Mullendore v. American Surety Co. of New York
| Decision Date | 20 August 1928 |
| Docket Number | No. 5379.,5379. |
| Citation | 27 F.2d 572 |
| Parties | MULLENDORE v. AMERICAN SURETY CO. OF NEW YORK. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Charles H. Loud and William B. Leavitt, both of Miles City, Mont., for appellant.
Sterling M. Wood and Robert E. Cooke, both of Billings, Mont., for appellee.
Before GILBERT, RUDKIN, and DIETRICH, Circuit Judges.
This is an appeal from a decree granting an injunction pendente lite, restraining a receiver from carrying out or obeying an order of the state court by which he was appointed. The appellant was appointed receiver of the Wibaux County Bank by the district court of the Seventh judicial district of the state of Montana, in and for the county of Wibaux, at the suit of the Attorney General of the state, and was, at the time of the entry of the decree complained of, charged with the duty of liquidating the affairs of the bank, collecting its assets, and making distribution among its creditors, under the direction and supervision of the appointing court. The appellee presented to the receiver a preferred claim against the bank in the sum of approximately $30,000, basing its claim of preference on the fact that it became subrogated to the rights of the United States, a preferred creditor under section 3466 of the Revised Statutes (31 USCA § 191). The claim was allowed by the receiver and by the state court as a common or general claim, but the claim of preference was disallowed. Thereafter the receiver presented a petition to the state court, setting forth the claims allowed against the bank, both common and preferred, that he had money in his possession sufficient in amount to pay a dividend of 5 per cent. on all general claims and the balance due on all preferred claims, and praying for an order requiring all persons interested to appear before the court and show cause why distribution should not be made. Upon this petition an order was made fixing the date of hearing and requiring all parties in interest to appear and show cause why the prayer of the petition should not be granted. It was further ordered that a copy of the order be served on the appellee and another indemnity company in the same manner as a summons in a civil action, and that due return of service be made. Before the time fixed for the hearing had expired, the appellee filed a petition for the removal of the controversy between the appellant and itself into the United States District Court for the District of Montana, accompanied by a proper bond. The state court ignored the petition for removal, and made an order directing the payment of dividends substantially as prayed. Thereupon the appellee filed the removal papers in the court below, accompanied by a bill of complaint setting...
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