In re Shoemaker

• Decision Date: 20 July 1915
• Docket Number: 5137.
• Parties: In re SHOEMAKER.
• Court: U.S. District Court — Eastern District of Pennsylvania

225 F. 329

In re SHOEMAKER.

No. 5137.

United States District Court, E.D. Pennsylvania.

July 20, 1915

Clinton O. Mayer, of Philadelphia, Pa., for claimant.

Alfred Aarons, of Philadelphia, Pa., for trustee.

THOMPSON District Judge.

In this case the referee has certified for review an order dismissing a petition of the trustee for an order upon the bankrupt to execute papers necessary for the purpose of vesting in the trustee the power to obtain the surrender value of four certain policies of life insurance issued by the Prudential Life Insurance Company of America on the life of the bankrupt. It was agreed at the hearing before the referee that the insurance policies provided that Florence M Shoemaker, daughter of the bankrupt, should be the beneficiary, with the right to change the beneficiary; that Florence M. Shoemaker is a minor of 18 years of age dependent upon her father, Samuel Shoemaker; and that she was made the beneficiary not in contemplation of bankruptcy. Florence M. Shoemaker claims the policies, and the benefits derived therefrom, as exempt from creditors, by virtue of the act of assembly of April 15, 1868 (Pamphlet Laws, page 103).

It appears from the opinion of the referee that the policies in question are four in number and the surrender value amounts to $3,074.52. The precise terms of the clause as to the change of beneficiary contained in the policies are as follows 'The insured may at any time while this policy is in force, by written notice to the company at its home office change the beneficiary or beneficiaries, such change to take effect only upon indorsement of the same on the policy by the company, whereupon all rights of the former beneficiary or beneficiaries shall cease: Provided, however, that no such change of beneficiary shall be valid if the policy or any interest therein be assigned at the time of such change.'

The act of assembly of the state of Pennsylvania, approved April 15, 1868 (P.L. 103), provides that:

'All policies of life insurance or annuities on the life of any person, which may hereafter mature, and which have been or shall be taken out for the benefit of, or bona fide assigned to, the wife or children or any relative dependent upon such person, shall be vested in such wife or children or other relative, full and clear from all claims of the creditors of such person.'

The trustee claims that he is entitled to the cash surrender value of these policies under section 70a (5) of the Bankruptcy Act.

In the case of In re Jamison Bros. & Co. (D.C.) 222 F. 92, on page 96, decided April 1, 1915, by Judge Dickinson, but not reported until after the decision of the referee and the filing of the certificate of review in this case, my learned colleague says:

'We are of opinion that, whatever may be the case in other jurisdictions, the rulings by which we are bound do not leave open to discussion these propositions:

'1. Where there has been

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