Quinton v. Millican

1. A man has an unlimited insurable interest in his own life; and where there is no intent to enter into a wagering contract, and classes of beneficiaries are not restricted, he may lawfully take out a policy of insurance on his life and have the same made payable to whomsoever he pleases, regardless of whether the beneficiary so designated has an insurable interest in his life. In this case there is no contention that the certificate constituted a wagering contract, or that there was any applicable law or rule restricting classes of beneficiaries.

2. A regular life-insurance policy issued to a man upon his own life, and in favor of his paramour, may, if not otherwise invalid, be collected by her; and where she is designated by name, although the words "whose relationship to me is that of wife" are added, she rather than the lawful wife is entitled to the proceeds.

3. While an agreement between a man and a woman, whereby he agreed to have a certificate of insurance upon his life so changed as to designate her as beneficiary in consideration of her living or continuing to live with him as his wife, when as they both knew he was lawfully married to another woman, would as an executory agreement be void and unenforceable, yet when the change in beneficiary has been fully executed as agreed, and after death of the insured the proceeds of the policy have been paid into court and claims thereto are to be determined on interpleader, the fund should be awarded to such substituted beneficiary as against the administratrix of the insured.

4. The court did not err in directing the verdict in favor of the beneficiary designated in the policy as changed, or in overruling the motion of the administratrix for a new trial.

No. 14526. JUNE 11, 1943. On May 3, 1937, a certificate of group life insurance was issued on the life of James Wilson Quinton, payable to "Ellen Green, sister, as beneficiary." The policy provided that the insured reserved the right to change the beneficiary. On August 19, 1940, the insured directed a change in beneficiary, so as to make the policy payable to "Clara Quinton, whose relationship to me is that of wife," which change was made by the insurer and endorsed on the policy on September 26, 1940. "Clara Quinton," though designated in the policy as "wife," was not such as a matter of fact, but the insured at the time was married to another woman, Maude New Quinton, who after his death was appointed as his administratrix. The insurer, on February 2, 1941, filed a petition against the original beneficiary, the substituted beneficiary, and the wife of the insured as administratrix, admitting liability, alleging conflicting claims by these parties, payment of the fund into court, and praying that the defendants be required to interplead, and for general relief. The prayer for interpleader was granted, and the defendants filed answers, each claiming the fund. The answer of Ellen Green claimed the proceeds as original beneficiary, on the ground that the change of beneficiary was illegal and void because of "immoral condition." Mrs. Maude New Quinton asserted, that the consideration "for the change of beneficiary was an immoral one," in that it involved illicit cohabitation between the insured and Clara Quinton, the substituted beneficiary; that on numerous occasions the insured informed this defendant that he had made the insurance payable to her; that there were funeral bills, expenses of administration, and other debts that should be paid from the proceeds of the policy. "Clara Quinton" asserted, among other things, that she had been lawfully designated as beneficiary and as such was "the only person lawfully entitled to the proceeds of said insurance." On the trial, after introduction of evidence respectively in behalf of the beneficiary last designated, and Mrs. Maude New Quinton as administratrix, the court directed a verdict in favor of the former, and a decree was entered awarding to her the proceeds of the policy. The administratrix moved for a new trial on the general grounds, and on a ground assigning error on the direction of the verdict. The motion was overruled, and she excepted.

It was agreed by all parties that "Clara Quinton," described as substituted beneficiary, is the same person as Clara Millican. Clara Millican was called by Mrs. Maude New Quinton, administratrix, for cross-examination, and testified substantially: She first knew the insured in February, 1939, and they started having intercourse in November, 1940. After that Quinton introduced her as his wife, but not before that time. She knew he was not divorced from his wife. When Quinton died she did not notify his wife or make any effort to do so. When Quinton died, "I went to the office of the Trion Company [the insured's employer] along with Mrs. [Ellen] Green, and she identified me and introduced me as James Wilson Quinton's wife. I did not tell them any different, but went ahead and allowed them to believe I was his wife." She also testified in effect that she first knew of the insurance policy on October 14, 1940, when the insured brought it to her. "He did bring that policy to me when we started living together and had it changed over and made payable to me, and he said that was the reason he was going to do it, because we were living together, and was part of the consideration for me going to live with him that the insurance would be made payable to me, and in consideration of that I did start living with him. I went to the mill office after his death and represented myself as Mrs. James Wilson Quinton, in order to get what money was coming to him." On direct examination she testified: "When I went to living with Mr. Quinton on November 15, I reckon it was because we just loved each other. The insurance policy had nothing to do with it. I would have lived with him if I had known there was no such thing as an insurance policy."

W. B. Simmons, a witness for Mrs. Maude New Quinton, as administratrix, testified: "I am the paymaster of The Trion Company. I also look after the insurance the company carries on its employees. I remember some time in August of 1939, Mr. J. W. Quinton came to see me about changing the beneficiary in his policy. At that time he asked that the beneficiary be changed, and referred to that person as his wife; there could have been no misunderstanding at that time about the relationship and his instructions; he referred to Clara Millican as his wife. . . He was alone." Mrs. Maude New Quinton testified that she and the insured were married by the ordinary in Cedartown, Georgia, in November, 1929, and lived together until 1935, and "I did not get a divorce." "There was never any question raised about whether I was his lawful wife or not." 1. "A person has an unlimited insurable interest in his own life, and can, where there is no intent to enter into a wagering contract, lawfully take out a policy of insurance on his own life, and make the same payable to whomsoever he pleases, regardless of whether the latter has an insurable interest in the life of the insured." Clements v.Terrell, 167 Ga. 237 (145 S.E. 78, 60 A.L.R. 969); UnionFraternal League v. Walton, 109 Ga. 1 (34 S.E. 317, 46 L.R.A. 424, 77 Am. St. Rep. 350); Rylander v. Allen, 125 Ga. 206 (53 S.E. 1032, 6 L.R.A. (N.S.) 128, 5 Ann. Cas. 355). There is no contention in this case that the certificate of insurance constituted a wagering contract. The rule stated above does not apply to policies issued by fraternal and benefit societies, where the classes of beneficiaries are restricted; but there was no such restriction in this case. Code, §§ 56-1608, 56-1703; Union Fraternal League v. Walton, 112 Ga. 315 (37 S.E. 389); District Grand Lodge v. Cothran, 156 Ga. 631 (119 S.E. 594, 31 L.R.A. 759), s. c. 31 Ga. App. 122 (120 S.E. 22); District Grand Lodge v. Gardner, 27 Ga. App. 145 (107 S.E. 774); Jones v. Sovereign Camp, 35 F.2d 345.

2. A regular life-insurance policy issued to a man on his own life, and in favor of his paramour, may, if not otherwise invalid, be collected by her; and where she is designated by name, although the words "whose relationship to me is that of wife" are added, she rather than his lawful wife is entitled to the proceeds. Code, § 56-903; Clements v. Terrell, supra;Equitable Life Assurance Society v. Paterson, 41 Ga. 338 (2) (5 Am. R. 535); Grand Lodge Knights of Pythias v.Barnard, 9 Ga. App. 71, 79 (70 S.E. 678); 2 Couch on Insurance, 1090, § 371; 29 Am. Jur. 965, § 1292; Yett v. Yett,261 Ky. 737 (88 S.W.2d 962); Mutual Benefit Life Insurance Co.v. Cummings, 66 Or. 272 (126 P. 982, 133 P. 1169, 47 L.R.A. (N.S.) 252, Ann. Cas. 1915B, 535); Walker v. General American Life Insurance Co. (Mo.), (141 S.W.2d 785). In each of the following cases, where the beneficiary appeared to occupy the relation of paramour, and recovery was denied, the policy was issued by a fraternal or benefit association, and the rulings were based on restrictions contained in the policy or rules of the associations: Di Messiah v. Gern, 10 Misc. 30 (30 N.Y. Supp. 824); Carter v. Employee's Benefit Association, 212 Ill. App. 213; Bolton v. Bolton, 73 Me. 299; Grand Lodge Order of Hermann-Soehne v. Elsner, 26 Mo. App. 108; Keener v. Grand Lodge A. O. U. W., 38 Mo. App. 543; Grand Lodge A. O. U. W. v. Hanses, 81 Mo. App. 545. In Jones v. Sovereign Camp W. O. W., 35 F.2d 345, the insurer was a fraternal organization. The insured, a married man, designated a woman who was not his wife, describing her as "cousin," though she was in fact not related to him. The fund was awarded to the insured's wife, it being held that the beneficiary named was not within the class permitted by the law of Georgia to receive benefits under such a policy.

3. In the instant case the insurance company paid the fund into court on interpleader, and presented no contention as to its liability or as to the validity or invalidity of any claim. The policy was originally made payable to Ellen Green, but the right to change the beneficiary was reserved by the insured, and at his direction the policy was so changed by the company as to substitute the name of "Clara Quinton" as beneficiary, she being the same person as Clara Millican. While Ellen Green filed an answer claiming the fund, she introduced no evidence, did not move for a new trial, and has not excepted. Therefore the case must be determined here as one solely between Clara Millican as designated beneficiary, and Mrs. Maude New Quinton as administratrix of the insured. It is contended by the administratrix that the designation of "Clara Quinton" as beneficiary was result of an illegal agreement between her and the insured, whereby they would live together as man and wife, and that in view of such illegal and immoral consideration, the designation is void and unenforceable. While the evidence would have authorized a finding that the agreement to change the beneficiary was based upon such consideration, and therefore, if the change had not already been made and "Clara Quinton" were seeking to have it made, she would have no standing for that purpose, yet the change in beneficiary was actually made as directed by the insured; and thus, regardless of any illegal agreement with which it was tainted, the principle invoked by the plaintiff in error has no application.

A contract to do an immoral or illegal thing is void. Code, § 20-501. If such contract is executory, neither party can enforce it. Howell v. Fountain, 3 Ga. 176 (46 Am. D. 415);Heineman v. Newman, 55 Ga. 262 (21 Am. R. 279); Rhodes v.Neal, 64 Ga. 704 (37 Am. R. 93). But if the contract is executed, it will be allowed to stand. Parrott v. Baker,82 Ga. 364 (4) (9 S.E. 1068); Garrison v. Burns, 98 Ga. 762 (26 S.E. 471); Beard v. White, 120 Ga. 1018 (4) (48 S.E. 400); Arteaga v. Arteaga, 169 Ga. 595 (151 S.E. 5). Since the insured was equally in the wrong in so far as any illegal agreement with the substituted beneficiary is concerned, he himself during his lifetime would not have been heard to attack it after it had been executed; and since his administratrix stands in his shoes, it necessarily follows that she will not be permitted to do so. Therefore the policy must be allowed to stand in its present form, and to have effect accordingly, in so far as the claims of these two parties are concerned. Crosby v.DeGraffenreid, 19 Ga. 290; Bush v. Rogan, 65 Ga. 320 (38 Am. R. 785); Edwards v. Kilpatrick, 70 Ga. 328;Fouche v. Brower, 74 Ga. 251 (4-b); Moore v. Cline,115 Ga. 405, 408 (41 S.E. 614); Watkins v. Nugen, 118 Ga. 372 (2), 375 (45 S.E. 260, 262);Perry v. Reynolds, 137 Ga. 427 (2) (73 S.E. 656);Boswell v. Boswell, 147 Ga. 734 (2) (95 S.E. 347);Arteaga v. Arteaga, supra. As to this feature of the case, it is distinguished by its facts from Watkins v. Nugen, supra, where the party attacking the deed was not a party to it, but asserted independent title and sought to have the deed canceled as a cloud thereon. Again, in Postelle v. Rivers, 112 Ga. 850 (38 S.E. 109), the action was based upon an executory contract; and it was held that the plaintiff could not recover, since it appeared that the contract was based upon an illegal and immoral consideration. In the instant case, even if the designation of the defendant in error as beneficiary was not an executed transaction before the insured's death, it certainly became such upon the instant of death, after which no further change in beneficiary could be made. Moreover, it appears that the policy here was never at any time payable to the estate of the insured or to his wife, Mrs. Maude New Quinton; and we are unable to see how she could in any capacity attack the claim of the substituted beneficiary on the ground that the change in beneficiary was made in pursuance of an illegal agreement between the insured and the latter claimant.

4. The court did not err in directing the verdict in favor of Clara Millican as substituted beneficiary, or in overruling the motion for a new trial filed by the administratrix.

Judgment affirmed. All the Justices concur.