West v Reid
| Jurisdiction | England & Wales |
| Judgment Date | 11 February 1843 |
| Date | 11 February 1843 |
| Court | High Court of Chancery |
English Reports Citation: 67 E.R. 104
HIGH COURT OF CHANCERY
S. C. 12 L. J. Ch. 245; 7 Jur. 147. See Saunders v. Dunman, 1878, 7 Ch. D. 829; In re Leslie, 1883, 23 Ch. D. 562; Falcke v. Scottish Imperial Insurance Company, 1886, 34 Ch. D. 234.
104 WEST V. REID 2 HARE, 249. [249] west v. eeid. Jan. 16, 17, Feb. 11, 1843. [S. C. 12 L. J. Ch. 245 ; 7 Jur. 147. See Saunders v. Dunman, 1878, 7 Ch. D. 829; In re Leslie, 1883, 23 Ch. D. 562; FalcJce v. Scottish Imperial Insurance Company, 1886, 34 Ch. D. 234.] In 1816 D. assigned a policy of insurance on his life to a trustee to secure a sum of money owing to W.; and soon afterwards the solicitor of W. caused a memorandum to be entered in the office of the insurance company, directing that all letters were to be sent to such solicitor, and the premiums were thenceforth paid by W., through the hands of such solicitor; but the insurance company were not informed on whose behalf the solicitor acted. In 1826 D. became bankrupt, and his assignees declined to interfere respecting the policy. The premiums continued to be paid by W. through his solicitor, during his life, and by the executors of W., through their bankers, after his death. D. died in 1839. Held, that the policy was in the order and disposition of the bankrupt, and that there was not any notice given to the insurance office of the assignment of the policy to take it out of such order and disposition. That the conduct of the assignees did not amount to an abandonment of any right which they had to the benefit of the policy. That the executors of W. had a lien on the policy for the amount of the premiums which had been paid by W., and his estate, and the interest thereon; and that they were entitled to payment of the amount thereof out of the monies payable under the policy. Negligence, as applied to cases of constructive notice, supposes the disregard of a fact known to the purchaser which indicated the existence of the fact, the knowledge of which the Court imputes to him; and such negligence may, without a fraudulent motive, be so gross as to justify the charge of constructive notice. Semble. A purchaser may be presumed to have investigated every instrument which directly or inferentially forms a link in the title to the property, but not instruments which are neither directly nor presumptively connected with it, and may only by possibility affect it. Semble. By a policy of insurance, bearing date the 16th of August 1813, the Defendant, Eeid, and two other directors of the Eock Life Assurance Company, in consideration of the annual premium of 95, 18s. 2d., covenanted to pay to the executors, administrators or assigns of James Daniell, three months after his decease, the sum of 2500, and any bonuses which might be allotted thereto. On the 23d of February 1816 James Daniell assigned his interest in several funds and securities, including the policy of assurance, to Mr. Wimburn (of the firm of Collett & Wimburn, solicitors), in trust to secure 5000 and interest lent to Daniell by one Woodroffe; and by the same assignment the policy was at the same time delivered to Mr. Wimburn, and thenceforward remained in his possession. On the 17th of May 1816 the interest of Woodroffe in the securities comprised in the indenture of the 23d of February preceding, including his interest in the policy, was as-[250]-signed to James West, for whom Mr. Wimburn afterwards remained the trustee. It appeared that in the year 1816 Mr. Collett (the partner of Mr. Wimburn) made some communication to the Eock Life Assurance Company, the only information given respecting the particulars or contents of which was contained in a memorandum entered by an officer of the company, dated the 23d of July 1816, in the margin of the declaration made by James Daniell at the time of making the insurance, in the following words :-" Letters to Collett & Wimburn, Chancery Lane, by Mr. Collett's order." From the time that James West became interested under the assignment of the 17th of May 1816 until his death the annual premiums were paid by him through the hands of his solicitors, Messrs. Collett & Wimburn. On the 3d of January 1826 James Daniell became bankrupt, and Barnes and Palmer were appointed his assignees. Daniell informed his assignees of the interest of West in the policy, and a correspondence on the subject took place soon afterwards 2 HAKE, 251. WEST V. REID 105 between the solicitors of West and the solicitors of the assignees, in which it was proposed, and appeared to be agreed between them, that the better course was to sell the policy and apply the proceeds towards the discharge of the debt due to West. The policy was at this time valued by the Eock Life Assurance Company at the sum of 375. At the time of the bankruptcy the sum due to West was 910, 12s. 7d. for principal and interest on the original debt, 575, 9s. for premiums paid on the policy, and 82, 19s. 3d. for interest thereon. On the 4th of August 1827 the solicitors of West wrote to the solicitors of the assignees, recommending that the sale should be carried into effect, and also stating that the annual premium was on the [251] point of becoming due, and offering to pay it, in order to keep the policy on foot, if authorized to do so by the assignees. Barnes and Palmer were afterwards removed from being assignees of the estate of Daniell, and the Defendant, Solarte, and others substituted in their place, by whom new solicitors were appointed, who refused to interfere with respect to the sale or paynient of the premiums. James West died in November 1829. From the death of West the annual premiums on the policy were paid by the Plaintiffs, his executors, through their bankers. On the 25th of December 1839 James Daniell died. The sum at this time due to the executors of James West in respect of the original debt, premiums and interest amounted to 4049, 12s. 9d. The sum payable on the policy was 3667, 10s. The bill was filed by the executors of West and Mr. Wimburn, their trustee, against J. Eeid, the director of the Eock Life Assurance Company, the surviving assignees, and the executor of Daniell, praying a declaration that the Plaintiffs were entitled to the policy of insurance, and the benefit thereof, and to the monies to be received thereby; and that the Eock Life Assurance Company might be decreed to pay to the Plaintiffs, the executors, the said sum of 3667, 10s., or such other sum as was then due and owing from the company on account of the policy; or if, under the circumstances, the assignees of the estate and effects of James Daniell had a right to redeem the policy, then that the Plaintiffs, the executors, might be declared to have a lien thereon for what was due to the estate of West, as well for principal and interest on the bonds therein mentioned, as for the amount of premiums paid by West or his executors, together with interest on such premiums, according to the indentures of the 23d of February and the 17th May 1816; and in the latter [252] case praying an account of what was due to the Plaintiffs for principal and interest upon the security of the said policy of insurance, and that the said assignees might be decreed to pay to the Plaintiffs what should appear to be due to them on the said account, together with the costs of the suit; or in default thereof that they might be foreclosed of the equity of redemption of the said policy. The Eock Life Assurance Company paid into Court the sum of 3667, 10s., due upon the policy, which was the only property comprised in the indenture of the 23d of February and 17th of May 1816, which became available for the payment of the Plaintiffs' debt. The assignees of James Daniell under his bankruptcy claimed the monies arising from the policy, on the ground that, the policy was in the order and disposition of the bankrupt; but it was admitted at the Bar, on the part of the assignees, that the Plaintiffs were entitled to a lien on the policy for the amount of the premiums paid on account of West and of his estate, and the interest thereupon. Mr. Boteler and Mr. Walpole, for the Plaintiffs, argued, first, that the policy was not in the order or disposition of Daniell at the time of his bankruptcy, within the meaning of the statute (6 G-eo. 4, c. 16, s. 72); Ryall v. Rmvles (1 Ves. sen. 349, 375; S. C. (nom. RyM v. Balk) 1 Atk. 165); Ex parte Richardson (Buck, 480); Falkener v. Case (cited 2 T. E. 491); Ex parte Manro (Buck, 300); Ex parte Colvill (Mont. 110 ; S. C. 2 Sim. 570); Williams v. Thorp (2 Sim. 257); Ex parte Smith, Re Styan (2 M. D. & De G. 213); Ex parte Pooley (C. E. 4th March 1842); Ex [253] parte Heathcote (C. E. 23d July 1842); Ex parte Cooper (2 M. D. & De G. 1); In re Hennessy (2 Drury & War. 555; S. C. 1 Con. & Law. 559); Ex parte Waiffmum (4 Dea. & Ch. 412 ; S. C. 2 Mont. & Ayr. 364); Edwards v. Scott (1 Man. & Grang. 962). Secondly, that if the policy would have been within the order and disposition of the bankrupt, under V.-C. XII.-4* 106 WEST V. REID 2 HAKE, 254. the Act, the notice given to the office, and the payment of the premiums by West and the Plaintiffs, had taken it out of such order and disposition; Duncan v. CTiamberlayne (11 Sim. 123); Ex parte Stright (2 Dea. & Ch. 314); Smith v. Smith (2 Cro. & Mees. 231); Ex parte Stevens (4 Dea. & Ch. 117); Hiern v. Mill (13 Ves. 114); TibUts v. George (5 Ad. & El. 107); Jones v. Smith (ante, vol. 1, p. 43); Stiles v. Cowper (3 Atk. 692); Dan v. Spurrier (7 Ves. 231); Shannon v. Broadstreet (1 Sch. & Lef. 52). Thirdly, that the conduct of the assignees had in effect amounted to an abandonment of any right which they might have had to the policy by virtue of the statute: they might after their right accrued have taken proceedings at law against Wimburn for the recovery of the policy. Fourthly, that the Plaintiffs were at least entitled to the assistance of the Court in the recovery of so much of the monies payable on the policy as should give...
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