Summary
In Cannon v. Hamilton (1963), 174 Ohio St. 268 [22 O.O.2d 331], this court set forth several principles which are dispositive of this matter.
Summary of this case from Phillips v. PeltonOpinion
Nos. 37400 and 37454
Decided March 13, 1963.
Insurance — Life — Beneficiaries — Insured's wife named as beneficiary — Entitled to proceeds notwithstanding divorce, when — Change of beneficiary accomplished, how — Separation agreement may effect removal of wife as beneficiary.
1. A married woman who is named as a beneficiary in a policy of life insurance is entitled to the proceeds upon the death of her insured husband, notwithstanding a divorce obtained by her from the insured before his death. The designation of the beneficiary in the policy as the wife of the insured is merely descriptive. ( Overhiser, Admx., v. Overhiser, 63 Ohio St. 77, approved and followed.)
2. Ordinarily, a change of beneficiary in a policy of life insurance by the insured is accomplished by following the procedure directed in the policy.
3. A separation agreement entered into between the insured and his wife before divorce and made a part of the divorce decree may operate to remove the wife as beneficiary in the policy of life insurance, but to have that effect such agreement must plainly indicate the elimination of the wife as such beneficiary.
APPEALS from the Court of Appeals for Cuyahoga County.
The present action arose in the Court of Common Pleas of Cuyahoga County, when Katherine Cannon, administratrix of the estate of Edward Cannon, deceased, also known as Eddie Cannon, and his widow sought to secure for the estate the sum of $5,600, which amount is represented by $600 in death benefits payable under a certificate issued by the Employes Benefit Association of Swift Company, of which decedent was a member, and the amount of $5,000 under a group life insurance policy of Swift Company employees issued to decedent by the Aetna Life Insurance Company.
Joint answers and cross-petitions were filed by Bertha Cannon Fears and Mabel Cannon Flanagan, daughters of the decedent, and by the guardian ad litem of three minor grandchildren of the decedent, children of his deceased daughter, Dorothy Cannon Burks, claiming the $5,600. Addie Cannon Hamilton, divorced wife of the decedent, also filed an answer and cross-petition, claiming to be entitled to the $5,600 as the primary surviving beneficiary named in the certificate of the Employes Benefit Association and in the insurance policy.
The last beneficiaries as designated in the certificate and in the policy were: "Addie Cannon, my wife, if she survives me, otherwise to Bertha Fears, Mable Cannon, and Dorothy Cannon, my children, equally, or the survivor." There were no restrictions on the insured as to a change of beneficiaries.
Both the Employes Benefit Association and the Aetna Life Insurance Company interpleaded, paid the amount due from each into court and disappeared from the contest.
As shown by the record, the decedent-insured, Edward Cannon, who died in October 1958, was a long-time employee of Swift Company. He became a dues-paying member of the Employes Benefit Association of that company in 1924, and his then wife, Izola Cannon, was named in the certificate as the beneficiary first entitled to the death benefits payable thereunder. In March of 1946, he changed the beneficiaries in writing to those designated in the language above quoted.
In May 1946, the Aetna Life Insurance Company issued to Edward Cannon a group life insurance policy in the face amount of $4,000, increased to $5,000 the following year, designating the same beneficiaries in the same manner. Neither in the certificate nor in the insurance policy were those beneciaries changed nor was any application made to accomplish that result.
In June 1947, Addie Cannon, later Addie Cannon Hamilton, secured a divorce from Edward (Eddie) Cannon in the Court of Common Pleas of Cuyahoga County. Incorporated in the decree as a part thereof was a separation agreement dated April 1947, signed by "Addie Cannon" and "Eddie Cannon" and attested by two witnesses. Such agreement, omitting the formal parts, awarded to Addie Cannon certain household furnishings and personal effects, and a like clause was inserted awarding Eddie Cannon similar articles. That part of the agreement which might in any way affect the present litigation was as follows:
"4. * * * Policy of insurance on the life of Eddie Cannon, now in the possession of Addie Cannon, is to be delivered to Eddie Cannon.
"5. In full settlement of all claims of Addie Cannon, Eddie Cannon agrees to pay one hundred dollars ($100) to Addie Cannon for legal expenses incurred by her in Common Pleas case No. 574448, and said Addie Cannon agrees that she will not ask for any further sums whatsoever upon obtaining a divorce in said case."
At the trial, Addie Cannon Hamilton testified that at the time of her separation from Edward Cannon she did not take with her any policies of insurance.
Upon the pleadings, evidence and exhibits, the trial court rendered judgment for Mabel Cannon Flanagan and Bertha Cannon Fears under the wording of the beneficiary clauses of the certificate and of the life insurance policy and determined that, by the divorce decree and the provisions of the separation agreement incorporated therein, Addie Cannon Hamilton had been eliminated and removed as a beneficiary.
On an appeal on questions of law and fact to the Court of Appeals, that court reduced the appeal to an appeal on questions of law alone, reversed the judgment below and rendered final judgment for Addie Cannon Hamilton on authority of the cases of Hergenrather v. State of Mutual Life Assur. Co. of Worcester, 79 Ohio App. 116, 68 N.E.2d 833; Stone v. Stephens, 92 Ohio App. 53, 110 N.E.2d 18; and Overhiser, Admx., v. Overhiser, 63 Ohio St. 77, 57 N.E. 965, 81 Am. St. Rep., 612, 50 L.R.A., 552.
The cause is now in this court by reason of the allowance of separate motions to require the Court of Appeals to certify the record, by plaintiff, Katherine Cannon, executrix of the estate of Edward Cannon (case No. 37400), and by defendants Mabel Cannon Flanagan and Bertha Fears (case No. 37454).
Messrs. Krause, Klein Fromson, for appellants in case No. 37400.
Mr. Wyatt C. Brownlee, for Katherine Cannon, administratix, appellant in case No. 37454.
Mr. Joseph L. Newman, for appellee Addie Cannon Hamilton.
In 46 Corpus Juris Secundum, 45, Insurance, Section 1160, the rule of general acceptance is stated as follows:
"Under a policy naming and designating the wife of insured as beneficiary, the person holding that relation to insured at the time the policy is issued, and not the one who may become his wife by a subsequent marriage after the divorce of the former, is to be deemed the beneficiary under the policy. Except in a few jurisdictions, a subsequent divorce alone will not defeat the right of the person designated in the policy as wife to recover thereunder, such designation being regarded merely as descriptive * * *."
Such is the rule in Ohio as contained in the syllabus of Overhiser, Admx., v. Overhiser, supra ( 63 Ohio St. 77), which reads:
"When a married woman is named as a beneficiary in a policy of insurance on the life of her husband she is entitled to the proceeds of the policy, notwithstanding a divorce obtained by her before his death."
Another well established rule of law is that, "in an action involving the rights of the named beneficiary as against other persons to the proceeds of the policy, the burden is ordinarily on the latter to show that they, and not the named beneficiary, have a right to the proceeds." 46 Corpus Juris Secundum, 433, Insurance, Section 1319.
We concede that, where the terms of a separation agreement carried into a divorce decree plainly disclose an intent to remove the named beneficiary in a life insurance policy from all rights to the proceeds thereof, such agreement may operate to prevent the named beneficiary from claiming the proceeds upon the death of the insured, but the separation agreement herein did not contain language sufficiently strong or definite to accomplish that result, especially when considered in relation to the subsequent conduct of the insured in failing to change the beneficiary in accordance with the terms of the policy. See Mayberry v. Kathan, 232 F.2d 54, 98 U.S. App., D.C., 54; Pate, Exr., v. Citizens Southern National Bank, 203 Ga. 442, 47 S.E.2d 277; John Hancock Mutual Life Ins. Co. v. Dawson (Mo.App.), 278 S.W.2d 57. Compare Prudential Ins. Co. of America v. Irvine, 338 Mich. 18, 61 N.W.2d 14.
A "claim" has been defined as "a demand of some matter of right made by one person upon another, to do or to forebear to do some act or thing as a matter of duty." Prigg v. Commonwealth of Pennsylvania, 41 U.S. 539, 615, 10 L. Ed., 1060, 1089. The separation agreement herein, incorporated in the divorce decree, was no more than a division of chattels and a monetary settlement. It can hardly be extended to cancel Addie Cannon Hamilton's position as the beneficiary in the certificate and the insurance policy. She was not a claimant "as a matter of right" and the decedent-insured could have exercised his privilege of removing her as such beneficiary at any time before his death.
Ordinarily, a change of beneficiary is accomplished by following the method therefor prescribed in the policy. Here the insured apparently made no attempt to effect a change over an 11-year period, although he knew that it could be done as shown by the fact that he had done it in connection with the certificate issued by the Employes Benefit Association. Such factor distinguishes the instant case from that of Atkinson v. Metropolitan Life Ins. Co., 114 Ohio St. 109, 150 N.E. 748, where such an attempt was made. Compare Stone v. Stephens, 155 Ohio St. 595, 99 N.E.2d 766, 25 A.L.R. (2d), 992.
Section 2107.33, Revised Code, pertains to the revocation of a will, including an implied revocation by "subsequent changes in the circumstances of the testator." That section and cases decided thereunder (see Younker, Exr., v. Johnson, 160 Ohio St. 409, 116 N.E.2d 715) are not controlling in the present situation. The right of Addie Cannon Hamilton as the designated beneficiary did not depend on the continuing existence of a wife and husband relationship between her and the decedent-insured but rested rather upon principles of law pertaining to contracts.
The judgment of the Court of Appeals is affirmed.
Judgment affirmed.
TAFT, C.J., MATTHIAS, O'NEILL, GRIFFITH, HERBERT and GIBSON, JJ., concur.