B-111816, SEP 26, 1952

B-111816, SEP 26, 1952

PRECIS-UNAVAILABLE

KANSAS CITY LIFE INSURANCE COMPANY:

REFERENCE IS MADE TO CERTIFICATE OF INDEBTEDNESS NO. US-74037, ISSUED BY THIS OFFICE ON JULY 11, 1952, WHEREIN YOUR COMPANY WAS CERTIFIED TO BE INDEBTED TO THE UNITED STATES IN THE AMOUNT OF $188.64, REPRESENTING ERRONEOUS PAYMENTS OF VOLUNTARY CLASS E ALLOTMENT AT THE RATE OF $7.86 PER MONTH FOR THE PERIOD NOVEMBER 1, 1948, TO OCTOBER 31, 1950, FOR LIFE INSURANCE PREMIUMS ON YOUR POLICY NO. 1,065,816, ISSUED BY YOUR COMPANY TO THE ALLOTTER, CHARLES H. BRIGGS, SUBSEQUENT TO HIS DISCHARGE FROM THE MILITARY SERVICE.

THE RECORD ON FILE IN THIS OFFICE SHOWS THAT YOUR COMPANY WAS PLACED ON NOTICE OF THE ERRONEOUS PAYMENTS BY LETTER DATED DECEMBER 12, 1950, FROM THE DEPARTMENT OF THE ARMY. UNDER DATE OF JANUARY 4, 1951, YOUR COMPANY ADVISED THE ALLOTTER THAT THE CASH VALUE OF HIS POLICY AS OF DECEMBER 12, 1950, WAS $184, AND IF HE DESIRED THAT THE CASE VALUE BE APPLIED AGAINST THE OVERPAYMENT THAT HE SHOULD EXECUTE THE FORM ON THE POLICY FOR CANCELLATION AND SURRENDER. ON JUNE 20, 1951, YOUR COMPANY ADVISED THE DEPARTMENT OF THE ARMY THAT NO FURTHER ACTION COULD BE TAKEN TOWARDS SURRENDER OF THE POLICY AND APPLICATION OF ITS CASH VALUE TO THE OVERPAYMENT DUE TO YOUR FAILURE TO SECURE THE POLICY OR AN AFFIDAVIT FROM THE BENEFICIARY THAT SHE DOES NOT HAVE THE POLICY. IN THAT CONNECTION, IT IS ASSUMED THAT THE BENEFICIARY IS PHYLLIS M. BRIGGS, FORMER WIFE OF THE ALLOTTER. CORRESPONDENCE ON FILE HERE FURTHER INDICATES THAT THE ALLOTTER IS ENTIRELY WILLING TO HAVE THE CASH SURRENDER VALUE OF THE POLICY APPLIED AGAINST THE OVERPAYMENT.

WHILE THIS OFFICE IS NOT INFORMED AS TO THE PROVISIONS OF THE INSTANT POLICY OF INSURANCE WITH REGARD TO THE INTEREST WHICH THE BENEFICIARY MAY HAVE THEREUNDER, SECTION 376.560 OF VERNON'S ANNOTATED MISSOURI STATUTES WOULD APPEAR TO BE FOR APPLICATION IN VIEW OF THE FACT THAT THE BENEFICIARY UNDER THE POLICY IS THE FORMER WIFE OF THE ALLOTTER. SAID SECTION READS IN PART AS FOLLOWS:

"ANY POLICY OF INSURANCE HERETOFORE OR HEREAFTER MADE BY ANY INSURANCE COMPANY ON THE LIFE OF ANY PERSON, EXPRESSED TO BE FOR THE BENEFIT OF THE WIFE OF THE INSURED, SHALL INURE TO HER SEPARATE BENEFIT, INDEPENDENTLY OF THE CREDITORS, EXECUTORS AND ADMINISTRATORS OF THE HUSBAND; PROVIDED, HOWEVER, THAT IN THE EVENT OF THE DEATH OR DIVORCEMENT OF THE WIFE BEFORE THE DECEASE OF THE HUSBAND, HE SHALL HAVE THE RIGHT TO DESIGNATE ANOTHER BENEFICIARY, UPON WRITTEN NOTICE TO THE COMPANY, BUT SUCH NOTICE SHALL NOT BE EFFECTED, UNLESS ENDORSED UPON THE POLICY BY THE PRESIDENT OR VICE- PRESIDENT AND SECRETARY OF THE COMPANY ISSUING THE POLICY. ***"

WITH RESPECT TO THE OPERATION OF THE ABOVE SECTION, SEE ORTHWEIN V. GERMANIA LIFE INSURANCE COMPANY, 170 S.W. 885.

MOREOVER, AN INSURED HAS THE RIGHT TO SURRENDER A CONTRACT OF INSURANCE AND THEREBY CUT OFF EVERY RIGHT OF THE BENEFICIARY EVEN THOUGH THE POLICY IS OUT OF THE POSSESSION OF THE INSURED AND NOT IN HIS POWER TO SURRENDER PHYSICALLY. SEE DELANEY V. DELANEY, 51 N.E. 961. SEE MORGAN V. PENN MUTUAL LIFE INSURANCE COMPANY, 94 F. 2D 129.

IN VIEW OF THE FOREGOING AND ON THE BASIS OF THE PRESENT RECORD, IT IS THE OPINION OF THIS OFFICE THAT THE ALLOTTER IS ENTITLED TO RECEIVE THE CASH SURRENDER VALUE OF THE POLICY IN HIS OWN RIGHT AND WITHOUT REGARD TO THE FAILURE OF HIS BENEFICIARY TO JOIN HIM IN EXECUTING THE PROPER FORMS FOR CANCELLATION AND SURRENDER. ALSO, TO EXPEDITE THE MATTER, THE ALLOTTER'S REQUEST FOR CANCELLATION AND SURRENDER SHOULD CONTAIN AN AUTHORIZATION FOR PAYMENT OF THE CASH SURRENDER VALUE TO THE TREASURER OF THE UNITED STATES.

YOUR COMMENTS AND VIEWS WITH REGARD TO THE MATTER SHOULD BE COMMUNICATED TO THIS OFFICE WITHIN 30 DAYS FROM THE DATE OF THIS LETTER IN ORDER TO AVOID THE NECESSITY OF TRANSMITTING THE MATTER TO THE ATTORNEY GENERAL FOR THE INSTITUTION OF FORMAL COLLECTION PROCEEDINGS.