Sheldon, J.
1. The defendant Stanley’s demurrer to the bill was overruled rightly. The bill states a proper case for equitable relief. Brigham v. Home Life Ins. Co. 131 Mass. 319. French v. Peters, 177 Mass. 568, 573, 574. A somewhat similar bill was maintained in Blinn v. Dame, 207 Mass. 159.
2. The plaintiff by his assignment from Sommer acquired as against the latter a valid title to the policy of insurance which here is in question. As between the plaintiff and Sommer, it is immaterial that the assignment was not written upon or attached to the policy, that no reference to the assignment was written or noted on the policy, or that no notice of it was given to the insurance company, either in the manner required by the fifth clause of the policy or otherwise. Merrill v. New England Mutual Life Ins. Co. 103 Mass. 245, 252. Hewins v. Baker, 161 Mass. 320. Atlantic Mutual Life Ins. Co. v. Gannon, 179 Mass. 291. See also Northwestern Mutual Life Ins. Co. v. Wright, 153 Wis. 252; Wood v. Phœnix Mutual Life Ins. Co. 22 La. Ann. 617; Manhattan Life Ins. Co. v. Cohen, 139 So. W. Rep. 51; Howe v. Hagan, 97 N. Y. Supp. 86; Cowdrey v. Vandenburgh, 101 U. S. 572; Dunlevy v. New York Life Ins. Co. 204 Fed. Rep. 670; Fortescue v. Barnett, 3 M. & K. 36. The contrary statements in Palmer v. Merrill, 6 Cush. 282, have not been followed. James v. Newton, 142 Mass. 366, 378. Richardson v. White, 167 Mass. 58, 60. The English rule, as stated in Dearle v. Hall, 3 Russ. 1, though adopted in many other jurisdictions, is not the law of this Commonwealth. Thayer v. Daniels, 113 Mass. 129, 131. Putman v. Story, 132 Mass. 205, 211.
It is true also, as the plaintiff has contended, that the owner of a chattel does not, by merely entrusting to a third person the custody or even the possession thereof, hold him out as its owner, and will not by that fact alone be estopped from setting up his title against even a bona fide purchaser from his bailee. Rogers v. Dutton, 182 Mass. 187, 189, and cases there cited. But we have here to do, not with a chattel, but with a non-negotiable chose in action, the right to receive in the future a certain sum of money upon the happening of certain contingencies. The policy of in[186]*186surance merely shows the existence, nature and extent of the right. As has been correctly stated by counsel for Stanley, “it is the tangible evidence which the owner of the right possesses in order to show title to the right.” The court must apply here the rule stated by the Chief Justice in Baker v. Davie, 211 Mass. 429, 440, “that when an owner has so acted as to mislead a third person into the honest belief that the one dealing with the property had a right to do so, he is estopped from showing the truth.” The statement of Lord Herschell in London Joint Stock Bank v. Simmons, [1892] A. C. 201, 215, quoted and followed by this court in Gardner v. Beacon Trust Co. 190 Mass. 27, 28, is to the same effect: “The general rule of the law is, that where a person has obtained the property of another from one who is dealing with it without the authority of the true owner, no title is acquired as against that owner, even though full value be given, and the property be taken in the belief that an unquestionble title thereto is being obtained, unless the person taking it can show that the true owner has so acted as to mislead him into the belief that the person dealing with the property had authority to do so. If this can be shown, a good title is acquired by personal estoppel against the true owner.” The same general principle (although its application in that case depended upon the existence of a custom) was stated again in Baker v. Davie, 211 Mass. 429, 436. See also Washington v. First National Bank, 147 Mich. 571; Brocklesby v. Temperance Permanent Building Society, [1895] A. C. 173, 181; Farquharson Brothers & Co. v. King & Co. [1901] 2 K. B. 697. See Scollans v. Rollins, 173 Mass. 275.
But this estoppel of a rightful owner to set up his title against a bona fide purchaser for value from one who had not the right to sell rests upon the conduct of the rightful owner. It arises against him when by bis own conduct he has so clothed the wrongdoer with the indicia of ownership as to justify third persons in regarding the wrongdoer as either the rightful owner or as having authority from that owner. The estoppel arises only from the owner’s voluntary action tending to produce and in fact producing that result. If this policy had been delivered to the plaintiff and then had been obtained from him by Sommer or Williams by means of a common law larceny, there would have been no foundation for an estoppel against the plaintiff, because, whatever [187]*187third persons might have thought or even might have been justified in thinking, the possession and apparent ownership would not have been put into Sommer or into Williams as Sommer’s agent by any voluntary action of the plaintiff. Bangor Electric Light & Power Co. v. Robinson, 52 Fed. Rep. 520. Farmers’ Bank v. Diebold Safe & Lock Co. 66 Ohio St. 367. This distinction was stated clearly by Holmes, C. J. in Russell v. American Bell Telephone Co. 180 Mass. 467, 469, et seq., citing as typical cases Knox v. Eden Musee Americain Co. 148 N. Y. 441, and Pennsylvania Railroad’s appeal, 86 Penn. St. 80. See also Varney v. Curtis, 213 Mass. 309, 312.
The rights of these parties depend upon the application of the principles which we have stated.
The plaintiff took his assignment by an instrument separate and apart from the policy itself. He allowed the possession of the policy to remain unaltered. It is true that he did this on the false representation that it was held by the insurance company as security for a premium loan; but the fact remains that it was his voluntary act. He took no other precaution, either by giving notice to the company or otherwise. He testified that he did not even tell Sommer that the policy had not been delivered to him. He trusted everything to Williams; and his own testimony was that he did this by reason of his “full confidence in Williams.” He knowingly allowed the circumstances to be such as to indicate that Sommer retained the full ownership of the policy, and such that no inquiry of the company would disclose anything to the contrary or throw any doubt upon Sommer’s title. For this reason, such cases as Mente v. Townsend, 68 Ark. 391, are not applicable here. The case is a stronger one than Bridge v. Connecticut Mutual Life Ins. Co. 152 Mass. 343, and the reasoning of that opinion is decisive against the plaintiff. There are no circumstances upon which any distinction can be made in his favor.
But the assignment to Stanley was not in reality, but only in form, an absolute one. It was given to secure an indebtedness of Sommer to Stanley. The plaintiff has a right to redeem from Stanley. This makes it necessary to determine the amount for which Stanley can hold the policy as against the plaintiff.
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Sheldon, J.
1. The defendant Stanley’s demurrer to the bill was overruled rightly. The bill states a proper case for equitable relief. Brigham v. Home Life Ins. Co. 131 Mass. 319. French v. Peters, 177 Mass. 568, 573, 574. A somewhat similar bill was maintained in Blinn v. Dame, 207 Mass. 159.
2. The plaintiff by his assignment from Sommer acquired as against the latter a valid title to the policy of insurance which here is in question. As between the plaintiff and Sommer, it is immaterial that the assignment was not written upon or attached to the policy, that no reference to the assignment was written or noted on the policy, or that no notice of it was given to the insurance company, either in the manner required by the fifth clause of the policy or otherwise. Merrill v. New England Mutual Life Ins. Co. 103 Mass. 245, 252. Hewins v. Baker, 161 Mass. 320. Atlantic Mutual Life Ins. Co. v. Gannon, 179 Mass. 291. See also Northwestern Mutual Life Ins. Co. v. Wright, 153 Wis. 252; Wood v. Phœnix Mutual Life Ins. Co. 22 La. Ann. 617; Manhattan Life Ins. Co. v. Cohen, 139 So. W. Rep. 51; Howe v. Hagan, 97 N. Y. Supp. 86; Cowdrey v. Vandenburgh, 101 U. S. 572; Dunlevy v. New York Life Ins. Co. 204 Fed. Rep. 670; Fortescue v. Barnett, 3 M. & K. 36. The contrary statements in Palmer v. Merrill, 6 Cush. 282, have not been followed. James v. Newton, 142 Mass. 366, 378. Richardson v. White, 167 Mass. 58, 60. The English rule, as stated in Dearle v. Hall, 3 Russ. 1, though adopted in many other jurisdictions, is not the law of this Commonwealth. Thayer v. Daniels, 113 Mass. 129, 131. Putman v. Story, 132 Mass. 205, 211.
It is true also, as the plaintiff has contended, that the owner of a chattel does not, by merely entrusting to a third person the custody or even the possession thereof, hold him out as its owner, and will not by that fact alone be estopped from setting up his title against even a bona fide purchaser from his bailee. Rogers v. Dutton, 182 Mass. 187, 189, and cases there cited. But we have here to do, not with a chattel, but with a non-negotiable chose in action, the right to receive in the future a certain sum of money upon the happening of certain contingencies. The policy of in[186]*186surance merely shows the existence, nature and extent of the right. As has been correctly stated by counsel for Stanley, “it is the tangible evidence which the owner of the right possesses in order to show title to the right.” The court must apply here the rule stated by the Chief Justice in Baker v. Davie, 211 Mass. 429, 440, “that when an owner has so acted as to mislead a third person into the honest belief that the one dealing with the property had a right to do so, he is estopped from showing the truth.” The statement of Lord Herschell in London Joint Stock Bank v. Simmons, [1892] A. C. 201, 215, quoted and followed by this court in Gardner v. Beacon Trust Co. 190 Mass. 27, 28, is to the same effect: “The general rule of the law is, that where a person has obtained the property of another from one who is dealing with it without the authority of the true owner, no title is acquired as against that owner, even though full value be given, and the property be taken in the belief that an unquestionble title thereto is being obtained, unless the person taking it can show that the true owner has so acted as to mislead him into the belief that the person dealing with the property had authority to do so. If this can be shown, a good title is acquired by personal estoppel against the true owner.” The same general principle (although its application in that case depended upon the existence of a custom) was stated again in Baker v. Davie, 211 Mass. 429, 436. See also Washington v. First National Bank, 147 Mich. 571; Brocklesby v. Temperance Permanent Building Society, [1895] A. C. 173, 181; Farquharson Brothers & Co. v. King & Co. [1901] 2 K. B. 697. See Scollans v. Rollins, 173 Mass. 275.
But this estoppel of a rightful owner to set up his title against a bona fide purchaser for value from one who had not the right to sell rests upon the conduct of the rightful owner. It arises against him when by bis own conduct he has so clothed the wrongdoer with the indicia of ownership as to justify third persons in regarding the wrongdoer as either the rightful owner or as having authority from that owner. The estoppel arises only from the owner’s voluntary action tending to produce and in fact producing that result. If this policy had been delivered to the plaintiff and then had been obtained from him by Sommer or Williams by means of a common law larceny, there would have been no foundation for an estoppel against the plaintiff, because, whatever [187]*187third persons might have thought or even might have been justified in thinking, the possession and apparent ownership would not have been put into Sommer or into Williams as Sommer’s agent by any voluntary action of the plaintiff. Bangor Electric Light & Power Co. v. Robinson, 52 Fed. Rep. 520. Farmers’ Bank v. Diebold Safe & Lock Co. 66 Ohio St. 367. This distinction was stated clearly by Holmes, C. J. in Russell v. American Bell Telephone Co. 180 Mass. 467, 469, et seq., citing as typical cases Knox v. Eden Musee Americain Co. 148 N. Y. 441, and Pennsylvania Railroad’s appeal, 86 Penn. St. 80. See also Varney v. Curtis, 213 Mass. 309, 312.
The rights of these parties depend upon the application of the principles which we have stated.
The plaintiff took his assignment by an instrument separate and apart from the policy itself. He allowed the possession of the policy to remain unaltered. It is true that he did this on the false representation that it was held by the insurance company as security for a premium loan; but the fact remains that it was his voluntary act. He took no other precaution, either by giving notice to the company or otherwise. He testified that he did not even tell Sommer that the policy had not been delivered to him. He trusted everything to Williams; and his own testimony was that he did this by reason of his “full confidence in Williams.” He knowingly allowed the circumstances to be such as to indicate that Sommer retained the full ownership of the policy, and such that no inquiry of the company would disclose anything to the contrary or throw any doubt upon Sommer’s title. For this reason, such cases as Mente v. Townsend, 68 Ark. 391, are not applicable here. The case is a stronger one than Bridge v. Connecticut Mutual Life Ins. Co. 152 Mass. 343, and the reasoning of that opinion is decisive against the plaintiff. There are no circumstances upon which any distinction can be made in his favor.
But the assignment to Stanley was not in reality, but only in form, an absolute one. It was given to secure an indebtedness of Sommer to Stanley. The plaintiff has a right to redeem from Stanley. This makes it necessary to determine the amount for which Stanley can hold the policy as against the plaintiff.
This policy was assigned to Stanley on February 2, 1910, to [188]*188secure aunóte for $3,000. Afterwards Stanley lent to Sommer the further sum of $1,000, and took from him a note for that amount, dated February 2, 1911, and signed by Sommer. Above Sommer’s signature, Williams, without Sommer’s knowledge or consent, wrote the words: “ Conn. Mut. Policy 215356 as security.” Those words described this policy.
We need not consider whether this interpolation by Williams in the note before its delivery to Stanley destroyed the validity of the note. R. L. c. 73, §§ 141, 142. Stoddard v. Penniman, 108 Mass. 366. Draper v. Wood, 112 Mass. 315. Citizen’s National Bank v. Richmond, 121 Mass. 110. Greenfield Savings Bank v. Stowell, 123 Mass. 196. But we are clearly of opinion that it does not give to Stanley the right to hold the policy as security for the payment of this latter note. The assignment to him was to secure the payment of the note for $3,000, not what further amounts might become due to him from Sommer. Sommer has never made or undertaken to make any further assignment to Stanley, or given or undertaken to give to Stanley any greater rights in the policy.
The other questions raised are disposed of by the findings of fact made in the Superior Court.
The plaintiff, if he so desires, may have a decree allowing him to redeem the policy upon payment of the amount due on Sommer’s note for $3,000, with interest and costs, within such time and upon such terms as may be determined by a judge of the Superior Court. If he shall not so redeem, his bill must be dismissed with costs.
So ordered.