First National Bank of Denver, Colorado v. John Klug

• Citation: 186 U.S. 202,46 L.Ed. 1127,22 S.Ct. 899
• Decision Date: 02 June 1902
• Docket Number: No. 599,599
• Parties: FIRST NATIONAL BANK OF DENVER, COLORADO, First National Bank of York, Nebraska, and Harris & Company, Appts. , v. JOHN P. KLUG and Charles H. Wheeler
• Court: U.S. Supreme Court

186 U.S. 202

22 S.Ct. 899

46 L.Ed. 1127

FIRST NATIONAL BANK OF DENVER, COLORADO, First National Bank of York, Nebraska, and Harris & Company, Appts.,

v JOHN P. KLUG and Charles H. Wheeler.

No. 599.

Submitted May 5, 1902.

Decided June 2, 1902.

Messrs. Charles J. Greene, Ralph W. Breckenridge, and George L. Hodges for appellants.

Mr. John F. Shafroth for appellees.

Mr. Chief Justice Fuller delivered the opinion of the court:

The bankrupt act provides: 'Any natural person, except a wage earner or a per- son engaged chiefly in farming or the tillage of the soil, any unincorporated company, and any corporation engaged principally in manufacturing, trading, printing, publishing, or mercantile pursuits, owing debts to the amount of $1,000 or over, may be adjudged an involuntary bankrupt upon default or an impartial trial, and shall be subject to the provisions and entitled to the benefits of this act.' § 4b.

In this proceeding by petition in involuntary bankruptcy filed against John P. Klug, a trial before a jury was had on the issue whether Klug was 'engaged chiefly in farming,' within the meaning of the act. The district court, upon the evidence, directed the jury to find that Klug was a farmer and engaged chiefly in farming, within the meaning of the act, and, the jury having found accordingly, entered judgment dismissing the petition with costs. Petitioners prayed an appeal directly to this court, which was allowed, and the district court thereupon made and filed its findings of fact and conclusions of law in pursuance of the 3d subdivision of General Order in Bankruptcy, 36.

Section 24 of the bankrupt act provides:

'a. The Supreme Court of the United States, the circuit courts of appeals of the United States, and the supreme courts of the territories, in vacation in chambers and during their respective terms, as now or as they may be hereafter held, are hereby invested with appellate jurisdiction of controversies arising in bankruptcy proceedings from the courts of bankruptcy from which they have appellate jurisdiction in other cases. The Supreme Court of the United States shall exercise a like jurisdiction from courts of bankruptcy not within any organized circuit of the United States and from the supreme court of the District of Columbia.

'b. The several circuit courts of appeal shall have jurisdiction in equity, either interlocutory or final, to superintend and revise in matter of law the proceedings of the several inferior courts of bankruptcy within their jurisdiction. Such power shall be exercised on due notice and petition by any party aggrieved.' [30 Stat. at L. 544, chap. 541.]

Our jurisdiction of this appeal depends on the act of March 3 1891, by the 5th section of which an appeal or writ of error from or to the circuit or district courts will lie directly 'in any case where the jurisdiction of the court is in issue,' and in such cases 'the question of jurisdiction alone shall be certified to the supreme court from the court below for decision.' In this case there is no such certificate, and, moreover, the district court had and exercised jurisdiction. The conclusion was, it is true, that Klug could not be adjudged a bankrupt, but the court had jurisdiction to so determine, and its jurisdiction over the subjectmatter was not and could not be questioned. Mueller v. Nugent, 184 U. S. 15, ante, 269, 22 Sup. Ct. Rep. 269; Louisville Trust Co. v. Comingor, 184 U. S. 25, ante, 293, 22 Sup. Ct. Rep. 293; Smith v. McKay, 161 U. S. 355, 40 L. ed. 731, 16 Sup. Ct. Rep. 490.

It is not contended that the case falls within either of the other classes of cases mentioned in § 5.

Section 25 provides:

'a. That appeals, as in equity cases, may be taken in bankruptcy proceedings from the courts of bankruptcy to the circuit court of appeals of the United States, and to the supreme court of the territories, in the following cases, to wit, (1) from a judgment adjudging or refusing to adjudge the defendant a bankrupt; (2) from a judgment granting or denying a discharge; and (3) from a judgment allowing or rejecting...