In 1964 F. H. St. Pierre and Mary St. Pierre were officers and directors of Milwaukie Construction Company (Milwaukie), a general construction firm. Between April and July, 1964, Milwaukie had four contracts to build public buildings and made application to Glens Falls Insurance Company, appellee herein, for performance and payment bonds as required by the contracts. To secure the issued bonds totaling more than $600,000, Glens Falls required Milwaukie and the St. Pierres to execute a contract of indemnity. Paragraph four of this contract was as follows:

Milwaukie defaulted upon these construction jobs.

On July 20, 1965, appellee filed an action in the United States District Court for the District of Oregon against Milwaukie and the St. Pierres, appellants herein, asking for specific performance of the above provision of the indemnity agreement. At the time of trial it was admitted that Milwaukie was in default under four construction contracts and that demand had been made upon appellee for performance and payment under each of its bonds.

At the time of trial appellee estimated that it would be obligated to pay approximately $83,000 to the beneficiaries of the bonds, but since the contracts had not yet been completed the exact amount of the loss could not be determined. Appellee had previously set up a reserve to cover its contingent loss. It was also admitted that demand had been made upon appellants under the indemnity agreement to deposit with appellees money or acceptable security in the amount of $83,000, but the appellants had not complied.

After trial the district court made findings of fact in accordance with the above statement and concluded as follows:

The district court entered a decree in accordance with the above conclusion of law and in addition fixed the sum of $3,500 as attorneys fees to be awarded to appellee.

The district court had diversity jurisdiction, the appellee corporation having been organized and existing under the laws of New York and the appellants being citizens of the state of Oregon. This court has jurisdiction under 28 U.S. C. § 1291.

Appellants’ only specification of error is “the court erred in assuming equitable jurisdiction of this matter, as the facts and circumstances of the immediate case do not justify the application of equitable relief, and furthermore plaintiff has a remedy at law which is adequate.” We see no error in the action of the district court, and affirm.

Appellant contends that since appellee had an adequate legal remedy the district court should not have assumed equity jurisdiction. The facts indicate there was not an adequate remedy at law at the time the suit was brought. “The test of the jurisdiction of a court of equity is whether facts exist at the time of the commencement of the action sufficient to confer jurisdiction on the court.” Flaherty v. Bookhultz, 207 Or. 462 , 291 P.2d 221, 224 (1955).

At the time of the commencement of this action appellee could not determine its liability resulting from Milwaukie’s default on its contracts. The contracts had not been completed and it was not known what recoveries might be made and what further payments would be received. In the complaint the liability of appellee was estimated at approximately $45,000. At trial on February 25, 1966, the exact amount of appellee’s liability as surety still could not be definitely determined, but the estimate of the ultimate liability had risen to approximately $83,-000.

It is clear that where appellee knew it was going to have liability claims filed against it but did not know the amount of those claims, the legal remedy of money damages would not be adequate.

The right to equitable relief under the circumstances of this case is discussed in many authorities. In 50 Am.Jur., Surety-ship § 225 (1944), it is said:

Similarly, in 72 C.J.S., Principal and Surety § 303 (1951), it is said:

In discussing circumstances where equitable relief may be given, the court in Morley Const. Co. v. Maryland Cas. Co., 90 F.2d 976, 977 (8th Cir. 1937) states:

In Chicago Title & Trust Co. v. Fox Theatre Corp., 91 F.2d 907, 910 (2d Cir. 1937), the court states:

Appellant next contends that even if the remedy at law was inadequate, courts under similar circumstances have assumed equity jurisdiction only if a definite and ascertainable fund was clearly in existence. Appellant has cited us to no case which makes such a statement as a matter of law or which is authority for such a statement. The cases cited by appellant have included an ascertainable fund. On the other hand, in Admiral Oriental Line v. United States, 86 F.2d 201 (2d Cir. 1936), there was no “fund” involved. The court at 201 stated through Judge Learned Hand:

In the present case, while there was no “fund” involved of the kind found in most cases, there was evidence of particular property which appellant F. H. St. Pierre owned, some of which he admitted transferring out of the country to get it beyond reach of his creditors. St. Pierre admitted he owned an automobile, life insurance, a savings account and stock in an insurance company worth $9,000. He also admitted that he received $10,000 from the sale of real estate and that he had, after appellee demanded compliance with the indemnity agreement, transferred this money to his brother in Canada to get it out of reach of his creditors. He further admitted that he had transferred another piece of real property worth $10,000 but that he had not yet received the consideration for the transfer.

Appellant finally argues that there is no equity jurisdiction because a court cannot find a person in contempt for failing to pay over money he does not have. Whether or not contempt is a proper method to enforce the decree for specific performance has not been reached in this case. No contempt order has been issued by the district court. It will be time enough to consider that point if, as and when it is ever reached.

Under the facts of this case, we find there was no error in the judgment entered by the district court.

Judgment affirmed.