Report No. 82
5.6. English case of purchase in the name of another.-
In some of the judgment of the High Courts in India, reference is made to the English case of Beron Kensington.1 In that case a policy of insurance was taken out by one Sanderson on his own life on behalf of his wife's sister, Miss Stiles, and the policy provided that Miss Stiles, her executors, administrator and assigns, should be entitled to receive the policy moneys on his death. Sanderson, who survived Miss Stiles, retained the policy, and paid the premiums till his death; and the question for decision was whether the legal personal representatives of Miss stiles were trustees for the policy moneys for the legal personal representatives of Sanderson. Joyce, J., quoted the following statement of Lord Romily in Carrick v. Taylor, (1860) 29 Beav 79 (83).-
"If a purchase be made by one in the name of another, the presumption is that the latter is a trustee for the person who pays the money, unless the parties stand in the relation of parents and child.
Now, in the present case a policy was taken out by Mr. Sanderson a great many years ago, and the name of Miss Stiles appears in the policy as the person to whom the money is to be paid. The policy was never handed to her, and she is now dead, and the premiums were always paid, and were paid for many years after her death, by Sanderson. That, really is a case of a man taking the policy out in the name of another, that other person being a sister of his wife, and therefore, not standing in any relation to him 'that would meet the presumption', as Lord Eldon expressed it.
It comes really to this, a purchase by one to the name of another with no other circumstances at all proved. Therefore, in my opinion, although the legal personal representative of the lady in this case would be the person entitled to receive the money at law and to give a receipt for it, in equity the money belongs to the legal personal representative of Mr. Sanderson, who took out the policy."
It may be noted that the nominee was not standing in such relationship as to raise a presumption of an intention to benefit the nominee.2
1. Baron Kensington Earl of Longford (in re:) v. Baron Kensington, (1963) 1 Ch D 303.
2. See cases in para. 6.4, infra.