Legg v. St. John - 296 U.S. 489 (1936)
U.S. Supreme Court
Legg v. St. John, 296 U.S. 489 (1936)
Legg v. St. John
Argued November 18, 1935
Decided January 6, 1936
296 U.S. 489
1. The right of a bankrupt to receive future disability payments under a contract with an insurance company having no cash surrender value is not insurance within the meaning of § 70(a) of the Bankruptcy Act, and, if not exempted by the state law, passes to his trustee in bankruptcy. P. 296 U. S. 493.
Provision for the payment of disability benefits in connection with life insurance was not introduced in the United States until about twenty years after the passage of the Bankruptcy Act.
2. The fact that the disability benefits were provided for in a supplementary contract issued on the same day as, and physically
attached to, a policy of insurance on the obligee's life did not make them life insurance. P. 296 U. S. 494.
3. The right to receive such disability benefits in the future, having accrued before bankruptcy, is not after-acquired property, but is, in essence, an annuity purchased and paid for, which, like other property of the bankrupt, passes to the trustee unless exempted by the law of the bankrupt's domicile. P. 296 U. S. 495.
4. Such disability benefits are not exempted by the statutes of Tennessee. P. 296 U. S. 496.
76 F.2d 841 affirmed.
Certiorari, 295 U.S. 728, to review the affirmance of an order confirming a report of a referee in bankruptcy.