National Bank of Athens v. Shackelford

• Decision Date: 08 November 1915
• Docket Number: No. 40,40
• Citation: National Bank of Athens v. Shackelford, 239 U.S. 81, 36 S.Ct. 17, 60 L.Ed. 158 (1915)
• Parties: NATIONAL BANK OF ATHENS, Appt., v. F. C. SHACKELFORD, Trustee in Bankruptcy for J. N. Webb
• Court: U.S. Supreme Court

239 U.S. 81

36 S.Ct. 17

60 L.Ed. 158

NATIONAL BANK OF ATHENS, Appt.,

v F. C. SHACKELFORD, Trustee in Bankruptcy for J. N. Webb.

No. 40.

Argued October 29, 1915.

Decided November 8, 1915.

Messrs. John J. Strickland and Roy M. Strickland for appellant.

Messrs. Lamar C. Rucker, Horace M. Holden, Stephen C. Upson, and Howell C. Erwin for appellee.

Mr. Justice McReynolds delivered the opinion of the court:

This controversy arose in a bankruptcy proceeding, and was begun in the United States district court for the northern district of Georgia. Appellant claims that it holds a valid lien on certain real estate in the city of Athens, formerly the property of the bankrupt, Webb, under a mortgage deed executed by him November 6, 1911 but not recorded until non, August 14, 1912, a few hours before the petition in involuntary bankruptcy was filed. Among other things, the trustee asserts that the mortgage is void as to creditors because fraudulently withheld from record. Bankruptcy act, § 70. Georgia Code, 1910, § 3224.

Having heard the witnesses and upon the entire evidence, the district court, citing and purporting to follow Re Duggan, 106 C. C. A. 51, 183 Fed. 405 (1910), found and adjudged the deed invalid as against general creditors. Affirming this action, the circuit court of appeals for the fifth circuit declared: 'The evidence in this case tends strongly to show that, although the mortgage given by the bankrupt to the appellant was for a valid consideration and effective as between the parties thereto, the same by understanding, if not agreement, was withheld from record, so as not to affect the mortgagor's credit; and we therefore concur with the trial judge in his disposition of the case.' 125 C. C. A. 575, 576, 208 Fed. 677, 678. In the Duggan Case the same court had held fraudulent and void, both as to prior and subsequent creditors, a chattel...