Cummings v. Synnott

184 F. 718 | 3rd Cir. | 1911

LANNING, Circuit Judge.

After taking a very large amount of testimony and employing the services of an expert accountant, the referee in bankruptcy found that John E. Cummings, the bankrupt, at the time of his adjudication, which was in a voluntary case, had in his hands or under his control the sum of $(>9,317.44, for which he had failed to account to his trustee. Accordingly, on November 18, 1909, the referee made an order directing Cummings to pay that sum forthwith to his trustee. The order was carried to the District Court on a petition to review, and ori February 21, 1910, that court affirmed the referee, giving the bankrupt until March 1, 1910, to comply with its terms. The matter now comes to us for consideration.

The bankrupt complains that in the account stated against him’ by the referee he has been erroneously charged with items not belonging to his estate, and also that the referee failed to give him credit in the account for all he claims. We do not deem it necessary to consider, the items in detail. The referee, in a very carefully prepared report, has done so, and we concur with the District Court in the judgment that the account as prepared by the referee is in all respects amply supported by the proofs.

The principal charge against the bankrupt is one of $200,000. It appears that the bankrupt sold certain shares of the capital stock of the Atlantic Match Company for that sum, and that he received the cash. This is conclusively proven, and, indeed, is not denied. Three-eighths of the shares were owned by him, and five-eighths by Thomas W. Synnott and Charles H. Graham. Synnott and Graham had authorized him to act as their agent in making the sale, and he had fraudulently concealed from them the fact that he had received such cash payment. His present contention is that five-eighths of the $200,000 belongs to Synnott and Graham, and not to his estate, and that it is beyond the power of the court to require him to pay what is due to them over to his trustee in bankruptcy. A sufficient answer to this contention is that Synnott and Graham, being unable to trace the proceeds of the sale of their stock into any particular fund or property, have not attempted to enforce any trust in their behalf, but have put in their claims against the bankrupt’s estate as general creditors.

The order is clearly right. The bankrupt’s counsel has treated the case, in argument, as though it were one of contempt. It is not. No proceedings to have the bankrupt punished for contempt have yet been instituted.

The order of the District Court is affirmed, with costs.