Hyman v. McLendon
| Citation | 102 F.2d 189 |
| Decision Date | 28 February 1939 |
| Docket Number | No. 4414.,4414. |
| Parties | HYMAN v. McLENDON et al. In re LANE. |
| Court | United States Courts of Appeals. United States Court of Appeals (4th Circuit) |
L. D. Jennings and Marion W. Seabrook, both of Sumter, S. C. (Royall & Wright, of Florence, S. C., and C. B. Ruffin, of Hartsville, S. C., on the brief), for appellant.
Henry E. Davis, of Florence, S. C. (Samuel Want, of Darlington, S. C., and Henry C. Jennings and R. H. Singletary, both of Bishopville, S. C., on the brief), for appellees.
Before PARKER and SOPER, Circuit Judges, and CHESNUT, District Judge.
This is an appeal from an order directing that a suit by a trustee in bankruptcy to impress a trust on property and for the recovery of damages be prosecuted in the court of bankruptcy, referring the suit for hearing to the referee in bankruptcy and enjoining the trustee and the bankrupt from further prosecution of a suit involving the same subject matter instituted in a state court. Motion is made to dismiss the appeal because not taken within the time allowed by statute, and we are of opinion that the motion must be allowed.
On September 24, 1935, Dr. Joseph Benjamin Lane of Lee County, S. C., was duly adjudicated a bankrupt on his voluntary petition; and on January 20, 1936, he was granted his discharge. No trustee was appointed prior to the granting of the discharge because the petition disclosed no sufficient assets to justify such appointment. On May 28th, 1936, however, Dr. Lane began a suit in the Court of Common Pleas of Lee County, S. C., against R. W. McLendon and others seeking to impress specific property with a trust in his favor, and to recover damages in the sum of $85,000 on account of transactions alleged to have occurred over a period of years extending from 1921 to 1934. On July 3, 1936, the defendants in the suit instituted in the state court filed a petition with the court of bankruptcy asking that the discharge of the bankrupt be set aside, that a trustee of his estate be appointed and that the trustee be authorized to bring before the bankruptcy court for adjudication the matters involved in the suit in the state court. After a hearing on this petition, the bankruptcy court revoked the order of discharge and directed that a trustee in bankruptcy of the estate of the bankrupt be appointed. This court denied an appeal from that order. Lane v. McLendon, 4 Cir., 87 F.2d 1009. Later a trustee of the estate of the bankrupt was duly appointed and the bankruptcy court designated counsel to represent him in the prosecution of the claim involved in the suit in the state court.
On March 25, 1938, R. W. McLendon and the other defendants in the suit pending in the state court filed petition in the bankruptcy court setting forth the pendency of the suit in the state court and asking the court of bankruptcy to adjudicate the matters there in controversy. Answer was filed to this petition by counsel for the trustee denying the jurisdiction of the court of bankruptcy and alleging that exclusive jurisdiction in the matter rested with the state court. The District Judge, on September 1, 1938, entered the order from which appeal is taken, striking out the answer of the trustee, enjoining him from proceeding with the prosecution of the suit in the state court, holding that exclusive jurisdiction to determine the matters in controversy rested with the court of bankruptcy, and referring these matters to a special master for hearing on the merits. No attempt was made to appeal...
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