The opinion of the court was delivered by: Mercer, District Judge.
This is an action to recover the sum of $10,000 upon a National
Service Life Insurance policy issued by the United States of
America. Eleanor A. Eldin and Teresa G. Eldin are made defendants
pursuant to Section 38 U.S.C.A. § 445, on the ground that they
claim some interest in the proceeds.
The contentions of the plaintiffs on both of the issues
submitted are necessarily based upon a legal assignment of the
proceeds of the policy by the veteran or upon an equitable
of the proceeds, or upon the creation of a constructive trust by
the operation of law based upon the conduct and contractual
obligations of the veteran, or by seizure of the proceeds of the
policy by legal or equitable process after the maturity of the
policy. Certain decisions of state courts involving private
insurance policies have been cited by the plaintiffs in support
of the above conditions but these decisions of State Courts
cannot nullify a Congressional Act or the public policy of
Congress as expressed in the Congressional Acts and particularly
the provisions of 38 U.S.C.A. §§ 802(g) and 454a. Any attempt to
create vested rights in the beneficiary prior to the maturity of
the policy or to make the proceeds of the policy, after maturity,
subject to the moral, legal, or equitable debts of the veteran by
reason of his conduct during his lifetime would be contrary to
the Congressional purpose. Neither the conduct nor the
contractual obligations of the deceased veteran can divert by any
theory of law the proceeds of such an insurance policy from his
designated beneficiary at the time the policy matures.
In Heifner v. Soderstrom, D.C., 134 F. Supp. 174, the Court
reviews all of the decisions cited in the various briefs filed
herein. In that case the insured's former wife commenced an
action against the insured's mother to impose a trust upon the
proceeds of the insured's National Service Life Insurance policy.
The former wife had been the beneficiary of the policy but after
the wife had instituted a divorce action against the insured he
designated his mother as beneficiary. Subsequently, the wife was
granted a judgment which awarded her the insurance policy.
At page 180, the Court said:
"It seems clear that there is a clear and definite
Congressional mandate that the insured in a National
Service Life Insurance policy shall have the right
`at all times' to change the beneficiary of the
policy and that such right may not be denied him by
either a federal or a state court."
At page 181, the Court said:
"It seems clear from the cases that no court can
deny the insured in a National Service Life Insurance
policy the right to change the beneficiary of it or
designate some one other than the designated
beneficiary to receive the proceeds thereof."
At page 182, the Court said:
"In the present case the evidence does not
establish an agreement on the part of the insured not
to exercise the right to change the beneficiary of
the policy. Under the authority of the cases relating
to War Risk insurance policies, such an agreement
would be ineffective if made."
In Von Der Lippi-Lipski v. United States, 55 App.D.C. 202,
4 F.2d 168, at page 169, the Court said:
"We are of the opinion that the agreement, alleged
in the amended bill of complaint to have been entered
into by the plaintiff and the insured, was invalid,
in so far as it affected the right and authority of
the insured to change the beneficiary under the
contract of insurance. To hold otherwise would do
violence to the plain and ordinary meaning of the
language expressive of the legislative intent."
Other cases which have considered the questions involved herein
Pack v. United States, 9 Cir., 176 F.2d 770; Moreno v. United
States, 1 Cir., 120 F.2d 128; Tohulka v. United States, 7 Cir.,
204 F.2d 414.
The Court has considered the cases cited by the plaintiff,
including In re Flanagan, D.C., 31 F. Supp. 402; and Kaschefsky v.
Kaschefsky, 6 Cir., 110 F.2d 836, and other cases but the Court
is of the opinion that these cases are clearly distinguishable.
For the reasons herein set forth it is the opinion of the Court
that the issues should be in favor of the defendants. It
is therefore ordered that the proceeds of said insurance policy
involved herein be paid to the designated beneficiary, Eleanor A.
Eldin. In compliance with Rule 52, Rules of Civil Procedure, 28
U.S.C.A., the findings of fact and conclusions of law appear in
this opinion and the same are adopted as a findings of fact and
conclusions of law as contemplated by said Rule 52.
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