Appeals, Nos. 327, 328, 329, and 332, Jan. T., 1958, from decree of Orphans' Court of Philadelphia County, No. 271 of 1958, in re estate of John R. Henderson, deceased. Decree affirmed.
William Jay Leon, for appellant.
George M. Brodhead, with him Robert E. Jones, J. Eustace, Jr., and Moffett, Frye & Leopold, for appellee.
Robert A. Webster, with him Henry A. Frye, Frank J. Eustace, Jr., and Moffet Frye & Leopold, for appellee.
Philip A. Bregy, with him Earle N. Barber, Jr., and MacCoy, Evans & Lewis, for appellees.
Before Jones, C.j., Bell, Musmanno, Jones, Cohen and Bok, JJ.
OPINION BY MR. JUSTICE BELL
These appeals raise the following questions: (1) Is a widow who takes against her husband's will entitled thereby to share in the proceeds of certain policies of insurance upon his life; and (2) did the Orphans' Court have jurisdiction to decide the rights of the widow to the policies or the proceeds thereof?
John R. Henderson died on November 9, 1957, leaving a will dated October 28, 1957. Henderson in his will gave his personal effects to his son who was his only child, his residence to his wife, and his residuary estate in trust for his wife for her life and after her death to persons whose names and interests are immaterial. He left an estate of approximately $126,000.Unfortunately for his residuary legatees and for his widow's present claim, he included in his will a tax clause directing that all taxes be paid out of his residuary estate.
Henderson took out three policies of insurance on his life, all of which were in force at his death. On June 5, 1920, Henderson took out a life insurance policy with the Prudential Insurance Company of America in the amount of $10,000; and on February 18, 1926, he took out a life insurance policy with the Equitable Life Insurance Company of Iowa in the amount of $25,000.*fn1 In each policy he reserved the right to change the beneficiary by written notice to the Company. In each policy his wife was originally named as the beneficiary. In each policy he changed the beneficiary
several times - in each instance naming a beneficiary other than his wife. His final change in the Prudential policy occurred on April 28, 1952, at which time he named as beneficiary "Ruth Bjornsgaard, Sister of the Insured, if living, otherwise Catherine K. Yardley, Friend of the Insured". Both his sister and Miss Yardley survived Henderson. Henderson's final change of beneficiary in his Equitable policy occurred on January 17, 1952, at which time he named "Catherine K. Yardley Primary Beneficiary, [and] First Contingent Beneficiary [his] Estate". Miss Yardley survived Henderson. The insured paid all the premiums on each of these policies, and the policies at his death were found in his possession. Henderson's widow was never notified nor did she acquiesce in any changes of beneficiary.
Henderson's widow duly filed an election to take against his will and against the life insurance policies which she claimed were testamentary conveyances of her husband's assets.
The Wills Act of April 24, 1947,*fn2 § 8, gives to a surviving spouse a right of election to take against the will of her deceased spouse. A surviving spouse who elects to take against the will, where the testator leaves only one child, "... shall be entitled to one-half of the real and personal estate of the testator". It will, of course, be noted that "the real and personal estate of the testator" is not defined, and that insurance is not mentioned.
A named beneficiary in a life insurance policy - where the insured reserves the right to change the
beneficiary - has no vested interest in the policy or its proceeds during the insured's lifetime. While the authorities are not in accord as to whether the beneficiary's interest is testamentary, the later cases hold that such a beneficiary has only an expectancy: Bayer's Estate, 345 Pa. 308, 26 A.2d 202; Knoche v. Mutual Life Insurance Co., 317 Pa. 370, 176 A. 230; Riley v. Wirth, 313 Pa. 362, 169 A. 139; Irving Bank v. Alexander, 280 Pa. 466, 124 A. 634; Weil v. Marquis, 256 Pa. 608, 101 A. 70; Fidelity Trust Co. v. Travelers' Insurance Co., 320 Pa. 161, 181 A. 594.
In Knoche v. Mutual Life Insurance Co., 317 Pa., supra, the Court said (pages 371, 372): "Where the right to change the beneficiary has been reserved in a life insurance policy, the beneficiary named has but a mere expectancy with no vested right or interest during the lifetime of the insured: Riley v. Wirth, 313 Pa. 362, 367; Irving Bank v. Alexander, 280 Pa. 466, 470; Weil v. Marquis, 256 Pa. 608, 614, 37 C.J. 579, section 345 ...
"Where, however, the designation of the beneficiary in the policy is absolute and unconditional because the right to change the beneficiary is not expressly reserved to the insured, the beneficiary has a vested interest in the policy and cannot be deprived of its proceeds by anything the insured may do without the beneficiary's consent. ...: Joyce on Insurance, 2d ed., volume 2, section 730a, 731; Smith v. Metropolitan Life Ins. Co., 222 Pa. 226; [Entwistle v. Travelers' Insurance Company, 202 Pa. 141, 51 A. 759]; Schuberth v. Prudential Ins. Co., 86 Pa. Superior Ct. 80."
It was well settled, prior to 1948, that the proceeds of a life insurance policy which was payable to a named beneficiary other than the insured's executors or his estate, - irrespective of whether a right to change ...