971

MUELLER v. NUGENT.

184 U. S. 1-18

to property of bankrupt by third person in possession is well founded or fictitious and colorable; In re Friedman, 161 Fed. 261, 88 C. C. A. 306, District Court has power to make summary order directing third persons to pay to receiver sums of money coming into their possession from sale of bankrupt's stock of goods five days before filing of petition in bankruptcy; In re Kane, 161 Fed. 639, trustee cannot in summary proceeding against bank alone compel it to pay money withdrawn and not paid to trustee, but petition may be amended to bring in other parties, participating in withdrawal of fund; Linstroth Wagon Co. v. Ballew, 149 Fed. 965, 966, 8 L. R. A. (N. S.) 1204, 79 C. C. A. 470, where claimant sues for property prior to petition in State court, trustee coming in to defend, judgment conclusive on trustee; Moody v. Cole, 148 Fed. 296, 300, where, in proceeding to enforce order requiring bankrupt to turn over property, evidence shows beyond reasonable doubt bankrupt in contempt, court should commit without plenary suit; In re Home Discount Co., 147 Fed. 552, where creditor of bankrupt takes assignment of future wages, taking no action until after bankruptcy proceedings commenced, referee may summarily compel withdrawal of notice of assignment; In re Cole, 144 Fed. 394, 75 C. C. A. 330, order requiring married woman to turn money over to trustee extends to money belonging to her held by husband; In re Knopf, 144 Fed. 251, bankruptcy court can order marshal to take property while in possession of adverse claimant when necessary for preservation; In re Lacov, 142 Fed. 962, 74 C. C. A. 130, bankruptcy court may institute contempt proceedings to enforce order requiring petitioning creditors to pay expense of receivership; In re Bacon, 132 Fed. 159, where advantageous to estate, mortgagee compelled to accept payment and surrender property to trustee; In re Kane, 131 Fed. 387, bankruptcy court, determining adverse claim colorable only, can proceed summarily against bankrupt's agent to recover property; Schweer v. Brown, 130 Fed. 329, 64 C. C. A. 574, commitment of bankrupt for refusal to surrender property to trustee is not void as. imprisonment for debts; In re Kane, 125 Fed. 985, holding statement that bankrupt gave money, traced to his hands, to his wife who opens the same, is no defense in contempt proceedings for nonsurrender of funds; In re Knight, 125 Fed. 42, holding receiver appointed by State court, after act of bankruptcy and within four months' period, holds subject to rights of general creditors; In re Breslauer, 121 Fed. 914, holding trustee may recover money deposited with bank on its judgment against bankrupt within four months before adjudication; In re Kellogg, 121 Fed. 336, 57 C. C. A. 547, holding court of bankruptcy has jurisdiction, under section 2, subdivision 7, Act of 1898, to determine in summary proceedings validity of mortgage on bankrupt's property; In re Shachter, 119 Fed. 1014, holding bankruptcy court has jurisdiction to proceed against bankrupt for contempt for failure to turn over all property to trustee.

Distinguished in Jaquith v. Rowley, 188 U. S. 623, 624, 47 L. Ed. 622, 23 Sup. Ct. 371, holding surety on bankrupt's bail bond is an adverse claimant to property held to indemnify himself, and can be sued in bankruptcy court only with his consent; Stone-Ordean-Wells Co. v. Mark, 227 Fed. 979, execution creditor whose execution was levied eight days before filing of petition in bankruptcy is adverse claimant, and may not be compelled by bankruptcy court in summary proceeding to pay money to estate; In re Shea, 211 Fed. 367, holding wife of bankrupt had bona fide adverse claim which she was entitled to have tried in plenary suit; In re Yorkville Coal Co., 211 Fed. 621, 128 C. C. A. 570, claimant's testimony that wagons were purchased from bankrupt establishes adverse claim not determinable in bankruptcy proceedings over his protest; In re Bacon, 210 Fed. 134, 126 C. C. A. 643, in proceedings by trustee to recover corporate stock of bankrupt in hands of bank, claim of another bank to lien on stock under pledge contract with bankrupt is adverse and cannot be determined by summary proceedings over bank's protest; Shea v. Lewis, 206 Fed. 881, 124 C. C. A. 537, claim to property purchased by wife with proceeds of land acquired by bankrupt under homestead laws, and conveyed to her when not subject to liens is adverse and cannot be determined in summary proceedings in bankruptcy without her consent; Le Master v. Spencer, 203 Fed. 216, 121 C. C. A. 416, adverse claimant of property in possession of marshal as receiver in bankruptcy, by filing petition in bankruptcy court for its recovery consents to jurisdiction of such court summarily to determine his rights; First Nat. Bank v. Hopkins, 199 Fed. 875, 876, 118 C. C. A. 321, holding bank's claim was adversary one and could be determined only in plenary suit between bank and trustee; Cooney v. Collins, 176 Fed. 192, 99 C. C. A. 543, court of bankruptcy is without jurisdiction of proceeding by trustee to recover property from adverse claimant, who holds legal title and possession and asserts sole ownership, and who does not consent to jurisdiction; Horner Gaylord Co. v. Miller, 147 Fed. 302, bankruptcy court will appoint receiver and issue injunction where bill shows fraudulent transfer, transferee secreting same; In re Laplume etc. Milk Co., 145 Fed. 1015, treasurer of bankrupt corporation cannot be summarily required to turn over money paid out between filing petition and adjudication; In re Davis Tailoring Co., 144 Fed. 286, where bankrupt corporation sells property prior to petition in bankruptcy, referee cannot compel vendee to surrender property to trustee by summary order; American Trust Co. v. Wallis, 126 Fed. 467, 469, 61 C. C. A. 342, holding court of bankruptcy without jurisdiction to order bankrupt to pay to trustee money received with knowledge of petition, but which has since been paid out; In re Chase, 124 Fed. 759, 760, 59 C. C. A. 629, holding assignment for benefit of creditors fairly made without attempt to defraud does not preclude assignee from recovering disbursements and expenses made

973

LOUISVILLE TRUST CO. v. COMINGOR. 184 U. S. 18-26

before filing of petition; In re Knickerbocker, 121 Fed. 1006, holding referee has jurisdiction to determine bona fides of adverse claim made to bankrupt's property in hands of respondents; In re Wells, 114 Fed. 224, holding bankruptcy court does not by filing of petition acquire jurisdiction of property of bankrupt attached in State court before proceedings taken; Kennedy v. Pierce's Loan Co., 100 Mo. App. 275, 93 S. W. 359, sustaining bankrupt's pledge of personalty made in good faith on adequate consideration after filing of involuntary petition, but before adjudication.

Failure or refusal to deliver money or property belonging to bankrupt to trustee, as contempt. Note, 23 L. R. A. (N. S.) 255, 256, 261.

Herein petition for review filed under subdivision b, section 24, Bankruptcy Act of 1898.

Cited in Burleigh v. Foreman, 125 Fed. 220, 60 C. C. A. 109, holding appeal lies from order made on separable issue arising between parties intervening in proceedings to marshal assets in hands of trustee; Hutchinson v. Otis, Wilcox & Co., 123 Fed. 18, 59 C. C. A. 94, holding appellate jurisdiction of Supreme Court, under Bankruptcy Act of 1898, does not extend to appeals from Circuit Court of Appeals.

Instituting bankruptcy or insolvency proceeding as ground for action for malicious prosecution. Note, Ann. Cas. 1916D, 909. Miscellaneous. Cited in Sullivan v. Goldman, 225 U. S. 695, 56 L. Ed. 1261, 32 Sup. Ct. 834, dismissing for want of jurisdiction; McDonald v. Goddard Grocery Co., 184 Mo. App. 443, 171 S. W. 654, action for malicious prosecution may be maintained against person instituting bankruptcy proceedings maliciously and without probable cause, though no seizure of property or person is made.

184 U. S. 18-26, 46 L. Ed. 413, 22 Sup. Ct. 293, LOUISVILLE TRUST CO. v. COMINGOR.

Claim of assignee held to be adversely to bankrupt and outstanding when petition in bankruptcy was filed.

Approved in In re Levitt, 126 Fed. 891, holding claim of assignee of bankrupt's insurance policies for expenses incurred not debt or claim against bankrupt lost by not proving within one year; Burleigh v. Foreman, 125 Fed. 220, 60 C. C. A. 109, holding appeal lies from order made on separable issue arising between interveners in proceeding to marshal assets.

What amounts to adverse holding of property acquired from bankrupt. Note, 8 L. R. A. (N. S.) 1235.

Jurisdiction of bankruptcy court is dependent on its conclusion as to adverse claim.

Approved in In re Kane, 131 Fed. 387, bankruptcy court, determining adverse claim colorable, only can proceed summarily against

bankrupt's agent to recover property; In re Teschemacher, 127 Fed. 730, holding where third party makes real claim to ownership of property bankruptcy court having determined that fact cannot retain jurisdiction; In re Knickerbocker, 121 Fed. 1006, holding persons claiming property of bankrupt cannot be deprived of right to litigate disputed right to possession in plenary suit; In re Hartman, 121 Fed. 941, holding person to whom bankrupt's property is claimed to have been transferred in bad faith is adverse claimant; In re Breslauer, 121 Fed. 914, holding bankruptcy court has jurisdiction where no adverse claim exists to order payment to trustee; Furth v. Stahl, 205 Pa. St. 441, 55 Atl. 29, holding bankrupt's trustee cannot object to jurisdiction of court in appointing auditor to report disposition of fund raised on mortgage sale to which trustee agreed.

District Court has jurisdiction to determine whether claim asserted was adverse when petition in bankruptcy was filed.

Approved in First Nat. Bank v. Chicago Title etc. Co., 198 U. S. 289, 291, 49 L. Ed. 1055, 25 Sup. Ct. 693, no appeal from bankruptcy court deciding possession, decreeing sale, determining right of adverse claimant; Schweer v. Brown, 195 U. S. 172, 49 L. Ed. 145, 25 Sup. Ct. 15, no direct appeal to Supreme Court from District Court decision that adverse claim to money not made when bankruptcy petition filed; First Nat. Bank v. Klug, 186 U. S. 204, 46 L. Ed. 1127, 22 Sup. Ct. 900, holding direct appeal from District Court's dismissal of petition on finding that alleged bankrupt was engaged chiefly in farming cannot be maintained where jurisdiction not challenged; In re Breslauer, 121 Fed. 914, holding bankruptcy court has jurisdiction to determine whether claim to proceeds of sale of property was adverse at time of petition; In re Davis, 119 Fed. 953, 955, holding bankruptcy court has jurisdiction by summary proceedings to require bank holding funds as fiduciary to pay same to trustee; Downer v. Porter, 116 Ky. 427, 76 S. W. 136, upholding Ky. Stats. 1899, § 1911, making transferee of debtor hold property in trust for creditors where made in contemplation of insolvency.

Where bankruptcy court erroneously adjudicates merits, its action is subject to review.

Approved in In re New York Car Wheel Wks., 132 Fed. 204, following rule; In re Friend, 134 Fed. 782, 67 C. C. A. 500, judgment confirming composition reviewable by appeal under 30 Stat. 553, § 25, since it acts as discharge; Holden v. Stratton, 191 U. S. 119, 48 L. Ed. 118, 24 Sup. Ct. 47, holding certiorari is proper method for obtaining review of decision of Circuit Court of Appeals in exercise of its revising power over inferior courts of bankruptcy; O'Neal v. United States, 190 U. S. 38, 47 L. Ed. 946, 23 Sup. Ct. 777, holding judgment of District Court committing for contempt cannot be reviewed by Supreme Court on error where sole question was power to commit on facts;

Ex parte O'Neal, 125 Fed. 968, holding Circuit Court cannot review on habeas corpus errors in proceedings in District Court punishing relator for assault on trustee in bankruptcy; Burleigh v. Foreman, 125 Fed. 220, 60 C. C. A. 109, holding appeal lies from order of District Court on separable issue arising between interveners in proceeding to marshal assets.

Appellate jurisdiction of Federal Supreme Court in bankruptcy proceedings. Note, 16 Ann. Cas. 1016.

Bankruptcy court cannot by summary process require return of money paid by assignee to counsel and expended before petition in bankruptcy is filed.

Approved in Babbitt v. Dutcher, 216 U. S. 105, 17 Ann. Cas. 969, 54 L. Ed. 403, 30 Sup. Ct. 372, bankruptcy court may, by summary proceeding, compel delivery of corporate records and stockbooks of bankrupt corporation; In re Schmick Handle & Lumber Co., 233 Fed. 449, where claimant of logs agrees with receiver in bankruptcy to manufacture them into lumber and pay proceeds to receivers, court has possession of fund and may in summary proceeding determine ownership of fund; Crawford v. Sternberg, 220 Fed. 74, 135 C. C. A. 641, fact that members of bankrupt partnership paid out money on individual debts before trustee made application for its return, and, having no other money, were unable to repay it to trustee, was sufficient defense to application for its return; In re Lummus, 214 Fed. 893, bankruptcy court cannot summarily adjudicate rights of creditor to property transferred to him on day before filing of petition, where it appears indebtedness was bona fide and he claims property as purchaser; In re Shea, 211 Fed. 367, 369, holding wife of bankrupt had bona fide adverse claim to building association stock purchased with her savings and to money deposited in bank, except certain balance, which she was entitled to have tried in plenary suit; In re Bacon, 210 Fed. 134, 126 C. C. A. 643, in proceedings by trustee to recover corporate stock of bankrupt in hands of bank, claim of another bank to lien on stock under pledge contract with bankrupt is adverse and cannot be determined by summary proceedings over bank's protest; In re Green, 207 Fed. 695, where assets were out of bankrupt's possession when petition was filed, transferee testifying to purchase of property in good faith, is entitled to have facts determined in plenary suit, though testimony may appear incredible; Shea v. Lewis, 206 Fed. 880, 881, 124 C. C. A. 537, claim to property purchased with proceeds of land acquired by bankrupt under homestead laws and conveyed to her when not subject to liens is adverse and cannot be determined in summary proceedings in bankruptcy without her consent; In re Holden, 203 Fed. 233, 121 C. C. A. 435, in absence of finding that bankrupt is in possession of withheld assets affidavit that he is unable to comply with referee's order is sufficient answer to contempt proceeding; In re Blum, 202 Fed. 885, 121 C. C. A. 241, holding claim of bankrupt's wife to money