In re Lippincott & Co.

NIELDS, District Judge. Boyeraft, Ine., Glenn Eiddle Mills, and Fleischer Coat Co., Inc., three creditors of Lippineott & Co., Incorporated, a Delaware corporation, bolding claims aggregating $545.18, filed their petition in this court April 29, 1933, alleging an act of bankruptcy, “in that it did consent to tbe appointment of receivers in the Court of Chancery of the State of Delaware.” The petition is verified by Stewart Lynch as attorney in fact for each petitioning creditor. The verification states that the facts therein “so far as they relate to his own act and deed are true, and so far as they relate to the act and deed of any other person, he believes them to be true.” The alleged bankrupt and certain creditors have appeared and moved to dismiss tbe involuntary petition on tbe ground (1) that tbe petition does not allege and state an act of bankruptcy, and (2) that the verification is improper and insufficient. Verification upon belief is insufficient. In re Bellah (D. C.) 116 F. 69; Sabin v. Blake-McFall Co. (C. C. A.) 223 F. 501. Tbe petitioning creditors ask leave to file an amended petition properly verified. Should leave to ameud be granted? While it is within the discretion of the court to allow such an amendment, leave will not he granted unless the ends of justice will be promoted thereby. Woolford v. Diamond State Steel Co. (D. C.) 138 F. 582; In re Refund Cash Grocery (D. C.) 30 F.(2d) 158. No proof has been offered to sustain tbe application. On the contrary, it appears that tbe alleged bankrupt operated a large department store in Wilmington, Del., and in February last receivers were appointed by tbe Court of Chancery of this state to operate tbe store and liquidate its assets. This liquidation is now completed, with tbe exception of tbe sale of accounts receivable of doubtful value, store fixtures, and certain parcels of real estate. This court assumes tbe state court receivers will properly dispose of tbe above assets of tbe company and make distribution under tbe order of tbe chancellor. Approximately 550 creditors, including tbe three petitioners, have filed their proofs of claim in tbe receivership proceeding. There is no suggestion of any act of omission or commission on the part of tbe state court receivers detrimental to tbe interest of creditors. The bankruptcy petition alleges no priorities or preferences that may be set aside or voided. If tbe administration of the estate is now transferred to this court, it will entail additional fees and costs. Tbe intervention of this court will not benefit tbe estate. I can perceive no possible advantage to tbe creditors from tbe prosecution of tbe bankruptcy proceedings. An order denying leave to amend and dismissing tbe involuntary petition may be presented.