Hyland v. The James Roy

• Citation: 59 F. 784
• Parties: THE JAMES ROY. v. THE JAMES ROY. HYLAND
• Decision Date: 13 February 1894
• Court: U.S. District Court — Southern District of New York

59 F. 784

THE JAMES ROY.

HYLAND v. THE JAMES ROY.

United States District Court, S.D. New York.

February 13, 1894

Charles M. Stafford, for petitioner.

Hyland & Zabriskie, for libelant.

Root &amp Clark, for the marshal.

BROWN District Judge.

The above libel was filed on the 2d of February, 1894, to recover damages to the libelant's scow, through the alleged negligence of the tug James Roy while having the scow in tow on the 23d day of November, 1893. Upon process in rem the marshal, on the 2d of February, arrested the tug and took her into his custody. The petition avers that the owner of the tug on the 16th day of December, 1893, made a general assignment for the benefit of his creditors, without preference; that the assignment was duly recorded, an approved bond given by the assignee, and an inventory filed--all in accordance with the New York statute of 1877, and the amendments thereto; and that possession of the tug was taken by the assignee, who held the same at the time she was taken from him by the marshal. The petitioner prays that the tug be discharged from arrest, on the ground that she was virtually in custodia legis, and therefore not liable to arrest by the marshal under process of this court. Taylor v. Carryl, 20 How. 596.

Under the laws of this state, the county courts, and the supreme court, have concurrent summary jurisdiction upon petition to supervise the conduct of assignees, to enforce the provisions of voluntary assignments for creditors, and to settle and adjust the assignee's accounts. This liability of the assignee to regulation, direction, and control, does not in any sense make such a voluntary assignee, ipso facto, an officer of the court, like a receiver, a sheriff, or a marshal. The very fact that under the laws of New York there are two independent courts that may exercise this same supervisory power over assignees, is conclusive that the assignee's possession of the assigned property is not of itself the possession of either court; since the same property cannot be in the possession of both courts at the same time, and the possession of either would exclude the other.

There is, in truth, no foundation for the contention that the assignee's possession is that of either court, until after some definite proceeding in the one court or the other has been taken to give the court possession of the property as in other regular suits; and none such has been taken in this case. Under the state law the assignment is in no sense a judicial proceeding, or any part of any judicial proceeding in insolvency, like an assignment in bankruptcy. The state court of appeals, in construing the state act, has repeatedly held that it has made no difference in the essential nature of the assignee's possession; and that the assignee 'is merely the representative of the debtor.' In re Lewis, 81 N.Y. 421, 424; In re Holbrook, 99 N.Y. 539, 546, 2 N.E. 887; Roberts & Co. v. Vietor, 130 N.Y. 585, 598, 29 N.E. 1025.

A receiver, on the other hand, is the representative of the court that appoints him; his hand and his possession are those of the court. The supreme court of this state has held that the county court, notwithstanding the general language of the act of 1877, has no authority to entertain summary jurisdiction of claims upon the property hostile to the assignee; but only of proceedings in aid of the trust; and that opposing claims must be enforced by regular action against the assignee. Potter v. Durfee, 44 Hun, 197; In re Witmer, 40 Hun, 64. The ordinary practice moreover, to make such voluntary assignees parties defendant in foreclosure suits, without any application for leave to sue, is conclusive that the petitioner's contention has no recognition even in the state courts.

In the federal courts this question has been repeatedly adjudicated adversely to the claim now made. The statutes of Michigan which are more favorable to the petitioner's contention than the statutes of New York, have been held, on full consideration and discussion of the subject by the present Mr. Justice Brown,...