In re C. Moench & Sons Co.

Citations

• 123 F. 965
• 1903 U.S. Dist. LEXIS 260

Syllabus

<p>1. Bankrupts—Corporations—Acts op Directors.</p> <p>Where a state court seized the property of an alleged bankrupt corporation, and the appointment of receivers by the state court was subsequently confirmed by the federal court in a bankruptcy proceeding against the corporation previously commenced, such facts did not deprive the corporation’s directors, acting for it, of the right to adopt a resolution declaring its inability to pay its debts, and its willingness to be adjudged a bankrupt.</p> <p>2. Same—Collusion—Estoppel.</p> <p>Where petitioning creditors to have a corporation adjudged a bankrupt Instituted such proceedings in order that all the creditors should share equally in the bankrupt’s estate, and, to this end, obtained the consent of the corporation to declare its inability to pay its debts, and willingness to be adjudged a bankrupt, as authorized by Bankr. Act 1898, § 3, subd. 5 (Act July 1, 1898, c. 541, 30 Stat. 546 [U. S. Comp. St. 1901, p. 3422]), such creditors were not estopped to urge the corporation’s resolution as an act of bankruptcy, on the ground of collusion, as against an attaching creditor, who, in case the bankruptcy proceedings were dismissed, would obtain a preference by his attachment.</p> <p>3. Same.</p> <p>Where a corporation, by vote of its directors, declared its inability to pay its debts, and its willingness to be adjudged a bankrupt, as authorized by Bankr. Act 1898, § 3, subd. 5, on request of certain creditors the latter were entitled to have the corporation adjudged a bankrupt, without regard to its solvency.</p>