117 F.2d 608 (6th Cir. 1941), 8651, Egyptian Supply Co. v. Boyd

Docket Nº:8651.
Citation:117 F.2d 608
Party Name:EGYPTIAN SUPPLY CO. v. BOYD et al. In re GRAVES.
Case Date:February 11, 1941
Court:United States Courts of Appeals, Court of Appeals for the Sixth Circuit
 
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Page 608

117 F.2d 608 (6th Cir. 1941)

EGYPTIAN SUPPLY CO.

v.

BOYD et al.

In re GRAVES.

No. 8651.

United States Court of Appeals, Sixth Circuit.

February 11, 1941

Page 609

Albert Karnes and Waller & Threlkeld, all of Paducah, Ky., for appellant.

David R. Reed, James G. Wheeler, A.E. Boyd, E. Palmer James, Adrian H. Terrell, A.E. Boyd, Jr., McMurry, Katterjohn & Reed, Wheeler & Shelbourne, and Boyd & Boyd, all of Paducah, Ky., for appellees.

Before HICKS, ALLEN, and HAMILTON, Circuit Judges.

HAMILTON, Circuit Judge.

This case, which arises in proceedings in bankruptcy, involves conflicting claims of two classes of creditors. On September 12, 1938, appellant, Egyptian Supply Company,

Page 610

filed in the McCracken County Circuit Court of Kentucky an action against R. W. Graves, seeking to recover $1,988.97 for merchandise sold and delivered to him.

Simultaneously with the filing of the petition, it sued out and was granted an attachment pursuant to the provisions of Sections 196 to and including 212 of the Kentucky Code, which attachment was levied on two lots, together with improvements thereon, at 1725 Monroe Street and 617 North Fifth Street, Paducah, Kentucky.

Pursuant to the provisions of Sections 2358a-2 and 2358a3 of Carroll's Kentucky Statutes, Baldwin's Edition, 1936, a lis pendens notice was filed by appellant in the County Court Clerk's office of McCracker County. Subsequently, during the month of September, 1938, the appellees, exclusive of A. E. Boyd, trustee, pursuant to the provisions of Sections 2463 to and inclusive of Section 2468, Carroll's Kentucky Statutes, Baldwin's 1936 Edition, filed in the County Clerk's office of McCracker County, mechanics' and materialmen's liens for labor and materials used in the erection, altering and repairing of houses on the real estate covered by the attachment.

On November 5, 1938, R.W. Graves filed his petition in bankruptcy in this action and on November 7, 1938, was adjudged a bankruptcy.

Appellant, Egyptian Supply Company, as an attachment lien creditor, filed in these proceedings its claim which was identical with the one in its petition. Each of the appellees, excluding A. E. Boyd, trustee, filed in these proceedings his mechanics' and materialmen's lien claim identical with the ones theretofore filed in the Clerk's office of the McCracken County Court. The referee found that the bankrupt was insolvent on September 12, 1938, the date appellant procured its attachment and, on petition of the trustee, dissolved appellant's lien and found it to be a general creditor. He sustained the liens of the materialmen and mechanics. On petition for review, the court sustained the referee and this appeal is prosecuted from that order.

At the time these proceedings were instituted appellant had perfected its attachment lien and appellees, exclusive of A. E. Boyd, Jr., trustee, had perfected their mechanics' and materialmen's lien. Appellees' lien was subsequent to appellant's and appellant insists that, under the facts, it was the duty of the court to preserve its lien for the benefit of the estate and further that there is no substantial evidence the bankrupt was insolvent at the time its lien was obtained and that for this reason its lien is superior to the...

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