In re Rusch

116 F. 270, 53 C.C.A. 631, 1902 U.S. App. LEXIS 4327

• Court: Court of Appeals for the Seventh Circuit
• Decided: May 6, 1902
• Docket: No. 769
• Status: Published

Opinion

JENKINS, Circuit Judge.

By section 24a of the bankruptcy act (30 Stat. c. 541) the circuit courts of appeals are given “appellate jurisdiction of controversies arising in bankruptcy proceedings from' the courts of bankruptcy from which they have appellate jurisdiction in other cases.” By 'subdivision “b” of that section such courts are given 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. • This revisory power is like to that conferred upon circuit courts under the bankruptcy act of 1867 (Rev. St. § 4986). Under that act it was ruled that the jurisdiction thus conferred upon the circuit courts was dual in character:

“First, jurisdiction as a court of bankruptcy over the proceedings in bankruptcy initiated by the petition, and ending in the distribution of assets among 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.” Lathrop v. Drake, 91 U. S. 516, 23 L. Ed. 414.

This rule is applicable to the grant of jurisdiction under the present bankruptcy act. It follows that the power to revise by original petition here the ruling of the bankruptcy court extends only to some order made in the bankruptcy proceedings proper, and does not embrace proceedings in suits brought by the trustee in bankruptcy against third parties. In re Jacobs, 39 C. C. A. 647, 99 Fed. 539. We hold in the opinion in the principal case, herewith decided (Stelling v. Lumber Co., 116 Fed. 261), that the proceeding below was not “a proceeding in bankruptcy,” but was in the nature of an independent suit by the trustee, which could have been maintained equally in a state court (Eyster v. Gaff, 91 U. S. 521, 23 L. Ed. 403; Claflin v. Houseman, 93 U. S. 130, 23 L. Ed. 833; McKenna v. Simpson, 129 U. S. 506, 9 Sup. Ct. 365, 32 L. Ed. 771; Kidder v. Horrobin, 72 N. Y. 159), and was maintainable in the bankruptcy court as a plenary suit, and only because of the submission of the G. W. Jones Lumber Company to its jurisdiction (Bardes v. Bank, 178 U. S. 524, 20 Sup. Ct. 1000, 44 L. Ed. 1175; Trust Co. v. Comingor, 22 Sup. Ct. 293, 46 L. Ed.-). We cannot, therefore, properly entertain this petition to review the action of the court which is here complained of.

The petition must be dismissed