after stating the facts, delivered the opinion of the court.
In the case with which we have to deal, the law of the state oí the domicile of the bankrupt does not exempt policies of insurance from judicial pursuit by creditors. The questions, therefore, are sharply presented, whether the insurance in question is property which, under the bankruptcy act, passes to the trustee, and whether the case comes within the proviso of section 70a of the act (30 Stat. c. 541). The solution of these questions requires us to ascertain the real nature of this contract. The policy is a semitoutine policy; upon its face, an ordinary life policy, the premiums payable in 20 years, and the amount stated to be paid upon the death of the bankrupt to his wife, Anna B. Welling, if she be living; otherwise to his surviving children, if any; otherwise to his legal representatives or assigns, ft also provides for the right after payment of premiums for three years, and upon default thereafter in the payment of a subsequent premium, to a paid-up policy, without participation in profits, in favor of the wife, if living; if not living, to the surviving children; and, if none such, to the personal representatives or assigns of David Welling, — for as many twentieth parts of the original amount assured as there have been complete annual premiums received. If these provisions constituted in full the contract, we could not doubt that the bankrupt has 110 pecuniary interest in the policy which would pass to his trustee, because in no case would there be payable to him in his lifetime any sum of money whatever upon the contract. There are, however, superimposed upon this contract certain conditions W'hich qualify its effect and restrict the rights of the wife. These conditions declare that upon the completion of the tontine dividend period, November 27, 1506, the policy not having then been terminated by lapse or death, the bankrupt, not his wife, should have one of the four specified options, one of which is to receive in cash the *192policy’s accumulated reserve, stated to be $6,8x4.50, and also the surplus^ apportioned by the society to the policy. It is clear that the entire interest of the wife in this policy, and her right to receive any sum of money thereon, is contingent upon the death of hei husband before the completion of the tontine period, subject, perhaps, to her right before that time to receive in lieu of the policy a paid-up policy upon her husband’s life, payable to herself, for ¿b many twentieth parts of the sum assured as there have been annual dividends paid. It is likewise clear that this is also a contract between the assurance society and the bankrupt that on the 27th day of November, 1906, if he then survive, the society will pay him, is he so elect, a certain sum of money, or, should he so elect, will issue certain insurance to him, as stated in the condition. We cannot doubt that the bankrupt, from the moment the policy was issued, had a pecuniary interest in it, and a right to receive money upon it at the stated time, contingent only upon his surviving the tontine period; that the wife’s interest is contingent upon her husband’s death within the tontine period; and that her interest lapses at the completion of the tontine period, unless there had been substituted for the policy a new paid-up policy in the event and upon the terms stated. The proviso of section 70a declares that:
“When any bankrupt shall have any insurance policy which has a cash surrender value payable to himself, his estate or personal representatives, he may within thirty days after the cash surrender value has been ascertained and stated to the trustee by the company issuing the same, pay or secure to the trustee the sum so ascertained and stated and continue to hold, own, and carry such policy, free from the claims of the creditors participating in the distribution of his estate under the bankruptcy proceedings, otherwise the policy shall pass to the trustee as assets.”
We are of opinion (and therein we concur with the court below and with the referee) that this policy does not fall within the proviso. The term “cash surrender value,” therein employed, has a defined and legal meaning, namely, the cash value — ascertainable by known rules — of a contract of insurance abandoned and given up for cancellation to the insurer by the owner, having contract right to do so. The- “surrender” of the proviso is not the subject of negotiation or agreement, but of right. The proviso does not include those policies -where the right to surrender is not given by the contract. In the present case, failing provision in the policy to that end, surrender could only be legally accomplished through agreement with the company by the joint action of Welling and his wife. There exists no right in the wife or in the bankrupt, or in both jointly, to surrender. It could only be done by the joint action of the two by agreement with the assurance society. If provision for surrender were incorporated in the contract, it would not be within the power of the bankrupt to surrender the policy, and thereby cut off the interest of his wife therein. Bank v. Hume, 128 U. S. 195, 9 Sup. Ct. 41, 32 L. Ed. 370. She has a distinct interest in the policy, which does not pass to the trustee in bankruptcy. Atkins v. Society, 132 Mass. 395, 402. We cannot concur in the suggestion to the contrary in Re Steele (D. C.) 98 Fed. 78, 80. Nor could the bankruptcy court rightfully compel such surrender and cancellation of the pol*193icy by the bankrupt, he agreeing thereto in concurrence with the company; for that might be to deprive the wife of her interest. And likewise it would not be within the power of the wife to surrender the policy, and thereby deprive the husband of his right at the end of the tontine period to receive the stipulated amount. Surrender can only be accomplished through agreement with the company by the joint action of husband and wife. Besides, if we concede that this policy lias a “cash surrender value,” within the meaning of the proviso, that value was not “payable to himself,” for both the bankrupt and his wife had an interest therein. We are not advised by the record, nor are we otherwise informed, that there is any known rule by which surrender value- — assuming such to exist — could be equitably apportioned between the bankrupt and his wife, or by which it could be ascertained what proportion thereof was “payable to himself,” within the meaning of the proviso. From the report in Re Diack (D. C.) 100 Fed. 770, the referee would seem to have reached an apportionment in such case, but the basis of his calculation is not apparent. We are therefore clearly of opinion that the policy in question does not fall within the provisions of the proviso.
But it does not follow, as was assumed by the court below and by the referee, that, because the policy does not fall within the terms of the proviso, the bankrupt has not property therein which passes to his trustee. By the terms of the policy lie was entitled to receive at the end of the tontine period the cash payment stipulated in the contract. That is a vested contract right, contingent only upon his surviving the tontine period. The right is valuable, increasing in value with each successive payment of premium. The policy, technically, had not a “surrender value,” within the meaning of the proviso; but it had an actual value, and that valuable right was right of property existing in the bankrupt. It is the plain provision of the bankruptcy law that all the estate of the bankrupt shall, by operation of law, be vested in the trustee, save such as is specifically excepted by the provisions of the bankruptcy law, or by the law of the domicile of the bankrupt. The language of the provision is comprehensive. Subdivision 5 of section 70a declares that there shall be thus vested in the trustee “property which prior to the filing of the petition he could by any means have transferred or which might have been levied upon and sold under judicial process against him.” Then follows the proviso which we have considered. It is clear that this proviso merely defines a certain class» of insurance which may be excepted and exempted, by the action of the bankrupt and upon the conditions stated, from the general property which by the law is vested in the trustee. In other words, the proviso is in the nature of a privilege to the debtor to retain such specified insurance upon yielding to the trustee the cash surrender value of the policy at the time of adjudication. All other property of the bankrupt, including all insurance owned by him, which does not fall within the provisions of the proviso, passes to the trustee. The statute cannot legitimate!j' be construed to mean that a policy does not vest in the trustee except it have a cash surrender value, and that such may be rescued by the bankrupt upon' *194the terms stated The meaning of the provision is clear, — that all the propei'ty of the bankrupt except that specified in the proviso, shall be vested in the trustee, axid that also shall pass unless the bankrupt avail himself of the privilege granted him by the law. The contract in question gives to the bankrupt the right to receive at a certain date a specified suxn of money, contingent upon his surviving to that date. This is a vested right of property existing in the bankrupt, which passes to the trustee. It is a propei'ty right which he could have transferred, axid it falls within the comprehensive language of the section which vests title in the trustee. 2 May, Ins. § 459d; Porter v. Porter, 2 Willson, Civ. Cas. Ct. App. § 434; Cameron v. Fay, 55 Tex. 58; Levy v. Van Hagen, 69 Ala. 17; Tompkins v. Levy, 87 Ala. 263, 6 South. 346, 13 Am. St. Rep. 31; Boyden v. Insurance Co., 153 Mass. 544, 27 N. E. 669; Tennes v. Insurance Co., 26 Minn. 271, 3 N. W. 346; Talcott v. Field, 34 Neb. 611, 52 N. W. 400, 33 Am. St. Rep. 662; Evers v. Association, 59 Mo. 429. In the last case it was ruled that there was no joint interest in the policy during the continuance of the life of the insured; that while he lived he had the sole and absolute interest, with a bare contingency resulting to the other party, that, “had he survived to the designated time when the payment of the policies was to inure to him personally, he, and he alone, would have reaped their fruits, and no other one was jointly interested with him”; and that the interest of the beneficiary did not take effect until the insured’s interest ceased by death. It does not appear that the policy in that case contained a provision like the one here, providing for a paid-up policy to the beneficiary xiamed in case of default in the payment of premium after three annual premiums had been paid. This provision, even if the doctrine of the Missouri case can be upheld to its full extent, would, as we think, give to the wife a present right and interest in the policy, to receive upon the conditions stated a paid-up policy upon the life of her husband, — a right however, whiclx she could not exercise without his consent, since that would be to deprive him of his right to receive the amount specified at the conclusion of the tontine period.
The case of Ex parte Dever, 18 Q. B. Div. 660, is not in conflict with our conclusion. The policy there was like to the one.here, except that the right of option at the conclusion of the tontine period was vested in the wife, and not the husband. The right of the husband to receive anything under that policy rested in the possibility of the wife, at the end of the tontine pex-iod, exercising her option to receive a specified sum of money, which, it was argued, under the marital laws of England, would pass to the husband. Whether it would so pass was not determined; but the court ruled that the husband had no property right in the policy which passed to the trustee, because it was something that could only accrue in the exercise of the wife’s optioxi on the double contingency which had not happened at the time he obtained his discharge. The court said:
“It was the mere hope of a hope that something might come to him by reason of his surviving the ten years, and of his wife’s exercising her option in that particular manner, and it was a mere spes, and there was nothing which could vest in the trustee in bankruptcy.”
*195In re Slingluff (D. C.) 106 Fed. 154, 3 Nat. Bankr. News, 254, 5 Am. Bankr. R. 76, was a case upon an endowment policy, where the specified amount was payable to the bankrupt at the date stated, if he survived, and, if he should die within the period, then to the wife or her legal representatives. Judge Morris in that case delivered an able and exhaustive opinion, covering the whole ground here considered, and reaching the conclusion to which we are compelled.
It remains to consider how this matter should be dealt with by the court below. ' The trustee takes the policy as of the date of the adjudication in bankruptcy, and subject to all its burdens. Fie takes it subject to the duty of continuing it in force by the payment of semiannual premiums until the completion of the tontine period. That will involve a large outlay of money, which may prove burdensome to the estate. He also takes the policy subject to the contingency of the death of the bankrupt before the completion of the tontine period, and, if that contingency should happen, he will fail to realize anything, and possibly the bankrupt’s estate might lose the amount disbursed in payment of premiums. There would seem to be two modes of practically and equitably solving the problem. One is to ascertain, if it be possible, the actual value of the policy at the date of the adjudication in bankruptcy, and the equitable apportionment of that value among the respective interests in the policy, and then, in analogy to the declared policy of the law as stated in the proviso, to permit the bankrupt, if he so desire, to pay to the trustee that proportion of the actuál value which would be coming to him at the time stated and upon the plan suggested, and that the trustee thereupon convey all claim to the policy to the bankrupt. The other plan is to direct a sale by the trustee of the interest of the bankrupt in the policy at the date of the adjudication in bankruptcy. These views are suggested to the court below for its consideration in the equitable disposition of the matter under the rules which we have declared, and because the record furnishes no data from which specific directions may be given.