Ullman v. David Blustein & Bro.

282 F. 265, 1922 U.S. App. LEXIS 2631

• Court: Court of Appeals for the Second Circuit
• Decided: May 1, 1922
• Docket: No. 305
• Status: Published

Opinion

HOUGH, Circuit Judge.

The record does not contain any opihion rendered by the lower court upon eliminating Blustein from the scope of the examination order. We must therefore assume that the reasons assigned by Blustein for the order complained of are the reasons, and the only reasons, that actuated the lower court.

It is quite true that an order requiring examination under section 21a is discretionary; and if it is discretionary to grant the order, it is also discretionary to refuse it, and the order before us is in effect such refusal so far as Blustein is concerned. In re Weidenfeld, 254 Fed. 677, 166 C. C. A. 175. But discretion, if abused, is error of law, and therefore reviewable by petition to revise, and it is an abuse of discretion to refuse to follow settled law; i. e. (inter alia), approved decisions, even when exercising discretion.

Blustein’s only assigned reason for escaping examination under section 21a is that between his firm and the bankrupt there was a litigation pending in another court wherein each party in substance asserted the other to be indebted to him. This in itself is not a lawful or otherwise good reason for denying examination under section 21a. The point was specifically ruled in Re Cliffe (D. C.) 97 Fed. 540, approved in Re Madero (D. C.) 256 Fed. 859.

It follows that error of law was committed in entering the order under review.

It may be pointed out that .Blustein has mistaken his remedy. He has no right to escape or refuse all examination; but if examination goes too far, and unlawful or unnecessary questions are asked, it is always possible to obtain relief upon summary reference .to the District Judge.

Order reversed, with costs.