3 F. Cas. 71 | D. Conn. | 1870
This is a bill in equity praying this court to declare void a levy of an execution upon certain machinery of the bankrupts, and thus remove a cloud on the title of the assignees thereto. The facts which have led to this controversy are as follows:—The Allerton Iron Works Manufacturing Company were a corporation located at Norwalk, Connecticut, and engaged in building machinery. They had a machine shop, and such tools and machinery as are necessary in a business of that character.
On the 10th of January, 1870, Reynolds & Co., a corporation located at New Haven, brought a suit against the Allerton Iron Works Manufacturing Company (the bankrupts) and attached the machinery- in their shop at Norwalk to the amount of $1000. The writ upon which this attachment was made was returnable and returned to the Superior Court for New Haven county on the first Tuesday qf March 1870, and on the 30th of the same month judgment was rendered in favor of the plaintiffs therein against the bankrupts for $1,156.91.
On the 3d of February, 1870, the same property was attached by the New York Steam Engine Company for $2200. On the same day the defendants, George Place & Co., attached the same property for $2000, and on the 22d of April following judgment was rendered in their favor and against the bankrupts for $1,507.68, and execution issued thereon. On the 2d of May, 1870, the officer claimed to levy this execution on the machinery in question, the New York Steam Engine Company waiving any rights under their attachment. But the lien by the prior attachment of Reynolds & Co. was not
On the 3d of May, 1870, the Allerton Iron Works Manufacturing Company filed their petition in this court praying to be declared bankrupts under the act of Congress, and on the 9th of the same month were adjudicated bankrupts. The plaintiffs claim this property over which the levy of the defendants’ execution is hanging, and ask for a decree of this court declaring it void in order that they may sell it at its full Aralue, unembarrassed by this alleged lien of the defendants.
It will be noticed that all these attachments, and the execution in question, were levied on the property within four months next preceding the filing of the petition in bankruptcy. The attachments were therefore dissolved by Operation of the bankrupt law when the debtors went into bankruptcy, as they were all attachments on mesne process under the statutes of Connecticut. The present defendants claim however that, as the bankrupt act only dissolves attachments on mesne process, the levy of their execution is left undisturbed. And it is true that the fourteenth section of the act dissolves such attachments only, and not levies of executipn. The law therefore seems to contemplate possible results that are somewhat singular. An attachment on mesne process of any age short of four months is dissolved absolutely by the adjudication, and the latter relates back to the time of filing the petition. But an execution, actually and legally levied, remains, and the property is held by it, even though the suit upon .which it is founded may not have been commenced ten days before the filing of .the bankrupt’s petition. It may be asked why the
The plaintiffs insist that the levy of the execution in question was void, inasmuch as there was a prior attachment lien in force upon this property when the attempted levy was made. The solution of this question depends, not upon the bankrupt act, but upon the true construction of the statutes of Connecticut relating to attachments on mesne process and the levy of executions. The practice of attaching property on mesne process, and holding it in the custody of the law subject to execution upon judgment recovered in the same suit, has been sanctioned by the law of this state for more than two hundred years. The process has been regulated by statute for a century. In 1770 the colonial legislature passed the act of which the following was a section. “ No estate attached as aforesaid shall be held to respond the judgment obtained by the plaintiff at whose suit the same is attached, either against the debtor or any other creditor, unless such judgment creditor take out execution on such judgment and have the same levied on the goods or personal estate within
If this view of the law needed any further support, it would be found in the consequences which would inevitably follow if subsequent attaching creditors were allowed to levy their executions subject to prior attachments. The extent and value of such prior liens can never be determined until judgment in the suits out of which they originated be rendered; and even then it can never be known whether the creditors having such liens would enforce.them or not until after the expiration given them by statute. Take the ‘case of a prior attachment upon a suit for tort. The property attached is taken into the custody of the law to respond to such judgment as may be recovered. There is an inchoate lien to the extent of the direction in the writ. The extent and value of this lien, which may finally be enforced against the property
In the case of Pease v. Bancroft, 15 Met. R., 90, involving the question whether a sale of an equity of redemption on a second attachment pending the first would have been good as against the debtor, the court decline to express an opinion, though they give a good reason why it ought not to be held good. The court, however, held that such a sale by a second attaching creditor was void as against all the others, and thereby let in a third attaching creditor to the rights which the second would otherwise have retained. But I attribute no importance to the doubt implied from the language of the court in Pease v. Bancroft. In the first place the language of the statute of Connecticut regulating the levy of executions
But it is said that the plaintiffs have adequate remedy at law, and are therefore entitled to no relief in equity. There might be force in this objection but for the peculiar provisions of the statutes of Connecticut relating to attachments and executions levied on machinery used in manufacturing establishments. Attachments of such property are made, where it cannot be removed without manifest injury, by particularly describing the same in the return of the officer, and leaving a copy of the writ with such return thereon in the town clerk’s office in the town where the same is situated. In case of the levy of an execution notice thereof is posted by the officer on the door of the building in which the same is situated. This course was pursued in making the levy in question. The officer •making it has no actual possession, but his official acts, done as he claims under color of law and in the execution of legal process, constitute a cloud on the title of the assignees that might well affect the price in the market. Such a cloud it is the peculiar, province of a court of equity to remove. But even if the officer had actual possession of this property, holding it under this alleged color of right, on a proper application this court might feel called upon to exercise the power conferred upon it by the bankrupt act, and compel him to deliver it to the assignees, instead of turning them over to an action of trover. But this question does not arise in the present case. I am satisfied that the plaintiffs are entitled