The replacement trustee in bankruptcy brought a motion for a declaration that it owned the bankrupt's leased office equipment and furniture free and clear.
The bankrupt had financed the equipment through leases secured by a collateral assignment of his life insurance policies.
After his death, the insurer paid the lessor from the death benefit, which the bankrupt's spouse and daughter (the beneficiaries) argued unjustly enriched the estate.
The court held that the rule in Ex parte James did not apply to give the beneficiaries a proprietary claim against the equipment, and granted the trustee's declaration, noting the beneficiaries could pursue other remedies if they suffered a loss.
