Court Opinion

ID: 8807363
Source: CourtListenerOpinion
Date Created: 2022-11-26 14:51:47.168639+00
Date Added: 2024-06-11T17:04:09.147740
License: Public Domain

KNAPP, Circuit Judge
(dissenting in part). I cannot agree to a construction of the South Carolina statute which takes from the wife and gives to the husband’s creditors the excess over $500 of premiums paid by him “in any one year” when he was perfectly solvent. A single illustration will serve the purpose of argument. It is not uncommon to take out a “paid-up” life policy; that is, a policy for which a lump sum is paid at the time it is issued, in lieu of annual or other stated payments. At the age of 25, a husband insures his life for such amount, payable to his wife at his death, as $10,000 then paid will purchase. He is solvent at the time, and continues solvent for 40 years, when some misfortune overtakes him, and he dies heavily indebted, leaving little or no property. In such a case, if the majority are right, the husband’s creditors, whose claims may not have accrued until within a year before his death, can take from the insurance money, as against the wife, the sum of $9,500, with interest thereon for 40 years, which might aggregate enough to exhaust the policy. It seems clear to me that the language of this statute does not require and should not receive a construction under which such a palpably unjust result is possible. I am of opinion that the creditors referred to in the proviso, the meaning of which is in dispute, are creditors whose rights are adversely affected by payments of premiums because of the insolvency of the debtor when such payments were made, or because the payments themselves contributed to his insolvency. True, the statute makes no mention of insolvency; but that would appear to be implied, since it has no application except to an insolvent condition. When that condition exists, the proviso comes in to limit the annual amount that may be paid for insurance, and I cannot believe that the Legislature ever intended to give to “such creditors” any right to premiums previously paid, when the insured was entirely solvent, although such premiums were more than $500 a year.
As I read it, the Domeyer Case cited in tire majority opinion, is not in point. The report of that case (70 App. Div. 134, 75 N. Y. Supp. 150) states that the judgment of the trial court was sought to be sustained “upon the theory that, inasmuch as Domeyer for several years prior to his death was insolvent, and during that time (italics mine) the premiums on all of the policies referred to exceeded $500 a year, and such premiums were paid out of his own property, the plaintiff as a creditor is entitled to recover,” etc. Apparently, therefore, the court was dealing with a case where the excess premiums were all paid after the insured became insolvent; and the question' here considered was not involved.
I think the decree below was right, and should be affirmed without modification.