220 F. 269 | 7th Cir. | 1914
Thus the only reviewable question herein is whether such ruling was erroneous “in matters of law,” and its solution rests on the inquiry of jurisdiction to that end, over both corporation and subject-matter.
The first mentioned order of the District Court, made April 10, 1912, is plainly without force in the present inquiry, beyond proving that possession of the property was thus obtained by the receiver and transmitted to the trustee, in a summary proceeding, without either (a) consent or waiver on the part of corporation holding possession thereof and claiming ownership, or (b) attempted determination either of ownership or ultimate possession of the property. So the above-recited finding of the referee (affirmed on review) of res ad-judicata effect therein was plainly an erronous conclusion of law..
■ Consideration of the other findings certified by the referee — that the transfer of property made by the bankrupts to the corporation, December 21, 1911, “consisted either of an illegal preference or a transfer to hinder and delay creditors” — involves alone the force and effect of the averments of fact and claim of title set forth on the part of the corporation, and we are of opinion that the issue so raised was not within the jurisdiction either of the referee or of the District Court on review of his order, for determination in such proceedings. The claim of adverse ownership expressly appeared, both in the trustee’s petition before the referee and in the corporation’s pleading of want of jurisdiction. Whatever may be the merits of that controversy over the title, and whatever may be assumed as powers vested in the Dis-trictCourt for' determination of such controversy — either through application or consent of the claimant in the course of bankruptcy proceedings, ¡or through- its exercise of the powers of a court of equity—
The order against the petitioner is reversed, accordingly, with direction to dismiss the summary proceedings and order certified by the referee.