William J. Brennan, Jr.

“ On surrender of a policy the insurer, being relieved of the obligation to provide death benefits during future years where the annual value of the risk exceeds the annual net level premium, no longer needs to retain the surrendering policyholder's contributions to the funds previously accumulated for such purpose. ”

“ Bess.↑ Once a federal tax lien attaches to the insured's interest, of course, the Government, in a proper action joining the appropriate parties, can enforce the lien in the insured's lifetime and thereby recover the cash surrender value. ”

“ Insofar as the Government's action here rests on a theory of liability in equity for debts of another person, I agree with the Court that Mrs. Bess' liability is to be determined by reference to state law and that consequently the Government cannot prevail on this basis since state law here imposes no liability. ”

“ Bess paid all premiums and it is conceded that none was paid in fraud of his creditors.
The federal income taxes were owing for the several years from 1945 to 1949. The assets of Mr. Bess' estate were applied to payment of the amounts owing for 1948 and 1949, but a total of $8,874.57 remained owing for 1945, 1946 and 1947 when the estate was adjudged insolvent by the Monmouth County Court in 1952. ”