LAW REPORTS.

Dominion, Volume 6, Issue 1587, 2 November 1912, Page 14

LAW REPORTS.

SUPREME COURT. CASE BEFORE A FULL BENCH... INSURANCE POLICY. FOE WHOSE BENEFIT WAS IT? Who was entitled to tiro praceedsV an insurance policy effected on- the life' of the late' James Shepherd, retired grocer, of Timaru? This was the principal question involved in an'action, heard before a Full Bench of the Supreme Court yesterday. An important question -of principle was also behind the action, the decision in which will affect many policyholders in the Government Life Insurance Department. The Bencli was occupied by Mr. Justice Benniston, Mr. Justice Edwards, ..and Mr. Justice" Chapman. The plaintiff-was the Publio Trustee (as executor of the will of the late James Shepherd) and the defendant was Fiances Shepherd, widow, of'Timaru. Mr. J. W. Macdonnld, solicitor to tho' Publio Trust Office, appeared- for the Publie Trustee, whilo Mr. C. H. Ttcadwell appeared for Mrs, Shepherd and for the Government Life Insurance Department.. ' It appeared that James Shepherd died at Timaru on May 1912, leaving a considerable estate. Probate of his will was 'ranted to. the Publie Trustee on May 28, 1912. By 'the Will Mrs. Shepherd was ;iven a ; life estate, • the remainder pass-, ng on to the children and the grant l ,-' >hildren. The Court was mainly consented about a life"insurance ptiicy for' 8200, which deceased had taken out with he Government Life Insurance Deportuent on September 2, 1871, and on which le had endorsed a deed poll declaring that 10.had effected the policy for 'his' wife's >encfit. This declaration had been iitado in September 28, 1871,.but notice thereof ipd never been given to the Department. ;n view of tho legislation' on tho'subjeot, he question now arose as to \whcther the. [eclaration was effective by reason of nonompliance with the statutory provisions r whether there was'a good common law rust? ..•.■■■■' Several statutes surrounded, the question. Section 8 flf the New Zealand Government Insurance and Annuities Act, 1870, made ' it lawful for any person to insuro his life, under that Act or under the Government Annuities Act, 18f>9, for the tone-fit of his wife and children. On November" 7, 1870, regulations were published enacting that if a', policy had been effected under Section 8 (referred-, to) it. would be sufficient .to declare the trusts by a declaration, in 'tie form which deceased- used. These., regulations remained in- force, until Juno 3(1, .1873. Subsequently doubts arose as to the .validity of these" declarations, and an Act. was framed in. 1874 giving' the Gojjjmissionor power to validate them all. TDeceased never availed''himself of-the provisions of this Act.'' '_■•'. In a previous case—Haggitt r. the Gov ernment Life Commissioner—Mr. Justice Pennefather • held - that non-compliance with tho -statute destroyed the^ rights uii■der the declaration.. This decisicmi how-, ever, was never acted on ui practice, by the Department,' as the case was not . argued on both sides, and decision- was - given after tho parties had:- compromised; After hearing .argument yesterday,, their • Honours were unanimously of opinion that deceased had-created'a good common law .. trust by-the declaration, and.that there- . fore the proceeds of the policy were rightly due to Mrs. Shepherd. ■• Their 'Honours. distinguished the cage from that'of Hoggitt v. the Government Life, in which the circumstances wore scarcely parallel, Costs were allowed Shepherd out of the estate. • • • '