42 Md. 164 | Md. | 1875
delivered the opinion of the Court.
It appears from the record in this case that the appellants, ou the 14th day of April, 1873, caused an attachment on warrant to be issued against the goods and chattels of Frederick Witte, returnable to the May Term of the Court of Common Pleas of Baltimore City, to he held on the 9th day of May, and that on the 24th day of April,
It was contended by the appellee’s counsel that the appellee, under the agreed statement of facts, had a right to recover under either the 14th, 35th or 39th sections of the Bankrupt Act, and that his three prayers were properly granted. The 35th section provides that if any person, being insolvent, or in contemplation of insolvency, within four months before tbe filing of the petition by or against him, with a view to give a peference to any creditor, or person having a claim against him, or who is under any liability for him, procures any part of his property to be attached, sequestered or seized under execution,
The 39th section declares what shall be an Act of Bankruptcy, and provides, among others, that if a person, being insolvent, or in contemplation of bankruptcy or insolvency, shall give a warrant to confess a judgment, or procure or suffer liis property to he taken on legal process, with intent to give a preference to one or more of his creditors, or with intent, by such disposition of his property, to defeat or delay the operation of the Bankrupt Act, he shall he deemed to have committed an act of bankruptcy, and the assignee may recover the money or property if the person shall he adjudged a bankrupt, provided the person taking the property had reasonable cause to believe that a fraud on the Act was intended, or that the debtor was insolvent. It will he observed that by the 35th section, in order to render the attachment void and enable the assignee to recover, the debtor must be insolvent, or contemplating bankruptcy, must procure his property to be attached, within four months before the petition in bankruptcy is filed, with a view to give a preference, and the plaintiff in the attachment must have reasonable cause to believe the debtor insolvent, and that the attachment is in fraud of the provisions of the Bankrupt Act. And under the 39th section to render the legal process void and to enable the assignee to recover, the debtor must be bankrupt or insolvent, or contemplating bankruptcy, and must procure or suffer his property to he taken on legal process with intent to give a preference, or to defeat or delay the operation of the Act. And if the party be adjudged a bankrupt the assignee may recover provided the party taking the property had reasonable cause to believe that a fraud on the Act was intended, or that the debtor was
Vanderhoof Brothers were insolvent at the time they were sued by the bank, and the latter had reasonable cause to believe that they were, and that they had committed an act of bankruptcy, and that they had no property other than their stock in trade. The money arising from the sale under the execution was in the bankrupt Court awaiting the termination of the suit between the assignee and the bank. These facts were found by the Court, and are much stronger in favor of the assignee’s right, than are those contained in the agreed statement in this case. In that case, as in this, it was contended that the failure of the debtor to appear and defend the suit fur
In that case the Supreme Court decided:
1. That something more than passive non-resistance of an insolvent debtor to regular judicial proceedings, in which a judgment and levy on his property are obtained, when the debt is due and' he is without just defence to the action, is necessary to show a preference to a creditor, or a purpose to defeat or delay the operation of the Bankrupt Act.
2. That the fact that the debtor, under such circumstances, does not file a petition in bankruptcy is not
8. That, though the judgment creditor in such case may-know the insolvent condition of the debtor, his levy and seizure are not void under the circumstances, nor any violation of the Bankrupt Act.
4. That a lien, thus obtained by him, will not be displaced by subsequent proceedings in bankruptcy against the debtor, though within four months of the filing of the petition. In the case now under consideration there is no more evidence to show that Frederick Witte procured this property to be taken under the attachment, ox procured or suffered it to be taken on legal process with intent to give a preference to the appellants, or to defeat or delay the operation of the Bankrupt Act, than there was in the case of Wilson vs. City Bank, above referred to, and we think it clear that the appellee has no right to recover from the appellants under either section 35 or 39.
But it was contended that the appellee had a right of 'recovery under section 14. That section provides that as soon as an assignee is appointed and qualified, the judge or register shall assign and convey to the assignee all the estate of the bankrupt, and such assignment shall relate back to the commencement of the proceedings in bankruptcy, and thereupon, by operation of law, the title to such property shall vest in the -assignee, although the same is then attached on' mesne process, as the proj)erty of the debtor, and shall dissolve such attachment if made within four months next preceding the commencement of said proceedings. We are of opinion that the appellee has no better foundation for his claim to recover under this section than under the 35th and 39th. This section refers, and can only refer to attachments, which are pending at the time the petition in bankruptcy is filed. The petition against Witte was filed on the 26th May, 1813, he was adjudged a bankrupt on the 4th June, and the assignee
As we have shown that the appellee has no right to recover in this case under either of the sections of the Bankrupt Act before referred to, for the reasons stated, it is unnecessary to notice in this opinion the further question, which was argued in this Court, whether it is the duty of the assignee in bankruptcy to make known by proper proceedings to the State Court the fact that the defendant in an attachment has been adjudged a bankrupt. As there was error in granting the appellee’s prayers and in refusing to grant those of the appellants, the judgment appealed from will be reversed, and as the plaintiff can in no event recover in this case, a new trial will not be awarded.
Judgment reversed.