New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1899-04-07
u-DGEHATCH ON J. j. LITTLE
49, OPINION AS TO HIS METHODS AS RE
CEIvER OF A COMPANY


TO VEST IN LITTLE THE Pos-
SESSION OF THE POLICIES.
WE'RE FRAUDULENT"
.,sort Iittlc Of the Board of Education
having recently drawn great deal OF a'ientioi
y" .,,,self hv procuring an indictment for crimi-
80, uhel against citizen who jocularly criti-
10" '.a hin, in his capacity as a public servant.
.oa having also contended that he was worthy
:, nuhlic sympathy and support in such treat
n, ~ his critics. it may prove interesting to
..ad what a Justice of the Supreme Court has
regordinr a case in which Mr.. Little
figured.
rha oninion Of the Supreme Court relates to
.no business methods of Mr. Little. as receiver
:, .he Worthington Company. and is set forth
=. ,orgth in the decision of the Appellate ID
,s,or NJ the Supreme Court in the Second De-
..o,,nent in the case of Reynolds against the
x-,ro life Insurance Company. Joseph j. Little.
:. receiver. and others defendants The opinion
:, the Court is reported in %. Appellate Di-
vision Reports. page 591.
AS STATED IN THE OPINION.
The facts as stated in the opinion are as fol-
lows
IN 1889 the IFtna Life Insurance Company Is
.rsd TWO policies of insurance for So,0oo each
r,on the life of Richard Worthington. payable
~ himself at the end Of twenty years. or, in the
event Of his death. to his estate. In March,
1904 F~ank REYNOLDS was appointed receiver OF
p.chard Worthington AT the instance Of judg-
rtnt creditor but knowledge of the existence Of
tbe noljcies was concealed from the receiver by
Richard Worthington and his wife. Margaret
who ioined in an assignment of the policies to a
niece Of Worthirgton. Iu 1884 Worthington
d,ed and letters Of administration were granted
to his widow. Margaret Worthington to whom
the niece then reassigned the policies.
The Court holds that this assignment was
made with intent to hinder, delay and defraud
the creditors of Richard Worthington, and was
without any consideration whatever"
In the mean time, in January, 1893 Joseph
J Little had been appointed receiver of the
Worthington Company, "a corporation which, In
fact consisted almost wholly Of Mr.. Worthing
ton and his wife" Soon after her husbands
death Margaret Worthington. having obtained
the policies by assignment from her niece, as
hereinbefore stated. proceeded. in December.
1894 TO assign them 10 Joseph J. Little. as re-
oeiver Of the Worthington Company. upon con-
ditior that he would pay to her personally BIZ
per cent Of the proceeds Of the policies. The
made with intent to hinder, delay and defraud
the creditors Of Richard Worthington"; that 1t
vas fraudulent as to creditors and in breach Of
the trust reposed in said Margaret Worthington
as Administrative. and was accepted by Joseph
J. Little with knowledge Of the previous assign
rnsns- end with knowledge OF the fact that
Reynolds had been appointed receiver of Rich
ard Worthington. At the time of Worthngtons
death there were pending several suits against
him and his wife. brought by Joseph ]. Little. as
receiver Of the Worthngton Company.
A COMPROMISE EFFECTED.
In December 1894. a compromise was effected
and an order was entered on the petition of
Joseph J. Little authorizing him to settle these
suits receiving the policies from Margaret
Worthngton and authorizing him to pay TO her
31ia per cent Of the amount collected on the
policies. The settlement was carried out; S13,
i6S was paid in satisfaction of the policies by
the Aetna Life Insurance Company TO the City
Chamberlain and by the City Chamberlain TO
Joseph J. Little. and he In turn paid over to
Margaret Worthington 37iz per cent of the
amount collected. The present suit was
brought to recover the amount received by
Joseph ]. Little as receiver and Margaret
Worthington. the Aetna Life Insurance Com
The Appellate Division. in reviewing the de-
cision Of the trial term. refers to the steps by
which Little and Margaret Worthington OBJ
ained the money as a transaction conceived
in fraud and contaminated in deception, trick
cry and sharp practices. resulting in gain Of
more than $1,000 to the wrongdoers and con-
squent loss TO the innocent parties"
The opinion continues:
l. requires argument to show that Joseph ];
LLitue' receiver, has been paid that which Is not
, ,ue 70 him. and 1t is almost equally clear that
tns,e IS no way IN which he can be compelled 10
unless this Court. with all the parties before II,
,eelold that transactions against good conscience
+. shoLq l prevail and so amends the judgment mat
taith TO suffer
WHAT THE COURT SAYS HER DUTY WAS.
Richard Worthhgton at the time Of his death
was with the exception Of those policies which
were kept concealed in fraud Of the rights of this
plaintiff the representative Of creditors, insol-
vent Margaret Worthington having come into
possession Of those policies as Administrative of
The estate. II became her duty discover 10
frank Reynolds. as receiver of the property and
Estate Of Richard Worthngton. the fact of the ex
htence Of these assets. Instead OF discharging
This duty Margaret Worthington, In pursuance Of
The same fraudulent purpose which actuated both
herself and her husband IN the effort TO conceal
these policies and thus defraud his creditors.
tered into an arrangement with Joseph j. Little,
receiver Of the Worthington Company. by which
enc as adminisratrix (and personality transferred
those policies condition that she should receive
70 her 37i2 per cent of the proceeds, and
this compromise. sanctioned by the Judgment cred
iors through the misrepresentation OF the sald
Lutte. was by like methods. given the approval
o. the Court This transfer was made TO Joseph
:. L!tle az receiver with full knowledge OF the
fraudulent transfers and Of the appointment OF
his plaintiff as receiver OF the property and es-
tate OF Richard Worthington He knew the facts.
sne knowing them be could get no better title than
Joseph J. Little Receiver, knew that these poll
icies Of insurance belonged 20 the estate of Rich
ard Worthinglon. ne knew that thls plalntin had