Page:Federal Reporter, 1st Series, Volume 9.djvu/608

 IN EE SMITH. 593 �business was carried on ; that after his failure they were taken by him to his fatiier's house, at Deckertown; that all eollectible debts were collected ; that he left them there during the year 1876, while he was living in Chicago, and that, without his knowledge or wish, they were sold by his sister to the rag-man, as waste paper, under the impression that they were of no value to any one. Ail the proof is to the effeet that they were regularly kept, and were valueless to the creditors. The remaining specifications have reference to the transfer and assign- ment by the bankrupt of minerai leases to his brother-in-law, Guild, and of an endowment policy of life insurance for $5,000 upon his life to his father, Abraham Smith. The allegation is that these were transferred by him in contemplation of bankruptcy. I have had no difficulty in regard to the leases, as the evidence is quite clear that they were of no value, either in the hands of the bankrupt or of his assignee. But this is not the case as to the insurance policy. -It was taken by the bankrupt on his own life, in the Mutual Life Insur- ance Companj of New York, in 1866, on the plan of its becoming a paid-up policy at the end of 10 years, and all the annual premiums, except one or two, had been paid by the bankrupt at the time of the assignment, and the unpaid premiums were afterwards settled by a transfer of accumulated dividends. It was assigned without the pay- ment of any consideration. The bankrupt says that he gave it to his father because he wanted his parents to have the benefit of it in case of his death. The father testifies that he knew nathing of the trans- fer for a year or two after it had been assigned to him. Whatever the intention of the bankrupt may have been, the effeet of his action was to give over to his father, as against the claims of creditors, a valuable asset. Where the company is solvent, a paid-up policy will generally be purchased by the institution; and where this cannot be effected it has a market value. The counsel for the bajikrupt insisted, on the argument, that it could not be said it was assigned "in con- templation of bankruptcy," because the assignor did not go into bankruptcy until five years afterwards.. But that is not the meaning of the phrase as used in the law. It occurred in the bankruptcy act of 1841, and had received a judicial construction when the late act was passed. �In Everett v. Stone, S Story, 453, Mr. Justice Story said: " 'Con- templation of bankruptcy' means a contemplation of becoming a broken-up and ruined man; according to the original signification of the term, a person whose table or counter of business is broken up, v.9,no.l0— 38 ��� �