Phoenix Mutual Life Insurance v. Harris

45 App. D.C. 474, 1916 U.S. App. LEXIS 2716
Court of Appeals for the D.C. Circuit·Decided November 15, 1916·No. No. 2953·Published

Opinion

Mr. Justice Robb

delivered the opinion of the Court:

Under the provisions of see. 323 of our Code, which became effective in 1901, no executor or administrator may sell any property of his decedent without first procuring an order of the probate court, and any sale made, without such an order is declared to be void and to pass no title to the purchaser. It is the contention of the plaintiff that inasmuch as it does not appear that the consent of court to the assignment of this policy had first been obtained, the courts of this jurisdiction, in view of the public policy expressed in said see. 323, ought not to recognize this assignment.

While fit does not definitely appear where this assignment was made, it does appear that the estate was settled in New Jersey, where Mrs. Harris, the beneficiary, was domiciled at her death; and inasmuch as this policy constituted an asset of her estate, although not mentioned in the list of assets filed by the administrator, probably for the reason that its value to the estate was negligible, it is not a violent assumption that the assignment was made during the course of administration in New Jersey. And as it does not appear that the common law had been modified in New Jersey, it is apparent, prima facie at least, that this was a perfectly valid assignment there. Vreeland v. Schoonmaker, 16 N. J. Eq. 512, 530. Indeed, it is conceded that the assignment was valid in New Jersey, the situs [477] of the thing assigned. Of course, at common law an executor or administrator had absolute power of disposal over all personal property coming into his hands, including choses in action, and such sales protected purchasers, exeept where fraud appeared. Wyatt v. Rambo, 29 Ala. 510, 68 Am. Dec. 89; Jones v. Atchison, T. & S. F. R. Co. 150 Mass. 304, 5 L.R.A. 538, 23 N. E. 43; Kent v. Bothwell, 152 Mass. 341, 9 L.R.A. 258, 25 N. E. 721; Petersen v. Chemical Bank, 32 N. Y. 21, 88 Am. Dec. 298; Lark v. Linstead, 2 Md. Ch. 162; Albert v. Baltimore, 2 Md. 159; Miller v. Williamson, 5 Md. 219. Owing to this rule of the common law, statutes providing for the granting of decrees of court as to sales generally are construed to be for the protection of the administrator, and not as a limitation of his power. Flynn v. Ohio G. W. R. Co. 159 Iowa, 571, 45 L.R.A.(N.S.) 1098, 141 N. W. 401; 11 R. C. L. 411.

"Whether, at the time this assignment was made in New Jersey, when the rights of the parties became fixed, the law of this jurisdiction denied the right of local executors and administrators to make such an assignment, we do not deem it necessary to determine, but see Miller v. Williamson, supra, and Marbury v. Ehlen, 72 Md. 206, 20 Am. St. Rep. 467, 19 Atl. 618. In our view, even if we assume that such a prohibition existed, no rule of public policy would be offended by giving force and effect to this contract. We think it quite obvious that the provisions of sec. 323 of our Code were intended to apply merely to local executors and administrators dealing with property within this jurisdiction. The section declares that if any executor or administrator shall sell, pledge, or dispose of any property without an order of court, his letters may be revoked, clearly indicating, we think, that the prohibition was not intended to extend to contracts made by executors and administrators of other jurisdictions. In other words, this statute was addressed to the constituent elements or validity of a local contract by executors and administrators, rather than to the procedure to be followed in establishing all contracts by executors and administrators, wherever made.

[478] The transaction in question was regularly effected by a New Jersey ádministrator, and the subject-matter was New Jersey property. The dominion of that State over personal property within its borders and its right to regulate its transfer hardly will be questioned. Green v. Van Buskirk, 7 Wall. 139, 19 L. ed. 109. Clearly, therefore, the validity of this contract ought to be determined by the laws of that State, and we see no room for the application of the rule that a contract will not be enforced in one jurisdiction, even though valid where made, if in conflict with the public policy of the forum. However, in view of the rule of the common law, to which we have referred, it would be going far to hold that there was anything about the transaction tending to corrupt public morals or in any way affect the public policy of this jurisdiction. This is not an attempt by a New Jersey administrator to transfer by assignment personal property located here, contrary to the laws of this jurisdiction, nor is it an attempt, as in Oscanyan v. Winchester Repeating Arms Co. 103 U. S. 261, 26 L. ed. 539, to enforce a contract “corrupt in its origin and corrupting in its tendencies.” The general rule was there stated to be that the validity of a contract is to be determined by the law of the place where made, unless it is to.be performed in another country. • The enforcement of the contract in that case was refused because it involved a gross violation of trust, “vicious 'in its character and tendency, and so repugnant to all our notions of right and morality, that it can have no countenance in the courts of the United States.”

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Phoenix Mutual Life Insurance v. Harris, 45 App. D.C. 474, 1916 U.S. App. LEXIS 2716 (D.C. Cir. 1916).

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Related

Green v. Van Buskirk
74 U.S. 139 (Supreme Court, 1869)
Scudder v. Union National Bank
91 U.S. 406 (Supreme Court, 1875)
Oscanyan v. Arms Co.
103 U.S. 261 (Supreme Court, 1881)
Petersen v. . Chemical Bank
32 N.Y. 21 (New York Court of Appeals, 1865)
Jones v. Atchison, Topeka, & Santa Fé Railroad
5 L.R.A. 538 (Massachusetts Supreme Judicial Court, 1889)
Kent v. Bothwell
9 L.R.A. 258 (Massachusetts Supreme Judicial Court, 1890)
Emery v. Burbank
28 L.R.A. 57 (Massachusetts Supreme Judicial Court, 1895)
Wyatt's Adm'r v. Rambo
29 Ala. 510 (Supreme Court of Alabama, 1857)
Albert v. Mayor of Baltimore
2 Md. 159 (Court of Appeals of Maryland, 1852)
Miller v. Williamson
5 Md. 219 (Court of Appeals of Maryland, 1853)
Lark v. Linstead
2 Md. Ch. 162 (Maryland Chancery Ct, 1850)
Flynn v. Chicago Great Western Railroad
141 N.W. 401 (Supreme Court of Iowa, 1913)
Marbury v. Ehlen
19 A. 648 (Court of Appeals of Maryland, 1890)