Leighton v. Kennedy

Citations

• 129 F. 737
• 64 C.C.A. 265
• 1904 U.S. App. LEXIS 4093

Syllabus

<p>1. Bankruptcy — Assignment of Claims — Effect.</p> <p>Within four months prior to the filing of a petition praying that the person against whom the petition was brought should be adjudged a bankrupt, the alleged bankrupt had made a general assignment for the benefit of creditors to one M. M., prior to the filing of the petition, purchased the claims of 12 creditors, which were nonnegotiable choses in action, under such circumstances that the alleged bankrupt might have claimed that the purchases were in his interest. Afterwards, and a few days before the filing of the petition, M. assigned each of said claims to a stranger, with the purpose of keeping alive 12 different claims in the hands of 12 different supposed creditors, so that the same might be enumerated as outstanding creditors with reference to any such petition. Held, that the claims so purchased merged in M., so as to become a single claim in equity, or are to be regarded as extinguished; that, in either case, the several persons to whom the claims were assigned acquired no equities superior to those of M., as the claims were nonnegotiable choses in action; and that the attempt by M. to create the condition described with reference to enumeration of creditors was an attempt to defeat the scheme of the statutes in bankruptcy, and therefore, in any view, noneffectual.</p> <p>2. Same.</p> <p>Within four months prior to the filing of a petition praying an adjudication in bankruptcy of the person against whom the petition was filed, the alleged bankrupt made an assignment for the benefit of creditors to M. M., within a few days prior to the filing of the petition, purchased with funds of the assigned estate several claims against the alleged bankrupt belonging to creditors who had not assented to the assignment; and thereafter, before the filing of the petition, M. executed formal assignments of each of said claims to a stranger, without receiving any consideration therefor. Held, that the claims, if not ex