Dodd v. Hammock

Warner, Chief Justice. The plaintiffs, as_ the assignees in -bankruptcy of West, [404] Edwards & Co., brought their action against the defendants to recover the possession of certain described personal property in the plaintiffs’ declaration mentioned, of the alleged value of $2,371.47, to which property the plaintiffs claim title, and which the defendants refused to deliver to them. The defendants demurred to the plaintiffs’ declaration on the ground that the court did not have jurisdiction of the case. The court sustained the demurrer, and the plaintiffs ex. cej)ted. The question presented for our judgment and decision in this case, is whether the courts of this state have concurrent jurisdiction of matters and proceedings in bankruptcy, with the courts of the United Slates, so far as the collection of the assets of the bankrupt are concerned, when the amount thereof exceeds the sum of five hundred dollars, or whether the latter courts have the exclusive jurisdiction ? Whatever may have been the concurrent jurisdiction of the state courts with the courts of the United States in such cases prior to the adoption of the revised statutes of the United States, the 7llth section thereof, vested the exclusive jurisdiction in the courts of the United States. The jurisdiction conferred upon the distict courts of the United States, in bankruptcy cases, by the act of 1867, was “ the collection of all the assets nf the bankrupt.” The 711th section of the revised statutes declares, that “the jurisdiction vested in the courts of the United States in the cases and proceedings hereinafter mentioned, shall be exclusive of the courts of the several states.” One of the eases and proceedings thereinafter mentioned, is “of all matters and proceedings in bankruptcy.” The collection of all the assets of the bankrupt, is one of the necessary and important matters and proceedings of the bankrupt court, as provided by the bankrupt act of 1867, and the 711th section of the revised statutes of the United States declares, that the jurisdiction vested in the courts of the United States, “ of all matters and proceedings in bankruptcy, shall be exclusive of the courts of the several states.” That such was [405] the intention of congress, is manifested by the fact, that subsequently to the adoption of the revised statutes, the act of 22d of June, 1874, was passed, which provided that the bankrupt court having charge of the estate of any bankrupt, may direct that any of the legal assets or debts of the bankrupt, when the same does not exceed five hundred dollars, shall be collected in the courts of the state whpre such bankrupt resides. If congress had not supposed, that by the adoption of the 711th section of the revised statutes, hereinbefore cited, that the United States courts had exclusive jurisdiction of all matters and proceedings in bankruptcy, the act of the 22d of June, 1874, authorizing the bankrupt court to direct that the legal assets of the bankrupt, to the extent of five hundred dollars, should be collected in the courts of the state in which the bankrupt resided, would not have been necessary, as the state courts had concurrent jurisdiction with the United States courts, to collect the bankrupt’s assets without regard to the amount thereof. Claflin vs. Houseman, assignee, 3d Otto’s Rep., 130. But it has been suggested that any plaintiff has the legal right to sue in the state courts for a deprivation of his property, and that there is nothing alleged in the plaintiffs’ declaration which will take this ease out of that general rule. The plaintiffs sue as the assignees in bankruptcy of West, Edwards & Co., and claim title to the property sued for in that capacity. The plaintiffs cannot claim title to the property sued for as the assignees in bankruptcy of West, Edwards & Co., unless there had been an adjudication in bankruptcy, adjudging them to be bankrupts in accordance with the provisions of the bankrupt act of 1867, and thereby vesting the title to the property sued for- in the plaintiffs as the assignees in bankruptcy of West, Edwards & Co., under the provisions of that act. It necessarily follows, therefore, that when the plaintiffs claim title to the property sued for as the assignees in bankruptcy of West, Edwards & Co., that they claim title to it as part of the assets of the adjudicated [406] bankrupts whose assignees they are. West, Edwards & Co. could not, in any legal sense, be considered bankrupts until they had been adjudicated to be so by the "proper tribunal, and until that had been done the plaintiffs could not have become their assignees in bankruptcy, and had the title to their property vested in them in that capacity, so as to authorize them to sue for it as they have done, as appears upon the face of their decía,ration. The suit for the prop ty mentioned in the plaintiffs’ declaration by the plaintiffs as the assignees in bankruptcy of West, Edwards & Co., to which they claim title in that capacity, relates to “ matters and proceedings in bankruptcy” of which, by the 711th section of the revised statutes before cited, the courts of the United States have the exclusive jurisdiction. See the case of Olcott, assignee, vs. Maclean et al., National Bankrupt Register, 1877, page 79. Let the judgment of the court below be affirmed. Jackson, Judge, concurred, but furnished no written opinion.