New York Life Insurance Co. v. Dunlevy

In 1907, Boggs & Buhl (Boggs) obtained a personal judgment by default against Effie Dunlevy (plaintiff) in Pennsylvania state court. At the time, Dunlevy was a Pennsylvania resident. In 1909, the surrender value of a New York Life Insurance Company (NYLI) (defendant) life-insurance policy on Joseph Gould (defendant), Dunlevy’s father, became due for $2,479.70. Dunlevy alleged that the policy had been assigned to her in 1893. In November 1909, Boggs attempted to attach its judgment against Dunlevy to the life-insurance money, summoning Gould and NYLI as garnishees. Gould answered, contesting any assignment to Dunlevy and claiming full right to the funds. NYLI paid the disputed money into the court to be paid out to the correct party. NYLI also sought to interplead the parties to determine the correct recipient in one proceeding. Despite being notified of the request for interpleader, Dunlevy, who had moved to California, did not respond. Instead, Dunlevy initiated a separate action in California against Gould and NYLI, seeking to recover the insurance money. In the Pennsylvania case, the court found that there was no assignment and awarded the money to Gould. Meanwhile, in the California case, which had been removed to federal court, the district court awarded the money to Dunlevy, and the court of appeals affirmed. Gould appealed, arguing that the Pennsylvania judgment barred Dunlevy’s recovery. He argued that the Pennsylvania judgment was binding on Dunlevy because the Pennsylvania court originally had jurisdiction over Dunlevy in the action by Boggs in 1907.