Beecher v. Bininger

3 F. Cas. 49, 7 Blatchf. 170, 1870 U.S. App. LEXIS 1429
CourtU.S. Circuit Court for the District of Southern New York
DecidedFebruary 11, 1870
StatusPublished
Cited by1 cases

This text of 3 F. Cas. 49 (Beecher v. Bininger) is published on Counsel Stack Legal Research, covering U.S. Circuit Court for the District of Southern New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Beecher v. Bininger, 3 F. Cas. 49, 7 Blatchf. 170, 1870 U.S. App. LEXIS 1429 (circtsdny 1870).

Opinion

WOODRUFF, Circuit Judge.

The bill of complaint herein alleges, that, by the decree-of the district court, the defendants Bininger and Clark, co-partners in business, have been [50]*50adjudged bankrupts; that the plaintiff has, in pursuance of the provisions of the bankrupt act, been appointed assignee, and the property and estate of the bankrupts have been assigned to him, as is directed by section fourteen of the act; that the bankrupts heretofore composed the co-partnership firm of Abraham Bininger & Co.; that, prior to the institution of the proceedings in the district court, wherein they were declared bankrupts, one of the partners, Clark, had filed his complaint, in equity, In the superior court of the city of New York, for the determination of their interests in the co-partnership property, and the defendants Hanrahan and Barr had been appointed receiver’s of the property of the said firm, and were in the actual possession of the property; that said receivers exclude the plaintiff from any possession or control of the property, so that he cannot make an inventory thereof; that Clark will not make such inventory, and the plaintiff cannot particularly specify the same, but he gives a general description thereof, and avers that, if properly administered. it is sufficient for the payment of all the debts of the bankrupts; that nearly all of the creditors have proved their debts in the proceedings in bankruptcy; that the receivers have set themselves to defeat those proceedings, resist the attempts of the marshal to possess himself of the property under the warrants of the district court, have converted a portion of the property into money, and refuse to deliver possession to the plaintiff, or to render him an account, and claim an excessive amount as fees or commissions as receivers; and that, by these means, the plaintiff is prevented from administering his trust as assignee, and the effect and operation of the act of congress are impeded, hindered, and delayed. Upon the principal facts thus alleged, with some other details, the plaintiff seeks, by way of relief, a decree that the title of Bininger and Clark to the property is divested, except such as they may claim under and through him as as-signee; that the receivers’ title is divested, except so far as they have a lien for their just fees or commissions as receivers; and that they deliver the property to the plaintiff, as such assignee, to be by him administered. As auxiliary to such relief, the plaintiff prays for an injunction restraining the defendants from intermeddling with the property, restraining Clark from prosecuting his said action in the superior court of the city of New York, and restraining the defendants from preventing the marshal from taking possession of the property. He also prays that a receiver of the property may be appointed by this court.

Upon this bill the plaintiff moves for an injunction and a receiver according to the prayer. The defendant Clark and the receivers resist the motion on various grounds, and. among others, that Bininger and Clark had committed no act of bankruptcy; that the state court had acquired jurisdiction of the property, in the action brought by Clark for the settlement of the affairs of the co-partnership, before any proceedings in bankruptcy were instituted; that, by the appointment of the receivers, the title of the bankrupts was divested, and became vested in such receivers; that neither the jurisdiction of the state court, nor the title of the receivers, was divested by the decree in bankruptcy, or the appointment of the assignee; that the state court has jurisdiction to proceed with the settlement of the co-partnership affairs, the payment of the creditors of the firm, and the distribution of the property; that the receivers are warranted in acting, and are bound by law, and by their bonds as receivers, to hold and administer the property under the direction of the state court; that such property is to be deemed in legal custody, from which it ought not to be, and cannot legally be, taken by the federal courts; and that there is no ground for impeaching the administration to which the property is subject in the state court, which proceeds in such cases according to the rules of equity alike recognized by the federal and state courts, and will apply the property to the payment of the debts of the firm on equitable principles, and with the equality of distribution which governs the administration of the estate of a bankrupt in the federal court.

It is quite certain that this court cannot listen to any argument which proceeds upoD the allegation that the decree by which Bin-inger and Clark were adjudged bankrupts was erroneous in fact or in law. The pen-dency of proceedings in this court for the review of that adjudication may furnish a reason why, if there is no danger of injury to the property or serious loss to the bankrupts or their creditors, this court should not summarily interfere with the temporary custody of the property; but this court will not, on a mere motion of this description, suffer a collateral attack upon that decree, and proceed upon any assumption that such decree is erroneous, but will presume the contrary to be true. On the other hand, a plaintiff coming by motion to this court, and asking its summary interposition by an injunction and a receivership pendente lite, must show other grounds than a mere conflict of claim to the title and possession of the property which is the subject of litigation.

It is quite true that proceedings in bankruptcy are summary in their nature, and that the purpose and design of the bankrupt act is to make them summary and speedy in effecting the purposes of its enactment. To this end a very extensive summary jurisdiction is given to the district court, as a court of bankruptcy, by the first section of the act. This extends to the collection of all the assets of the bankrupt, the ascertainment and liquidation of the liens and other specific claims thereon, the adjustment of the [51]*51priorities and conflicting interests of all parties, the marshalling and disposition of the funds and assets, and all matters and things to he done under and in virtue of the hank-' ruptcy, with full authority to compel obedience to all orders and decrees in bankruptcy, to the same extent as this court has authority in any suit in equity. If, however, the case arises in which that summary jurisdiction, comprehensive as it is, seems inadequate, concurrent jurisdiction is, by the second section, given to this court, to entertain an action at law or a Buit in equity by the assignee against any person claiming an adverse interest, or by such person against the assignee, touching any property or rights of property of the bankrupt, •transferable to or vested in such assignee. The assignee must, in such cases, proceed at law or in equity, according to the nature of the case; and, where he proceeds by bill in equity, his suit is subject to the ordinary rules governing this court, and regulating its discretion as a court of equity, in other •cases. Therefore, on an application for an injunction and a receivership, in the first instance, where the plaintiff insists that it be granted before the merits of the controversy shall be examined and considered on the proofs of both parties, on all the questions of law and fact, he must not only show a case of adverse and conflicting claims, and that the ease is one of equitable cognizance, but he must show some emergency, some peril of loss which the court will be unable completely to redress; and the danger must be clear, and the right, in general, free from reasonable doubt

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Cite This Page — Counsel Stack

Bluebook (online)
3 F. Cas. 49, 7 Blatchf. 170, 1870 U.S. App. LEXIS 1429, Counsel Stack Legal Research, https://law.counselstack.com/opinion/beecher-v-bininger-circtsdny-1870.