Beach Resort Hotel Corp. v. Wieder

• Decision Date: 10 October 1956
• Parties: BEACH RESORT HOTEL CORPORATION, a Florida corporation, and Abraham Rosen, Petitioners, v. Bernard R. WIEDER, Joseph Amigo, Yetta Rosen, Palwi, Inc., and Max Orovitz, as Receiver, Respondents.
• Court: Florida Supreme Court

Page 52

90 So.2d 52

BEACH RESORT HOTEL CORPORATION, a Florida corporation, and Abraham Rosen, Petitioners, v. Bernard R. WIEDER, Joseph Amigo, Yetta Rosen, Palwi, Inc., and Max Orovitz, as Receiver, Respondents.

Supreme Court of Florida, Special Division B.

Oct. 10, 1956.

Ward & Ward, Miami, for petitioners.

Sibley & Davis, Meyer, Weiss, Rosen & Rose, and Morris Berick, Miami Beach, for respondents.

On Petition for Rehearing

O'CONNELL, Justice.

The petitioner asserts, by petition for rehearing in this cause, that the order of the bankruptcy court quoted in the original opinion was directed only to a specific and limited point in issue between the parties to this cause before the lower court. Conceding (upon a consideration of the matters reflected by the records in prior appearances of the cause here, but brought to the attention of the Court in the instant certiorari proceeding for the first time by petition for rehearing) that the order referred to did not constitute a relinquishment by the bankruptcy court of authority over the entire controversy, it still appears that the first question posed must be answered in the negative.

The fundamental problem is whether, under the circumstances, the bankruptcy proceeding superseded the pending litigation in the state courts so as to require that such litigation be immediately terminated and the properties or funds in receivership surrendered. The Act has certainly never been construed to permit a summary termination of any and all suits in other courts of which they had, at the time of a bankruptcy petition by one of the parties, full cognizance. Eyster v. Gaff, 91 U.S. 521, 23 L.Ed. 403. The prevailing rule is expressed as follows:

'In the determination of the rights and liabilities of the bankrupt and third persons with relation to particular assets or other matters which arise out of, and are governed by, common-law rules or statutes other than the Bankruptcy Act [11 U.S.C.A. § 1 et seq.], bankruptcy and state courts have concurrent jurisdiction, and the general rule, * * * to the effect that the tribunal which first obtains jurisdiction of the matter retains it exclusively has been applied.' 8 C.J.S., Bankruptcy, § 29, p. 446.

There is no inconsistency between this principle and the acknowledged exclusive jurisdiction of the bankruptcy court over the affairs of the bankrupt as such. Herman v. Cullerton, 9 Cir., 13 F.2d 754; Shrewsbury v. Reynolds-Morse Corp., 105 Colo. 30, 94 P.2d 686. Cf. First Nat. Bank v. Zangwill, 61 Fla. 596, 54 So. 375; Kelley v. Lassister, 150 Fla. 118, 7 So.2d 458.

A review of the cases involving application of the above cited rule will plainly sustain the action of the court below in the entry of its order on mandate. Bryan v. Speakman, 5 Cir., 53 F.2d 463, certiorari denied 285 U.S. 539, 52 S.Ct. 312, 76 L.Ed. 932; In re Couch Cotton Mills Co., D.C.Ga., 275 F. 496; Park v. Stryker, 8 Cir., 6 F.2d 457; In re Brinn, D.C.Ga., 262 F. 527; Redmon v. Witt, 6 Cir., 9 F.2d 36; Dayton Coal & Iron Co., D.C.E.D.C.Tenn. 1922, 291 F. 390, 1 A.B.R.,N.S., 434. Remington on Bankruptcy, 3rd. ed., Vol. V., Sec. 2042, et seq.; Collier, 14th ed., Vol. I, Secs. 2.63, 11.02.

There is another reason why we will not quash the order on mandate issued by the Circuit Court.

Even if the bankruptcy court...