298 F. 926 (8th Cir. 1924), 250, In re Western Rope & Mfg. Co.

Docket Nº:250, 6403.
Citation:298 F. 926
Case Date:April 23, 1924
Court:United States Courts of Appeals, Court of Appeals for the Eighth Circuit

Page 926

298 F. 926 (8th Cir. 1924)





Nos. 250, 6403.

United States Court of Appeals, Eighth Circuit.

April 23, 1924

Rehearing Denied July 9, 1924.

H. B. Martin, of Tulsa, Okl. (Roy A. Reynolds, of Tulsa, Okl., on the brief), for appellant and petitioner.

Page 927

Philip Kates, of Tulsa, Okl., and Samuel A. Mitchell, of St. Louis, Mo., for appellee and respondent.

Before STONE and LEWIS, Circuit Judges, and PHILLIPS, District Judge.

STONE, Circuit Judge.

These are a petition to revise and an appeal from an order of the bankruptcy court in a summary proceeding requiring petitioner (appellant) to turn over certain money to the trustee as property of the bankrupt.

Petitioner (appellant) was made an additional party in the bankruptcy proceeding and served with a writ to show cause why she should not turn over property in her possession because the same was part of the bankrupt estate. From the first, and all through the proceeding, petitioner (appellant) has challenged the jurisdiction of the bankruptcy court to hear and determine this matter in a summary proceeding, claiming that it can only be examined in a plenary action. The bases upon which the referee and court below retained jurisdiction and upon which respondent (appellee) hopes to sustain the jurisdiction here is that the contention of petitioner (appellant) that its claim is adverse is merely colorable within the meaning of Mueller v. Nugent, 184 U.S. 1, 22 Sup.Ct. 269, 46 L.Ed. 405, and other similar cases. We think the Mueller Case and quite a few other cases before the various Courts of Appeals have established the doctrine that where the claim alleged to be adverse is not really so, but only colorably such, that the bankruptcy court has jurisdiction to determine the character of the claim in that respect and, if it is colorable only, to adjudicate the merits of the matter in a summary manner. The application of this rule involves a definition of what is meant by colorable. In our judgment, the meaning of that word as used in this connection is that a claim alleged to be adverse is only colorably so when, admitting the facts to be as alleged by the claimant, there is, as matter of law, no adverseness in the claim.

Measured by the above standard, we cannot say that this claim is merely colorable. The claim here is, as shown...

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