68 F.2d 832 | 2d Cir. | 1934
The appellee obtained a decree for a money judgment on a bond given to release the American gas yacht Greyhound against Michael Santantonio, principal thereon, and George S. Van Sehaiek, superintendent of insurance of the state of New York, as liquidator of the Greater City Surety & Indemnity
On January 25, 1933, an order was entered, in the Supreme Court of the state of New York, dissolving the surety company and directing the superintendent of insurance to take possession of iis property and to liquidate its business pursuant to article 11 (§ 400 et seq.) of the Insurance Law of the state of New York (Consol. Laws N. Y. c. 28). This order contained a restraining injunction against any person bringing or prosecuting any claim against the superintendent of insurance and his successors in office as liquidator of the surety corporation. The liquidator is now in possession and liquidating the affairs of the surety.
On April 5, 1933, appellee moved for an order directing the claimant to furnish now and adequate security, pursuant to Admiralty Rule 8, or, in the alternative, for a judgment for the amount of the bond against the principal and surety. Counsel for the superintendent appearing but not opposing, an order was entered accordingly and the claimant failed to post such new security. Thereupon a motion was made and granted for the decree altered below. The superintendent appeared by counsel and resisted the motion on the ground that the surety was dissolved and that no judgment could be entered against it or the liquidator in view of the dissolution and the restraining order of the state Supreme Court.
The questions presented are (.1) whether the restraining order of the state court enjoined the United States from seeking and deprived the District Court of jurisdiction to enter judgment against the surety or liquidator in the admiralty suit; and (2) whether the order of dissolution of the surety prevented judgment against the surety or liquidator.
The District Courts have exclusive jurisdiction over all seizures and forfeitures under the laws of the United States. Title 28 U. S. Code, § 41 (.1, 9), and § 371 (28 USCA § 41 (I, 9) and § 371). Moreover, the District Court first acquired jurisdiction over the Greyhound by this suit in admiralty, and, on filing the bond, the court no longer concerned itself with the vessel. It had possession of the res, and had the right to adjudicate the libel of forfeiture and grant judgment upon the bond.
After the appellant took possession of the property and started liquidation of the Greater City Surety & Indemnity Corporation, a new and better security was asked for (Admiralty Rule 8, U. S. Code, title 28, § 723 (28 USCA § 723); Rule 19, Admiralty Rules Eastern District of N. Y.), and was not forthcoming. Therefore the motion for judgment was properly made and entered. The Fred M. Lawrence, 94 F. 1017 (C. C. A. 2); The Stella R. (D. C.) 1 F. Supp. 998. The appellee, without its consent, could not be enjoined from asking judgment upon this bond, and the injunction of the state court was not binding upon the federal government. Turner v. United States, 248 U. S. 354, 39 S. Ct. 109, 63 L. Ed. 291; Stanley v. Schwalby, 162 U. S. 255, 270, 16 S. Ct. 754, 40 L. Ed. 960 ; Field v. United States, 34 U. S. (9 Pet.) 182, 200, 9 L. Ed. 94; United States ex rel. Ray v. Porter (D. C.) 24 F.(2d) 139, 143; Porter, Receiver, v. Beha, 12 F.(2d) 513 (C. C. A. 2). And the admiralty court having first obtained jurisdiction, it could liquidate the claim on the bond. Riehle v. Margolies, 279 U. S. 218, 49 S. Ct. 310, 73 L. Ed. 669.
Reliance is placed by appellant on Lion Bonding Co. v. Karatz, 262 U. S. 77, 43 S. Ct. 480, 67 L. Ed. 871, where the Supreme Court denied jurisdiction in the federal court to take the property of a surety company from state court receivers; the surety company having been declared insolvent by the law of the state, and the department of that state, with the usual powers of receiver under a decree of the state court, having taken possession. In the instant case, all that was sought was a decree for judgment. Its collection is another matter. Appellee does not seek to interfere with the possession of the res of the liquidator, but is seeking to liquidate its claim in the court where the suit was first instituted and later to file the claim with the liquidator. This is the proper prqcedure. Richle v. Margolies, 279 U. S. 218, 49 S. Ct. 310, 73 L. Ed. 669.
While the prior and paramount federal jurisdiction over the state court’s restraining order does not prevent the appellee from obtaining judgment, yet the state law determines
After judgment, the appellee may present the judgment in the state court proceeding as a claim against the assets in the possession of the liquidator.
Decree reversed.