In re Boston & Oaxaca Min. Co.

• Decision Date: 14 May 1909
• Docket Number: 14,609.
• Citation: 181 F. 422
• Parties: In re BOSTON & OAXACA MINING CO.
• Court: U.S. District Court — District of Massachusetts

181 F. 422

In re BOSTON & OAXACA MINING CO.

No. 14,609.

United States District Court, D. Massachusetts.

May 14, 1909

Arthur P. Teele, for petitioning creditors.

Whipple Sears & Ogden, for objecting creditors.

DODGE District Judge.

The referee finds that the alleged bankrupt had its principal place of business in Boston, and I do not find sufficient ground in the evidence for disagreeing with this conclusion. The court, therefore, has jurisdiction.

The act of bankruptcy alleged is that on January 8, 1909, 'one Cassius C. Bennett, of Pierre, S.D., was appointed receiver of said Boston & Oaxaca Mining Company because of insolvency by the circuit court, county of Hughes, state of South Dakota, and also by the superior court, county of Suffolk, in the commonwealth of Massachusetts, on February 4, 1909. ' Taking this allegation that a receiver was 'appointed' on the dates referred to, to be equivalent to an allegation that a receiver 'has been put in charge of' the alleged bankrupt's 'property,' the act of bankruptcy charged is that described in section 3a(4) of the bankruptcy act. There is no dispute that the South Dakota court referred to did by decree entered January 8, 1909, put Mr. Bennett in charge of the respondent's property as receiver, nor that the Massachusetts court referred to did, by decree entered February 4, 1909, make him ancillary receiver of the respondent's property in Massachusetts. The question to be decided here is: Were these receiverships established because of the company's insolvency?

The company's insolvency on the dates referred to is denied. The referee has made no definite finding upon this precise question.

He has found:

'That even according to the present liberal definition of insolvency, this company, owing as it did about $18,000 on January 1, 1909, and having no available funds with which to meet its liabilities, was at the time of the filing of the petition against it on the 18th day of February, 1909, insolvent. As further evidence of this is the fact that the company had voted to issue bonds with which to raise funds to meet its pressing liabilities. In fact, it had owed the former treasurer, Mr. Pierce, $100 for borrowed money for over a year.'

But the aggregate of the company's property, though not available on January 1st for the payment of its liabilities, might nevertheless have been, 'at a fair valuation, sufficient in amount to pay its debts. ' Nor, if the company was insolvent in the only sense recognized in the present bankruptcy act at the filing of the petition, does it necessarily follow that the same state of things existed as early as January 8th or February 4th. Assuming, however, that the company was insolvent on both these dates, it still remains to be proved that the action of the South Dakota court or of the Massachusetts court was because of such insolvency. That fact is not established merely by proof that insolvency existed when the court acted.

The decree made by the South Dakota court on January 8, 1909 with the complaint and the...