16 Blatchf. 48 | U.S. Circuit Court for the District of Southern New York | 1879
This is a motion for an injunction pendente lite, upon the complainant’s bill. The complainant filed his petition in voluntary bankruptcy, in the Eastern district of New York, on the 11th of February, 1878, and on the same day filed his petition for a meeting of his creditors to consider a proposed composition. The first meeting in composition was held February 28th, 1878 the composition proposed was 33% per ■cent., for which notes were to be given, payable within eighteen months. On April 11th, 1878, the creditors accepted and confirmed the composition by the requisite majority [Case No. 14,029], and at a hearing before the court on May 21st, 1878, the resolutions were confirmed and ordered to be recorded [Id. 14,->033], On the 18th of April, 1878, the complainant was adjudicated a bankrupt. The Iron Clad Manufacturing Company, one of the defendants, was a creditor of the complainant, having a provable debt, and its name and address and the amount of its claim were inserted in the schedule annexed to the composition petition. On April 10, 1S78, after the filing of the petition in bankruptcy, the company commenced an action in the marine court of the city of New York, by attachment, against the complainant, to recover this debt, and, on the 8th of April, 1878, judgment was entered therein for $817 92, and an execution was on the same day issued on the judgment and delivered to the sheriff. The warrant of attachment had been levied, on April 10th, on personal property of the complainant, and, on the 18th of April, the sheriff levied his execution on the same, and now threatens to sell the same under the execution, to satisfy the judgment The bill further shows, that the loss of this property will disable the complainant from carrying into effect his composition; and the prayer of the bill is, that the levy and seizure be declared void and the property restored to the bankrupt, and that the defendants be enjoined, &e.
This motion for an injunction is resisted on the ground that the court has no power to issue a writ of injunction in this case, to stay proceedings in a state court, being prohibited from doing so, as it is claimed, by section 720 of the Revised Statutes, which provides as follows: “The writ of injunction shall not be granted by any court of the United States, to stay proceedings in any court of a state, except in cases where such injunction may be authorized by any law relating to proceedings in bankruptcy." It is not claimed on the part of the complainant that the proceeding sought to be enjoined is not a proceeding in a state court, but it is claimed that this is a case where the injunction is authorized by a “law relating to proceedings in bankruptcy,” within the meaning of that section; and this is the question to be determined.
The jurisdiction in this case cannot be sustained on the ground of the citizenship of the parties in different states, because all the parties are residents and citizens of the state of New York. Neither can it be sustained under any provisions of the bankrupt law giving jurisdiction to the circuit court of the United States. Those provisions are contained in sections 4,979, 4,980 and 4,986. Section 4,979 gives jurisdiction only in cases between an assignee and a person claiming an-adverse interest; and sections 4,980 and 4,986 give jurisdiction to the circuit court only by way of review or appeal from order’s and decrees, in or arising from proceedings in bankruptcy, of the district court of the same district. It is evident, that the circuit court of this district, therefore, cannot entertain this bill under either of these sections. Section 630 of the -Revised Statutes, evidently referring to the jurisdiction thus given, provides as follows: “The circuit courts shall have jurisdiction in matters of bankruptcy, to be exercised within the limits and in the manner provided by law.”
The only statute under which this bill can be maintained, and that on which the complainant’s counsel rely, is section 1 of the act of March 3, 1875 (18 Stat 470), which provides, that “the circuit courts of the United States shall have original cognizance, concurrent with the courts of the several states, of all suits of a civil nature, at common law or in equity, where the matter in dispute exceeds, exclusive of costs, the sum or value of five hundred dollars, and arising under the constitution or laws of the United States." It is not questioned by the defendants’ counsel that this is a suit of a civil nature, where the matter in dispute arises under the bankrupt law. The language of the act is general — “arising under the laws of the United States.” There is nothing in the other provisions of the act indicating any purpose to except eases where the matter in dispute arises under the bankrupt law. The court, however, in cases coming within this act, does not sit in bankruptcy, although the matter in dispute may arise under the bankruptcy law. It'sits as a court of common law or of equity, and section 720 of the Revised Statutes applies to all such cases. This new grant of power does not give jurisdiction of a case or proceeding in bankruptcy; and, therefore, where the relief asked for in a case under this statute is such as it is by statute exclusively ■ within the power of a court sitting in bankruptcy to grant, or such as it is forbidden to any court of the United States to exercise except when sitting in bankruptcy, sueh relief cannot be given in a suit at law or in equity brought under this statute. Section 720 of the Revised Statutes is a re-enactment of the act of March 2, 1793 (1 Stat. 334,) as modified by the provisions of the bankrupt law of 1867. Prior to the passage of the bankrupt law, the courts of the United States were prohibited from issuing any injunction to stay proceedings in a
