Hackett v. Supreme Council American Legion of Honor

92 N.E. 133, 206 Mass. 139, 1910 Mass. LEXIS 771

• Court: Massachusetts Supreme Judicial Court
• Decided: May 19, 1910
• Status: Published

Opinion

Loring, J.

But one question is presented by this bill of exceptions, namely, Did the evidence warrant a finding for the plaintiffs ?

The plaintiffs, as beneficiaries under a death benefit certificate issued by the defendant corporation, on April 16, 1904, brought against it the bill in equity here in question. It appears from the evidence stated in the bill of exceptions that the member under whom the plaintiffs claim died on November 20, 1900, and that on April 4,1901, the beneficiaries accepted $1,900 and surrendered the certificate for cancellation. In the words of the bill of exceptions, “ The defense mainly relied upon was accord and satisfaction.” It is settled now that there was no accord and satisfaction. Attorney General v. American Legion of Honor, 196 Mass. 151. The result is that in place of there being as matter of law no evidence on which a finding could be made in favor of the plaintiffs there was as matter of law no evidence on which a finding could be made in favor of the defendant if accord and satisfaction was the only defense.

The plaintiffs’ resort to equity seems to have been founded upon the supposed existence of a release under seal which they wished to have set aside for fraud. But as a matter of fact no release was given, and the plaintiffs’ cause of action was a money demand.

It is not apparent to us why the- plaintiffs, after the receiver was appointed, pursued their bill against the corporation. When a debtor becomes bankrupt

* the creditor is put to an election, to proceed against the debtor or take his share of the debtor’s assets in bankruptcy. The object of proceeding against the debtor is in the hope that he (the debtor) may not get a discharge or may not plead it or may not take the necessary steps to be in a position to plead it. In either of these cases the creditor will get a judgment against the debtor which he can satisfy out of the property of the debtor (if any) acquired after the date of the bankruptcy proceedings. On the other hand if the creditor wishes to entitle himself to his share of the bankrupt’s estate he must make his proof against that estate in the court which has the collection and distribution of it. A judgment procured in a common law court after the date of bankruptcy proceedings does not entitle the creditor to share in the assets administered in and by the bankrupt court.

This was explained in Attorney General v. American Legion of Honor, 196 Mass. 151. It is repeated here because in the Superior Court an order was made for a decree directing “ the receiver ” to “ pay to the plaintiffs the sum of three thousand one hundred (S3,100) dollars.” The only decree that can be entered in this suit is a decree that the corporation pay that sum to the plaintiffs.

Exceptions overruled.

The reference to bankruptcy is only by way of illustration. In the present case no proceedings in bankruptcy were involved. The receiver was appointed on an information brought by the Attorney General at the relation of the insurance commissioner, see ante, 131, 132.