GRIMM v. GRIMM

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Docket Number

Docket No. L.A. 18998.

Attorney(S)

John J. Craig and Rush M. Blodget for Appellants. Stephen Monteleone for Respondent.

Judges

Roger J. Traynor
B. Rey Schauer

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Smart Summary

Factual and Procedural Background

In January 1941, Clara Grimm (plaintiff/respondent) and Lewis Grimm were divorced. Prior to their divorce, in December 1939, they entered into a property settlement agreement dividing their community property, including a life insurance policy issued in 1930 on the husband's life, which named the wife as beneficiary. The agreement made the policy the separate property of the husband and granted him the right to change the beneficiary. Lewis Grimm died in April 1943 without changing the beneficiary designation, having not remarried and leaving no issue. After his death, Clara Grimm claimed the insurance proceeds as the named beneficiary and brought an action for a declaration of her rights. The insurance company paid the proceeds into court and was dismissed. The trial court ruled in favor of Clara Grimm, and the administrators of Lewis Grimm’s estate appealed, arguing that the property settlement agreement terminated the wife’s rights to the insurance proceeds.

Legal Issues Presented

Whether the property settlement agreement between the spouses terminated the wife's rights to the insurance policy proceeds despite her remaining the named beneficiary at the husband's death.
Whether the wife's relinquishment of interest in the policy and its proceeds in the agreement constituted a complete transfer of her rights or only a waiver of community property interests.
How to interpret the effect of the husband's failure to change the beneficiary designation after the property settlement agreement and divorce.

Arguments of the Parties

Respondent's Arguments

The insurance policy was community property at the time of the property settlement, and the wife retained her community interest in the policy proceeds.
Although the agreement made the policy the husband's separate property and gave him the right to change the beneficiary, the wife did not relinquish her right to receive proceeds as the named beneficiary unless the husband changed the designation.
The property settlement did not clearly show an intention to deprive the wife of rights accruing from the husband's bounty, such as the insurance proceeds, especially since the husband did not change the beneficiary before death.
The wife’s waiver of inheritance rights was limited to those under the husband's will and did not extend to her rights as a beneficiary of the insurance policy.
The husband’s failure to change the beneficiary designation after the divorce is effectively a confirmation of the wife’s beneficiary status.

Appellants' Arguments

The wife conveyed, transferred, released, and relinquished all her interest in the insurance policy and its "avails" to the husband for valuable consideration.
The language of the property settlement agreement is clear and unambiguous in transferring all interest in the policy and its proceeds to the husband, which divested the wife of any rights to the insurance proceeds.
The wife’s covenant to execute documents to change the beneficiary was a procedural provision and did not indicate any reservation of rights as beneficiary.
The wife’s rights to the insurance proceeds were extinguished by the conveyance, and she could only regain rights through a reconveyance by the husband, which did not occur.
The wife’s claim to the insurance proceeds is not covered by the exception in the agreement that reserved inheritance rights under the husband's will, as the insurance proceeds do not arise from a will or codicil.
The case is analogous to Sullivan v. Union Oil Co., where the wife’s rights in a similar fund were held to have been released.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Travelers Ins. Co. v. Fancher, 219 Cal. 351, 356	Insurance premiums paid with community funds make the policy community property; right of wife to maintain action for community share in proceeds.	Confirmed the policy was community property at the time of settlement and wife retained community interest.
Blethen v. Pacific Mut. L. Ins. Co., 198 Cal. 91, 99-101	Right of insured to change beneficiary is subject to wife's consent; wife’s rights as beneficiary protected absent valid change.	Supported that wife’s beneficiary interest survives absent husband’s valid change of beneficiary.
New York Life Ins. Co. v. Bank of Italy, 60 Cal.App. 602, 606	Community property principles applied to insurance policies.	Reinforced community property nature of the policy.
Jenkins v. Jenkins, 112 Cal.App. 402, 407, 409	Property settlement agreements construed narrowly regarding renunciation of expectancies.	Supported careful interpretation of settlement agreements not to extinguish beneficiary rights absent clear intent.
Mazman v. Brown, 12 Cal.App.2d 272, 275	Change of beneficiary without wife’s consent and without consideration is voidable.	Supported wife’s ability to maintain claim on policy proceeds.
Dixon Lumber Co. v. Peacock, 217 Cal. 415, 418	Beneficiary’s rights under insurance policy protected absent valid revocation.	Reinforced wife’s rights as beneficiary.
Page v. Washington Mutual Life Assn., 20 Cal.2d 234, 242	Beneficiary’s interest is a mere expectancy until insured’s death.	Clarified nature of beneficiary interest as expectancy.
Cook v. Cook, 17 Cal.2d 639, 644, 646	Beneficiary interest akin to testamentary expectancy; interpretation of property settlement agreements.	Used to analogize beneficiary rights to rights under a will.
Bennett v. Forrest, 24 Cal.2d 485, 492	Assignment or release of expectancy enforceable only when expectancy matures into right.	Supported that contract must clearly evidence intention to assign expectancy.
Estate of Crane, 6 Cal.2d 218, 221	Expectancies waived only if contract expressly or necessarily implies waiver; testator’s failure to revoke indicates intent to confirm beneficiary or will.	Key precedent guiding interpretation of property settlement and beneficiary rights.
Sandrosky v. Prudential Ins. Co., 217 Cal. 578	General clauses in settlement agreements not construed to include renunciation of expectancies unless clearly expressed.	Supported narrow construction of waiver clauses in property settlements.
Sullivan v. Union Oil Co., 16 Cal.2d 229	Property settlement waiving all rights to estate and inheritance can extinguish beneficiary rights in certain employee benefit funds.	Distinguished by majority as involving different facts; cited by dissent as controlling.

Court's Reasoning and Analysis

The court began by recognizing that the insurance policy was community property at the time of the property settlement because premiums were paid with community funds. The settlement agreement converted the policy into the husband's separate property and granted him the right to change the beneficiary. However, the wife retained her community interest in the policy proceeds unless the husband validly changed the beneficiary designation, which he did not do before his death.

The court emphasized that a beneficiary's interest in an insurance policy where the insured has the power to change the beneficiary is a mere expectancy until the insured's death. An equitable assignment or renunciation of such expectancy is enforceable only if the contract clearly expresses such intent. Property settlement agreements are construed narrowly and general clauses are not interpreted as renouncing expectancies unless expressly stated.

Here, the property settlement agreement stated that the wife relinquished rights in the separate property of the husband and discharged claims arising from the marriage, but it did not clearly show an intention to extinguish rights accruing from the husband's bounty, such as the insurance proceeds. The agreement acknowledged the husband's right to change the beneficiary and the wife’s obligation to cooperate in such change, implying no immediate renunciation of the wife's beneficiary status.

The husband's failure to change the beneficiary designation after the divorce was taken as a confirmation of the wife's beneficiary status, reflecting his intention that she receive the proceeds. The court distinguished this case from Sullivan v. Union Oil Co., where the waiver was broader and involved a different type of fund. The court concluded that the wife was entitled to the insurance proceeds as the named beneficiary at the time of the husband's death.

Holding and Implications

The judgment of the Superior Court affirming the wife's right to the insurance policy proceeds was affirmed.

The direct effect of this decision is that the wife, as the named beneficiary who was not effectively disclaimed or replaced, is entitled to the insurance proceeds despite the property settlement agreement that made the policy separate property of the husband. The decision underscores that property settlement agreements will not be construed to extinguish expectancies such as beneficiary rights unless the agreement clearly and expressly so provides. No new precedent beyond the careful application of existing principles was established.

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CLARA GRIMM, Respondent, v. WALTER E. GRIMM et al., as Administrators,etc., Appellants.

TRAYNOR, J.

In January, 1941, plaintiff and Lewis Grimm were divorced. In December, 1939, they entered into a property settlement agreement that provided for a division of their community property, which included an insurance policy on the life of the husband, issued in 1930 and naming the wife as beneficiary. The agreement made this policy the separate property of the husband and gave him the right to change the beneficiary. He died in April, 1943, without having made such a change. He had not remarried, and he left no issue. After his death, plaintiff claimed the proceeds of the insurance policy as the beneficiary thereof and brought this action for a declaration of her rights. The insurance company under stipulation paid the money due on the policy into court and was dismissed from the action. The trial court entered judgment for plaintiff, and defendants, the administrators of Lewis Grimm's estate, appeal. Defendants contend that the estate is entitled to the proceeds on the ground that the agreement between the spouses terminated all rights of plaintiff with respect to the policy, including the right to receive the insurance money as the beneficiary thereof.

[1] All premiums were paid with community funds and the policy was therefore community property at the time of the property settlement agreement. ( Travelers Ins. Co. v. Fancher, 219 Cal. 351, 356 [ 26 P.2d 482]; Blethen v. Pacific Mut. L. Ins. Co., 198 Cal. 91, 99 [ 243 P. 431]; New York Life Ins. Co. v. Bank of Italy, 60 Cal.App. 602, 606 [ 214 P. 61]; Jenkins v. Jenkins, 112 Cal.App. 402, 409 [ 297 P. 56].) [2] It is settled that even though the insurance contract may provide that the insured husband has the right to change the beneficiary without the wife's consent where she is named as such, any change of beneficiary without her consent and without a valuable consideration is voidable, and after the death of the husband the wife may maintain an action for her community share in the proceeds of the policy. ( Mazman v. Brown, 12 Cal.App.2d 272, 275 [ 55 P.2d 539]; Travelers' Ins. Co. v. Fancher, supra, at p. 356; Dixon Lumber Co. v. Peacock, 217 Cal. 415, 418 [ 19 P.2d 233]; Blethen v. Pacific Mut. L. Ins. Co., supra, at p. 101; see 3 Cal.Jur. 10-Yr.Supp. 622; 114 A.L.R. 545, 554.) A wife, however, can release this community interest in the insurance policy and still be a beneficiary thereof. If she executes such a release and the husband revokes his designation of her as beneficiary she has no right to the insurance proceeds upon his death; but if he fails to revoke his designation of her as beneficiary, she is entitled, like any other beneficiary, to the proceeds of the policy at the time of his death. She would not be entitled to such proceeds, however, if the parties agreed that no rights were to accrue to her, even though she remained the beneficiary at the time of the husband's death. It remains to be determined, therefore, whether the spouses in the present case agreed, not only that the policy should become the separate property of the husband, but that no rights should accrue to plaintiff even though she remained the beneficiary at the time of the husband's death.

[3] The interest of a beneficiary designated by an insured who has the right to change the beneficiary is, like that of a legatee under a will, a mere expectancy of a gift at the time of the insured's death. ( Page v. Washington Mutual Life Assn., 20 Cal.2d 234, 242 [ 125 P.2d 20]; Cook v. Cook, 17 Cal.2d 639, 644 [ 111 P.2d 322]; Blethen v. Pacific Mut. L. Ins. Co., 198 Cal. 91, 98 [ 243 P. 431]; Mahony v. Crocker, 58 Cal.App.2d 196, 202 [ 136 P.2d 810]; Mutual Life Ins. Co. v. Franck, 9 Cal.App.2d 528, 537 [ 50 P.2d 480]; Hack v. Metz, 173 S.C. 413 [ 176 S.E. 314, 95 A.L.R. 196]; see 14 Cal.Jur. 583; 29 Am.Jur., Insurance, § 1276, p. 952.) [4] An assignment or release of an expectancy becomes enforceable in equity when the expectancy has developed into a right. ( Bennett v. Forrest, 24 Cal.2d 485, 492 [ 150 P.2d 416]; Estate of Crane, 6 Cal.2d 218 [ 57 P.2d 476, 104 A.L.R. 1101]; Anglo California Nat. Bank v. Kidd, 58 Cal.App.2d 651, 655 [ 137 P.2d 460]; Bridge v. Kedon, 163 Cal. 493, 500 [ 126 P. 149, 43 L.R.A.N.S. 404]; Estate of Edelman, 148 Cal. 233, 238 [ 82 P. 962, 113 Am.St.Rep. 231]; Estate of Garcelon, 104 Cal. 570, 584 [38 P. 414, 43 Am.St.Rep. 134, 32 L.R.A. 595]; see 17 A.L.R. 597; 44 A.L.R. 1465; 121 A.L.R. 450; 3 Cal.Jur. 251; 9 Cal.Jur. 478; 4 Am.Jur., Assignments, § 51, p. 270.) [5] It is settled, however, that a contract constitutes an equitable assignment or renunciation of an expectancy only if it expressly or by necessary implication so provides. ( Estate of Jones, 118 Cal. 499, 502 [50 P. 766, 62 Am.St.Rep. 251]; see 4 Pomeroy, Equity Jurisprudence, § 1290.) [6] In interpreting property settlement agreements courts weigh carefully the language of the agreements before concluding that they eliminate rights the disavowal of which is not necessarily connected with the purpose of such agreements. ( Estate of McNutt, 36 Cal.App.2d 542, 549 [ 98 P.2d 253]; Girard v. Girard, 29 N.M. 189 [221 P. 801, 35 A.L.R. 1493].) This court and other courts have therefore applied to property settlement agreements the rule that general expressions or clauses in such agreements are not to be construed as including an assignment or renunciation of expectancies and that a beneficiary therefore retains his status under an insurance policy or under a will if it does not clearly appear from the agreement that in addition to the segregation of the property of the spouses it was intended to deprive either spouse of the right to take property under a will or an insurance contract of the other. ( Sandrosky v. Prudential Ins. Co., 217 Cal. 578 [ 20 P.2d 325]; Jenkins v. Jenkins, 112 Cal.App. 402, 407 [ 297 P. 56]; Estate of Crane, supra, p. 221; Merchants Nat. Bank v. Hubbard, 220 Ala. 372 [ 125 So. 335]; Equitable Life Assur. Soc. v. Stilley, 271 Ill. App. 283; see Girard v. Girard, 29 N.M. 189 [221 P. 801, 35 A.L.R. 1493]; In re Sword, 120 Misc. 427 [199 N.Y.S. 672] [aff'd, 204 N.Y.S. 952]; In re Brown's Will, 153 Misc. 282 [274 N.Y.S. 924, 931]; In re Griffith's Will, 167 Misc. 366 [3 N.Y.S.2d 925, 927]; Weir v. King, (Tex.Civ.App.) 166 S.W.2d 187; Lindey, Separation Agreements, p. 283.) In Estate of Crane, supra, this court set forth the considerations that commend the rule that expectancies under a will or an insurance policy are regarded as waived only when it appears that the attention of the parties was directed to such expectancies and their intention to disclaim future rights that might develop from such expectancies was made clear in the contract. [7] Since the husband has the power to revoke his will or to change the beneficiary named in an insurance policy his failure to do so ordinarily indicates that he did not wish to effect a change so that in effect his failure to act amounts to a confirmation of the will or the designation of the wife in the insurance policy. Both instruments are to be read as expressing the decedent's intentions at the time of his death. As was said in Estate of Crane, supra, at page 221: "It is to be remembered that although the will in which the legacy is contained had been executed prior to the date of the contract, the testator lived more than two years thereafter. And a will speaks from and as of the date of the testator's death. If the testator had not executed this will until after the date of the property settlement agreement, it would not be reasonable to say that he was without right to make such subsequent will and thereby give additional property to his wife. But in substance and effect he did the same thing by leaving his will unchanged after the date of said contract." Moreover, while a property settlement agreement provides for what the husband is conceding to his wife as a matter of right, frequently he is willing to grant more to her as a matter of bounty, for as recognized in Estate of Crane, supra, at page 221, the affection of spouses for each other may survive separation agreements and divorce proceedings.

[8] The property settlement agreement in the present case provided: "The parties hereto do mutually covenant and agree that this agreement is intended and shall be construed as, and the same shall be, a complete property settlement between the parties hereto, and that it comprises, settles and discharges all claims arising or existing, or which may hereafter arise by reason of the marriage of the parties hereto, and that second party accepts the provision herein made for her in full satisfaction of her right to support and maintenance." This clause sets forth two conditions of the property settlement agreement: the wife relinquishes her rights in all the property that was or by virtue of the agreement became separate property of the husband, and each spouse discharges all claims then existing or in the future arising as a result of the marital relationship of the parties. Plaintiff bases her claim to the insurance proceeds on a contract made by the husband in her favor while they were married and left in effect by him after the property settlement agreement and the divorce. She makes no claim arising out of the former marital relationship, nor does she assert a right contrary to her general waiver of all rights in the separate property of the husband.

The property settlement agreement setting forth the community property described the insurance policy as one in which the wife was named as beneficiary. As to the property that was to be separate property of the husband, the agreement (designating the husband as first party and the wife as second party) provided: "All funds and property of every nature described or referred to in said Exhibit A, other than the property hereinabove provided to be paid or conveyed to second party, and all property hereinabove referred to as now being the separate property of the first party hereto, together with all property of any nature hereafter possessed or acquired by first party shall be and remain the sole and separate property of said first party, and second party hereby conveys, relinquishes and releases to first party all right, title, interest and claim which she has or might have therein or thereto. Said first party shall have the right to change the beneficiary of the life insurance policy, described in Article VIII of said 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." Under this provision the insurance policy was like any other community property that was to become separate property of the husband. There was no indication that anything else was intended with respect to the policy. The express reference in the agreement to the right of the husband to change the beneficiary indicates that there was no immediate change and that the wife would remain the beneficiary of the policy unless the husband exercised his right to change the beneficiary. It was for the husband to decide whether he wished his wife or someone else to get the proceeds of the policy. If the decedent intended that plaintiff, who was his wife for more than thirty years, should have the insurance proceeds, he would naturally suppose that his intention would be fulfilled if he did not change the beneficiary. It is significant that he lived for several years after the agreement without making such a change. Plaintiff's agreement to execute upon the husband's request any instrument necessary or convenient to change the beneficiary also makes it apparent from the face of the agreement that there was no present renunciation of the wife as beneficiary. Plaintiff's relinquishment of her interest in the "avails" of the policy does not show an intention to give up more than her community rights, which included a share in the proceeds of the policy. The intention of the spouses to exclude from the agreement rights that might accrue to plaintiff at the death of the husband as a result of his bounty is indicated by the provision of the agreement in which plaintiff waived all rights of inheritance in her husband's estate "except in such manner and upon such terms as may be provided in any will and/or codicil thereto of first party in effect at the date of his death." Since the position of a beneficiary named in a life insurance policy as an object of the bounty of the insured is similar to that of a beneficiary of a will ( Cook v. Cook, 17 Cal.2d 639, 646 [ 111 P.2d 322]), plaintiff no more relinquished the right to take as beneficiary of her husband's insurance policy than she relinquished the right to take as beneficiary of his will. In this respect there is a clear distinction between the present case and Sullivan v. Union Oil Co., 16 Cal.2d 229 [ 105 P.2d 922], on which defendants mainly rely. In that case the parties to the property settlement agreed that "`each hereby waive any and all right to the estate of the other left at his or her death and forever quitclaim any and all right to share in the same of the other, . . . and hereby release and waive all right to inherit under any will of the other . . . and from the date of this agreement . . . they shall have all the rights of single persons and maintain the same relation of such toward the other.'" There was no provision, as in the present case, to indicate that the parties contemplated no present renunciation by the husband of the wife as beneficiary, but left it to him to decide in the future whether or not to change the beneficiary. Moreover, the Sullivan case involved, not a contract with an insurance company, but an "Employees' Provident Fund" maintained by the husband's employer, to which the husband contributed by monthly deductions from his salary. Under the facts of that case all interests of the wife in the fund were regarded as part of her interest in the community property and as such released in favor of the husband.

The judgment is affirmed.

Gibson, C.J., Shenk, J., Edmonds, J., and Spence, J., concurred.

SCHAUER, J.

I dissent. The majority opinion takes from the estate of decedent and gives to plaintiff property ("avails" of a specifically described life insurance policy) in which the latter has no right, title, or interest. By formal written agreement for a valuable consideration the plaintiff conveyed to the decedent all of her interest in the avails of the policy. The exact language used by the parties is: "second party [plaintiff] hereby transfers, releases and relinquishes to first party [decedent] all interest in and to said policy of insurance and the premiums paid thereunder and the avails thereof." (Italics added.) We cannot give effect to the words "second party hereby transfers. . . to first party all interest in and to said policy . . . and the avails thereof" and still permit plaintiff to recover. We have no right to give no effect to those words. They are clear and definite in meaning. The word "transfer" means "to convey from one . . . person . . . to another." (Webster's New Int. Dict. (2d ed.).) The majority opinion does not assert, and the evidence does not suggest, that the decedent ever reconveyed to plaintiff any interest in, to, or under the policy, or its "avails." I think that such majority opinion fails to reckon squarely with the essential problem when it declares that "Plaintiff's relinquishment of her interest in the `avails' of the policy does not show an intention to give up more than her community rights, which included a share in the proceeds of the policy." (Italics added.) The instrument effects an out and out conveyance of all interest in the avails of the policy. An actual conveyance is more than a relinquishment.

Neither do I find convincing the argument in the opinion based on the statement that "The intention of the spouses to exclude from the agreement rights that might accrue to plaintiff at the death of the husband as a result of his bounty is indicated by the provision of the agreement in which plaintiff waived all rights of inheritance in her husband's estate `except in such manner and upon such terms as may be provided in any will and/or codicil thereto of first party in effect at the date of his death.'" The foregoing exception is specific and exclusive. It excepts from operation of the relinquishment of plaintiff's rights of inheritance from the decedent only such rights as are encompassed in the language "in such manner and upon such terms as may be provided in any will and/or codicil thereto of first party in effect at the date of his death." It seems almost trite to have to point out that the asserted right claimed in this action by plaintiff is not one which is evidenced or created by "terms . . . provided in any will and/or codicil thereto of first party."

It is an established rule of construction that a proviso or exception is used to limit and qualify that which immediately precedes it and to expressly negative a construction or effect that would prevail in the absence of the proviso or exception; that which is specifically excepted from the operation of the general clause would, in the absence of the proviso or exception, have been included within the operation of such general clause. (17 C.J.S. § 343, pp. 796-797 [rule as to contracts]; see, also, People ex rel. Happell v. Sischo (1943), 23 Cal.2d 478, 493 [ 144 P.2d 785, 150 A.L.R. 1431] [rule of statutory construction].) Furthermore, the express enumeration of exceptions indicates the exclusion of any other exceptions. (17 C.J.S. § 343, p. 797 [rule as to contracts]; see, also, Belloc v. Rogers (1858), 9 Cal. 123, 128; Tynan v. Walker (1869), 35 Cal. 634, 639 [95 Am.Dec. 152]; Rothschild v. Superior Court (1930), 109 Cal.App. 345, 348 [ 293 P. 106]; C.I.T. Corp. v. Biltmore Garage (1934), 3 Cal.App.2d Supp. 757, 761 [ 36 P.2d 247]; In re De Neef (1941), 42 Cal.App.2d 691, 694 [ 109 P.2d 741] [rule of statutory construction].) There is no presumption in favor of plaintiff. She had sued Mr. Grimm, the decedent, for divorce. She contracted with him freely, upon an equal footing.

The declaration in the opinion that "Since the position of a beneficiary named in a life insurance policy as an object of the bounty of the insured is similar to that of a beneficiary of a will [citation] plaintiff no more relinquished the right to take as beneficiary of her husband's insurance policy than she relinquished the right to take as beneficiary of his will" seems to me to be a non sequitur. The exception clause expressly reserves to plaintiff the right to take as beneficiary under a will or codicil thereto but it does not reserve or create the right to succeed otherwise to avails of the insurance policy, which policy and the "avails thereof" plaintiff had conveyed to decedent for a valuable consideration.

The transfer in writing to decedent of all of plaintiff's interest in and to the policy and its "avails" immediately divested plaintiff of all her interest in and to such policy and its "avails" and vested all of such interest in decedent as his separate property. There was no necessity for him to change the policy-designated beneficiary; he owned and there was vested in him all of such beneficiary's interest. She could thereafter acquire no interest in or right to the policy proceeds except by affirmative and competent action of the decedent to that end. He could have made a will or codicil bequeathing such avails to plaintiff but he did not do so. He chose to keep such policy and its avails for himself and his estate. His estate is now entitled to have them free of any claim of plaintiff, for which she has long since received fair compensation and of which she divested herself by voluntary action.

The provision in the agreement by which plaintiff bound herself to execute upon Mr. Grimm's request any instrument necessary or convenient to change the beneficiary does not, in my view, make it apparent, as asserted in the opinion, "that there was no present renunciation of the wife as beneficiary" in any material sense. Since Mr. Grimm had bought, paid for, and received a conveyance of plaintiff's entire interest there is apparent no essential reason why he should have desired or thought that he needed to have the policy itself amended to show a change in the designated beneficiary until and unless he wanted to name some third person as beneficiary. To accomplish that end he might well have needed plaintiff's execution of a proper document and, therefore, an appropriate covenant to that end was included in the agreement, but insofar as Mr. Grimm's rights against the plaintiff were concerned, if he wanted the avails of the policy to go to his estate, he already, in the agreement, had everything which he could reasonably anticipate would be needed.

Lastly, I find no substantial ground for distinguishing this case from our opinion in Sullivan v. Union Oil Co. (1940), 16 Cal.2d 229, 233 [ 105 P.2d 922]. The agreement in that case provided that "each [husband and wife] hereby waive any and all right to the estate of the other left at his or her death and forever quitclaim any and all right to share in the same of the other, . . . and hereby release and waive all right to inherit under any will of the other . . . and from the date of this agreement . . . they shall have all the rights of single persons and maintain the same relation of such toward the other." The agreement in the case now before us seems more certain and efficacious to the end in question than does that involved in the Sullivan case. In addition to the language of conveyance and relinquishment hereinabove quoted the agreement we are construing provides that "All funds and property of every nature described or referred to in said Exhibit A [with certain immaterial exceptions but specifically including the mooted policy] . . . together with all property of any nature hereafter possessed or acquired by first party [the decedent] shall be and remain the sole and separate property of said first party, and second party [plaintiff] hereby transfers, conveys, relinquishes and releases to first party all right, title, interest and claim which she has or might have therein or thereto." (Italics added.) Here the plaintiff not only released and relinquished all claims arising out of the marital status but she expressly conveyed to the decedent all of her interest in and claim to the precise property in controversy. Such conveyance, instead of indicating as asserted in the opinion "that the parties contemplated no present renunciation by the husband of the wife as beneficiary," in any material sense, conclusively establishes that the wife thereupon completely divested herself of all interest under the policy, specifically including the "avails thereof" and any claim which she "might have therein or thereto." In other words she expressly conveyed to Mr. Grimm all of her interest as beneficiary and agreed that it should "remain" his "sole and separate property." Certainly, he could have reconveyed it to her, but he never did so.

As previously shown, there was no occasion or reason for Mr. Grimm, the former husband, to change the name of the beneficiary shown in the policy unless and until he wanted to designate a third person to that status. Since he apparently wished only to have the proceeds go to his own estate he rested upon the conveyance from plaintiff which, at least so far as appears, was never questioned during his lifetime and the due execution and fairness of which are not now questioned. We should not now, after his death, enable plaintiff to gratuitously take from his estate that which was his.

The judgment should be reversed.

Carter, J., concurred.

Appellants' petition for a rehearing was denied April 23, 1945. Carter, J., and Schauer, J., voted for a rehearing.