Abhiramavalli Ammal vs The Official Trustee of Madras and Others

Madhavan Nair, J.—This is an application to show cause why the Official Trustee of Madras be not directed as Trustee of the petitioner

herein to recover on her behalf of the amount due under Policy No. 6033 of R. Srinivasa Aiyar, deceased, effected with the United India Life

Assurance Company and to pay the same to the petitioner. The petitioner, Abhiramavalli Ammal, is the widow of R. Srinivasa Aiyar who was the

Head Master of Saint Antony''s Secondary School, Negapatam. The petition is opposed by his two brothers. The late Mr. Srinivasa Aiyar insured

his life for a sum of Rs. 1,000 with the United India Life Assurance Company, Madras. The policy so far as is material is as follows:

This policy...witnesseth that in consideration of the payment already made to the company...as stated in the subjoined schedule...the company doth

hereby agree that, upon proof satisfactory to the directors of the happening of the event or events on which the sum assured is to become payable

as described in the said schedule and the title of the person or persons who may be entitled to receive the same, it will pay the sum stated in such

schedule as the sum assured to such person or persons.

The schedule to the policy stated inter alia the following particulars under the following headings:

Name, address and R. Srinivasan Esq.,

calling of the Head Master,

assured.

Amount Rs. 1,000 only.

Sum To whom The assured or his

assured payable wife Abhiramavalli

if he predeceases her.

The petitioner''s right to recover the amount is based on Section 6, Married Women''s Property Act, 1874, which runs as follows:

A policy of insurance effected by any married man on his own life, and expressed on the face of it to be for the benefit of his wife and children, or

any of them, shall enure and be deemed to be a trust for the benefit of his wife, or of his wife and children or any of them, according to the interest

so expressed, and shall not, so long as any object of the trust remains, be subject to the control of the husband, or to its creditors or form part of

his estate.

This language is in material particulars identical with the language of Section 10, English Married Women''s Property Act, 1870. In England the

Act of 1870 was repealed by the Married Women''s Property Act, 1882. Section 11 of that Act corresponding to Section 10 of the previous Act

and Section 6 of our Act is as follows:

A policy of assurance effected by any man on his own life, and expressed to be for the benefit of his wife, or of his children, or of his wife and

children, or any of them; or by any woman on her own life, and expressed to be for the benefit of her husband or of her children or her husband

and children, or any of them; shall create a trust in favour of the objects therein named; and the moneys payable under any such policy shall not, so

long as any object of the trust remains unperformed, form part of the estate of the insured, or be subject to his or her debts.

It will be observed that in two particulars the terms of Section 11 of the Act of 1882, differ from the terms of Section 10 of the Act of 1870.

The words ""on the face of it"" appearing in Section 10 are omitted in Section 11 of the later Act, and for the words ""shall...be deemed to be a trust

appearing in Section 10 of the Act of 1870 we have the words ""shall create a trust in favour of the objects therein named, etc.,"" in Section 11 of

the Act of 1882.

Relying on Section 6, Married Women''s Property Act, 1874, it is argued on behalf of the petitioner that by using the words that the sum is

payable to ""the assured or his wife Abhiramavalli if he predeceases her"" it is expressed on the face of the policy that it is for the benefit of the wife

of Srinivasa Aiyar if he predeceases her, and so, the policy shall enure"" and be deemed to bo a trust for the benefit"" of the petitioner within the

meaning of that section. On the, other hand, the argument of the respondents is that the words used in the policy are not specific enough to show

that it is expressed on the face of it that it is for the benefit of his wife and that the policy shall enure and be deemed to he a trust for her benefit

within the meaning of the section. According to this argument, in order that a policy may be deemed to be a trust in favour of the wife within the

meaning of Section 6 of the Act it must appear on the face of the document in express words that the insurance was intended by the deceased for

the benefit of his wife. I do not think that the language of Section 6 warrants the contention urged on behalf of the respondents. That section states

that the policy shall on the face of it express that it is to be for the benefit of the wife and if it is so expressed, then it says the policy shall be

deemed to be a trust for the benefit of the wife. There is nothing in the language of the section to show that the words ""for the benefit of his wife"" or

other words corresponding to these should appear in the policy to enable us to infer a statutory trust in favour of the wife within the meaning of the

section. If on reading the words used in the policy it appears that the assured has intended, in the event of his death, that the policy should enure to

the benefit of his wife, then I think the policy may be deemed to be a trust for her benefit. I shall now consider how far the authorities brought to

my notice support the respective contentions.

The only Indian decision bearing on the point occurs in Srinivasachariar v. Ranganayaki Ammal [1916]32 I.C.991. In that case R insured his life

in S company and died in 1914. Under the terms of the policy the amount assured was payable to R or to his wife in case of his death earlier. It

was held that the sum insured did not form part of the deceased''s estate but that the widow was the beneficiary who became entitled to the

beneficial interest in that sum on her husband''s death. The exact terms of the policy making the amount payable to the wife in the case of the

husband''s death do not appear in the judgment, but from the facts stated by the reporter it would appear that the terms were as general as the

terms used in the present policy. This decision supports the petitioner. Another decision which supports the argument of the petitioner may be

found In re Fleetwood''s Policy [1926] 1Ch.D.48, a decision under the English Act, 1882. In that case a husband took out an insurance policy for

�500 on his life and by the terms of the policy the insurance company agreed to pay the sum to the insured''s wife, if she were living at his death,

or in the event of her prior death to pay it to the insured''s executors, administrators, and assigns. It was held that the policy came within Section

11, Married Women''s Property Act, 1882, and created a trust in favour of the wife in certain events. Though the words for the benefit of his wife

did not appear in the terms of the policy, the learned Judge pointed out that

the policy is, in the terms of the section a policy of assurance effected by a man on his own life, and expressed to bo for the benefit of his wife.

Using similar language, I think we may say in this case that the language used in the policy ""to the assured or his wife Abhiramavalli if he

predeceases her"" shows that it is a policy of assurance expressed to be for the benefit of his wife though the express words for the benefit of his

wife"" do not appear in the terms of the policy. Mr. Duraiswami Aiyar for the respondents drew my attention to a series of cases under the English

Act, 1870, the language of Section 11 of which, as I have already stated, is identical with that of Section 6 of the present Act. These cases are In

re Mellor''s Policy [1877] 6 Ch.D. 127, In re Mellor''s Policy [1878] 7 Ch.D. 20, In re Adam''s Policy Trusts [1883] 23 Ch.D. 525, In re Seyton

v. Satterthwaite [1887] 34 Ch.D. 511, In re M [1899] 1 Ch.D. 79 and Griffith''s Policy [1903] 1 Ch.D. 739. In all these cases the terms of the

policy contained the words for the benefit of his wife."" On the strength of these decisions it is contended that, unless these words appear on the

face of the policy, the policy cannot be deemed to be a trust within the meaning of Section 6 of the Act. I do not think this conclusion necessarily

follows from these decisions. Of course, if these words appear on the face of the policy, then there can be no difficulty at all with regard to the

solution of the question whether a statutory trust in favour of the wife has been created or not; but these cases do not say that, unless these words

are used, no statutory trust within the meaning of the section can be inferred. It is well known that in England documents are drawn up with greater

precision than in this country. It is clear that in the cases referred to the draftsman, to avoid all difficulties of construction have obviously introduced

the very words of the statute in the documents themselves. If a similar procedure is adopted in India also by insurance companies in drawing up the

terms of the policy in cases where the assured intends to create a trust in favour of his wife in the event of his death, there will be no scope for

arguments like the one now urged on behalf of the respondents. In Griffiths v. Fleming [1909] 1 K.B. 805 a case strongly relied on by Mr.

Duraiswami Aiyar, a husband and his wife effected with an Insurance Association a policy whereby, in consideration of a premium of which each

paid a part, a sum of money was made payable upon the death of whichever of them should first die to the survivor. The wife having died, the

husband brought an action upon the policy to recover the policy money. Under the heading the amount...to whom payable"" in the policy it was

stated ""�500 to the survivor of the grantees."" It was argued against the contentions of the husband''s counsel by Sir John Simon, K. C, that to

come within Section 11, Married Women''s Property Act, 1882:

the insurance must comply strictly with its terms and must be expressly for the benefit of one or more of the objects therein named.

This argument found favour with Vaughan Williams, L. J. But Kennedy, L. J., with whom Farwell, L. J., concurred, did not accept it. This case

is more an authority for the petitioner than one for the respondents. In this connexion I may state that having regard to the second point of

difference between the language of Section 11 of the English Act, 1882, and the language of Section 10 of the Act, 1870 which I have already

pointed out, the argument advanced in the English cases is somewhat plausible; but the language of the Indian Act is identical with the language of

the English Act, 1870, which in my opinion does not lend any support to the respondents'' arguments.

For the above reasons I hold that the terms of the insurance policy in the present case fall within the language of Section 6, Married Women''s

Property Act, 1874, and so a statutory trust in favour of the petitioner has been created under the Act. She is therefore entitled to claim the money.

Her prayer in the petition is granted with costs which I fix at Rs. 75.