108 F. 532 | U.S. Circuit Court for the District of Eastern Louisiana | 1901
The original suit, still pending, was brought on a rule nisi on the trustee to show cause why a certain fund in his hands as the “trustee of the estate of E. C. Fenner, bankrupt,” should not be paid over to the McFarland Carriage Company. The intervention of A. De Gasquet-James, now on trial, is to secure a landlord’s lien on that fund. E. C. Fenner was a carriage dealer in Few Orleans. On the 26th of May, 1899, he was adjudicated a bankrupt. In June following, Claude D. Solanes was appointed trustee. Fenner turned over to Solanes, trustee, as a part of his estate, a lot of carriages which were then in the storehouse leased, by the bankrupt, Fenner, from the intervener herein, who then held certain unpaid monthly rent notes, against Fenner, for back rent and for the unexpired term of the lease. The McFarland Carriage Company, a citizen of Indiana, claiming to be the legal owner of said certain lot of carriages, and, having made demand in vain on the trustee for the carriages, instituted a suit in the circuit court against “Claude D. Solanes, trustee of the, estate
The articles in the Revised Civil Code relied upon for the lien claimed are as follows: Article 2705 provides, “The lessor has for the payment of his rent and other obligations of the lease a right of pledge on the movable effects of the lessee which are found on the property leased.” Article 2707 provides, “Tins right of pledge affects not only the movables of the lessee, and under-lessee, but all those belonging to third persons when their goods are stored in the house or store by their own consent, express or implied.” The McFarland Carriage Company resists the claim made by the lessor on the said fund: First, because the fund is not now, or has not been, in custodia iegis; second, that under the law plaintiff is not entitled to be paid out of the fund on any of the lease notes; third, iliafc the trustee represents the mass of creditors in the management of the bankrupt’s ('state, but (hey (the creditors) may and must for themselves, in their own right, pursue the property in the prescribed period, or lose their privilege.
The contention of defendant’s counsel as to the property or fund not being in custodia legis is founded, as it appears from his argument, largely on what he says is the legal import of the language which counsel quotes from the opinion, of the court of appeals reversing the circuit court’s judgment on the motion to show cause, which quotation is as follows:
'“In addition to tlie facts above recited from the transcript of the record, we learn from the brief of counsel submitted on behalf of the defendant trustee that pending a decision of the suit (intermediate the -tiling of the petition ,*534 mu! the decree), and with the consent of the plaintiff, sales were made of the goods claimed, and the trustee retained the proceeds of the sale of the goods to respond to the final judgment of the court. * « ® It thus appears that the defendant trustee did not receive this fund as the trustee of the bankrupt, but as trustee of the parties to the present suit, and to respond to the final judgment of the court therein.”
Counsel contends that this statement appearing in the court of appeals opinion has the legal effect, in the pending suit, of res judi-cata on the issue as to whether or not the fund in question is in custodia legis. He further contends that the circuit court of appeals, in reversing the circuit court’s judgment on the rule nisi, passed on that issue finally, and adversely to the pending claim of the inter-vener, and the question now of custodia legis is no longer an open one. A transcript of the record, showing the case that was tried, on the rule nisi, in the circuit court, between the carriage company, plaintiff, and Solanes, “trustee of. the estate of E. C. Fenner, bankrupt,” as defendant, shows all the evidence which was administered therein by either side, and is now before this court as a part of inter-vener’s evidence. There does not seem to he anything in that transcript to show that the trustee, Solanes, held the fund otherwise than in his official capacity, or that any issue of law or fact pertaining to the matter as to whether or not the proceeds in question were or were not in custodia legis was material to the determination of the claim made by the McFarland Carriage Company for said proceeds on the said trustee. It seems from the evidence in the said transcript that the matter heard and passed upon ¿herein by the circuit court was limited to the question as to who was the legal owner of the carriages or proceeds thereof, and there was no issue therein as to where the fund then was, or as to in what capacity it was then held by Solanes. The facts not disputed shqw that the carriages were scheduled as the bankrupt’s property, and that as such property they were turned over to the trustee, who took possession of them and subjected them to his official possession, as he did other property belonging to the bankrupt; that subsequently the carriage company made demand for their property on the trustee of the bankrupt, which was refused by him; that the trustee asked for and received an order from the bankrupt court to sell certain carriages at private sale, and in the court’s order there was reserved all the rights of interested parties over the proceeds (then in the bankrupt court’s depository) of the sale. II appears, too, that the carriage company consented, on certain conditions, for the trustee of the bankrupt to make the sale; that the proceeds of the sale are now in the bankrupt court’s depository, to the credit of the trustee; that plaintiff, the landlord, now intervening in this suit, was not a party to any of the proceedings heretofore had in the circuit court. On this statement of undisputed facts, it appears that the carriages, even though they did not belong- to the bankrupt at the time of the adjudication, were then, as the proceeds of said sale are now, in the legal custody of the trustee of the bankrupt; that suit was instituted against him., as. the trustee of the bankrupt, for the recovery of the carriages. It appears, too, as a legal presumption, that the McFarland Carriage Company consented that Solanes,.
Notwithstanding the suggestion contained in the circuit court of appeals' opinion to the effect that Solanos held Die fund in his personal relation ro the paridos, and not in his official relations, it must be conceded, I think, that a trustee becoming possessed of property turned over to him by the bankrupt, and listed in the schedule of the bankrupt's assets, could not, on his own motion, change his official relations to the property in ids possession so as to hold the proceeds of the sale made under judicial authority as an individual trustee, in a personal sense, of the parties to that: suit. Considering die issues involved in the rule nisi, I do not think the trial court: would liave been authorized to admit evidence on either side to shew that Solanos consented to disclaim or to forego the legal posses,-ion of the carriages or fund, or of his official relations to either the carriages or fund, and to assume merely personal relations, while holding Hie fund., between the parties affected by the court’s order to ceil the property. Considering all the proceedings preliminary to the adjudication, inclusive of the schedules showing the bankrupt’s estate which was surrendered to the trustee, the law will presume that holanes, at: the time the rule was heard in the circuit court, held the proceeds of that sale as the trustee of Fenner, the bankrupt. Tin's presumption, -in the absence of proof to the contrary, shows the legal status of the fund. In fact, the plain till in the rule nisi, the carriage company, demanded the carriages, and afterwards the money, from holanes, trustee, sued Solanos, trustee, for the proceed:-'', and, it seems, consented that a sale he made by Holanes, trustee. It clearly was not permissible, in law, to either party to that rule, to show that Holanes held the fund otherwise than in his official capacity. The rule nisi instituted by the carriage company was, so far as its purposes are disclosed in the rule, limited to the recovery, as against Trustee Holanes, of the proceeds of a judicial sale, which vare then, presumably, in the bankrupt court’s depository. The defendant trustee therein put: at issue, under his sworn answer, other issues than the matter as to the legal ownership, of the carriages. Among such matters, he alleged that the lessor of the store in which the carriages were at the time of the adjudication held unpaid claims for rent against the estate; that the law imposes a lien in the landlord's favor, for a pro rata pari of the unpaid rent, on the carriages on hit? premises. Such issues presented in the answer of the defendant, it seems, by the judgment of the circuit court, were passed upon favorably to him on the trial of the rule. It was the purpose of the trial court in dismissing the rule that the fund should be held
Considering the state of case now presented on behalf of the in-tervener, I do -not think the question of custodia legis, vel non, of the said proceeds, could have been an issue conclusively passed upon adversely to him by the appellate court. It appears on reading the opinion of the appellate court that the proceeds of the sale which
It appears from the final decree of the circuit court on the rule nisi, which decree is now executory, that the execution thereof responsively to the mandate of the circuit court of appeals will operate; directly on the proceeds of the judicial sale made under legal process from the bankrupt court; that Solanes will have to respond to the final judgment in the capacity in which he was sued on the rule (that is, as "the trustee of the estate of Fenner, bankrupt"); that in so responding he will have to pay over to plaiutiff in the ruse such said proceeds as are now in (he bankrupt court’s depository to the credit of the said estate; that said trustee will have to pay from the funds of the estate all costs incurred in the suit against him in his official capacity. Notwithstanding such conditions follow (he decision of (lie circuit court of appeals, it is contended that it v.as the judicial purpose of that court to decide against all parties, including this intervener, who may have or claim an intern?! in the fund; that Solanes, though sued in his official capacity, held the said proceeds at the time the rule was filed, and holds the wnne now, noi as the trustee of the bankrupt, but as a mere stakeholder for all parties to the rule. This contention is made, as to the legal effect of the language quoted by counsel from the court of appeals opinion, in the face of the fact, which seems to he conceded in argument, that there was no evidence in the trial court tending to show (liat Ms relations to the fund in question were other (han those of an administrator whose legal duty it is to hold the same for the court appointing him until it is legally withdrawn from judicial custody. It is not contended that the proceeds may not he legally withdrawn under an executory writ responsive to the said mandate. Under frequent judicial interpretations of the bankrupt law respecting the subject-matter of this suit, I think, after the date upon which Fenner was adjudged a bankrupt, the said carriages ceased to be on the leased premises either with the express or implied consent of the owner thereof, and the intervener is not entitled to a lieu after the date of such adjudication. Conceding that the rule of law stated in the third proposition is well founded, it is not applicable to the state of case now submitted. The intervener is not