form. But the holder of a single policy can have no average result. He takes the risk with the chances fairly balanced. Had he taken out one hundred policies on the lives of as many debtors, it is more than probable that some of them would have largely exceeded their expectation, while others would not have reached it. In such case there would not have been material gain

or loss.

If the assured should live out his expectancy of life no question could probably arise as to the right of the holder to retain the whole of the money. It could not then be successfully assailed as a gambling transaction. But the character of the contract cannot depend upon results, or the accident of death. If not lawful in its inception it could never become so.

In order to ascertain whether an insurance is disproportioned to the debt, regard must be had to the age of the assured, his expectation of life and the cost of carrying the insurance with interest thereon, as well as upon the amount of the debt. The evidence which forms the subject of the first assignment, the court say, was not only proper, but essential, to an intelligent understanding of the case. It is just what was lacking in Grant v. Kline, and was one of the reasons why the court avoided deciding the broad question in that case. But anyone who reads that opinion between the lines can see that the judicial mind must have been influenced to some extent by the suggestion in reference to the Carlisle Tables.

The rule announced in Ulrich v. Reinoehl, supra, it is admitted may not be the best, but the court has not been able to find a better, after a most careful and anxious consideration of the question. That it will not produce exact justice in all cases is possible. There will always be cases of individual hardship in the application of all general rules. No general rule can be made to fit each particular case, otherwise it would cease to be a rule. Attention was especially called to this difficulty by the following extract from the opinion of the learned judge below in refusing a new trial:

"With much respect it is suggested that the principle indicated in Grant v. Kline, 115 Pa. 625, 7 Cent. Rep. 626, and Cooper v. Shaeffer (Pa.) 9 Cent. Rep. 601, as the proper rule to determine for what sum a creditor's policy should be taken out, ought to be somewhat expanded before it is positively adopted. As now stated, it would

not provide for a case like this, where the policy is taken out in a company which levies annual (monthly?) assessments, and where therefore allowance must be made in the creditor's forecast for possible fluctuations; neither would it now provide for the not infrequent contingency of the insured outliving his expectancy. Under the present form of the indicated rule, the creditor must always lose if the debtor lives beyond his expectancy; and it cannot be accurately applied to assessment insurance, because in this variety of the business the annual payments are not a previously known and certain sum."

But the court has no difficulty in disposing of the objection that the rule does not provide for the case of the assured living beyond his expectancy and thus entailing a loss upon the creditor. If we go beyond the expectency where are we to stop? A man may live to the age of a hundred, and such a length of days is of frequent occurrence. To sanction a policy covering such a period, and yet to allow the holder to recover the full amount in case of death within a year would be a retrograde step in the decisions. Under such a system the creditor would be absolutely secure, with the possibility of an enormous gain in case of an early death. Whereas at present, the risk of a debtor's exceeding his expectancy is equalized by the possibility of his death within it, and in a given number of cases the result produces uniformity. The want of uniformity is not the fault of the rule, but of its application to a single

case.

There is more difficulty, the court admits, in the other objection. The policy in question, however, it is said, was taken out in a mutual company, where assessments are made from time to time, and there appears to have been no difficulty upon the trial below in ascertaining with sufficient accuracy the amount of assessments which the defendants would have been called upon to pay had the assured lived out his expectancy. The precise amount of such assessments cannot of course be estimated with the same accuracy as in the case of a company in which the annual premium is a fixed But the assessments even in a mutual company can be approximated by the experience of other similar companies with sufficient accuracy to base an insurance upon it. And where a policy has been taken out in good faith by a creditor, the law does not

sum.

exact impossibilities. A slight mistake, one way or the other, owing to the condition of the company's business, by which assessments are increased or diminished, would not necessarily vitiate a policy. The cost of life insurance by whatever system adopted, it is believed, does not vary so greatly as to prevent a reasonable approximation thereof.

It may be that few men would take out a life policy to secure a debt of $100, where there is an expectancy of life for twenty-six years, and pay an annual assessment or premium in excess of the whole amount of the debt. But courts do not pass upon the wisdom of contracts. They only consider their legality and care must be taken in the enforcement of an admittedly sound rule of policy not to impinge upon the right of the citizen to contract. In Ul rich v. Reinoehl, supra, the contract was lawful, and the defendants appear to have entered in not so much for their own benefit as for the accommodation of the assured. The court is not to measure its legality by its results but by its surroundings at the time it was made.

In conclusion the opinion is expressed that a creditor may lawfully take out a policy on the life of his debtor in an amount to cover the debt with interest, and the cost of such insurance with interest thereon during the period of the expectancy of life of the assured, according to the Carlisle Tables.

In some states a creditor holding a policy on the life of his debtor as security for his debt is held a trustee to the extent of the proceeds above the debt and expenses, and may be called on to account therefor by the personal representatives of the debtor.'

A creditor who takes an assignment of a life policy as security for a loan can hold the proceeds of that policy only to the extent of the sums actually advanced by him."

In other states in the absence of evidence that the policy was held in trust for the debtor, where the rights of the parties appear upon the face of the policy, the presumption is against such trust.'

It has been said, however, on the authority of Goodsall v. Boldero, 9 East, 72, that an insurance upon the life of a debtor, in

'Tateum v. Ross, 150 Mass. 440.

'Roller v. Beam, 6 L. R. A. 136, 86 Va. 512.

Corson v. Garnier (Pa.) 4 Cent. Rep. 308,

behalf of a creditor, is in legal effect but a guaranty of the debt, and if the debt is paid the insurance is at an end. But it is now settled that this case is not the law. It was directly drawn in question and was expressly overruled in Dalby v. India & L. L. Assur. Co., decided in the exchequer chamber, 15 C. B. 365.

It is perhaps true that a policy in favor of a creditor is to be regarded as collateral security only where the debtor is under obligation to pay the premiums; but where the creditor pays the premiums, the right of the creditor is absolute;' and a creditor who insures the life of his debtor, and is obliged to keep alive the policy by paying premiums, may hold all he can recover on the policy, unless there is a gross disproportion between the debt and the amount of the policy.'

h. Future Delivery of Stocks, Grain and Produce.-The rule at common law that, "articles which had no actual or potential existence at the time of the contract, were not subjects of sale," was at one time well recognized. But it was found that this was too restrictive upon commercial transactions. The manufacturer, desiring to contract for the delivery of his product at a future date, when the purchaser would find use for it, if excluded from contracting for the raw material deliverable to him at a fixed price a sufficient time before it was to be operated upon, was compelled to purchase in the present market, and store the article until he could make it available for manufacturing purposes.

There was thus, the investment of capital without interest, the cost of storage, the hazard of decay and loss by fire or casualty, as well as loss of weight and measure, and expense of cooperage in case of fluid.

But the relaxation of the rule, so that a contract for the sale and future delivery of a commodity of a designated kind or class, which the seller does not own, or which has at the time no actual existence, but which may be supplied by purchase in the market at the proper time, or produced of material to be so acquired; enables the manufacturer to contract to sell his product at a fixed future date, for a determined price, without such investment of 'Amick v. Butler, 9 West. Rep. 845, 111 Ind. 578.

2 Rittler v. Smith, 2 L. R. A, 844, 70 Md. 261.

capital, or cost or hazard of storage, and without risk of an advance in the raw material; having already contracted for it, deliverable at a sufficiently early date, which will enable him to comply with his contract of sale.

Such contracts are now recognized where the intent is that the commodity shall actually be procured by the seller, and supplied to the purchaser, upon the maturity of the contract of sale. Contracts in regard to the sale and future delivery of grain and cotton were found to be equally necessary, in the interest of the farmer and planter, as well as the manufacturer and miller. As these commodities come upon the market at annual periods in immense quantities, exceeding the present demand of the manufacturer or miller, it produces corresponding "gluts" in the market.

Both the capital and the storage capacity of the individual millers and manufacturers were limited, and if the necessity existed to make present purchases for immediate delivery, the price of grain or cotton was inevitably depressed by the enormous supply demanding immediate payment and storage.

It was found necessary, therefore, in these cases also to relax the rule, and permit the farmer and planter to sell by sample, contracting for future delivery at specified dates;' and the law is now everywhere recognized that an executory contract for the sale of goods for future delivery is not infected with the quality of a wager by reason of the fact that at the date of a contract the vendor had not the goods; had not entered into any arrangement to provide them, and had no expectation of acquiring them, unless by a subsequent purchase in the market; and it is equally true that a bona fide purchase of grain for speculation, though it be for future delivery, is as legitimate as a purchase for actual use.❜ So executory contracts for the sale of stock may be made with

Eduards v. Hoeffinghoff, 38 Fed. Rep. 635; Conner v. Robertson, 37 La. Ann. 814: Irwin v. Williar, 110 U. S. 499-508, 28 L. ed. 225-229; Cobb v. Prell, 15 Fed. Rep. 774, 22 Am. L. Reg. N. S. 609, and note; Crawford v. Harlowo, 10 West. Rep. 78, 92 Mo. 489, 1 Am. St. Rep. 745, and note; Ex parte Young, 6 Biss. 53; Pickering v. Cease, 79 Ill. 328; Cockrell v. Thompson, 85 Mo. 510; White v. Barber, 123 U. S. 392, 31 L. ed. 243. Conner v. Robertson, 37 La. Ann. 814.

Edwards v. Hoeffinghoff, 38 Fed. Rep. 635.