In re Union Dredging Co.

225 F. 188, 1915 U.S. Dist. LEXIS 1237
CourtDistrict Court, D. Delaware
DecidedMarch 19, 1915
DocketNo. 254
StatusPublished
Cited by8 cases

This text of 225 F. 188 (In re Union Dredging Co.) is published on Counsel Stack Legal Research, covering District Court, D. Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Union Dredging Co., 225 F. 188, 1915 U.S. Dist. LEXIS 1237 (D. Del. 1915).

Opinion

BRADFORD, District Judge.

This case is before the court on petitions of review of certain orders made by the referee disallowing in whole or in part claims for compensation for alleged services rendered in the course of the administration of the bankrupt estate. It appears from the summary of evidence certified by him to the judge, among other things, that prior do the adjudication in bankruptcy April 10, 1913, the Union Dredging Company was engaged in gold dredging in California; that its plant and property situated in Sacramento County about two miles from Folsom and twenty two miles from Sacramento, consisted of six hundred and seventy two acres of land, approximately, with an office^building and appurtenances thereon, and also a placer dredge, with its equipment and Keystone drill, mining tools and implements, and office furniture, books and supplies; that the placer dredge had been purchased under a contract of conditional sale, from the Bu'cyrus Company, of Milwaukee, Wisconsin, which provided that the title to the dredge was to remain in the vendor until the full purchase price and any and all notes given therefor or renewals thereof should be paid; that as an additional security for the payment of such purchase price a mortgage was given to the Bucyrus Company, covering practically all of the real estate of the bankrupt; that at the time of the filing of the petition in bankruptcy title to the dredge had not been acquired by the bankrupt, there then being owing of the purchase price thereof upwards of $16,000; that from April 12, 1913, until June 12 next following the said plant and property were in charge of Charles J. Cull and Wilmington Trust Company as receivers; that the latter was appointed trustee and as such took charge of the bankrupt estate June 12, 1913; that the real estate and personal property of the bankrupt were sold April 28, 1914, for $60,000; that the sale was confirmed May 28, 1914; that the receivers filed their account together with a petition for their discharge June 25, 1914, and a supplemental report November 23, 1914; that the first and final account of the trustee was also filed at the last mentioned date; that the total amount received by the trustee from all sources applicable to the costs and expenses of administration and to the claims of creditors, not taking into consideration the sum of $16,500, proceeds of trustee’s certificates, issued and sold under order of court, and the further sum of $600, loaned for insurance on dredge, was the sum of $63,062.99; that the last mentioned sum includes $1,007.12, being the net balance, paid to the trustee, of the sum of $1,958.72, which came into the possession of the receivers; that of the above mentioned sum of $63,062.99 received by the trustee, $32,063.31 has been applied by it to the costs and expenses of administration, leaving a balance of $31,019.68 in the hands of the trustee applicable to further costs and expenses of administration and the claims of creditors. This balance should, in the opinion of the referee, be increased by the sum of $369.92, hereinafter particularly referred to, which has been directed to be turned over to the trustee by those to whom it was paid.

The matters in controversy covered by the petitions for review are: First, the disallowance of an alleged claim of Richard H. Vail, amounting to $943.25, representing an unpaid balance of moneys due [190]*190him for services and expenses rendered and incurred by him on account of the bankrupt estate. Second, the allowance to Griggs, Baldwin & Baldwin of the sum of only $130.08 as a set-off against the •sum of $500 paid by the bankrupt to them before bankruptcy, and directing that law firm to turn over to the trustee the difference, namely, $369.92: Third, the disallowance of compensation claimed by Griggs, Baldwin & Baldwin to be due them as attorneys for Charles J. Cull, one of the receivers. Fourth, the allowance to- the trustee for Pillsbury, Madison & Sutro of the sum of only $500 instead of $1,500, alleged to have been due to that firm for services as attorneys for the trustee. Fifth, tlie allowance to the trustee of only the sum of $41.95, instead of $83.90, to cover the traveling expenses of Pillsbury, Madison & Sutro in connection with the settlement of the estate. Sixth, the allowance to the trustee for Sylvester D. Townsend, Jr., Esq., of only the sum of $2,575'as compensation for services as •attorney for the trustee, instead of $4,000 as alleged by him to be due. Seventh, the allowance to the trustee of only $202.70 to cover the traveling expenses of Mr. Townsend, attorney for the trustee, •on his trip to California, instead of $405.40, ás claimed by him.

[1] The referee properly disallowed the alleged claim of Vail for services and expenses. In the supplemental report of the Wilmington Trust Company, one of the receivers, made under oath November 20, 1914, it is stated that June 10, 1914, that company received a •certain bill and claim from Vail reading as follows:

“22 May, 1913.
“Charles J. Gull and Wilmington Trust Go., Receivers 11111011 Dredging Go., to Richard H. Vail, 68 Washing Square South, New York, Dr.
To railroad and Pullman...................................... $ 133 .S5
To expenses..........'....................................... 59.40
To services, 10 days........................................... 1,000.00
1,193.25
By cash.................................................. 250.00
To balance.............................................. ? 943.25”

In its supplemental report reference was also made to the claim asserted by Vail, as follows:

“With respect to ,said claim, Wilmington Trust Company reports that until •said tenth day of June it had no knowledge whatever that the said Richard H. Vail had been employed to perform any services for the said Receivership Estate; that it never was consulted with reference to the employment of the said Richard H. Vail; that it has never at any time ratified the employment of the said Vail or the validity and sufficiency of said claim; that upon information and belief it avers that the services so rendered by the said Vail were useless and valueless to said Receivership Estate, and that the said employment of the said Richard H. Vail was without authority of law.”

The supplemental report of Cull, one of the receivers, made under oath November 17, 1914, states:

“At a meeting of the executive committee of the Union Dredging Company, held March 20th, 1913, at which all the members thereof were present, the following resolution was adopted:
“ ‘Resolved that Mr. Richard H. Vail be employed and authorized on behalf •of the company to go to Eolsom to investigate the operations of the company1 [191]*191there, with full power to assume charge of operations, discharge or suspend tile super!elondeut, employees and working men, and engage others on behalf of the company.’
“Air. Vail started on his trip about the 5th of April, and on the 11th of April the company went into the hands of receivers. The directors of the company (Messrs. Griggs, Gillinder, Gorgas raid Gull) thought it would he best for Air. Vail to continue to Folsoin and make his report on conditions Hiere, irrespective of the receivership proceedings, and I accordingly telegraphed Mr.

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Bluebook (online)
225 F. 188, 1915 U.S. Dist. LEXIS 1237, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-union-dredging-co-ded-1915.