In re Friedman

• Decision Date: 14 April 1908
• Docket Number: 211.
• Citation: 161 F. 260
• Parties: In re FRIEDMAN et al.
• Court: U.S. Court of Appeals — Second Circuit

161 F. 260

In re FRIEDMAN et al.

No. 211.

United States Court of Appeals, Second Circuit.

April 14, 1908

Emanuel Herz, for petitioners.

William Lesser, for respondent.

Before LACOMBE, WARD, and NOYES, Circuit Judges.

LACOMBE Circuit Judge.

On March 22, 1907, an involuntary petition in bankruptcy was filed against Abraham Friedman, and a temporary receiver was appointed. The record submitted on this appeal is defective in that it fails to give the filing dates of several of the orders contained in it, but it is apparent that receiver was appointed promptly probably on the day petition was filed. Adjudication of bankruptcy followed on April 4, 1907.

An order was obtained under Act July 1, 1898, c. 541, Sec. 21a, 30 Stat. 552 (U.S. Comp. St. 1901, p. 3430), for the examination of various persons, including these petitioners Celia Friedman, Max Levinson, and Samuel Wiltchik, who attended and were examined on March 26th, 27th, 28th, and 29th. It developed that on the night of March 17, 1907, the bankrupt, a shoe dealer, sold his entire stock, receiving therefor $3,850. His wife was present, and it is not disputed that at one time, while counting it, she had the money in her possession. For a further statement of the facts reference may be had to In re Friedman (D.C.) 153 F. 939.

On March 27th an order was made requiring Celia Friedman to show cause why an order should not be made requiring her to turn over forthwith to the temporary receiver the sum of $3,850. On March 28th a like order was made requiring the Jenkins Trust Company, Max Levinson, and Samuel Wiltchik to turn over to the receiver the proceeds alleged to be in their possession of the sales made by the bankrupt. These orders to show cause were upon the testimony taken as aforesaid of Celia Friedman, of Max Levinson, her brother, William Herrman, a notary public, and Harris Perlmutter, an auctioneer. After an adjournment the motion came on for a hearing on April 8th, petitioners appearing by counsel and filing each an affidavit in opposition. On April 13th the District Court made and entered the order now sought to be reviewed. Pending proceedings to review new counsel have been substituted for petitioners.

It is contended that the District Court had no power to make a summary order directing third parties to pay over to the temporary receiver sums of money which they insisted they did not have or were their own property. There is no indication anywhere in the record that these petitioners raised any objection to the jurisdiction of the bankruptcy court to determine the question whether the several sums of money were or were not the property of the bankrupt, nor objected that the question could not be determined summarily. Many cases are cited on the briefs; but it is unnecessary to discuss them. Whatever might have been our own views on the general exercise of summary proceedings to seize hold of property which, before the petition in bankruptcy was filed, was in the actual possession of third persons who assert that they own it (In re Baudouine, 101 F. 574, 41 C.C.A. 318) we are concluded by the language of the Supreme Court in Mueller v. Nugent, 184 U.S. 1, 22 Sup.Ct. 269, 46 L.Ed. 405. In that case money which the bankrupt had collected a short time before...