Page:Federal Reporter, 1st Series, Volume 4.djvu/868

854 FEDEBAIi BEPOBTBB. �its property from its use and oontrol. It îa true that in such a case à court should consider well the consequences of its action, and adopt the extreme recourse only when the fact» of the case most clearly justify the measure. �But this defendant company is already extinct; its fran- chises are already forfeited and abandoned ; its property al- ready put by its own act out of its own use and possession, and committed to liquidation. Having thus itself made a. case for a receiver, and actually anticipated a court in ap- pointing one, this court is relieved from the painful inquiries and delîcate responsibility usually devolved upon courts in. passing upon applications for receivers ; and, therefore, I am confronted with but a single question, which is whether or not this court will allow the defendant company to appoint its receiver for it. �This is an insolvent life Insurance company — a company which has approached thousands of men and women in the land and said, if out of your annual earnings and Saving» yoa will pay me annual premiums of money during your natural lives, I will at your death pay to your widows and children certain thousands of dollars for their support. Hav- ing received these premiums for 12 or 15 years down to a few" weeks past, it now reveals to the world that it cannot comply with the solemn obligations which it had undertaken. I think that the mere fact of the failure of a life Insurance company is prima fade proof that its operations have been conducted in a fraudulent manner ; and, if the failure is not explained by some great casualty, such as a wide-spread pestilence, or sudden financial convulsion, or physical calam- ity, I think that it is per se proof of fraud. I will not pre- tend to say that it creates the presumption of moral turpi- tude in the managers of the company, but it certainly does of eonstructive fraud; thai is to say, of that financial im- becility or recklessness or extravagance, or that gross negli- gence, which is equivalent in its consequences to fraud, and which a court is bound to regard as eonstructive fraud. �Would the court be justified in allowing a trustee appointed by such a comnany, in the very deed in which it avowed its ����