In re Muntz TV
Decision Date | 30 September 1955 |
Docket Number | No. 11355.,11355. |
Citation | 225 F.2d 489 |
Parties | In the Matter of MUNTZ TV, Inc., Principal Debtor. Tele-Vogue, Inc., and Muntz Industries, Inc., Debtors. W. G. EMBRY and Fort Worth National Bank, Appellants, v. C. Wylie ALLEN and Floyd G. Dana, Trustees of Muntz TV, Inc., Appellees. |
Court | U.S. Court of Appeals — Seventh Circuit |
Rufus S. Garrett, Fort Worth, Tex., Robert F. Fuchs, Chicago, Ill., Rufus S. Garrett, Jr., Fort Worth, Tex., Frederick Mayer, Chicago, Ill., Garrett & Garrett, Fort Worth, Tex., Johnston, Thompson, Raymond & Mayer, Chicago, Ill., of counsel, for appellants.
Joseph W. Grady, James Overton Brooks, Chicago, Ill., for appellees.
Before MAJOR, FINNEGAN and SWAIN, Circuit Judges.
Muntz TV, Inc., principal debtor here, leased a store building in Fort Worth, Texas on June 4, 1952 for a three-year term expiring June 30, 1955 from W. G. Embry of that State. By proceedings commenced March 2, 1954, with filing an involuntary petition for reorganization under Chapter X of the Bankruptcy Act,1 appellees Allen and Dana, were appointed trustees of the debtor corporation. The Texas lease was rejected, as of March 4, 1954, by an order entered below April 2, 1954. Forced to enter an over-all field warehousing program with Lawrence Warehouse Company, shortly after signing that lease, Muntz sought its landlord's consent. But Embry, fearful of waiving his landlord's lien, withheld approval of such arrangement under which a part of all Muntz's leased premises would be segregated and Lawrence given custody of certain merchandise placed in segregated areas. Yet, Embry suggested that six months rent in advance under a deferred receipt arrangement with Muntz could stimulate granting the essential consent. Consequently a document was executed June 13, 1953 by Embry and Muntz containing these aspects now relevant:
Co-appellant, Fort Worth National Bank, Fort Worth, Texas, enters this situation because, as the parties' stipulation established, $2,400 was deposited with that Bank on June 13, 1953 by Muntz under that agreement already quoted. Filing their petition below, August 18, 1954, these trustees sought to have the Bank turn over $2,013.43 on the theory such moneys remained their debtor's property, since this was a security deposit flowing to trustees by virtue of an omnibus order entered March 3, 1954. That amount, incidently, reflects adjustment for charges incurred by these trustees for use of the premises involved. In passing, we also note, that rejection of the Embry-Muntz agreement was asked for by trustees. Embry resisted the petition for turnover, at the threshold, by challenging jurisdiction of the district court. He contended the fund was deposited in escrow with the Bank who, in turn held the $2,400 in trust for him. Insisting that this money did not belong to Muntz, Embry demanded that sum from the bank.
Appellants would have us reverse and remand (with directions) the district judge's order confirming his special master's report and directing the bank to pay $2,013.43 over to these trustees.
Since this is not a straight bankruptcy proceeding, but one under Chapter X we must decide, at the outset, the applicability and extent of principles governing summary and plenary jurisdiction. See e. g. Duda v. Sterling Mfg. Co., 8 Cir., 1950, 178 F.2d 428, 433, 14 A.L.R. 2d 899. Then, if appropriate we can apply them to the specific facts involved and determine if Embry and the Bank must be accorded a plenary proceeding. Implicit in this later aspect, of course is another question: Is the adverse claim colorable, substantial and ingenuous? We think First National Bank of Houston v. Lake, 4 Cir., 1952, 199 F.2d 524 contains an adequate explanation of cases cited by both parties to this appeal, while at the same time reflecting the answer to whether Chapter X completely overrides differences in summary and plenary jurisdiction. Chief Judge Parker could have been summarizing our problem here when he wrote. Id., 199 F. 2d 532, 533:
(Italics ours).
In their joint responsive pleading to appellees' petition for turnover we find appellants' paragraph five (5) stated:
"That the Forth Worth National Bank verily believes that said fund is the property of W. G. Embry and that said W. G. Embry is entitled to immediate possession thereof, but said bank stands willing and ready to pay the same to whomsoever it is due; and suggests that a plenary action be brought * * * to legally determine the right and title to...
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United Pacific Insurance Co. v. FIRST NATIONAL BANK OF ORE.
...and passed to the trustee on the adjudication. There is no similarity between the facts in that case and those in ours. In re Muntz TV, 7 Cir., 1955, 225 F.2d 489, supports my conclusions rather than those of the defendant The court has jurisdiction and the complaint states facts sufficient......
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In re Muntz TV
...Therefore, we think it unnecessary to cite or discuss such cases, other than the recent decision of this court in In the Matter of Muntz TV, Inc., 7 Cir., 225 F.2d 489, wherein it was held that the District Court did not have summary jurisdiction. As will be noted from a reading of that opi......