The question presented by this appeal is whether the appellant, Pateo Products Co., Inc., may sue the trustee in bankruptcy, formerly the receiver, in a plenary suit in the state courts of New Jersey because of the receiver’s or trustee’s 1 alleged negligence in losing or permitting to be lost an eight-hundred-pound mold, with a board attachment, alleged to be the property of Pateo.
The receiver caused personal property of the bankrupt and chattels belonging to others on the premises occupied by the bankrupt to be delivered to Paterson Textile Machinery Company (Paterson), the bankrupt previously having caused other personal property belonging to it to be lodged there. Neither the terms of the original deposit of the chattels with Paterson by the bankrupt nor the terms of the subsequent one by the receiver appear from the record. Apparently no receipt was delivered by Paterson to the bankrupt on the occasion of the first deposit. No receipt was given by Paterson to the receiver on the occasion of the second deposit. The record shows that Paterson was a “warehouse” or an “exchange.” No further description of it appears from the evidence.
The mold alleged by Pateo to be its property was among the chattels delivered to Paterson by the receiver. All of the bankrupt’s personal property was sold by the trustee at public auction from the floor of Paterson on April 22, 1953. It is conceded that at the time of the sale the mold was tagged with Patco's name and segregated from the bankrupt’s property by chalk marks on the floor. It is also agreed that the mold was not sold but disappeared after the sale. It is clear that Pateo, orally and by letter, pri- *71 or to the sale, asserted that the mold belonged to it, and that Pateo was informed by the attorney for the receiver, and later by the referee, that to obtain the mold it would have to file a reclamation petition. 2 On June 5, 1953, some forty-three days after the sale, the trustee, in response to an inquiry from Patco’s attorney, informed him that he did not have the mold in his possession.
On September 4, 1953, over four months after the sale, Pateo filed a petition to reclaim the mold. Hearings were held on this petition. On February 4, 1954, Pateo filed a petition for leave to sue the trustee in a plenary action. Additional hearings were had. On July 2, 1954, the referee denied the reclamation petition because the trustee no longer had possession of the mold, and dismissed the petition for leave to sue on the ground that the bankruptcy court was “without authority to act thereon.” The District Judge affirmed the denial of the reclamation petition but remanded the petition for leave to sue the trustee for further action. After another hearing, the referee again dismissed the petition for leave to sue on the grounds that Pateo had been guilty of laches and that the receiver or trustee had not been negligent. The referee was of the view that Pateo had allowed an unreasonable time to elapse before seeking to recover the mold by a reclamation petition and that “the receiver-trustee was a bailee for the benefit of Pateo and would be liable only for an act of gross negligence.” The court below affirmed. The appeal followed.
We agree that Pateo must make a
prima facie
case against the trustee, showing that its claim is not without foundation. Dunscombe v. Loftin, 5 Cir., 1946,
We cannot agree with the court’s conclusion that the receiver or trustee was in the position of a gratuitous bailee and therefore liable only for gross negligence. “[A] bankruptcy trustee is undoubtedly charged with the duty of preserving property which comes into his custody,
including that of claimants whose claims he may in the exercise of a reasonable judgment oppose
* * Rife v. Ruble, 6 Cir., 1939,
However, the trustee contends that by delivering the mold to Paterson
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he in effect delegated his duty of safekeeping to Paterson and was entitled to rely on Paterson to safeguard the property. This might be the case if Paterson had the status of a warehouseman for hire, assuming that the terms under which the mold was lodged with Paterson created the legal obligations which ordinarily exist between a paid warehouseman and bailor. But the receiver took no warehouse receipt. Under the circumstances we cannot ascertain, nor could the court below, what were the obligations of Paterson to the receiver in respect -to the property lodged by him with the warehouse. But in the absence of any receipt and of any evidence that indicates that Paterson was to be paid for the bailment, there is no showing that Paterson was other than a gratuitous bailee. Under the law of New Jersey a gratuitous bailee is liable only for gross negligence. See Weinstein v. Sheer,
Moreover, the receiver’s failure to procure a warehouse receipt may have put Pateo in a position where it cannot maintain a suit against Paterson. Paterson no longer has the mold, so Pateo cannot bring replevin. There is no receipt that can be negotiated by the trustee to Pateo to give it locus
standi.
Pateo was a stranger to the bailment contract, whatever it was. It is the law of New Jersey that one who is not a party to a contract cannot maintain a suit for breach of duty arising out of the contract. See Miller v. Davis & Averill, Inc.,
There remains for disposition, however, the issue whether Pateo is barred by laches, as the court below held. It has been said with regard to laches in bringing a reclamation proceeding that, “No burden is placed upon the petitioner to anticipate its being asserted as a defense”, In re Noble, D.C.W.D. N.Y.1937,
The judgment of the court below will be reversed and the cause remanded with the direction to authorize Pateo to sue the trustee in a plenary suit in a New Jersey State Court.