Sparhawk v. Yerkes

Citations

• 142 U.S. 1
• 12 S. Ct. 104
• 35 L. Ed. 915
• 1891 U.S. LEXIS 2564

Syllabus

<p>In December, 1871, Y., who was a member of the stock exchanges in New York and in Philadelphia, was declared to be a bankrupt. At that time his seat in the New York Exchange was worth about $1000, and the other about $2000. By the rules of each, membership, in case of failure, was suspended until settlement with its members who were creditors, and the seat in each was liable to be sold and the proceeds applied to the payment of the debts of such of its members. At the time of his failure the indebtedness of Y. to members of the New York Exchange amounted to about $8500, and to members of the Philadelphia Exchange to nearly $22,000. The assignees notified each exchange of their appointment, but took no steps to adjust the debts or to acquire the seats, which were appraised as of no value. Within two years Y. notified them that assessments on the seats were overdue. They told him he was- the proper party to pay them, and that what he might pay would be ¿recognized as properly to be refunded, in case the seats should be sold by them. Y. was discharged in bankruptcy in 1873. Erom his private means he paid all assessments overdue and from time to time maturing, and eventually settled with all the creditor members. Such members had proved their debts against his estate in bankruptcy, and in the several settlements he had the benefit of the dividends (28 per cent) paid by- the assignees. Having thus settled all such debts he was, in June, 1883, reinstated in his membership in the Philadelphia board, and in December, 1883, in his membership in the New York board. At that time the'value of the Philadelphia seat was about $6000, and of the New York seat about $20,000. In November, 1885, the assignees filed bills against Y. and each board, to have these memberships decreed to be assets of the bankrupt’s estate. Held,</p> <p>(1) That the assignees must be deemed to have elected not to accept these rights as property of the estate;</p> <p>(2) That Y. was not their trustee in