RUDELL v. BOARD OF ADMINISTRATION OF STATE EMPLOYEES RETIREMENT SYSTEM OF CALIFORNIA (1936)

In a proceeding in mandamus, the trial court directed that the sum of $958.40, which became due as a death benefit under the State Employees' Retirement System upon the death of Richard H. Teberg, deceased, be paid to petitioner Bertha Rose Rudell, also known as Bertha Rose Teberg. This appeal is taken solely by petitioner Lillian Nash, as the administratrix of the estate of Richard H. Teberg, deceased.

On November 19, 1931, said Richard H. Teberg was an employee of the state and so remained until the time of his death. On that date, he executed a certificate naming “Bertha Rose Teberg * * * who is my wife as the beneficiary” of any benefits to become due upon death as a member of the State Employees' Retirement System. At the time of executing said certificate the deceased and petitioner Bertha Rose Rudell, also known as Bertha Rose Teberg, were engaged to be married and were living together as husband and wife. No marriage was ever consummated, but the relationship continued until the death of the deceased in 1934. Said petitioner was known as the wife of the deceased and had assumed the name of Bertha Rose Teberg. Both parties were unmarried persons during the entire time that their relationship continued.

Appellant states several questions in the briefs, but confines the argument solely to the contention that respondent Bertha Rose Rudell, also known as Bertha Rose Teberg, was not entitled to said benefits because of the relationship existing between said respondent and the deceased. We find no merit in this contention. Said respondent was the named beneficiary and she was entitled to the money if she had an “insurable interest” in the life of the deceased. Section 100, State Employees' Retirement Act, St.1931, p. 1456, as amended by St. 1933, c. 473, p. 1243. There is a conflict of authority in other jurisdictions as to what constitutes an “insurable interest” in the life of another person, but in this state, that term is defined by statute. Said respondent had an “insurable interest” in the life of the deceased if she depended upon him in whole or in part for her support. Subdivision (b), § 10110, Insurance Code (St.1935, p. 636), formerly subdivision 2, § 2763, Civ.Code. The evidence on this subject stands uncontradicted. There is no requirement in the statute that the dependency should result from a legal obligation to support, and we are of the opinion that the “insurable interest” mentioned in said subdivision (b) rests solely upon the fact of dependency. This view finds support in the reading of the entire section. Subdivision (c) of that section specifically requires that a “legal obligation” must exist but there is no similar wording found in subdivision (b) which is under consideration here.

Appellant cites and relies upon Keener v. Grand Lodge, 38 Mo.App. 543, 550, and other similar cases following that decision. We find none of these authorities in point. In each of said cases the deceased had a lawful wife living during the time that he cohabited with the named beneficiary. The holding that the named beneficiary was not a dependent was apparently based upon the fact that the entire relationship was adulterous and was denounced by statute as a public offense. As was said in the cited case: “I would not restrict dependents to those whom one may be legally bound to support, nor, yet, to those to whom he may be morally bound, but the term should be restricted to those whom it is not unlawful for him to support.” In the present case, it was not unlawful for the deceased to support said respondent. Neither of the parties was married and the statutes of this state did not denounce their relationship as a public offense. 1 Cal. Jur. 469. Their relationship may have been contrary to good morals, but that fact alone would not prevent respondent from recovering as the named beneficiary. Warning v. Wilcox, 8 Cal.App. 317, 96 P. 910; Lampkin v. Travelers' Insurance Company, 11 Colo.App. 249, 52 P. 1040.

The judgment is affirmed.

I dissent.

Section 100 of the retirement act provides: “Upon the death of a member * * * there shall be paid to his estate, or to such person having an insurable interest in his life as he nominates by written designation.”

Section 2763 of the Civil Code, which was since carried into section 10110 of the Insurance Code of 1935, provided that: “Every person has an insurable interest in the life and health: * * * 2. Of any person on whom he depends wholly or in part for education or support.” The retirement statute is what is commonly called a pension act. It provides for a payment from the state fund of a monthly pension on retirement, and for payment in a lump sum to the dependents of a deceased employee.

In his application for membership in the retirement system the deceased nominated “Bertha Rose Teberg * * * who is my wife as the beneficiary.” The undisputed evidence is that there was no such person as Bertha Rose Teberg, that the deceased was an unmarried man from the time he entered the system until his death, but that for a period of four years he and the plaintiff had been living together under an indefinite promise of marriage. Upon these facts the appellant states the only question involved here to be: “Has a concubine an insurable interest in the life of her paramour?” Respondent defends upon the rule of other jurisdiction holding that a fiancée has an insurable interest in the life of her betrothed.

There is no real dispute as to the facts. The adulterous relation was known to some of the friends of the parties, but carefully concealed from the immediate family relations; there was no pretense of a marriage, no misunderstanding, and no fraud on the part of either participant. They knowingly and willingly entered into a void contract contrary to public policy and good morals. The whole story is told in the direct examination of the plaintiff reading:

“Q. And prior to, and up to the time of his death, was there any intention to discontinue this relation with the deceased? A. No sir.

“Q. And no separation contemplated? A. No sir.

“Q. And you, therefore, expected to live with him in the same capacity? A. Yes, because he had always promised marriage.

“Q. He had promised to marry you? A. He certainly did.

“Q. And I take it you expected to continue receiving his support as you had in the past? A. I did.”

The theory upon which a fiancé or a fiancée may be held to have an insurable interest is that a legal obligation has been assumed by the promise of marriage to be followed by the marriage contract; but in the early case of Boigneres v. Boulon, 54 Cal. 146, 147, it was held that the promise of a mistress being “immoral, illegal, and against public policy” founded no consideration for a promise of marriage. Upon the same reasoning an immoral contract of cohabitation should not constitute a consideration for an obligation to support. If the consideration is void the contract itself must be void, hence when the statute referred to the obligation to support, it intended a legal obligation, not one denounced as a crime or one generally rejected as contrary to public policy, good morals and decency. The main opinion, in holding that a prostitute has an insurable interest in her customers because she receives support from them, overlooks one of the basic purposes of the retirement act which is to care for the legitimate dependents of the deceased. It was for this reason that the Legislature limited the employee's right to name a beneficiary to one who had an insurable interest. To hold that this puts a concubine or prostitute in the same class as a lawful wife and children is to defeat the very purpose for which the statute was to a large extent enacted.

The judgment should be reversed.

SPENCE, Justice.

I concur: STURTEVANT, J.