In re Smith

E.D. Pennsylvania

In re Smith

123 F. 188, 1903 U.S. Dist. LEXIS 229

CourtDistrict Court, E.D. Pennsylvania

DecidedJune 9, 1903

DocketNo. 1,432

StatusPublished

This text of 123 F. 188 (In re Smith) is published on Counsel Stack Legal Research, covering District Court, E.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

In re Smith, 123 F. 188, 1903 U.S. Dist. LEXIS 229 (E.D. Pa. 1903).

Pincite

Opinion

J. B. McPHERSON, District Judge.

The bankrupt was the holder of a liquor license in this city, and owned the fixtures in a rented' place of business. At the receiver’s sale, $144.61 was bid for the-stock and fixtures, offered separately, and $1,000 for the license. The stock, fixtures, and license were then offered as an entirety, and brought $3,500. The sale was on September 16th, and upon the 18th. the receiver reported the sale to the court, and asked for an order of confirmation, which was thereupon granted. The landlord did not receive notice of the sale, but he did know when the petition for confirmation would be presented, and although he was in attendance-he made no objection to the sale or to the order. Several monthsafterwards he presented a petition to the referee, averring that the stock and fixtures were subject tó distraint for rent, and that he was therefore entitled, under the Pennsylvania statute (P. R. 1891, p. 122),. to have a year’s' rent paid in full out of the proceeds of the sale; arguing that', as the sum bid for the license separately was only $1,000, $2,500 should be taken as the value of the stock and fixtures, and this sum should be applied to the claim for rent. The referee disallowed the claim on the ground that it was impossible to say how much of the fund produced by the sale was the product of the license, and-how much was the product of the stock and fixtures. I agree with this conclusion, which accords with two previous decisions in this district. Re Gerry, 7 Am. Bankr. R. 462, 112 Fed. 957, and Re Klapholz, 7 Am. Bankr. R. 703, 113 Fed. 1002. It is certain that no apportionment of the $3,500 can be made with any degree of accuracy for, while it is true that only $1,000 was bid for the license separately,, and therefore it may be contended with some degree of plausibility that the remaining $2,500 was bid for the stock and fixtures, it may be also contended, and with equal plausibility, that as only $144.61 was bid for the stock and fixtures separately the license must have-produced the balance of the $3,500. Clearly, the two lots as an entirety were more valuable than when offered separately, but the excess of value cannot now be assigned to its proper source or sourcesv [189]*189Probably each lot contributed something to the higher price, but it •would be a mere guess to attempt to say how much. If the landlord had desired to object to the sale upon the ground that he had not received notice, his time for so doing was, at latest, when the petition for confirmation was presented; for of this at least he had knowledge, and he was actually present when the order was made. His acquiescence in the report and confirmation was a clear ratification of the sale in bulk, and a waiver of the failure to give him notice.

The action of the referee in rejecting the claim is approved.

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J. B. McPHERSON, District Judge.

The bankrupt was the holder of a liquor license in this city, and owned the fixtures in a rented' place of business. At the receiver’s sale, $144.61 was bid for the-stock and fixtures, offered separately, and $1,000 for the license. The stock, fixtures, and license were then offered as an entirety, and brought $3,500. The sale was on September 16th, and upon the 18th. the receiver reported the sale to the court, and asked for an order of confirmation, which was thereupon granted. The landlord did not receive notice of the sale, but he did know when the petition for confirmation would be presented, and although he was in attendance-he made no objection to the sale or to the order. Several monthsafterwards he presented a petition to the referee, averring that the stock and fixtures were subject tó distraint for rent, and that he was therefore entitled, under the Pennsylvania statute (P. R. 1891, p. 122),. to have a year’s' rent paid in full out of the proceeds of the sale; arguing that', as the sum bid for the license separately was only $1,000, $2,500 should be taken as the value of the stock and fixtures, and this sum should be applied to the claim for rent. The referee disallowed the claim on the ground that it was impossible to say how much of the fund produced by the sale was the product of the license, and-how much was the product of the stock and fixtures. I agree with this conclusion, which accords with two previous decisions in this district. Re Gerry, 7 Am. Bankr. R. 462, 112 Fed. 957, and Re Klapholz, 7 Am. Bankr. R. 703, 113 Fed. 1002. It is certain that no apportionment of the $3,500 can be made with any degree of accuracy for, while it is true that only $1,000 was bid for the license separately,, and therefore it may be contended with some degree of plausibility that the remaining $2,500 was bid for the stock and fixtures, it may be also contended, and with equal plausibility, that as only $144.61 was bid for the stock and fixtures separately the license must have-produced the balance of the $3,500. Clearly, the two lots as an entirety were more valuable than when offered separately, but the excess of value cannot now be assigned to its proper source or sourcesv [189]*189Probably each lot contributed something to the higher price, but it •would be a mere guess to attempt to say how much. If the landlord had desired to object to the sale upon the ground that he had not received notice, his time for so doing was, at latest, when the petition for confirmation was presented; for of this at least he had knowledge, and he was actually present when the order was made. His acquiescence in the report and confirmation was a clear ratification of the sale in bulk, and a waiver of the failure to give him notice.

The action of the referee in rejecting the claim is approved.

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Bluebook (online)

123 F. 188, 1903 U.S. Dist. LEXIS 229, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-smith-paed-1903.

Opinion

J. B. McPHERSON, District Judge.

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