GRIMM v. GRIMM ET AL (1944)

Husband and wife entered into a property settlement agreement, vesting portions of the community property in each as his sole and separate property. Among the community assets was an insurance policy for $5,000 in favor of the wife, with the right in the husband to change the beneficiary. The following clause with reference to the insurance policy appears in the property agreement: “Said first party shall have the right to change the beneficiary of the life insurance policy, described in Article VIII of Exhibit A, and second party agrees to execute upon request any instrument necessary or convenient to accomplish such change, and second party hereby transfers, releases and relinquishes to first party all interest in and to said policy of insurance and the premiums paid thereunder and the avails thereof.”

After the parties were divorced the husband died, without having changed the beneficiary.

In this action the personal representatives of the decedent contend that the property agreement by its terms conveyed to the husband all of the right, title and interest of the wife in and to the insurance policy, and therefore the avails thereof should be paid to them.

The trial court found that the failure of the decedent to exercise his power to change the beneficiary established that it was his intent to have the insurance money paid to his former wife, and that the property agreement alone did not go so far as to bar her right to take the proceeds of the policy.

This view finds support in the following cases: Cook v. Cook, 17 Cal.2d 639, 111 P.2d 322, holding that upon death an insurance beneficiary's right becomes vested, no change having been made by the insured prior to death; Sandrosky v. Prudential Ins. Co., 217 Cal. 578, 20 P.2d 325, holding that there may be drawn from a property agreement and subsequent conduct of the parties an inference that the husband intended that the wife should take under the policy at his death; and Mayfield v. Fidelity & Casualty Co., 16 Cal.App.2d 611, 61 P.2d 83, and Mutual Life Ins. Co. v. Franck, 9 Cal.App.2d 528, 50 P.2d 480, holding that a wife's right to take as beneficiary under a life insurance policy is an expectancy.

Appellants contend that Sullivan v. Union Oil Co., 16 Cal.2d 229, 105 P.2d 922, requires a reversal of the judgment.

The facts in the Sullivan case and in this case are not the same. In that case the property agreement applied to all of the property of the spouses without exception, which obviously included a provident fund set up by the husband's employer. In this case the deceased husband reserved a power to change the beneficiary, and the wife covenanted and agreed that that might be done. But the power was not exercised and the policy was left without change of beneficiary until the death of the insured. Under these circumstances, the beneficiary is entitled to the proceeds of the policy.

The facts in the pending case bring it more nearly within the rule in Jenkins v. Jenkins, 112 Cal.App. 402, 297 P. 56, wherein it was held that the proceeds of an insurance policy went to the beneficiary because the property agreement in question excluded the policy.

Judgment affirmed.

DRAPEAU, Justice pro tem.

YORK, P. J., and WHITE, J., concur.