, General Motors Corporation, by virtue of a certificate of participation issued to him, which named as beneficiary defendant Ostrander's decedent, Claude Ostrander. Two weeks prior to his death, Marx executed a change of beneficiary, naming as beneficiaries the plaintiff, Harris, and cross-plaintiff Stine, as director of the Saginaw county social welfare board, and directing that out of the proceeds of the policy an amount equal to that expended by the social welfare board for his care be paid to cross-plaintiff and the balance to plaintiff. Marx gave the change of beneficiary to an assistant prosecuting attorney who represented the social welfare board. The latter, during Marx's lifetime, caused the change of beneficiary and a copy thereof to be delivered to defendant insurance company and to General Motors Corporation, respectively, not accompanied by the certificate, however, but with the request that the employer enter the change of beneficiary upon its records accordingly. That request was under investigation by defendant insurance company at the time of Marx's death. The change has not been indorsed by the employer upon the certificate.

From decree upholding the change of beneficiary and directing payment in accord therewith to plaintiff and cross-plaintiff, defendant Ostrander appeals. Defendant insurance company, having paid the proceeds of the policy into court and obtained an order of discharge from further liability, is not concerned with the outcome.

The insurance policy reads, in part, as follows:

"Section 9. Change of beneficiary. * * * Any employee insured hereunder may from time to time, change the beneficiary by filing written notice thereof with the employer, accompanied by the certificate of such employee. Such change shall take effect upon indorsement thereof by the employer on such certificate, and unless the certificate is so indorsed, the change shall not take effect. After such indorsement, the change will relate back and take effect as of the date the employee signed said written notice of change, whether or not the employee be living at the time of such indorsement or not, but without prejudice to the company on account of any payments made by it before receipt of such written notice."

Defendant Ostrander relies on the quoted provision that the change of beneficiary shall take effect upon indorsement thereof by the employer on the certificate and shall not take effect unless so indorsed. It is significant to note, however, that the quoted provisions permit such indorsement after the assured's death, the change, thereupon, to relate back to the date of its execution by the assured. This disposes of defendant's argument that the change, to be effective, must be indorsed by the employer on the certificate and its records before assured's death.

Defendant Ostrander cites Aetna Life Insurance Co. v. Mallory, 291 Mich. 701; Dogariu v. Dogariu, 306 Mich. 392; Aetna Life Insurance Co. v. Owens, 318 Mich. 129; and Ancient Order of Gleaners v. Bury, 165 Mich. 1 (34 LRA NS 277), as authority for the proposition that an attempt at change of beneficiary by a method other or contrary to that expressly provided for in the policy is ineffective. In the instant case, however, the assured, sick in bed and near death, did all in his power to effect the change in the manner prescribed in the policy. He executed a proper instrument and it was delivered, during his lifetime, to his employer and the insurance company for indorsement. Lacking only was the certificate which he did not have because it was in the possession of plaintiff, who refused to surrender it. What more could the assured have done to comply with the provisions of the policy? Nothing remained but the performance of a formality, a ministerial act, by the employer or insurance company. Here was substantial compliance. Under the circumstances of this case and the authority of Equitable Life Assurance Society of United States v. Hitchcock, 270 Mich. 72 (106 A.L.R. 591); Quist v. Western & Southern Life Insurance Co., 219 Mich. 406; Supreme Court, Independent Order of Foresters v. Frise, 183 Mich. 186, and Thompson v. Metropolitan Life Insurance Co., 318 Ill App 235 (47 NE2d 879), the change of beneficiary must be held to have been effectuated.

Decree affirmed, with costs to appellees.

REID, C.J., and BOYLES, NORTH, BUTZEL, CARR, BUSHNELL, and SHARPE, JJ., concurred.