In re Jacobs

99 F. 539, 39 C.C.A. 647, 1900 U.S. App. LEXIS 4165
CourtCourt of Appeals for the Eighth Circuit
DecidedFebruary 3, 1900
DocketNo. 15
StatusPublished
Cited by10 cases

This text of 99 F. 539 (In re Jacobs) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Jacobs, 99 F. 539, 39 C.C.A. 647, 1900 U.S. App. LEXIS 4165 (8th Cir. 1900).

Opinion

THAYER, Circuit Judge.

This is a petition for review under subdivision “b” of section 24 of the bankrupt act, approved July 1, 1898 (30 Stat. 544, 553, c. 541), which is filed in behalf of Charles F. Jacobs, against whom an original bill in equity was exhibited by Samuel Rosenfeld, trustee in bankruptcy of the Mechanics’ Clothing Manufacturing Company, a bankrupt, on the 10th day of January, 1900, in the district court of the United States for the Eastern judicial district of Missouri. The purpose of the suit was to obtain a decree vacating a certain deed of trust, and to recover the property, or rather the proceeds of the property, which was thereby conveyed to said Charles F. Jacobs, the trustee in said deed of trust. The instrument in question was executed on April 16, 1899, by the Mechanics’ Clothing Manufacturing Company, and proceedings in bankruptcy were instituted against it on May 1, 1899, under which it was subsequently adjudged a bankrupt on November 20, 1899. Samuel Rosenfeld, the complainant in the bill, was appointed and qualified as trustee in bankruptcy of the Mechanics’ Clothing Manufacturing Company on December 18,1899, and on the 10th day of the following January he exhibited an original hill in the district court, where the adjudication had taken place, to annul the aforesaid deed of trust, charging, in substance, that it was conceived by the bankrupt company in bad faith, for the purpose of hindering, delaying, and defrauding its creditors, and for the express purpose of evading the operation of the existing bankrupt act.

The petitioner insists that the district court has no jurisdiction of the bill to vacate the deed of trust, and that the suit should have [540]*540been brought in the courts of the state, under the provisions of section 23 of the bankrupt act, because Rosenf eld and Jacobs, the parties plaintiff and defendant to the bill, are both citizens of the state of Missouri, and because subdivision “b” of section 23 expressly provides that “suits by the trustee shall only be brought or prosecuted in the courts where the bankrupt whose estate is being administered by such trustee might have brought or prosecuted them if proceedings in bankruptcy had not been instituted, unless by consent of the proposed bankrupt.” It is claimed that the district court erred in entertaining the bill, and such is the error of law which .we are asked to review. The respondents have filed a motion to dismiss the petition for review, and we are confronted in limine with the inquiry whether the alleged error of law is one which may be reviewed under subdivision “b” of section 24 of the bankrupt act. That section reads as follows:

“Sec. 24. Jurisdiction of Appellate Courts. — a. The supreme court of the United States, the circuit courts of appeals of the United States, and the supreme courts of the territories, in vacation, in chambers and during their respective terms, as now or as they may hereafter be held, are hereby invested with appellate jurisdiction of controversies arising in bankruptcy proceedings from the courts of bankruptcy from which they have appellate jurisdiction in other cases. The supreme court of the United States shall exercise a like jurisdiction from courts of bankruptcy not within any organized circuit of the United States and from the supreme court of .the district of Columbia.
“b. The several circuit courts of appeals shall have jurisdiction in equity, either interlocutory or final, to superintend and revise in matter of law the proceedings of the several inferior courts of bankruptcy within their jurisdiction. Such power shall be exercised on due notice and petition by any party aggrieved.”

Tbe first paragraph of section 2 of the bankrupt law of March 2r 1867, which now appears in the Revised Statutes of the United States as section 4986, reads .as follows:

“The circuit court for each district shall have a general superintendence and jurisdiction of all cases and questions arising in the district court for such district when sitting as a court in bankruptcy, whether the powers and jurisdiction of a circuit court have been conferred on such district court, or not; and except when special provision is otherwise made may upon bill, petition or other proper process of any party aggrieved, hear and determine the case as in a court of equity; and the powers and jurisdiction hereby granted may be exercised either by the court in term time or in vacation by the circuit justice or by the circuit judge of the circuit.”

In view of the similarity of the language employed in the two statutes above quoted and the general object designed to be accomplished by the two acts, we are of opinion that the jurisdiction conferred on the several circuit courts of appeals by subdivision “b” of section 24 of the recent bankrupt act is the same as that which was vested in the circuit courts by the bankrupt act of March 2, 1867, under the first paragraph of section 2 of that act, which now appears in the Revised Statutes as section 4986, above quoted. Congress, as we think, intended to confer on the several circuit courts of appeals the same supervisory control “of controversies arising in bankruptcy proceedings” in the district courts which the circuit court exercised under the act of 1867 by virtue of the above-quoted .provisions of that act. It was doubtless deemed most ex[541]*541pedient to transfer the supervisory jurisdiction formerly exercised by the circuit court to the several circuit courts of appeals, because since the creation of the latter courts by the act of March 3, 1891, the circuit court has ceased to exercise appellate functions, and is generally held by the district judge whose action that court would be called upon to review.' But, be this as it may, we discover nothing in the provisions of the recent bankrupt act which leads us to infer that the revisory power of the circuit courts of appeals to be exercised by petition for review is in any respect more extensive than that formerly exercised by the circuit courts under the act of 1867.

In the case of Lathrop v. Drake, 91 U. S. 516, 23 L. Ed. 414, it was held by the supreme court that the bankrupt act of 1867 conferred on the district court two distinct kinds or classes of jurisdiction:

“First, jurisdiction as a court of bankruptcy over the proceedings in bankruptcy initiated by the petition, and ending in the distribution of assets amongst the creditors, and the discharge or refusal of a discharge of the bankrupt; secondly, jurisdiction, as an ordinary court, of suits at,, law or in equity brought by,or against the assignee in reference to alleged property of the bankrupt, or to claims alleged to be due from or to him.”

The court further said:

“The language conferring this jurisdiction on the district courts is very broad and general. * * * The various branches of this jurisdiction are after-wards specified, resulting, however, in the two general classes before mentioned.”

It was also- held in the same case with respect to the circuit courts that the appellate jurisdiction conferred upon them by the act of 1867 was likewise of a twofold character, one species of which was to be exercised by petition for review, and the other in the ordinary way, by appeal or writ of error. In an earlier case, decided in 1873 (Coit v. Robinson, 19 Wall. 274, 282, 22 L. Ed. 152).

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Bluebook (online)
99 F. 539, 39 C.C.A. 647, 1900 U.S. App. LEXIS 4165, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-jacobs-ca8-1900.