130 F. 1004 | N.D. Cal. | 1904
This is an application for an order directing Charles B. Bills, trustee of the estate of Edward B. Howard, bankrupt, to pay the petitioner the sum of $6,492.37, with interest thereon from August 29, 1902, at the rate of 3 per cent, per annum, and the further sum of $681.30 costs awarded against the trustee by the United States Circuit Court for the Eastern District of New York in an action brought by the trustee against the petitioner
1. That this court has jurisdiction in this summary proceeding to require the trustee to make restitution of all moneys received by him under the decree of the Circuit Court subsequently reversed by the decree of the Circuit Court of Appeals, I entertain no doubt. The trustee is an officer of the court, and as such is subject to its direction in all matters concerning money or property which may have come into his possession by virtue of his office. It is claimed, however, by the trustee, that he is only responsible for so much of the money as actually came into his hands under such reversed decree; that in the action referred to he was the representative of the estate of the bankrupt, and as such had a right to employ an attorney; that he was not guilty of any negligence in the matter of the employment of such attorney, and cannot, therefore, be made personally responsible for the wrongful act of the attorney in appropriating a part of the moneys received on said judgment in payment of the fee claimed by him. It may be conceded that such would be the rule if the question were presented upon the settlement of the trustee’s account in the estate in bankruptcy, but, as between the trustee and this petitioner, a stranger, the trustee cannot be permitted to avoid compliance with the final decree of the United States Circuit Court directing him 'to make restitution of moneys received by him under the reversed decree by the plea that a portion of such money was unlawfully appropriated by his attorney in the action in which such decree was rendered. The money received by his attorney was, in judgment of law, received by the trustee, and must be restored by him to the petitioner.
2. The judgment of the Circuit Court, in so far as it relates to costs, can only be enforced by execution or by action. It cannot be enforced in this summary proceeding, as it is conceded that there are not now, and never have been, any funds in the hands of the trustee belonging to the petitioner or to the estate of the bankrupt with which to satisfy the same.
The motion that the trustee be directed to pay such costs is denied, without prejudice to the right of the petitioner to enforce judgment for the same by action or execution, as he may be advised. In all other respects the prayer of the petition is granted.