Ringling Trust & Savings Bank v. Whitfield Estates

• Decision Date: 15 April 1929
• Docket Number: No. 5399.,5399.
• Court: U.S. Court of Appeals — Fifth Circuit
• Parties: RINGLING TRUST & SAVINGS BANK et al. v. WHITFIELD ESTATES, Inc.

32 F.2d 92 (1929)

RINGLING TRUST & SAVINGS BANK et al. v. WHITFIELD ESTATES, Inc.

No. 5399.

Circuit Court of Appeals, Fifth Circuit.

April 15, 1929.

John H. Carter, of Sarasota, Fla. (Sawyer, Surrency, Carter & Keen, of Sarasota, Fla., on the brief), for appellants.

John C. Cooper, Jr., of Jacksonville, Fla. (Cooper, Knight, Adair, Cooper & Osborne, of Jacksonville, Fla., on the brief), for appellee.

Before WALKER and FOSTER, Circuit Judges, and DAWKINS, District Judge.

DAWKINS, District Judge.

This is an appeal from a verdict and decree rejecting the demand that defendant be adjudged an involuntary bankrupt. The transaction out of which the alleged acts of bankruptcy arose was a trust deed executed, within four months preceding filing of the petition, in favor of one of the defendants' creditors, Adair Realty & Trust Company, which petitioners charge was done with the intent (1) to hinder and delay unsecured creditors; and (2) with the intent, while insolvent, to prefer the said Adair Realty & Trust Company to the extent of $1,600,000.

Originally there were three petitioners, to wit, Ringling Trust & Savings Bank, Southern Construction Engineers, Inc., and Cragin-Smith Advertising Company, whose bill was filed on March 23, 1927, and on April 22d following a fourth petitioner, Gardner-Noble Company, was allowed to intervene, and an amendment on behalf of all was permitted, in which the said acts of bankruptcy were reiterated in more detail. It was further alleged that "all of the creditors, * * * at the time of the filing of the original petition, were less than 12 in number." On May 6, 1927, Cragin-Smith Advertising Company was allowed to withdraw as a petitioning creditor. On August 6th defendant answered, admitting that Ringling Trust & Savings Bank was a creditor, but specifically denying that the other petitioners were such. It further denied that the unsecured creditors were less than 12, and set out a list of some 40 individuals and firms, with addresses, which it alleged were unsecured creditors, averred that the trust deed assailed was for the purpose of securing bonds in the sum of $1,600,000, representing bona fide obligations of the defendant, and further denied that the transfer was for the purpose of defrauding or preferring any creditor. It prayed that the issues be submitted to a jury.

The case was tried before a jury, and, after all the evidence was in, the court below, upon motion of the defendant, directed a verdict in its favor, finding it "not guilty of the acts of bankruptcy alleged in the amended petition." A decree in accordance with this finding was entered, and this appeal was asked by the Ringling Trust & Savings Bank, Southern Construction Engineers, Gardner-Noble Company, and L. B. Whitfield, intervener. Subsequently L. B. Whitfield petitioned a severance and withdrew from the appeal. (We find in the record an answer by the defendant to the intervention of Whitfield, but no petition for that purpose by him, or order allowing the same by the court below.)

Motion to Dismiss.

On May 5, 1928, petitioners filed their motion of appeal in the following form:

"Come now the petitioning creditors, Ringling Trust & Savings Bank, a corporation, Southern Construction Engineers, Inc., a corporation, Gardner-Noble Company, a corporation, and L. B. Whitfield, intervening creditor, and enter their appeal from the final judgment of this honorable court, rendered in the above cause on May 5, A. D., 1928, to the United States Circuit Court of Appeals for the Fifth Judicial Circuit, returnable before said court at New Orleans, in the state of Louisiana, on June 4, A. D. 1928. The said Whitfield Estates, Inc., a corporation, and Messrs. Cooper, Knight, Adair, Cooper & Osborne, its attorneys of record, will please take notice of said appeal, the same being taken under the provision of the Act of Congress approved January 31, A. D. 1928, entitled `An act in reference to writs of error.'"

At the same time they filed a motion for writ of error, as follows:

"Come now the petitioning creditors, Ringling Trust & Savings Bank, a corporation, Southern Construction Engineers, Inc., a corporation, Gardner-Noble Company, a corporation, and L. B. Whitfield, intervening creditor in the above-stated cause, by their respective attorneys, and feeling themselves aggrieved by the final judgment of this honorable court entered against them in favor of the said Whitfield Estates, Inc., on the 5th day of May, A. D. 1928, hereby pray that a writ of error may be allowed them from the United States Circuit Court of Appeals for the Fifth Circuit, to the District Court of the United States for the Southern District of Florida, and be made returnable according to law and the practice of the court. And the said petitioners respectively present herewith their assignment of errors and prayer for reversal."

Accompanying this motion were nine assignments of error, which will be considered hereafter. Petitioners also filed their "petition for reversal" in the following words:

"Come now the petitioning creditors, Ringling Trust & Savings Bank, a corporation, Southern Engineers, Inc., a corporation, Gardner-Noble Company, a corporation, and L. B. Whitfield, intervening creditor, and pray for a reversal of the judgment of the District Court of the United States for the Southern District of Florida, in a certain matter therein pending in bankruptcy, in the matter of Whitfield Estates, Inc., bankrupt, which judgment was entered on the verdict of a jury on May 5, 1928, in said District Court."

On the same day the court signed and there was filed the following:

"This 5th day of May, 1928, came the plaintiff, the Ringling Bank & Trust Company, by its attorney, and filed herein and presented to the court its petition, praying for the allowance of a writ of error and assignments of error intended to be urged by it, praying also that a transcript of the record and papers upon which the judgment herein was rendered, duly authenticated, may be sent to the United States Circuit Court of Appeals for the Fifth Judicial Circuit and that such other and further proceedings may be had as may be proper in the premises. In consideration whereof, the court does allow the writ of error upon the defendant giving bond according to law in the sum of thirty thousand dollars ($30,000), which shall operate as a supersedeas bond."

A writ of error was immediately issued, addressed to the judge below, which bears the indorsement: "The within writ of error was this day served by filing the original with the clerk of said District Court, and also filing in said clerk's office a duly certified copy of same for the adverse party, and transmitting herewith the original record and proceedings as herein commanded." In the order allowing severance and withdrawal by L. B. Whitfield, "summons or other notice" of the appeal was waived. Citation on the writ of error was addressed to the defendant Whitfield Estates, which, together with return thereon, read as follows:

"To Whitfield Estates, Inc., a Corporation:

"You are hereby cited and admonished to be and appear at the United States Circuit Court of Appeals for the Fifth Circuit, to be held at the city of New Orleans in the state of Louisiana, thirty days from date hereof, pursuant to a writ of error filed in the clerk's office of the District Court of the United States for the Southern District of Florida, at Tampa, Florida, wherein Ringling Trust & Savings Bank, a corporation, Southern Construction Engineers, Inc., a corporation, and Gardner-Noble Company, a corporation, petitioning creditors, are plaintiffs in error, and you are the defendant in error, to show cause, if any there be, why the judgment in the said writ of error mentioned should not be corrected, and speedy justice done to the parties in that behalf.

"Witness, the honorable William Howard Taft, Chief Justice of the United States of America, this the 5th day of May, A. D. 1928."

"Before the undersigned authority personally appeared this day John H. Carter, who, being duly sworn, says that he is attorney for the Ringling Trust & Savings Bank and other petitioning creditors mentioned in the annexed citation in the matter of Whitfield Estates, Inc., bankrupt, and as such attorney he did on May 26, 1928, at Sarasota aforesaid, mail this original and a copy thereof to Messrs. Cooper, Knight, Adair, Cooper & Osborne, Jacksonville, Florida, the attorneys for the bankrupt, and have received their written acknowledgment of the copy and of their having seen the original, under date of May 31, 1928."

Petitioners asked for and were allowed a supersedeas, the bond therefor being fixed in the sum of $30,000. The bond was executed with the United States Fidelity & Guaranty Company as surety, approved and filed May 24, 1928.

The bill of exceptions was presented, settled, signed, and filed on June 2, 1928, there being attached and made a part thereof the evidence, including exhibits, etc. Defendant filed in this court a motion to dismiss "the paper purporting to be a writ of error," for want of jurisdiction, because relief by that writ has been abolished. It also filed a motion to dismiss the appeal upon the grounds: (1) That this court has no jurisdiction; (2) that the law covering the perfection of an appeal had not been complied with; (3) that there is no petition for appeal; (4) that the appeal has not been allowed as required by law; (5) that no citation of appeal has been issued or served upon counsel or the appellee; (6) that Gardner-Noble Company did not join in the appeal, and no severance has been allowed eliminating it as a party appellant; (7) that neither the Southern Construction Engineers nor Gardner-Noble Company have given any security for the prosecution of their appeal; (8) that all of the petitioning creditors were not joined in the appeal; (9) that said appeal is otherwise informal, irregular, and insufficient; and (10) for...