In re Beaver Coal Co.

• Decision Date: 28 February 1901
• Citation: 107 F. 98
• Parties: In re BEAVER COAL CO.
• Court: U.S. District Court — District of Oregon

107 F. 98

In re BEAVER COAL CO.

United States District Court, D. Oregon.

February 28, 1901

Buaer &amp Greene, for claimant.

Cotton Teal & Minor, for trustee.

BELLINGER District Judge.

This is an application in behalf of the sheriff of Coos county for an allowance of a claim of $769.99, and for payment as a priority out of the bankrupt's estate. On the 21st of June, 1900, upon a petition in involuntary bankruptcy filed on that day, the Beaver Coal Company was adjudged a bankrupt. Prior to this, and on the 15th and 16th of December, 1899 and on February 7, 1900, writs of attachment were placed in the sheriff's hands for service in three actions against the coal company, on demands aggregating above $6,000. Under these writs the property of the company, consisting of two stocks of general merchandise, 1,200 tons of coal, some 562,000 feet of lumber, sundry cases of liquor and bar fixtures, boxes of apples, an engine and wire cable, and sundry props, timber, and lumber at the coal mine of the company, and an electric dynamo, etc., was attached. On May 14th and 19th judgments were rendered for the plaintiffs in these writs, which included the costs of the attachments and an order for the sale of the attached property. Executions were issued on these judgments, and the attached property was ordered sold thereunder. The costs and expenses of the attachment proceedings, consisting mainly of keeper's fees, amounted to $976.29, of which $206.30 accrued subsequent to the filing of the petition in bankruptcy, and is admitted to be entitled to priority in payment. Priority is claimed for the residue of these costs, amounting to $769.99, on the following grounds:

'First, because, under the laws of the state of Oregon, the claim would be and is a preferred claim and entitled to a priority, and this priority is recognized and affirmed by section 64b, subd. 5, of the bankrupt law; second, because, in equity and good conscience, the claim ought to be so allowed and paid; and, third, because the levies under the writs of attachment were made and the liens attached to the property more than four months prior to the filing of the petition in bankruptcy against the Beaver Coal Company, and orders for the sale of the attached property for the satisfaction of said costs and the claims of the attaching creditors were entered in the judgment rendered against said Beaver Coal Company before the institution of said bankruptcy proceedings, and are unaffected thereby.'

By subdivision 5 of section 64b of the bankrupt act, 'debts owing to any person who by the laws of the states or the United States is entitled to priority' have priority of payment out of the bankrupt's estate. Under the state assignment law (section 3173, Hill's Comp.), an assignment operates to discharge all attachments on which judgments shall not have been rendered at the date of the assignment and it is provided that the claims in the attachment shall share pro rata with other claims, after the payment of the costs and disbursements in the attachment proceedings. So that under the statute these costs and disbursements are given priority where there has been a general assignment for the benefit of creditors, and it is contended from this that they have priority under subdivision 5 of section...