Mattocks v. Lovering

16 F. Cas. 1149, 1876 U.S. App. LEXIS 1763

• Court: U.S. Circuit Court for the District of Massachusetts
• Decided: April 4, 1876
• Status: Published

Opinion

SHEPLEY, Circuit Judge,

held, that a court of equity would not enforce any off-set of the claim purchased by Cady & Co. against the claim of the assignees of Norris, Hall & Co. upon Cady & Co. A court of equity would not allow a debtor, after known insolvency and contemplated bankruptcy of his creditor, by the purchase of his out-standing liabilities, to absorb, perhaps, the whole assets of the bankrupt in the entire payment of one portion of his liabilities, leaving the balance of the debts without any dividend, thus defeating that equal distribution of the assets among all the creditors. The result was that Stod-dard, Lovering & Co. had a right to sell their demands to Cady & Co., who in equity succeeded to the rights only which Stoddard, Lovering & Co. had to prove their debt and receive a dividend, but could not in equity claim to set-off the debt to Stoddard, Lover-ing & Co. against the debt due from Cady & Co. to the assignees' of the bankrupt estate. Bill dismissed without costs to either party.