INTESTATE ESTATE OF THE LATE ESPERANZA J. VILLANUEVA, PABLO ORO, ADMINISTRATOR; MARIANO J. VILLANUEVA, CLAIMANT AND APPELLANT.

PARAS, J.:

The West Coast Life Insurance Company issued two policies of Insurance on the
life of Esperanza Villanueva, one for two thousand pesos and maturing on April
1, 1943, and the other for three thousand pesos and maturing on March 31, 1943,
In both policies (with corresponding variation in, amount land date of maturity)
the insurer agreed “to pay two thousand pesos, at the home office of the
Company, in San Francisco, California, to the insured hereunder, if living, on
the 1st day of April 1943, or to the beneficiary Bartolome Villanueva, father of
insured, immediately upon receipt of due proof of the prior death of the
insured, Esperanza J. Villanueva, of La Paz, Philippine Islands, during the
continuance of this policy, with right on the part of the insured to change the
beneficiary.”

After, the death of Bartolome Villanueva in 1940, the latter was duly
substituted as beneficiary under the policies by Mariano J. Villanueva, a
brother of the insured. Esparanza J. Villanueva survived the insurance period,
for she died only on October 15, 1944, without, however, collecting the
insurance proceeds. Adverse claims for said proceeds were presented by the
estate of Esperanza J. Villanueva on the one hand and by Mariano J. Villanueva
on the other, which conflict was squarely submitted in the intestate proceedings
of Esperanza J. Villanueva.pending in the Court of First Instance of Iloilo.
From an order, dated February 26, 1947, holding that the state of the insured is
entitled to the insurance proceeds, to the exclusion of the beneficiary, Mariano
J. Villanueva, the latter has interposed the present appeal.

The lower court committed no error. Under the policies, 4he insurer obligated
itself to pay the insurance proceeds (1) to the insured if the latter lived on
the dates of maturity or (2) to the beneficiary if the insured died during the
continuance of the policies. The first contingency of course excludes the
second, and vice versa. In other words, as the insured Esperanza J. Villanueva
was living on April 1, and March 31, 1943, the proceeds are payable exclusively
to her or to her estate unless she had before her death otherwise assigned the
matured policies. It is not here pretended and much less proven, that there was
such assignment.) The beneficiary, Mariano J. Villanueva, could be entitled to
said proceeds only in default of the first contingency. To sustain the
beneficiary’s claim would be to altogether eliminate from the policies the
condition that the insurer “agrees to pay * * * to the insured hereunder, if
living”.

There is nothing in the Insurance Law (Act No. 2427) that militates against
the construction placed by the lower court on the disputed condition appearing
in the two policies now under advisement. On the contrary, said law provides
that “an insurance upon life may be made payable on the death of the person, or
on his surviving a specified period, or otherwise contingently on the
continuance or cessation of life” (Sec, 165), and that “a policy of
insurance upon life or health may pass by transfer, will, or succession, to any
person, whether he has an insurable interest or not, and such person may
recover upon it whatever the insured might have recovered” (Section
166).

Counsel for the beneficiary invokes the decision in Del Val vs. Del
Val, 29 Phil. 534, 540, in which it was held that “the proceeds of an insurance
policy belong exclusively to the beneficiary and not to the estate of the person
whose life was insured, and that such proceeds are the separate and individual
property of the beneficiary, and not of the heirs of the person whose life was
insured.” This citation is clearly not controlling, first, because it does not
appear therein that the insurance contract contained the stipulation appearing
in the policies issued on the life of Esperanza J. Villanueva and on which the
appealed order in the case at bar is based; and, secondly, because the Del Val
doctrine was made upon the authority of the provisions of the Code Commerce
relating to insurance (particularly section 428) which had been expressly
repealed by the present Insurance Act (No. 8427).

Our pronouncement is not novel, since it tallies with the following typical
American authorities: “If a policy of insurance provides that the proceeds shall
be payable to the assured, if he lives to a certain date, and, in case of his
death before that date, then they shall be payable to the beneficiary
designated, the interest of the beneficiary is a contingent one, and the benefit
of the policy will only inure to such beneficiary in case the assured dies
before the end of the period designated in the policy.” (Couch, Cyclopedia of
Insurance Law, Vol. 2, Sec. 343, p. 1023.) “Under endowment or tontine policies
payable to the insured at the expiration of a certain period, if alive, but
providing for the payment of a stated sum to a designated beneficiary in case of
the insured’s death during the period mentioned, the insured and the beneficiary
take contingent interest. The interest of the insured in the proceeds of the
insurance depends upon his survival of the expiration of endowment period. Upon
the insured’s death, within the period, the beneficiary will take, as against
the personal representative or the assignee of the insured. Upon the other hand,
if the insured survives she endowment period, the benefits are payable to him or
to his assignee, notwithstanding a beneficiary is designated in the policy.” (29
Am. Jur., Vol. 29, section 1277, pp. 952, 953.)

The appealed order is, therefore, Hereby affirmed, it is so ordered with
costs against the appellant.

Feria, Pablo, Perfecto, Bengzon, Briones, Padilla, and Tuason,
JJ., concur.