Opinion
7 Div. 58.
May 22, 1934. Rehearing Denied June 27, 1934.
Appeal from Circuit Court, Calhoun County; R. B. Carr, Judge.
Action on a policy of life insurance by Nettie Allbright against the Metropolitan Life Insurance Company. From a judgment of non-suit, plaintiff appeals.
Affirmed.
Certiorari denied by Supreme Court in Allbright v. Metropolitan Life Ins. Co., 229 Ala. 378, 157 So. 488.
Chas. F. Douglass, of Anniston, for appellant.
Though there be a facility of payment clause, if the insurer elects to pay a particular person, and especially for a consideration, it loses the right to pay any other person. Metropolitan Life Ins. Co. v. Chappell, 151 Tenn. 299, 269 S.W. 21; La Raw v. Prudential, 56 App. D.C. 199, 12 F.(2d) 140, 49 A.L.R. 935; Wallace v. Prudential Ins. Co., 174 Mo. App. 110, 157 S.W. 1028; Richards on Ins., 553; Re O'Neill's Estate, 143 Misc. 69, 255 N.Y.S. 767; Re Dickman's Estate, 142 Misc. 207, 254 N.Y.S. 302; Grabowski v. Lotko, 135 Misc. 747, 239 N.Y.S. 582; Tarasowski v. Prudential Ins. Co., 113 Misc. 248, 184 N.Y.S. 264; Smith v. Metropolitan Life Ins. Co., 222 Pa. 226, 71 A. 11, 20 L.R.A. (N.S.) 930, 128 Am. St. Rep. 799; Penney v. Burns, 226 Ala. 275, 146 So. 611. Where a party is made beneficiary in a policy without provision for change of beneficiary, he has a vested interest. Richards on Ins. 553. Payment to one not entitled waives the right to insist on payment to personal representative, and gives right of action to a blood relation who has assisted the insured. Life Ins. Co. of Va. v. Newell, 223 Ala. 401, 137 So. 16. See Life C. Ins. Co. v. Eubanks, 19 Ala. App. 36, 94 So. 198. An insurer cannot contract against waiver and estoppel. Modern Woodmen v. Head, 209 Ala. 420, 96 So. 219; Reliance Life Ins. Co. v. Sneed, 217 Ala. 669, 117 So. 307; American Equitable Assur. Co. v. Powderly Coal Lumber Co., 225 Ala. 208, 142 So. 37.
Chas. D. Kline, of Anniston, and Cabaniss Johnston, of Birmingham, for appellee.
Only the executor or administrator of the insured can maintain an action under the policy which by its terms is payable to the executor or administrator unless the company at its option elects to make payment to some other person as provided in the policy. Life Ins. Co. v. Newell, 223 Ala. 401, 137 So. 16; Williard v. Prudential Ins. Co., 276 Pa. 427, 120 A. 461, 28 A.L.R. 1348; Lewis v. Metropolitan Life Ins. Co., 17 La. App. 143, 134 So. 699; Heubner v. Metropolitan Life Ins. Co., 146 Ill. App. 282; McCarthy v. Metropolitan Life Ins. Co., 162 Mass. 254, 38 N.E. 435; Walton v. Metropolitan Life Ins. Co., 207 Mo. App. 296, 232 S.W. 259; Marzulli v. Metropolitan Life Ins. Co., 79 N.J. Law, 271, 75 A. 473; Ferretti v. Prudential Ins. Co., 49 Misc. 489, 97 N.Y.S. 1007; Burns v. Western S. L. I. Co., 35 Ohio App. 261, 172 N.E. 418; Metropolitan Life Ins. Co. v. Chappell, 151 Tenn. 299, 269 S.W. 21. Where the policy gives to the insurance company the right to make payment to any relative by blood or marriage, or to any other person appearing to the company to be equitably entitled to the proceeds of the policy, payment by the company to such a person is a defense to a suit by the person who otherwise would have been entitled to the proceeds of the policy. Life Ins. Co. v. Newell, supra; L.R.A. 1916F, 461, note; Thomas v. Prudential, 158 Ind. 461, 63 N.E. 795.
The action is to recover the death benefit under a policy of life insurance. Pertinent provisions of the policy, are:
"Metropolitan Life Insurance Company * * * doth * * * agree * * * to pay * * * to the executor or administrator of the insured, unless payment be made under the provisions of the next succeeding paragraph."
"The company may make any payment * * * to the insured, husband or wife etc." (Italics ours.)
"This policy constitutes the entire agreement between the Company and the insured and the holder and owner hereof. Its terms cannot be changed, or its conditions varied, except by the express agreement of the Company evidenced by the signature of its President or Secretary."
"Under the provision of the policy authorizing payment at the Company's option, to other person, Ethel Albright, cousin, has been designated beneficiary to recover death benefit only."
Our views are that under the policy, shown without dispute to be the policy sued on, containing the provisions we have quoted, appellant cannot maintain the suit. Suit can only be maintained by "the executor or administrator of the insured," regardless of whose name properly belongs at the place where that of Ethel Albright appears.
This seems to be the clear implication, if not holding, of our Supreme Court, in the opinion in the case of Life Ins. Co. of Va. v. Newell, 223 Ala. 401, 137 So. 16, 17. In that opinion that court said:
"The cases most frequently considered involved policies payable to executors and administrators, or to a named beneficiary, with an added 'Facility of Payment' clause similar to that here (and there) involved. With practical unanimity such policies are construed as conferring no right of action other than upon the personal representative or named beneficiary.
"The 'Facility of Payment' clause is held to be for the benefit of the insurer in effecting speedy settlement, and, in the absence of some matter of estoppel, to be made available at the option of the insurer." Citing Willard v. Prudential Ins. Co., 276 Pa. 427, 120 A. 461, 28 A.L.R. 1348.
And in this Willard v. Prudential Ins. Co. Case, so cited, the holding, in pertinent part, is that: "The 'facility of payment' clause (similar to that here — quoted in part as the second paragraph of this opinion, we interpolate) gives the company the option to make payment to any relative by blood; just how this could give the plaintiff (a brother, there) a right of action it is a little difficult to understand as the policy in suit, which is the contract between the company and the insured, provides that the money due on it shall be paid to his executors or administrators. To sanction a recovery by plaintiff would, in effect, be to make a new contract between the parties; under the provisions of the policy his right of action cannot be sustained."
Similarly, here, in line with these authorities, the first of which is binding upon us (Code 1923, § 7318), we hold that plaintiff's (appellant's) "right of action cannot be sustained."
The only obligation to pay was to the "executor or administrator of the insured"; with an option to pay to the designated beneficiary, under the provisions of the "Facility of Payment" clause.
The judgment is affirmed.
Affirmed.