#### Ed. Blank, Trading as Ed. Blank & Company *v.*London Guarantee & Accident Company, Limited, of London, England, Appellant.

*Insurance*— Insurance *against lad debts*— Affidavit *of*defense— *Sufficiency.*

In an action on a policy of credit insurance quoted in the opinion, an affidavit of defense, which avers that the debt is disputed by the debtor, and is in the process of litigation, is sufficient.

An averment that the bankruptcy of a debtor occurred after the term of insurance had expired, is also sufficient to prevent judgment.

Argued December 14, 1925.

Appeal No. 337, October T., 1925, by defendant, from judgment of Municipal Court of Philadelphia County, June T., 1925, No. 1121, in the case of Ed. Blank, trading as Ed. Blank & Company v. London Guarantee & Accident Company, Limited, of London, England.

Before Porter, Henderson, Trexler, Keller, Linn and Gawthrop, JJ.

Modified.

Assumpsit on policy of credit insurance. Before Bonniwell, J.

The facts are stated in the opinion of the Superior Court.

*141Rule for judgment for want of a sufficient affidavit of defense.

The Court made absolute the rule. Defendant appealed.

*Error assigned*was the decree of the Court.

*Wm. W. Smithers,*for appellant.

*Joseph Blank,*for appellee.

February 26, 1926:

Opinion by

Linn, J.,

Plaintiff has judgment for want of a sufficient affidavit of defense in his suit on a credit insurance policy. He was insured during 1924 .against loss up to $5,000, resulting from his debtors ’ insolvency as defined in the policy. In adjusting the insurer’s liability the policy provided for the deduction from the aggregate net loss of 25% as co-insurance, and certain other sums which need not now be specified. Suit was brought after the expiration of the term. Plaintiff declared that he had suffered losses on three accounts, referred to here briefly as the Keystone account, the Penn account, and the Firtel account. As to the Keystone account, the affidavit of defense set forth that the account was continuously disputed by the debtor and was now in suit at Harrisburg, Pennsylvania, :and that the suit was not determined, and that accordingly plaintiff was not entitled to recover; that liability did not arise until the amount was .ascertained pursuant to the provision in the policy providing that if such account “against a debtor is disputed in whole or in part, the same shall not be admitted in any adjustment under this policy until after it has been finally determined to be a valid claim against the debtor.” While that averment might with propriety have been amplified in detail it sufficiently ad*142vises plaintiff of the defense to be interposed to enable him adequately to prepare for trial; if the suit was brought as the affidavit states, it must have been brought in plaintiff’s name, because plaintiff wias the creditor; that connection with the suit would keep plaintiff advised exactly of its status; if a bona fide dispute as to the amount due plaintiff by his debtors exist, as averred, the loss is not yet payable.

The Penn claim is admitted in the affidavit of defense but no legal reason is furnished for not paying it, at least we do not so understand the averment to the effect that the iamount payable cannot be ascertained until an adjustment is made of all the accounts claimed under such policy, &c. If there is any such difficulty, the basis of it should have been set forth, so that we could pass on it. On this item plaintiff is entitled to judgment.

Concerning the Firtel account, the .affidavit of defense is sufficient to put the parties to trial. The statement avers that the insolvency of this debtor is covered by the policy, because “a consent for the appointment of a receiver was executed on December 31, 1924, by the attorney for Firtel Brothers, and an involuntary petition in bankruptcy bearing the same date was filed against the debtor”. The affidavit of defense avers that such consent is not insolvency as defined in the policy; that in any event the petition in bankruptcy was not filed until January 2, 1925, and therefore not within the provisions of the policy, because occurring after the term of the insurance, — the year 1924; and also that no notice thereof was given to defendant until January 21, 1925, — said to be subsequent to the date on which notice was required by the policy. Plaintiff’s averment is perhaps an incomplete or inadequate statement of what occurred during 1924; was the consent delivered? Was the attorney authorized? Was the petition in bankruptcy filed in *1431924? Those and other relevant matters may be cleared np at the trial. But the affidavit of defense raises a distinct issue of fact.

The record is remitted with instructions to modify the judgment by eliminating the items claimed on account of the Keystone State Shoe Mfg. Co. and the account of Firtel Brothers; as to them, a procedendo is awarded.