Court Opinion

ID: 9633908
Source: CourtListenerOpinion
Date Created: 2023-08-22 12:06:14.182065+00
Date Added: 2024-06-11T18:08:44.949421
License: Public Domain

Dolliver, J.
(dissenting) — In interpreting the phrase "insurable interest," which is not defined in RCW 41.40-.270, we must first look to the. context in which that phrase has been defined.
In its eagerness to rely upon a fixed rule, the majority has overlooked the purpose behind the rule. The rule requiring an insurable interest has no magic in itself. It exists for a specific reason — to assure that the beneficiary has an interest in protecting and prolonging the life of the insured. This purpose, stated inversely, is to prevent wagering: to disallow speculation ” 'upon the hazard of a life in which the beneficiary has no interest.'" Rakestraw v. Cincinnati, 69 Ohio App. 504, 510, 44 N.E.2d 278 (1942); 3 R. Anderson, Couch Cyclopedia of Insurance Law § 24:119 (2d ed. 1960). Extensive research has not disclosed any cases which assert a contrary rationale.
The majority suggests the insurable interest limitation may have been included to assure that dependents were cared for from the proceeds of the fund. However, this obviously is not the case since a person with a pecuniary interest in the insured's life, a business partner or creditor, could be named as a beneficiary. This notion is further vitiated by the circumstances pointed out by the majority where an unmarried or widowed member of the retirement system could name his estate as beneficiary and pass his *208accumulated contributions through his will to whomever he chooses.
A series of cases from other jurisdictions are cited by the majority which restrict the interpretation of "insurable interest" to relationships of blood or marriage or of a pecuniary nature. Without exception, these cases involve a situation in which the person procuring the policy is not the insured, but rather a third party taking out the policy for the benefit of himself or another person.
There may well be policy reasons for requiring a high, identifiable, or quantifiable standard when the insured is not the procurer or the beneficiary of the policy. The requirement of a relationship by blood or marriage or a pecuniary interest is compatible with this purpose. Our legislature has so found and has specified accordingly. RCW 48.18.030. Anyone, however, can be the beneficiary of an insurance policy in this state if the insured has procured the policy. RCW 48.18.030(1). Thus, although in this state the term "insurable interest" has been defined, it is defined solely in the context of the general insurance statutes and for the specific identifiable purpose of preventing wagering.
The majority has taken the definition of the term "insurable interest" as contained in RCW 48.18.030(3) and engrafted it on the statute dealing with employees' retirement. RCW 41.40.270. This might have some color of legitimacy and be declarative of legislative intent if the reason for RCW 48.18.030(3) was contained in the retirement statute as it is in the general insurance code. But no such reason exists. There is no disclosure of legislative intent in RCW 41.40.270 as to the meaning of "insurable interest"; the reasons for the' statutory definition of RCW 48.18.030(3) are not present; and the meaning of "insurable interest" has never been passed on by this court. Thus, it is appropriate to examine the situation as it actually exists and determine what meaning should be given to the term in question.
We have a most ironic situation before us. The sisters of the decedent, according to the majority, have an insurable *209interest in the life of Mr. Baker because they are related by blood. Mr. Baker disliked his sisters and apparently the feeling was mutual. He had not seen them for approximately 17 years although one sister lived in the same city and the others were in close geographical proximity. Despite this mutual antipathy, the majority seems willing to find that because Baker and his sisters were related by blood they can be assumed to have an interest in prolonging his life and, therefore, have an insurable interest.
The Cooks were longtime friends of Mr. Baker and remained as his closest friends until his death. They looked out for his welfare and cared for him when he was ill. They gave him gifts at Christmas and shared meals with him. There was mutual love and affection. Indeed, it may be said that they were like family to Mr. Baker. The evidence before the trial court is uncontroverted; the Cooks had an interest in perpetuating the life of Mr. Baker. Yet, the majority is unable to find that an insurable interest existed here.
It may be easier for a court to rely upon a mechanically identifiable relationship of blood or marriage. In doing so, however, we sacrifice fairness for the sake of our own comfort. Moreover, even the language of RCW 48.18.030(3) suggests that the substantial interest from a relationship of blood or law must be engendered by love and affection.
The law does not state inflexibly that only a relationship of blood or marriage qualifies as an insurable interest. Other jurisdictions have found that a blood relationship is not necessary for an insurable interest. See Thomas v. National Benefit Ass'n, 84 N.J.L. 281, 86 A. 375 (1913); Rakestraw v. Cincinnati, supra; Green v. Southwestern Voluntary Ass'n, 179 Va. 779, 20 S.E.2d 694 (1942). The trial court was not in error in finding that the beneficiaries had an interest in protecting, fostering, and prolonging the life of the insured rather than an interest in shortening his life, regardless of their lack of relationship by blood or law. See Warnock v. Davis, 104 U.S. 775, 26 L. Ed. 924 (1881).
*210The Cooks' insurable interest in Mr. Baker's life, based on mutual love and affection, is bolstered by the pecuniary interest they held in Baker's life: that the longer he worked, the larger would be his accumulated contributions. The majority rejects the trial court's finding that respondents' pecuniary interest existed because the pecuniary interest held by the Cooks "would have ceased to exist when Mr. Baker retired and began drawing his retirement allowance." While this may be true, it is irrelevant. At the time of his death, Mr. Baker was fully employed and was contributing to the fund. There is no question but at that time the Cooks were potentially benefiting from Baker's continuing productivity and had a specific pecuniary interest. The majority observes the respondents' pecuniary interest was not in the continuation of Mr. Baker's life but in his continued employment. It should be noted that the continuation of the latter was fully dependent upon the continuation of the former.
The majority would apply a rule where the reason for the rule does not exist; it would exalt a technical relationship and interest where love and affection had long since vanished and ignore an interest engendered by a warm, close, affectionate relationship far more powerful than blood or law; and, finally, it would deny a pecuniary interest because of an indefinite event possibly (although not in this case) occurring in the future. Neither the law nor the equities of this case nor the intent of the legislature requires such an outcome.
I dissent.
Wright, Utter, and Brachtenbach, JJ., concur with Dolliver, J.
Petition for rehearing granted September 2, 1977.