CUYLER v. WALLACE et al. (Court of Appeals of New York. Dec. 15, 1905.) 1. INSURANCE-ASSIGNMENT OF LIFE POLICY

-REASSIGNMENT EVIDENCE.

Evidence held insufficient to sustain presumption of reassignment of a life insurance policy assigned by the insured to his father, but found in the possession of another, without evidence as to the time when or the manner in which such other obtained repossession.

2. SAME EVIDENCE.

Where a policy was assigned by a son to his father, a contention that said policy, showing upon its face that the son was the person insured, was reassignable and transferable to him by mere delivery without any writing, and when found in the possession of the son after the death of the father will be presumed to have been assigned for a valuable consideration, cannot be sustained as, in the absence of a written assignment, the burden is on the holder to show that he is a bona fide holder and the manner in which he obtained the policy.

[Ed. Note. For cases in point, see vol. 28, Cent. Dig. Insurance, §§ 484, 1648.]

Appeal from Supreme Court, Appellate Division, Third Department.

Action by Emma F. Cuyler, administratrix of George N. Cuyler, against Matthew J. Wallace and others, executors of George Cuyler. From a judgment of the Appellate Division (101 App. Div. 207, 91 N. Y. Supp. 690), affirming a judgment for plaintiff, defendants appeal. Reversed.

The following are the stipulated facts: "The parties to the above-entitled action hereby stipulate and agree upon the following facts in this case: (1) That on or about May 7, 1867, the Connecticut Mutual Life Insurance Company issued and delivered to George N. Cuyler its policy of insurance on the life of George N. Cuyler, in and by which policy and contract of insurance the said company did insure the life of said George N. Cuyler in the sum of $2,500, and did promise and agree to pay the said sum of $2,500 to the legal representatives of the said George N. Cuyler within 90 days after satisfactory proofs of the death of the said George N. Cuyler had been furnished to said company. (2) That said policy of insurance became and was a fully paid up policy of insurance long before the death of said George N. Cuyler. (3) On or about 76 N.E.-1

August 2, 1887, George N. Cuyler assigned and delivered said policy of insurance to his father, George Cuyler, and a duplicate of said assignment was thereafter, and on or about February 18, 1891, duly filed in the office of the Connecticut Mutual Life Insurance Company. (4) George Cuyler died on or about November 7, 1893, at the city of Albany, leaving a last will and testament, which was duly admitted to probate by the surrogate of Albany county on the 11th day of July, 1894, and the defendants Matthew J. Wallace and Henry S. McCall were duly appointed as executors of said last will and testament and duly qualified as such, and ever since that time have been and now are acting as such. (5) After the assignment of said policy of insurance and the filing of a duplicate thereof with the insurance company, and previous to the death of George Cuyler, plaintiff's intestate, George N. Cuyler was in possession of said policy of insurance and continued in possession thereof up to the time of his death, claiming to be the owner thereof; and the defendants Henry S. McCall and Matthew J. Wallace, as executors of George Cuyler, deceased, never had possession of said policy of insurance. (6) The defendants, as executors of said George Cuyler, deceased, filed an inventory of said estate in the office of the surrogate of Albany county, on or about the 11th day of October, 1894, but no claim is therein made to the policy of insurance in question. (7) The defendants, as such executors, rendered a final account of their proceedings in the year 1895, but no claim is made in the said final account of their proceedings to the policy of insurance in question. (8) Objections were filed to the account of the defendants as executors in that proceeding by and on behalf of Charles M. Cuyler and Ida P. Cuyler, children and next of kin of their testator; one being that the said executors had failed to account or charge themselves with the said policy of insurance and claiming that it belonged to the estate of George Cuyler. (9) Upon that objection testimony was taken before the surrogate of Albany county. George N. Cuyler was subpoenaed and sworn as a witness.

was required to and did produce said policy of insurance, and did then and there testify that he was the owner of and in possession of said policy of insurance. (10) That thereafter, and on or about February 18, 1896, a decree was made by the surrogate of Albany county, in the said final judicial settlement of the accounts of the defendants as executors of the last will and testament of George Cuyler, deceased, and duly filed in said surrogate's office on that day, in and by which it was provided, among other things, that the defendants herein retain the sum of $500 for the expenses of prosecuting an action against George N. Cuyler for the recovery of said policy of insurance. (11) That said George N. Cuyler died intestate on the 22d day of August, 1903, at the city of Albany, where he was born and always resided. (12) That the plaintiff herein was duly appointed as the administratrix of his estate by the surrogate of Albany county, on or about September 15, 1903, and that she duly qualified, and ever since that time has been and now is acting as such administratrix. (13) That the said defendants never attempted, by action or any other proceeding, to recover said policy of insurance from George N. Cuyler in his lifetime, or since his death, except that the said defendants did make a claim to the moneys due on said policy of insurance from said Connecticut Mutual Life Insurance Company after the death of said George N. Cuyler. (14) That George N. Cuyler resided with his wife, the plaintiff herein, for many years prior to the death of George Cuyler, at 131 Chestnut street, in the city of Albany, N. Y., and that said George Cuyler resided on Clinton avenue, in said city of Albany. (15) Annexed hereto is a copy of the will of said George Cuyler." Dated April 23, 1904, and signed by respective counsel. The stipulation contains a copy of the will of George Cuyler, the father, and will be found in the record.

Peter A. Delaney, for appellants. Mark Cohn, for respondent.

BARTLETT, J. (after stating the facts). The facts are stipulated, and the sole question of law presented is whether the stipulated facts sustain the conclusions. In May, 1867, the Connecticut Mutual Life Insurance Company issued and delivered to George N. Cuyler a policy of insurance on his life for the sum of $2,500, payable to his legal representatives on proof of death. In August, 1887, George N. Cuyler assigned and delivered the policy to his father, George Cuyler, and a duplicate of the assignment was filed in February, 1891, in the office of the company. George Cuyler, the father, died in November, 1893, in the city of Albany, leaving a last will and testament, wherein the defendants were named as his executors. After the filing of the duplicate assignment with the insurance company, and previous to the

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death of George Cuyler, the father, George N. Cuyler, the son, was in possession of the policy of insurance and continued in possession thereof up to the time of his death, claiming it as owner. The defendants rendered a final account of their proceedings in the year 1895, but no claim was made by them to said policy of insurance in the inventory or account. Two children of the testator filed objections to this account; one reason being that the executors failed to charge themselves with the policy. Testimony was taken under these objections before the Surrogate's Court of Albany county, and George N. Cuyler was subpoenaed as a witness. was required to produce and did produce the policy, and testified that he was the owner of and in possession of the same. In February, 1896, a final decree was entered in this proceeding. The surrogate did not pass upon the question of the ownership of the policy, but inserted a provision in the decree providing that the defendants should retain the sum of $500 for the expenses of prosecuting an action against George N. Cuyler for the recovery of the policy of insurance. In August, 1903, George N. Cuyler died intestate in the city of Albany, and the plaintiff was duly appointed as the administratrix of his estate. The defendants thereupon made a claim upon the insurance company for the moneys due on the policy. After the death of George N. Cuyler his administratrix brought an action against the insurance company to recover on the policy, and on motion of the company the defendants were impleaded and the amount due on the policy was paid into court.

The trial court found as conclusions of law: First, that the said George N. Cuyler was at the time of his death the owner and holder of said policy of life insurance in the Connecticut Mutual Life Insurance Company; second, that the plaintiff is entitled to judgment for the moneys due upon said policy of life insurance described in the foregoing findings of fact, and that she should have judgment therefor against the defendants, together with the costs of this action, to be paid out of the estate and not by the defendants personally. The learned Appellate Division in a brief memorandum disposes of the question of law as follows: "The policy having been once shown to be legally owned by George Cuyler, there is a legal presumption of the continuance of ownership until some evidence be offered of its retransfer to George N. Cuyler. The possession of the policy itself by George N. Cuyler before the death of his father is not, in my judgment, alone sufficient to rebut the presumption of continuance of ownership of the policy by his father. When, in addition to that possession, however, is shown the failure of the executors of George Cuyler to find among his papers the assignment which was once delivered to him, a legal inference would fairly seem to follow that that assignment had been destroyed and the policy retrans

ferred by the father to the son. This is sufficient in my judgment to establish a prima facie case of ownership in the son, and in the absence of other evidence is sufficient to sustain the conclusions of the trial justice."

The single legal question presented is whether the administratrix of George N. Cuyler, the plaintiff, has sustained the burden of proof resting upon her by showing that the policy, which was concededly assigned and delivered by the intestate to his father, was reassigned and delivered by the father to the son. The Appellate Division correctly stated the principles of law upon which the defendants were entitled to rest in the first instance that, the policy having been shown to be the property of George Cuyler, the law presumes a continuance of ownership until some evidence of a retransfer; and that the mere possession of the policy by George N. Cuyler before the death of his father is not sufficient to rebut the presumption of continuance of ownership by the father. The learned justice writing for the Appellate Division then states: "When, in addition to that possession, however, is shown the failure of the executors of George Cuyler to find among his papers the assignment which was once delivered to him, a legal inference would fairly seem to follow that that assignment had been destroyed and the policy retransferred by the father to the son. This is sufficient, in my judgment, to establish a prima facie case of ownership in the son, and in the absence of other evidence is sufficient to sustain the conclusions of the trial justice."

It is to be remarked in the first place that It does not appear in the stipulated facts that the executors of George Cuyler failed to find among his papers the assignment which was once delivered to him. All that appears in the stipulation is that the executors of George Cuyler made no affirmative claim to the policy in question, either in their inventory or final account, and never attempted by action or other proceeding to recover said policy of insurance until after the death of George N. Cuyler, the son, when they claimed from the company the moneys due on the policy. The affirmative fact of a fruitless search for the assignment does not appear in the stipulation, and, if it did, it would have had no particular significance, as a duplicate was on file with the insurance company. On this vital point of the reassignment of the policy by the father to the son we have in this stipulation merely a statement of evidentiary facts. These facts are: (1) As set forth in subdivision 5 of the stipulation as follows: "After the assignment of said policy of insurance and the filing of a duplicate thereof with the insurance company, and previous to the death of George Cuyler, plaintiff's intestate, George N. Cuyler, was in possession of said policy of insurance, and continued in possession

thereof up to the time of his death, claiming to be the owner thereof; and the defendants Henry S. McCall and Matthew J. Wallace, as executors of George Cuyler, deceased, never had possession of said policy of insurance." (2) As contained in the ninth subdivision of the stipulation, which refers to the evidence of the son, in the accounting proceeding of his father's estate, which reads as follows: "George N. Cuyler was subpœnaed and sworn as a witness, was required to and did produce said policy of insurance, and did then and there testify that he was the owner of and in possession of said policy of insurance." The manner in which George N. Cuyler became possessed of the policy of insurance, after he had assigned the same in writing and delivered it to his father, is wholly unexplained. All that appears in this record might be absolutely true, even if George N. Cuyler had found this policy of insurance among his father's papers during the lifetime of the latter and placed it in his pocket without assignment or due authority. There is no fact stipulated in the record that overcomes the legal presumption that the assignment in writing by the son to his father of this policy and the delivery of the same to the father is at the present time in full force and effect. The mere evidentiary fact that the son was in possession of the policy, claiming to be the owner thereof prior to the death of the father, falls far short of the proof necessary to overcome the legal presumption that the father died possessed in law of this policy and that his legal representatives are entitled to collect the same. This court has recently had occasion to pass upon the futility of embracing within findings mere evidentiary facts. Alcock v. Davitt, 179 N. Y. 9, 71 N. E. 264.

The plaintiff, respondent, insists that this policy, showing upon its face that George N. Cuyler was the person insured, was assignable and transferable to him by mere delivery without any writing, and will be presumed to have been made for a valuable consideration. The authorities cited in support of this proposition do not sustain it, nor is it a correct statement of the law governing this case. The rule applicable to negotiable instruments payable to bearer or indorsed over in blank does not apply to the present situation. The holder of a promissory note indorsed in blank, producing the same, need not give other evidence of title unless his possession is impeached. Bedell v. Carll, 33 N. Y. 581; Collins v. Gilbert, 94 U. S. 753, 24 L. Ed. 170. The mere naked possession of a nonnegotiable instrument is not evidence of ownership. In the absence of a written assignment to him, the holder must show that he is a bona fide owner and the manner in which he became such. This court has held that proof of an advance of money to a mortgagee, coupled with proof that the one making the advance has possession of the mortgage, does not establish the fact of the purchase of the