Lilley v. Mutual Benefit Life Insurance ( 1892 )

Morse, O. J.

At his death Fred A. Holcomb had a life insurance policy in the defendant company for $10,000,which had been assigned to the defendant Walter H. McBrien absolutely in form. Tbe administrator of his estate filed the bill of complaint in this case, claiming that this assignment, while absolute in its terms, was really assigned as collateral security for moneys advanced by McBrien to Holcomb, and that the estate of Holcomb was entitled to a reassignment of it, upon payment to McBrien of the amount of his indebtedness. McBrien filed proofs of death, and claims that he is entitled to the full amount of the policy. The defendant insurance company, in its answer, expressed its willingness to pay the money to the person shown to be entitled to it; and, upon petition to the court below, was permitted to pay into court the amount due upon the policy, $9,870.32, without interest, and the bill was dismissed, without costs, as against such company.

Before the filing of the bill McBrien" was summoned by the administrator into the probate court and examined orally, against the objections of his counsel, as to money and effects in his hands belonging to Fred A. Holcomb, deceased. At the close of such examination, the administrator tendered McBrien, and on the 1st day of July, 1890, the sum of $1,123.44 as the full amount of his advances, with interest, to Holcomb up to that date, and demanded the delivery and reassignment of the policy of insurance, which McBrien refused to make.

The circuit judge found that the assignment of this policy to McBrien, although absolute in form,—

“Was made by way of mortgage or security only to secure the said McBrien for certain sums of money which the said Walter H. McBrien had theretofore advanced to the said Holcomb, as well as the premium money which the. said McBrien should thereafter pay upon the said policy of insurance.”

He also found that the amount so advanced, with interest up to July 1, 1890, was $1,123.44, the same sum tendered by the complainant, as administrator, to said McBrien. It was therefore decreed that complainant pay to said McBrien, out of the moneys deposited in court by the defendant insurance company, the sum of #1,123.44, less the costs of the suit to be taxed, and that thereupon such complainant should be entitled to receive the balance of the money so deposited.

The defendant McBrien appeals to this Court.

It is claimed by the appellant that the court erred in permitting the insurance company to pay the amount of the policy into court, and to discharge such company from any further payment of interest. The court did not err in this respect. The insurance company plainly evidenced, by all its acts before suit, that it was willing to pay the whole sum due upon the policy to the proper person, when such person should be designated and determined by the court. It was proper and lawful to pursue the course here adopted, and to release such company from all further liability on the payment of the money due upon the policy into court. There would have been no equity in continuing this company as a party to a litigation in which it had no personal concern, or to have forced it to pay interest while the administrator and McBrien were fighting to see who should have the fund.

It is further contended that it was incompetent to admit in evidence in this case, as the declarations of McBrien, his testimony taken against his objection in the probate court. It is true that the testimony of McBrien was illegally taken in the probate court. The statute under which it was taken plainly provides that it shall be upon written interrogatories. There is no authority in law, by statute or otherwise, for an examination of McBrien orally in the probate court. Palmer v. Circuit Judge, 90 Mich. 1; How. Stat. § 5877. But it does not necessarily follow that the testimony given before the probate judge cannot be given in evidence for the purpose of showing the declarations of McBrien as to the subject-matter of this suit. Mr. McBrien appeared in the probate court by counsel, and it does not appear that he was taken by surprise or forced to testify to an untruth. He gave his evidence as would any other witness, and does not seem to have been either scared or misled into testifying to anything to his detriment] nor is there any reason to suppose that his evidence so taken was any different than it would have been had he testified at his own free will, and without questioning the authority or jurisdiction of the court to take the same. If we believed that any injustice had been done to Mr. McBrien in the examination before the probate court, or that his testimony had been unduly given a tint or color against his case by the fact that he was sworn against his objection, we should strike the testimony so taken from the case. It is evident to us, however, that there can be no cause for complaint in this respect. By introducing this testimony the complainant waived the provisions of the statute, and McBrien was thereafter a competent witness in his own behalf, touching matters equally within the knowledge of the deceased, at least as to the transactions inquired of in the probate court, and put in this case as declarations of McBrien. Smith’s Appeal, 52 Mich. 415. Mr. McBrien did so testify, under objection of complainants counsel, and we have in this case the full benefit of his knowledge and history of the dealings between him and Holcomb, while the mouth of Holcomb is closed by death.

There was error in pérmitting Mr. Cook and other witnesses to give in evidence the declarations of the deceased in his own favor, but, striking this out of the case, we are satisfied that the assignment, although absolute in form, was not so intended between the parties; and that the intention and understanding of both was that, when Mr. Holcomb became able to pay and wished to do so, he was to receive a reassignment of this policy, upon paying to McBrien the money owing to him for advances, with interest. This is apparent from McBrien’s own testimony, taken as a whole. Some interesting questions of law are ably presented to us by the counsel upon both sides, but in this view of the case they become unimportant.

There is some difficulty in arriving at the sum justly owing by Holcomb, at the time of his death, to McBrien» Mr. McBrien testified, both in the probate court and also in the present suit, that Holcomb was owing him about $6,000. Five thousand dollars of this sum McBrien claims is owing to him for the sale of a half interest in a patent right to Holcomb. Holcomb was an inventor, and the money first advanced to him by McBrien was to help him in the procurement of patents. McBrien advanced several hundred dollars to Holcomb, and received assignments of an undivided half interest in two^ patents. Holcomb also took out an insurance policy for $5,000, and assigned it to McBrien. This policy was permitted to lapse. In one of these patents, Dr. Parker, of Grand Eapids, held a half interest before it was assigned to Mr. McBrien. McBrien testifies that he let Holcomb have $250 to buy this interest of Parker in October, 1887, and that in April, 1889, he reassigned such half interest to Holcomb for a consideration of $5,000, which has never been paid to him; and such an assignment is brought into court, and was recorded in the patent office on April 11, 1889. At the same time McBrien swears that the agreement was that Holcomb should insure his life for $10,000, and assign the same absolutely to McBrien, and the present policy was taken out under such agreement, McBrien to pay the first premium, and all assessments, which he has done. MeBrien claims that he, by this assignment to Holcomb, conveyed all his interest in all the patents to Holcomb; but, by the assignment produced, it appears that only, his interest in one was conveyed by the language of the instrument. It is also shown by McBrien’s own testimony that, during the time he held these patents jointly with Holcomb, there was no sale or demand for them; and yet within less than two years, these patents having no value but a speculative one, he insists that he sold his interest to Holcomb for $5,000, the sum recited as the consideration in the assignment, and it is therefore contended that this sum should be added to the sum’ tendered by the administrator as the real interest of MeBrien in the policy, if the assignment of such policy is found not to be an absolute conveyance of the whole of the same. The evidence shows that these patents so far have been found to be of no financial value whatever, except between Holcomb, Parker, and MeBrien; and the testimony strongly tends to show that they are worthless, and always have been. MeBrien was allowed the $250 paid to Parker, and we are inclined to believe that the circuit judge, who heard the testimony and saw the witnesses, came to the right conclusion, and that the decree below is right, although the truth of this contention is not as clear as we would wish it, or as it probably would have been could Holcomb have spoken on the present trial.

The decree is affirmed, with costs of this Court to complainant. The insurance company will also be allowed costs against defendant for the printing of the brief of its counsel.

The other Justices concurred.