In re Davis

Citations

• 119 F. 950
• 1903 U.S. Dist. LEXIS 396

Syllabus

<p>1. Bankruptcy—Jurisdiction to Order Surrender of Property.</p> <p>A court of bankruptcy has jurisdiction by a summary proceeding to require a third party having in bis possession money or property claimed to belong to the bankrupt’s estate to show cause why he should not pay over or surrender the same to the trustee, and to inquire into the nature of such party’s possession. If he held it prior to the bankruptcy proceedings, under an adverse claim asserted in good faith, the court is without jurisdiction to adjudicate such claim on the merits without his consent; but, if no adverse claim was made at the time the petition in bankruptcy was filed, the title to the money or property passed to the trustee on his appointment, and the court has jurisdiction to require its surrender to him by a summary order, notwithstanding any adverse right subsequently asserted by the party in possession.</p> <p>2. Same—Adverse Claimant—Fund Held in Fiduciary Capacity.</p> <p>An insolvent partnership sold its stock of goods, and by its direction the purchaser deposited the price in a bank, taking a receipt therefor, showing that the money was to be prorated among the several creditors of the firm as their interests might appear. Subsequently, on petition of creditors, the partnership was adjudicated an involuntary bankrupt. After such adjudication the bank undertook to apply the money so deposited on certain notes of the firm held by it and another creditor, without the consent of the depositor or the bankrupts, and it refused the demand of the trustee therefor. <EeW, that the bank held the deposit in a fiduciary capacity, as a trust fund, which precluded it from asserting an adverse claim thereto after the bankruptcy as against the trustee.</p> <p>8. Same—Order Requiring Fund to be Paid to Trustee—Interest.</p> <p>A summary order made by a court of bankruptcy requiring a third party to pay over to a trustee money of an estate in his. possession should not include interest on the amo