Lung v. Pacific Storage Warehouse

Holcomb, J. On October 16, 1920, appellant received a large quantity of apples from the Yakima Apple Depot, a corporation, for storage, at the agreed rate of two cents per box. The Yakima Apple Depot became and was adjudged a bankrupt in the United States district court on January 18,1921, and respondent was appointed trustee of the bankrupt on January 31, 1921. Appellant had a claim for storage which accrued prior to the bankruptcy trusteeship, and the amount was in dispute". On January 22, 1921, appellant filed its proof of claim in bankruptcy for the sum of $300, and asserted the same to be a preferred- and prior lien under the statutes of Washington for storage. [629] Although respondent had made an agreement with the manager of appellant for the delivery of the apples in question, and appellant in pursuance thereof had delivered approximately 150 boxes of the apples, subject to an understanding between them that whatever claims for storage appellant might have would be adjusted later out of the proceeds derived from the sale of the apples, appellant subsequently refused to deliver the remainder of the apples to respondent, and proceeded summarily to sell and dispose of the apples in its warehouse, under the guise of a foreclosure of the statutory lien for storage under the state laws. Respondent, in due course, instituted suit for the value of the apples disposed of, and the verdict, in a trial to a jury, was rendered in favor of respondent. Many questions of fact and of law are elaborately discussed by appellant, but there is only one question to' be decided, and that determines this controversy. In the first place, appellant was not a pledgee, but was merely a bailee for hire, the bailment being for the storage of the apples. When the depositor became bankrupt, the receiver or trustee took all title of the bankrupt to the chattels, subject, of course to the rights of all lien claimants. Sweet v. Oregon-Washington Lum. & Mfg. Co., 98 Wash. 91, 167 Pac. 82. In that case it was decided that property on which there is a valid lien passes to the trustee if he elects to take it, subject to such equities, liens and incumbrances as exist, whether created by operation of law or by the act of the bankrupt. And where a person having a lien goes into the bankruptcy court and petitions for the payment of his debt and the enforcement of his prior rights in the bankruptcy court, this act of the petitioner is a consent, and it confers exclusive jurisdiction upon the [630] bankruptcy court. In re Platteville Foundry & Mach. Co., 147 Fed. 828; In re Watts & Sachs, 190 U. S. 1, 23 Sup. Ct. 718; United States Fidelity & Guaranty Co. v. Bray, 225 U. S. 205, 32 Sup. Ct. 620. Appellant therefore had no right to pursue the remedy it did, and respondent had the right to pursue the remedy it followed. Judgment affirmed. Main, C. J., Mackintosh, Bridges, and Mitchell, JJ., concur.