rupt's estate becomes transformed into a judg-| Adams, 59 N. Y. 233; McDonald v. Whitney, ment, it will nevertheless be extinguished by a 12 Hun, 95. subsequent discharge in bankruptcy. Monroe v. Upton, 50 N. Y. 593; Ocean Bank V. Olcott, 46 N. Y. 22; Arnold v. Oliver, 2 N. Y. Civ. Pro. Rep. 457: Dewey v. Moyer, 72 N. Y. 75.

Among these facts was not involved the ques-trict of Massachusetts, rendered on the 26th day tion of a discharge in bankruptcy; it did not of March, 1875, five days before judgment in then exist. the state court.

[564]

565]

"As Conclusions of Law:
"I. That the said proceedings in bankruptcy
are no bar to the present action, and consti-
tute no defense herein.

96

"II. That the plaintiff should have judgment against the defendant for the sum of three thousand five hundred and ninety-five dollars ($3,595.15), with interest from April 1, 1875, amounting to one thousand one hundred and forty-two dollars ($1,142.96), making in all four thousand seven hundred and thirty-eight dollars ($4,738.11), together with the costs of this action, to be taxed; and an allowance, in addition to costs, amounting to the sum of seventy-five dollars."

circumstances, even after judgment, it might
be made the foundation for setting it aside and
admitting the defense. Ray v. Wight, 119 Mass.
426; Page v. Cole, 123 Mass. 93; Golden v. Blas-
kopf, 126 Mass. 523. Nothing of the kind was
attempted. The question before the Massa-
chusetts court for decision, at the moment it
rendered its judgment was whether Dimock
was then indebted to the Copper Company. Of
Dimock and of this question it had complete
jurisdiction, and it was bound to decide it
on the evidence before it. Its decision was
therefore conclusive, as much so as any judg-
ment where the jurisdiction is complete. It
concluded Mr. Dimock from ever denying that
he was so indebted on that day, wherever that
judgment was produced as evidence of the
debt. If he had the means at that time to prove
that the debt had been paid, released or other-
wise satisfied, and did not show it to the court,
The only question considered at all these he cannot be permitted to do it in this suit; and
trials was whether the discharge of the defend- the fact that the evidence that he did not then
ant in the bankruptcy proceeding is under the owe the debt was the discharge in bankruptcy,
facts found by the court a bar to the present made five days before, does not differ from a
action; and as the decision by the New York payment and receipt in full or a release for a
Court against the plaintiff in error, as to the valuable consideration. Cromwell v. Sac Coun
effect of that order of discharge, is to refuse to ty, 94 U. S. 357 [Bk. 24, L. ed. 200]. Also, Claf-
him a right claimed under the laws of the Unit-lin v. Houseman, 93 U. S. 134 [Bk. 23, L. ed.
ed States, this court has jurisdiction to review
the decision.

The judgment rendered on these findings was reversed by the supreme court in general term, and that judgment was in turn reversed by the court of appeals, which restored the judgment of the special term. 90 N. Y. 33.

The Superior Court of Massachusetts had jurisdiction of the suit of the Copper Company against Dimock, both as regards the subject matter and the parties. This jurisdiction was rendered complete by service of process and by the appearance of the defendant. All this was before the beginning of the bankruptcy proceeding. Nothing was done to oust this jurisdiction, and the case accordingly proceeded in due order to the rendition of the judgment which is the foundation of this action. It is not argued that this judgment was void, or that the court was ousted of its jurisdiction by anything done in the bankruptcy court. No such argument could be sustained if it were made. In the case of Eyster v. Gaff, 91 U. S. 521 [Bk. 23, L. ed. 403], which was very similar to this on the point now before the court, it was said: "The court in that case had acquired jurisdiction of the parties and of the subject matter of the suit. It was competent to administer full justice, and was proceeding according to the law which governed such a suit to do so. It could not take judicial notice of the proceedings in bankruptcy in another court, however seriously they might affect the rights of parties to the suit already pending. It was the duty of that court to proceed to a decree between the parties before it, until by some proper plead ings in the case it was informed of the changed relations of any of the parties to the subject matter of the suit. Having such jurisdiction, and performing its duty as the case stood in that court, we are at a loss to see how its decree can be treated as void." The court then goes on to show that if the assignee had brought his right, acquired pendente lite, to the notice of the court, it would have been protected. Hill v. Harding, 107 U. S. 631 [Bk. 27, L. ed. 493]. So here, if Dimock had brought his discharge to the attention of the superior court at any time before judgment, it would have been received as a bar to the action; and under proper

838]. A still stronger case of the validity of
judgments of a state court, in their relation to
bankruptcy proceedings had pendente lite, is
that of Davis v. Friedlander, 104 U. S. 570 [Bk.
26, L. ed. 818].

In the case of Thatcher v. Rockwell, 105 U.
S. 467 [Bk. 26, L. ed. 949], the Chief Justice,
after alluding to these and other cases, says:
"They establish the doctrine that, under the
late bankrupt law, the validity of a pending
suit or of the judgment or decree thereon was
not affected by the intervening bankruptcy of
one of the parties; that the assignee might or
might not be made a party; and whether he
was or not he was equally bound with any
other party acquiring an interest pendente lite."

It is said, however, that though the defenddant had his discharge before the judgment in the state court was rendered and might have successfully pleaded it in bar of that action and [566] did not do so, the judgment now sued on is the same debt and was one of the debts from which, by the terms of the bankrupt law, he was discharged under the order of the bankruptcy court, and to any attempt to enforce that judg ment the discharge may still be shown as a valid defense. That is to say, that the failure of the defendant to plead it when it was properly pleadable, when, if he ever intended to rely on it as a defense, he was bound to set it up, works him no prejudice, because, though he has a dozen judgments rendered against him for this debt after he has received his discharge, he may at any time set it up as a defense when these judgments are sought to be enforced. Upon the same principle, if he had appeared in the state court and pleaded his discharge in bar, and it had been overruled as a sufficient bar, he could, nevertheless, in this action on that judgment, renew the defense.

But in such case his remedy would not lie in renewing the struggle in a new suit on such judgment, but in bringing the first judgment for review before this court where his right under the discharge would have been enforced

1911

then, as he seeks to do it now, after submitting to that judgment without resistance and without complaint.

contract was induced or effected by Hunters fraud, such fraud vitiated the contract.

Shilling v. Accidental Death Ins. Co. 2 Hurl. & N. 42; Rawls v. Am. Mutual Life Ins. Co. 27 N. Y. 287; Prince of Wales Assurance Co. v. Palmer, 25 Beav. 605; Ford v. Belmont, 7 Robt. 97. See also Hills v. Miller, 3 Paige, 254; Parks v. Comstock, 59 Barb. 16.

The whole policy and every right and interest under it were assignable.

St. John v. Am. Mutual Life Ins. Co. 13 N. Y. 31; 24 Am. Law Reg. 753, where the cases are digested.

We are of opinion that, having in his hands good defense at the time judgment was rendered against him, namely: the order of discharge, and having failed to present it to a court which had jurisdiction of his case, and of all the defenses which he might have made, including this, the judgment is a valid judgment, and that the defense cannot be set up here in an action on that judgment. The case of Steward v. Green, 11 Paige, 535, seems directly in point. So also are Hollister v. Abbott, 31 N. H. 442 and The learned court below held that the makBradford v. Rice, 102 Mass. 472. ing of the policy payable to the legal represenIt is clear that until the judgment of the Mas-tatives in the event of Armstrong's death was sachusetts court is set aside or annulled by some direct proceeding in that court, its effect cannot be defeated as a cause of action, when sued in another State, by pleading the discharge as a bar which might have been pleaded in the origi nal action.

MUTUAL LIFE INSURANCE COMPANY
OF NEW YORK, Piff. in Err..

the designation of a class which took from Armstrong the power to divert the fund from that particular class; in other words, that the contract was with Armstrong's administratrix as a person distinct from Armstrong, which, of course, is a legal impossibility.

Wason v. Colburn, 99 Mass. 342; N. Y. Life Ins. Co. v. Flack, 3 Md. 341; 1 Bigelow, Ins. Rep. 146.

If a policy of life insurance once has a valid inception it may be assigned to any one, whether such assignee has an insurable interest in the life insured or not.

St. John v. Am. Mut. Life Ins. Co. 2 Duer, 419; S. C. 13 N. Y. 31; Valton v. Nat. Fund Life Ins. Co. 20 N. Y. 32; Olmsted v. Keyes, 85 JULIA ARMSTRONG, Admrx. of JOHN M. N. Y. 593; Bond v. Bunting, 78 Pa. St. 210;

ARMSTRONG, Deceased.

(See S. C. Reporter's ed. 591-600.)

Cunningham v. Smith, 70 Pa. St. 450.

The court erred in rejecting evidence of contemporaneous acts of fraud on the part of Hunter, showing or tending to show the formation

Life insurance-assignability of endowment pol- by him of a wicked and dishonest scheme, of icy-evidence-fraud.

which this swindling of the plaintiff in error was only a part.

Cary v. Hotailing, 1 Hill, 811; Bottomley v. U. S. 1 Story, 135; Castle v. Bullard, 23 How. 172 (Bk. 16, L. ed. 424); Butler v. Watkins, 13 Wall. 456 (Bk. 20, L. ed. 629).

Messrs. Herbert T. Ketcham, and George M. Mackellar, for defendant in error:

1. An endowment policy of insurance payable to the assured or his assigns at a certain date, or to his legal representatives if he should die before that time, is assignable by the assured, where the assignment is not made to cover a mere speculative risk; and the insurance passes to the assignee although the assured dies within the endowment period. 2. Evidence tending to prove that the assignee of such a policy caused the death of the assured, by Neither the assignment nor its duplicate was felonious means, is admissible in an action by him the act of Armstrong. Proof, sufficient to susagainst the company to recover on the policy. 3. Evidence tending to show that the assignce ef- tain a finding, was submitted to the jury that fected insurances upon the life of the assured in he never executed either paper; never authorother companies, at about the same time, is admis-ized their execution and never made or sancsible in support of the theory of the defense, that, in obtaining the insurance in question, it was the object of the assignee to cheat and defraud the de[No. 173.]

fendant company.

Argued Mar. 16, 17, 1886. Decided Apr.5, 1886.

IN ERROR to the Circuit Court of the United States for the Eastern District of New York. The history and facts of the case appear in the opinion of the court.

Messrs. Joseph H. Choate, Evarts and Southmayd, for plaintiff in error:

The application for the policy by Armstrong was at the instance and procurement of Hunter; its delivery was made by the Company directly to Hunter, for his own benefit, with the assent of Armstrong, as expressed by the assignment executed by Armstrong simultaneously with the making of the application.

These acts constituted a contract between Hunter and the Company, wherein Hunter, and not Armstrong was the principal; and if such

tioned any delivery of either paper; that whether he gave any authority for the delivery or not, no delivery was made; and that any delivery, if made, was void for fraud.

The proposition that the policy in suit was a contract between Hunter and the Company, and as such was void for Hunter's fraud, will not be entertained by this court, since the verdict of the jury must be assumed to embrace a finding that Hunter never took any relation whatever to the contract of insurance.

The contract was in writing and extrinsic evidence cannot be allowed to vary its clear and well defined stipulations.

Rawls v. Am. Mut. Life Ins. Co. 27 N. Y. 287, will be found not to have changed the fundamental canon forbidding the variation of express written instruments.

See also Lawrence v. For, 20 N. Y. 268.

Plaintiff in error seeks to avoid the policy by imputing Hunter's fraud to Armstrong, upon the theory that Hunter was Armstrong's agent.

[564]

[565]

"As Conclusions of Law:

"I. That the said proceedings in bankruptcy are no bar to the present action, and constitute no defense herein.

96

"II. That the plaintiff should have judgment against the defendant for the sum of three thousand five hundred and ninety-five dollars ($3,595.15), with interest from April 1, 1875, amounting to one thousand one hundred and forty-two dollars ($1,142.96), making in all four thousand seven hundred and thirty-eight dollars ($4,738.11), together with the costs of this action, to be taxed; and an allowance, in addition to costs, amounting to the sum of seventy-five dollars."

The judgment rendered on these findings was reversed by the supreme court in general term, and that judgment was in turn reversed by the court of appeals, which restored the judgment of the special term. 90 N. Y. 33.

circumstances, even after judgment, it might be made the foundation for setting it aside and admitting the defense. Ray v. Wight, 119 Mass. 426; Page v. Cole, 123 Mass. 93; Golden v. Blaskopf, 126 Mass. 523. Nothing of the kind was attempted.

chusetts court for decision, at the moment it The question before the Massarendered its judgment. was whether Dimock was then indebted to the Copper Company. Of Dimock and of this question it had complete jurisdiction, and it was bound to decide it on the evidence before it. Its decision was therefore conclusive, as much so as any judg ment where the jurisdiction is complete. It concluded Mr. Dimock from ever denying that he was so indebted on that day, wherever that judgment was produced as evidence of the debt. If he had the means at that time to prove that the debt had been paid, released or otherwise satisfied, and did not show it to the court, he cannot be permitted to do it in this suit; and the fact that the evidence that he did not then owe the debt was the discharge in bankruptcy, made five days before, does not differ from a payment and receipt in full or a release for a valuable consideration. Cromwell v. Sac Coun ty, 94 U. S. 357 [Bk. 24, L. ed. 200]. Also, Claf

The only question considered at all these
trials was whether the discharge of the defend-
ant in the bankruptcy proceeding is under the
facts found by the court a bar to the present
action; and as the decision by the New York
Court against the plaintiff in error, as to the
effect of that order of discharge, is to refuse to
him a right claimed under the laws of the Unit-lin v. Houseman, 93 U. S. 134 [Bk. 23, L. ed.
ed States, this court has jurisdiction to review
the decision.

The Superior Court of Massachusetts had
jurisdiction of the suit of the Copper Company
against Dimock, both as regards the subject
matter and the parties. This jurisdiction was
rendered complete by service of process and by
the appearance of the defendant. All this was
before the beginning of the bankruptcy pro-
ceeding. Nothing was done to oust this juris-
diction, and the case accordingly proceeded in
due order to the rendition of the judgment
which is the foundation of this action. It is
not argued that this judgment was void, or that
the court was ousted of its jurisdiction by any-
thing done in the bankruptcy court. No such
argument could be sustained if it were made.
In the case of Eyster v. Gaff, 91 U. S. 521 [Bk.
23, L. ed. 403], which was very similar to this
on the point now before the court, it was said:
"The court in that case had acquired jurisdic-
tion of the parties and of the subject matter of
the suit. It was competent to administer full
justice, and was proceeding according to the
law which governed such a suit to do so.
could not take judicial notice of the proceed-
It
ings in bankruptcy in another court, however
seriously they might affect the rights of parties
to the suit already pending. It was the duty
of that court to proceed to a decree between the
parties before it, until by some proper plead-
ings in the case it was informed of the changed
relations of any of the parties to the subject
matter of the suit. Having such jurisdiction,
and performing its duty as the case stood in
that court, we are at a loss to see how its decree
can be treated as void."
The court then goes
on to show that if the assignee had brought his
right, acquired pendente lite, to the notice of
the court, it would have been protected. Hill
v. Harding, 107 U. S. 631 [Bk. 27, L. ed. 493].
So here, if Dimock had brought his discharge
to the attention of the superior court at any
time before judgment, it would have been re-
ceived as a bar to the action; and under proper
993

838]. A still stronger case of the validity of bankruptcy proceedings had pendente lite, is judgments of a state court, in their relation to that of Davis v. Friedlander, 104 U. S. 570 [Bk. 26, L. ed. 818].

In the case of Thatcher v. Rockwell, 105 U. S. 467 [Bk. 26, L. ed. 949], the Chief Justice, after alluding to these and other cases, says: "They establish the doctrine that, under the late bankrupt law, the validity of a pending suit or of the judgment or decree thereon was not affected by the intervening bankruptcy of one of the parties; that the assignee might or might not be made a party; and whether he was or not he was equally bound with any other party acquiring an interest pendente lite."

dant had his discharge before the judgment in It is said, however, that though the defendthe state court was rendered and might have successfully pleaded it in bar of that action and did not do so, the judgment now sued on is the same debt and was one of the debts from which, by the terms of the bankrupt law, he was discharged under the order of the bankruptcy ment the discharge may still be shown as a valid court, and to any attempt to enforce that judg defense. That is to say, that the failure of the defendant to plead it when it was properly pleadable, when, if he ever intended to rely on it as a defense, he was bound to set it up, works him no prejudice, because, though he has a dozen judgments rendered against him for this debt after he has received his discharge, he may at any time set it up as a defense when these judgments are sought to be enforced. Upon the same principle, if he had appeared in the state court and pleaded his discharge in bar, and it had been overruled as a sufficient bar, he could, nevertheless, in this action on that judgment, renew the defense.

renewing the struggle in a new suit on such
But in such case his remedy would not lie in
judgment, but in bringing the first judgment
for review before this court where his right un-
der the discharge would have been enforced

[566]

591]

St. John v. Am. Mut. Life Ins. Co. 2 Duer, 419; S. C. 13 N. Y. 31; Valton v. Nat. Fund Life Ins. Co. 20 N. Y. 32; Olmsted v. Keyes, 85 JULIA ARMSTRONG, Admrx. of JOHN M. N. Y. 593; Bond v. Bunting, 78 Pa. St. 210;

Life insurance-assignability of endowment pol- by him of a wicked and dishonest scheme, of icy-evidence-fraud.

The proposition that the policy in suit was a contract between Hunter and the Company, and IN ERROR to the Circuit Court of the United as such was void for Hunter's fraud, will not be States for the Eastern District of New York. entertained by this court, since the verdict of the The history and facts of the case appear injury must be assumed to embrace a finding the opinion of the court. that Hunter never took any relation whatever to the contract of insurance.