In re Hyde

6 F. 869
District Court, S.D. New York·Decided February 15, 1881·Published·Cited by 1 cases

Opinion

Choate, D. J.

The court, having heard these cases and delivered an opinion therein on all the points and questions submitted in September last, (see 8 Fed. Rep. 839,) the respondent, Chapman, now moves the court that certain quests ons arising therein be adjourned into the circuit court. There has been great delay in making the application. The entry of the final orders to carry into effect the opinion of the court has been postponed, on the application of the respond[870] ent, to enable him to make a motion for a rehearing, which motion has been made and denied. The respondent has also been very dilatory in submitting to the court the amendments to the proposed orders, which he obtained leave of the court to submit. These laches on the part of the respondent is urged by' petitioner’s counsel as a reason for denying this application, but, in view of the great importance of the case to the parties, I do not feel at liberty, on this ground, to deny the application, although, so far as it is granted, it will be upon the condition that hereafter there be no delay.

It is urged on behalf of the petitioners that it is now too late to adjourn questions into the circuit court, because the statute does not allow this to be done after the decision of the questions by the district court, and that in this case the questions have .been decided by the district court. The provision of the statute is: “The district judge may adjourn any point or question arising in any case in bankruptcy into the circuit court for the district, in his discretion, to be there heard and determined.” 5 St. 44.5. I think the circumstance that the point, or question has been submitted to the district judge, and that he has expressed his opinion thereon, does not preclude him, if in his discretion he thinks it proper and just to do so, from adjourning questions into the circuit court to be there heard and determined. Indeed, it must often happen that until the district judge has heard and examined the whole ease he cannot properly or intelligently determine what points or questions are so important or so difficult as to call for the exercise of this discretionary power. Points which upon the pleadings or upon their first statement may appear difficult or important, may be found upon examination to be settled by authority; or, though difficult as abstract questions, wholly unimportant, because not decisive of the matter to be determined. Until an order or decree is entered it cannot be said, in the strict sense of the word, that there is a decision. The court may, notwithstanding its opinion delivered in the cause, enter an order or decree not altogether in conformity therewith. Until the entry of an order or decree its opinion, is subject to revision and corree[871] tion. This statute, indeed, is capable of a construction that the question or point adjourned is to bo heard and determined in tho circuit court, and not to be previously heard in the district court, or any decision made thereon in the district court; I think, however, this would he too strict and narrow a construction, in view of the purposes intended to be subserved in this provision of law.

The thirtieth rule in bankruptcy is as follows: “If a point or question arises which is deemed by the district judge difficult and important, the same will be adjourned to the circuit court by order, without motion by either party. Either party desiring such adjournment, and, previous to a final decision or decree in the district court on the point, producing the certificate of counsel that the point is difficult and important, may move the adjournment, and the court, in its discretion, may allow the same on such motion; but, unless both parties concur in the application, the adjournment will be at the expense of the party moving it.” This rule seems to show that the power of the district judge to adjourn questions into tho circuit court was understood to be cut off only by the entry of a decree or final order by the district court. And such seems to have been the practical application of tho statute and the rule In the case of Mott, (unreported.)*

The first question which I am asked to adjourn into the circuit court is, in substance, “Whether tho district court has power, sitting in bankruptcy, and exercising the jurisdiction conferred by the bankrupt law of 1841, by summary order to sot aside, and order to be surrendered and cancelled, deeds given by the official assignee which were improvidently, irregularly, or without due authority executed by him, or which were procured to be executed by imposition and fraudulent practices upon the court, or which were designedly so drawn as to be grants in excess of, or varying in material particulars from, the orders of the court under which they purport to be executed, while the same are still in the hands of the party by whom they were so procured from the assignee, and who had notice of said irregularities and defects, and who gave no [872] value therefor except certain sums paid to the official assignee as fees, upon the petition of a party not a creditor of the bankrupt, and having no interest in the matter except that he is in possession of land, claiming title thereto, and that he has been subjected to litigation, or is threatened with litigation, in respect to said land, based upon the deeds sought to be avoided. Whether this power, if it can be exercised at all, can be exercised after the discharge of the bankrupt, and when there are no longer any known assets to be distributed among creditors.”

When these petitions were first presented to the court the respondent, Chapman, appeared and moved that the petitions be dismissed on the ground that the court had no power to set aside the deeds upon these petitions. After argument of this motion it was withdrawn, without prejudice to the same point, to be taken up on a hearing on the merits, and the respondent answered. The point was again taken on the final hearing. It was insisted that if the petitioners have any title to relief they must proceed by plenary suit by bill in equity, and not summarily. This point was decided against the respondent. However clear it may seem to me that the court has power to avoid the deeds by summary order, the importance of the question is such that I think I ought to adjourn it into the circuit court.

In Nelson v. Carland, 1 How. 265, Justice Catron says: "The district judge may adjourn into the circuit court any question, whether he has or has not doubts regarding its decision. Its importance is a sufficient reason.” I think this question is of sufficient importance to be so adjourned.

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