Kirkpatrick v. Johnson

• Citation: 197 F. 235
• Decision Date: 18 June 1912
• Docket Number: 2.
• Parties: KIRKPATRICK v. JOHNSON.
• Court: U.S. District Court — Eastern District of Pennsylvania

197 F. 235

KIRKPATRICK v. JOHNSON.

No. 2.

United States District Court, E.D. Pennsylvania.

June 18, 1912

Kirkpatrick & Maxwell, of Easton, Pa., for complainant.

James W. Fox and Robert A. Stotz, both of Easton, Pa., for defendant.

J. B McPHERSON, Circuit Judge.

On April 25, 1911, Harry K. Johnson was adjudged bankrupt, and on May 6th the plaintiff qualified as trustee. He seeks by this suit to perfect his claim to a policy of life insurance now in the defendant's possession, in order that he may realize its surrender value for the benefit of the estate. Without discussing the evidence that supports them, I state my findings of fact as follows:

On December 27, 1900, the bankrupt took out a 20-year term $10,000, policy of life insurance in the Equitable Life Assurance Society of New York, in favor of Osborne H. Snyder who was then his partner; or, if Snyder should die first, then in favor of the bankrupt's executors, administrators, or assigns. The policy expressly reserved the right of the assured to change the beneficiary, and accordingly, on June 9, 1908, he substituted his own executors, administrators, or assigns in place of Snyder. No other change of beneficiary has since been made, but on June 10, 1910, the policy having then a cash surrender value of $1,300, which the insurance company was bound to pay to the bankrupt on demand, he transferred the policy to his wife, the present defendant, by an assignment in writing. She knew nothing about the transaction until after the bankruptcy. He was insolvent in June, and continuously thereafter until the date of adjudication. There was no consideration for the assignment, and no agreement between his wife and himself in relation thereto. He knew that he was in financial difficulties, and both the intent and the effect of the transaction were to hinder, delay, and defraud the bankrupt's creditors then existing. Among these creditors was the Converse Rubber Shoe Company, to whom he remained indebted continuously in large and varying amounts until the date of adjudication; the shoe company being then his only creditor. Between June 10, 1910, and April 25, 1911, the bankrupt paid the further sum of $772.50 to the insurance company, being premiums for three years upon the policy, one premium of $257.50 being due on November 21, 1910, and the other two premiums being paid unnecessarily in advance. These payments were made for the benefit of his wife,...