294 F. 71 | 2d Cir. | 1923
A petition in bankruptcy was filed against F. M. Fuller & Co. on the 26th day of June, 1922. On that day.they were depositors of the Coal & Iron National Bank'of the City of New York. On June 27, 1922, a check dated June 24, 1922, for $2,500.48 was issued by the alleged bankrupts drawn on their account in the bank and was presented for payment through the New York Clearing House. On the same day the bank was served with an order advising it of the appointment of a receiver. The bank returned the check unpaid through the proper channels. No written indorsement of nonpayment of the check was placed thereon, but there was indorsed notice that a receiver had been appointed by the United States District Court. At that time the alleged bankrupts had on deposit $8,899.09. The attorney for the payee of the check formally demanded that the bank pay $2,500.48 from the fund then standing to the credit of the alleged bankrupts. This demand was refused, because of the appointment of the receiver in bankruptcy. On August 7, 1922, the payee instituted a suit in the state Supreme Court against the bank to recover this sum. On July 13, 1922, a formal demand of the entire balance to the credit of-the bankrupts was made by the receiver. This was refused because of the claim of the payee, Christopher.
It thus appears that there are two adverse claimants to the funds now on deposit in the bank, the receiver and Christopher. The mutual accounts between a bankrupt and his bank of deposit are dosed by operation of law at the time a petition in bankruptcy is filed. In re Michaelis & Lindeman (D. C.) 196 Fed. 718. The receiver is entitled to the custody of the fund, where it plainly appears that there is no outstanding claim thereto with color of title. It has been held where a bank pays a check drawn by a depositor to a payee in ignorance of the filing of an involuntary petition in bankruptcy against the depositor, where the receiver qualified on the day of the payment of the check, and who does not make a demand for the depositor's fund until after the check is honored, that a trustee subsequently elected may not recover from the bank the amount paid on the check. In re Zotti, 186 Fed. 84, 108 C. C. A. 196, Ann. Cas. 1914A, 240. The filing of a petition is a caveat to all the world, and is in effect an attachment and injunction, and, on adjudication, the title to the bankrupt’s property becomes vested in the trustee, with actual or constructive possession, and places the fund in the custody of the bankruptcy court. Mueller v. Nugent, 184 U. S. 1, 22 Sup. Ct. 269, 46 L. Ed. 405. In the Zotti Case, supra, this court held that it was never intended that a bank, which had honestly paid checks of the depositor without notice that a petition in bankruptcy had been filed against .such depositor, could he compelled to pay it over again, and it was announced that it was only where a hank refused to pay moneys which it had received prior to the filing of the petition, and still had moneys which it had collusively transferred, that a summary order may be issued compelling it to pay to the trustee.
Banks holding deposits are debtors, and ordinarily are adverse claimants, not subject to summary jurisdiction. If there is a substantial basis for an adverse claim, and such claim is not merely colorable, the claimant: must be remitted to adjudicate his claim in a plenary suit.
Order affirmed.
HOUGH, Circuit Judge, heard the argument and concurred in the conclusion reached, but has not seen the opinion as prepared, because of necessary absence.