By the decided weight of authority it is held that an assignment of an insurance policy is a contract distinct and separate from the contract of insurance, and is governed by the law of the place where the assignment is made.
While the plaintiff daughter was still a minor, the insured executed an assignment of his policy and "all the dividend, benefit and advantage." The assignment was lodged with the defendant insurance company. When a creditor later obtained a judgment against the daughter and sought to garnish the policy, the insured insisted that he was the owner, and judgment was entered for the insured. The daughter sought to recover on the policy after he died. The company demurred to the complaint because there was no allegation that the assignment was delivered or even made known to the daughter. The demurrer was overruled, and judgment was entered against the company. In affirming on review, the court affirmed and ruled that Pennsylvania law applied.
Was plaintiff's cause of action barred by the proceedings in the court of Pennsylvania?
Pennsylvania law applied because that is where the assignment was made, and an assignment to a minor child was sufficient without an actual delivery because, in retaining the papers, the insured was deemed to have held them for his minor daughter. The judgment in the garnishment proceedings that the insured was the owner did not bar the daughter's claim because she made no appearance and the service of process upon her was invalid under the Pennsylvania act of April 6, 1859. The proceedings in the Pennsylvania court present no defense to the plaintiff's cause of action.