.1ETNA NAT. BANK '11. MANHATTAN LIFE INS. CO.
lETNA NAT. BANK
and others v.
MANHATTAN LIFE INS.
Co. and others.
(Oircuit OQurt, S. D. New York.
DECEASED DEBTOR TO BET ASIDE.
J. FRAUDPLENT ASSIGNMENT OF LIFE INSURA:NCE POLIcy-BILL BY CnEDITORS OF
A bill in equity may be maintained by creditors of a deceased debtor to set aside a fraudulent assignment of a life insurance policy originally payable to the debtor. his executors, administrators, and assigns, but fraudulently assigned by him to his wife while he was insolvent, and without valuaule consideration, notwithstanding such creditors have not obtained judgments at law against the debtor in his life-time, or against his representa(,ives after his decease; it appearing that the complainants had, prior to the death of I he deutor, outained a decree in equity against him and his wife in the circuit court of the United States for the Northern district of Florida, in which the amount of the complainants' debts was adjusted, and in which the said deutor was adjudged to be absolutely insolvent.
SAME-INJUNCTION PENDENTE LITE.
It appearing that the fund would be liahle to be placed out of the jurisdiction of the court, and beyond the I each of creditors in case they should be ultimately found to be entitled, if the injunction should be refused, held, that an injunction pendente lite should be granted to rest! ain the insurance company from paying over the ill,'ney under the policies until the rights of the parties should be dcrtermined.
In Equity. William B. Hornblomer, for plaintiffs. John W. Weed, for defendants. WHEEIJER, J. According to the bill in this case the policies in question on the life of the husband were origmally made payable to the executors, administrators, or assigns of the husband, and the premiums were paid out of his property, which, in equity, belonged to his creditors. And the assignment to the wife shortly before the death of the husband was for a merely nominal consideration, pecuniarily, and was made for the purpose of the avails of the policy beyond the reach of his creditors. It is inferable, from the statements of the bill, that the assignment was made in Florida, and not in New York. Its effect may be governed by the laws there rather than by the laws of New York, where the insurance company is located. And by the laws of either the assignment may be so far inoperative, as against his creditors who bring this bill, as to entitle them to the amount due on the policy in preference to the wife as assignee. The fund would be quite liable to be placed out of the jurisdiction of this court, and beyond the reach· of the creditors, in case they should be ultimately found to be entitled, if an injunction should be refused and the stay already granted vacated. It seems proper, therefore, that the fund be held where it is until the rights of the parties to it are determined. It is objected that the creditors have not a sufficient judgment at law upon their claims to entitle them to maintain this proceeding. They have, however, a decree of the circuit court of the United States v.24F,no.14-49
for the district of Florida, to which these creditors and the claimant were parties, as well as the debtor, in which,upon similar issues, the amount of their debts, respectively, was adjusted for the same purposes. And, further, the debtor has died leaving the sum due on these policies as a part of his estate, if it belongs to his estate, within this jurisdiction, with no other creditors, so far as yet appears here. These grounds may be foulld sufficient to uphold the proceedings. Motion for injunction granted·
..:ETNA NAT. BANK
and others v. UNI'fED others.
STATES LIFE INS.
(Oircuit Oourt, S. D. New York.
FRAUD ON CREDITORS-PREMIUMS PAID TO LIFE INSURANCE COMPANY-STATUTE OF NEW YORK.
A bill in equity may be maintained by creditors of a deceased debtor to reach premiums paid to a life insurance company in fraud of creditors of the insured out of funds of the insured, and in furtherance of a combination and conspiracy between the inRured and his wife to hinder, delay, and defraud the creditors of the deceased, notwithstanding the said pnlicies were made payable to the wife of the deceased, and notwithstanding the provisions of the statutes of New York exempting such policies from the claims of creditors of the husband, where the premiums do not exceed $GOO. But the creditors have no claim upon the insurance in such case beJ'ond the amount of the premiums and interest therton.
In Equity. William B. Hornblower, for plaintiffs. John W. Weed, for defendants. WHEELER, J. The policies in this case upon the life of the husband were originally made for the benefit of, and payable to, the wife. According to the bill the premiums were paid from thjl property of the husband in fraud of the rights of hiscreditors, who bring this bill. If this is all true, the amount due on the policy does not represent the property of the husband, nor any part of his estate, beyond the amount of the premiums. The insurance was upon her interest in his life, not the creditors' interest in his life, and the amount due represents her interest, and, beyond the amount of the premiums, is hers. An amount equal to the amount of the premiums may represent so much of his estate, and in equity belong to his creditors. They may ultimately, by these proceedings, reach that amount, but there appears to be no fair ground on- which they can reach more. Motion granted for an injunction to restrain payment of so much of policies as equals in amount the premiums paid thereon, with interest, and stay of proceedings vacated as to residue.