In re Joseph R. Marquette, Jr., Inc.
| Decision Date | 13 November 1918 |
| Docket Number | 58. |
| Citation | 254 F. 419 |
| Parties | In re JOSEPH R. MARQUETTE, JR., Inc. |
| Court | U.S. Court of Appeals — Second Circuit |
Patrick J. McDonald, of New York City, for petitioner.
Niebrugge & Maxfield, of New York City (Samuel C. Duberstein, of New York City, of counsel), for trustee in bankruptcy.
Rounds Hatch, Dillingham & Debevoise, of New York City (Stephen Barker, of New York City, of counsel), for Battery Park Nat Bank.
The bankrupt corporation succeeded to the business of and was formed by Joseph R. Marquette, Jr., who became its president. Before incorporation Marquette individually became the owner of a considerable quantity of imported merchandise, which (duty not being paid) was deposited in a bonded warehouse the proprietor of which issued the usual receipt for said merchandise to said Marquette individually.
Thereafter the bankrupt corporation having been created, Marquette, on behalf of the corporation, borrowed money from a bank, and as collateral security transferred to the bank the warehouse receipt aforesaid. The merchandise could not be removed from warehouse without the consent of the collector of customs showing that it was duty paid before withdrawal. Bankruptcy having supervened, Marquette refused to sign applications for withdrawal unless the bank would stipulate to pay to him individually, and not to the trustee of the bankrupt corporation, whatever surplus might remain on the sale of the merchandise to liquidate the bankrupt's indebtedness to the bank. Apparently failing to obtain such stipulation, he transferred his right, title, and interest in and to said merchandise to a third party.
The trustee, becoming aware of this situation, brought by petition a summary proceeding against Marquette individually, seeking an order directing him to 'instruct the collector of customs that he relinquishes and withdraws any claims which he' might have against said merchandise. After considering affidavits on both sides, the District Court ordered (1) that Marquette be restrained and enjoined from in any manner interfering with the sale by the bank of said merchandise; (2) that the bank and the trustee jointly offer the merchandise for sale, and any surplus over indebtedness be paid to the trustee; and (3) that Marquette be required to execute an instrument in writing signifying that he had no objection to the sale of said merchandise by the bank and the trustee jointly as aforesaid.
Marquette, in his answer to the trustee's petition, averred that the merchandise in question was not, and never had been, property of the bankrupt corporation, and objected to the jurisdiction of the court in the premises. After the passage of the order hereinabove summarized, he brought this petition to revise.
Before WARD, HOUGH, and MANTON,...
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