tiable in its character is, in the absence of any application of the rules of equitable estoppel, subject to all equities existing at the time of the transfer and to all defences valid as between the original parties. A valid policy was issued to a wife, and afterwards, by coercion, she executed an assignment of it, and the fraudulent assignee assigned it to a bona fide purchaser, without notice; it was held that no title could be acquired even by an innocent purchaser to a chose in action from one who has procured it from the owner by undue influence, compulsion or coercion : Barry v. Equitable Life Ins. Co., 59 N. Y. 587. The assignee must, like other assignees of nonnegotiable choses in action, inquire of the debtor, before advancing money, if any defence or equities exist in relation thereto, as a policy of insurance is not a representation of the company, but only a muniment of title, and no title can be acquired even by a bona fide assignee for value from one without title obtaining the same from a fraudulent agent: Charter Oak Life Ins. Co. v. Smith, 40 Ohio St. 414. And a rule that an assignee cannot rely upon the recitals of an insurance policy, was enforced in a case where by failure of an assignee to pay a premium note, although the policy recited that it was paid, a forfeiture thereof was sustained. How V. Union Mut. Life Ins. Co., 80 N. Y. 32. Nor can an assignee of a policy as collateral require payment without complying with the terms of the policy by obtaining the receipt of the beneficiary indorsed thereon; non constat the debt may have been paid: Kelley v. Caplice, 23 Kan. 474. Nor can he rely upon unauthorized representations of an agent: Knight v. Mutual Life Ins. Co., 37 Leg. Int. 82. Nor can any title be acquired to policies of life insu rance where illegal although the loans and debts secured be larger in amount than the value of the policy: Stokell v. Kimball, 59 N. H. 13; and an assignment of policies by a wife as surety will be released by a discharge of an endorser: O'Mara v. Nugent, 37 N. J. Eq. 326.

The Rights of the Assignor.-The assignor or pledgor is entitled to a return of insurance policies upon complying with the terms of the agreement upon which such assignment was made. Although the assignment be absolute in terms, an agreement in parol that the assignor should have a right to redeem at any time upon repayment, with interest, of the premiums paid by the assignee, will be enforced in equity. Such right of redemption followed the policy into the hands of the assignee, and at all times affected his title:

Matthews v. Sheehan, 69 N. Y. 589. The rule was enforced in another case where an insurance policy was assigned in absolute terms, but the assignee (who was the agent of the company issuing the policy) delivered a receipt at the same time reciting that the assignment was as collateral security for the premium, and to be void if the note was paid at maturity, otherwise to continue for sole benefit of the agent. The company was notified of the assignment, but not of the receipt, and the note not being paid, the agent surrendered the policy. Prior to the surrender the company were informed of the facts, the assignor demanding a retransfer, the policy being of greater value than the amount of the note. Upon an equitable action to redeem, it was held that as no notice had been given to redeem before the surrender, it must be treated as made on account of the assignor as well as the assignee, and that he was entitled to any excess of value above the amount due on the premium note: Dongan v. Mut. Ben. Life Ins. Co., 46 Md. 469. So, where an assignee of a policy holding the same as collateral security wrongfully surrendered it to the company, he was mulcted in damages for the conversion: Wheeler v. Peters, 40 Ohio St. 424. The pledgor is also entitled upon settlement to the benefit of any sums which have been collected by the pledgee on such insurance policies, and to which the assignor would be entitled on payment of the debt: White v. British Empire Ins. Co., L. R., 7 Eq. 394.

Payment of the debt or the discharge of the obligation is essential to entitle the assignor to a return of collateral securities, as where policies of insurance were assigned as collateral security to secure the payment of certain bills of exchange, although an arbitration has fixed the amount of the account, the money not having been paid: Scott v. Campbell, 1 Camp. 216. And where assurance policies were assigned as collateral for the payment of a bond and mortgage, and the mortgage had been discharged, but the bond not paid: Hollis v. Ins. Co., 12 Phila. 321. Nor can an assignor, who during minority as a beneficiary joined with his father in an assignment thereof as collateral to secure the assignee from liability as endorser, and under which the assignee had been obliged to pay a portion of the liability, repudiate the contract on coming of age, and recover the policy, during the lifetime of the assured, by an action of detinue: Bowers v. Parker, 58 N. H. 565.

But it was held payment where a company issuing a policy

received it and other securities as collateral for the payment of premium notes, the policy by its terms being void if the assured died by his own hands, except as to any bona fide interest therein at the time of death. The company was held within the rule, and the proceeds of the policy having paid the debt, it was ordered to redeliver the other securities: White v. Penn Mut. Life Ins. Co., 6 Mo. App. 587. And a deposit of policies as collateral was held within the exception: Cook v. Black, 1 Hare 390. Nor was it any defence to a suit upon the original indebtedness that the creditor held an insurance policy upon the life of the debtor as collateral: Reeves v. Plough, 41 Ind. 204: Burrows v. Bangs, 34 Mich. 304,

Insurable Interests as applied to Assignees.-An important question relative to the assignment of valid life insurance policies is, as to the intention of the parties in procuring such insurance, whether it is in fact a bona fide assignment, for a valuable consideration, or simply a cover for a gaming speculation in the life of the insured, and in arriving at such intention the extent or character of the insurable interest of the assignee in the life, is a fact for consideration: Johnson v. Van Epps, 14 Ill. App. 201. Generally, it may be said, that an assignee of valid insurance policies, in common with assignees of other choses in action, is entitled to the presumption that he is a bona fide holder for value, without notice: Page v. Burnstine, 102 U. S. 664. The fact that he has no insurable interest in the life of the assured does not create a presumption that he acquired his interest under such assignment for the purpose of speculating or gambling upon the life of the assured: Clark v. Allen, 11 R. I. 439. Nor is this fact either conclusive nor prima facie evidence that the transaction is illegal: United Life Ins. Co. v. Allen, 138 Mass. 240. No subsequent assignment can destroy the validity of a policy that was legal when issued: Campbell v. New England Life Ins. Co., 98 Mass. 381; nor taint it as a wagering policy: Mut. Life Ins. Co. v. Allen, 50 Id. 18. Even where made the basis of a mere speculation or wager on the part of the assignee, so that no recovery is permitted to him, yet the beneficiary of the policy may enforce the same, the validity of the policy not being affected by the subsequent illegality. And unless there is some peculiarity about the rules that should govern the assignment of policies of insurance, where the assignee has no insurable interest in the life of the assured, the same rules as to its validity should

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govern such assignments as are applied to assignments of interests under wills and vested remainders: In re Irving, L. R., 7 Ch. D. 419. In all these cases, although the value of the investment depends upon the life of a person in which the assignee has no interest except the expectancy of its cessation, the validity of such assignments is not questioned.

The courts have considered in several cases this question of the insurable interest required by the assignee to render valid an assignment of life insurance policies, and the general rule seems to be that such assignments are supported where a valid insurance policy has been issued, and the owner sells the same in a bona fide transaction, for the purpose of securing its present value, or where the owner, in a like bona fide transaction, assigns such policy as collateral to secure a bona fide advance or a valid debt, or some obligation as endorser or surety, and the advance or debt has been paid or the obligation discharged, although in the first case, the assignee has no insurable interest in the life of the insured at the time of the assignment, and in the second, his insurable interest has ceased, and he is an assignee as in the first case, without insurable interest in the life of the assured.

In a recent case, Scott v. Dickson, 16 W. N. C. 181, decided by the Supreme Court of Pennsylvania, a policy of life insurance was issued to Dickson, and upon delivery by the agent, Dickson said he wished to transfer the policy to Scott, "the best friend I have in the world." He executed the assignment, notice of it was sent to the company, but Scott was never informed of it. Scott, at the time, was surety on a penal bond given by Dickson, but the liability ceased, and at his decease he was without insurable interest in the life of Dickson. The assignment was supported on the ground that the original insurance was for the benefit of the assignee. The court (Mr. Justice PAXSON) say:

"It requires but a moment's reflection to see that this rule [that the assignment of a policy does not fall upon the cessation of interest] is based upon sound principles. It treats a contract of life insurance not as a contract of indemnity, as in the case of fire and marine insurance, but as a contract to pay a certain sum of money in the event of death. And if a policy failed with the cessation of interest, it would lead to this result: A. is a creditor of B. to the extent of a $1000, and insures his life to that amount, and continues the policy until he has paid in premiums say, $1100. If

the policy ceases as soon as the debt is paid, A. loses all he has paid, and in reality is out $100, although he has received the debt in full. *** Policies of this sort are not in any sense wagering. It would be to deny a man's right to do what he will with his own to say that he could not insure his life for the benefit of an indigent relative or a friend to whom he felt under obligations. And the fact that he continues to pay the premiuins himself, and retains the control of the policy up to the time of his death, leaves no room for speculation, or the improper practices of a few years ago which brought such a scandal upon the life insurance business of this state."

And referring to the case of Gilbert v. Moore, infra, said: we do not regard this as within the authority of Gilbert v. Moore, for the reason that there is nothing in the facts as set forth in the case stated, from which the deduction can fairly be drawn that this was a wagering policy. On the contrary, there is enough to show that John F. Scott had an insurable interest in the life of Richard Dickson."

In an earlier case, Cunningham v. Smith, 70 Penn. St. 450, in which Smith insured his life, and immediately assigned the policy to the defendants, the court say: "Smith's interest in his own life was unquestionable, and if he was willing to insure himself, with their money, and then assign his policy to them there is no principle of law which can prevent such a transaction."

Another recent decision on this question was delivered by the Supreme Judicial Court of Massachusetts in the case of the Mut. Life Ins. Co. of New York v. Allen, 138 Mass. 24. This was a bill of interpleader filed by the insurance company to determine whether the wife of the deceased, the beneficiary in the policy, or the assignee, Allen, were entitled to the proceeds, the assignment being made for a sum paid, and the surrender of notes of the assured upon which surrender he had no insurable interest in the life. The court (W. ALLEN, J.) say: "The question is, whether the right to a sum of money payable on the death of a person under a contract in the form of an insurance policy has any special character or quality which renders it less assignable than the right to a sum payable at the death of some person under any other contract or assurance, or than a remainder in real estate expectant on such death. We see nothing in the contract of life insurance which will prevent the assured from selling his right under the contract for his