Reiss v. Reardon

• Decision Date: 22 March 1927
• Docket Number: No. 299,299
• Citation: 18 F.2d 200
• Parties: REISS v. REARDON.
• Court: U.S. Court of Appeals — Eighth Circuit

18 F.2d 200 (1927)

REISS v. REARDON.

No. 299, Original.

Circuit Court of Appeals, Eighth Circuit.

March 22, 1927.

Irl B. Rosenblum, of St. Louis, Mo. (Louis Mayer, of St. Louis, Mo., on the brief), for petitioner.

Jacob M. Lashly, of St. Louis, Mo. (Robert A. Holland, Jr., and M. P. Phillips, both of St. Louis, Mo., on the brief), for respondent.

Before STONE and VAN VALKENBURGH, Circuit Judges, and TRIEBER, District Judge.

TRIEBER, District Judge.

This is a petition to revise an order made by the referee after a hearing, directing the petitioner to pay to the trustee a large sum of money found to be in the possession of the petitioner and being a part of the assets of the bankrupt estate. Upon a petition for review the order was by the District Court sustained.

The only ground upon which it is sought to have the petition to revise granted is that there is no evidence whatever to justify the order made, and that the undisputed evidence clearly establishes that the petitioner did not have either the goods claimed to have been concealed by him or the proceeds thereof. It is also claimed that the petition asked for the return of the goods, and that therefore no order could be made requiring the petitioner to pay over the value of the goods.

The petition of the trustee, upon which the hearing was had, stated that the petitioner has in his possession or under his control a large amount of merchandise, consisting of men's and boys' shoes, a description of which is set out, or, if sold, the proceeds thereof, of the value of $28,245, and the prayer of the petition is that he be required to turn over and deliver forthwith the property above mentioned, or the proceeds thereof, amounting to the said sum of money. The response of the bankrupt was that all the merchandise he received during his conduct of his business was sold by him in the regular course of business; that he has not in his possession, in his custody, or under his control any of the proceeds of said merchandise.

The finding of the referee was that "the petitioner has in his possession or under his control the sum of $27,345, in money which constitutes the assets of his estate in bankruptcy, and he is directed to turn that sum over to the trustee." The referee filed an elaborate memorandum or opinion, in which he states that he finds that the bankrupt sold the shoes which he purchased, except those remaining on hand at the time of his bankruptcy, and deposited the proceeds in his bank account at the Franklin Bank, in St. Louis; that from June 2, 1924, to August 25, 1924, he withdrew by checks upon the Franklin Bank for his personal use sums aggregating $30,745. This money the bankrupt testified he expended in gambling, in going out with women, and in purchasing a certain lot and land in Oklahoma. He testified to that effect, and also introduced a number of witnesses, most of them rather disreputable, some of whom claimed that they gambled with the petitioner, and saw him gamble at different places, and that he lost large sums of money.

The referee held that the presumption arising from the evidence that this large shortage, the money drawn out, a very small part of which was applied to the payment of his debts, is still in his possession or under his control, was not overcome by that testimony. In other words, he did not consider the witnesses entitled to any credibility. Of course, it was impossible for the trustee to introduce proof that the bankrupt did not lose the money gambling, or squandered it in riotous living.

He also claimed that he had bought from his friend and associate, Morris S'Renco, a certain lot in a small town and 20 acres of land in Oklahoma for $4,625. He testified that he had never seen the lot or the land, knew nothing of it, made no inquiries, but accepted the word of his friend that it was valuable oil land; but as a matter of fact it was not oil land, nor was it within proximity of any lands on which oil had been discovered. S'Renco testified that this land consisted of one lot, for which S'Renco had paid $1,500, and 20 acres, for which he had paid $2,500, and that the payments were made in cash. Morris Kessler corroborated the testimony of S'Renco.

Abraham Goldstein testified he owned a one-third interest in the 20 acres of land, which were sold to S'Renco by Morris Kessler, and that he received for his one-third interest $80 or $90, and that he considered $80 a fair valuation of his one-third interest. Kessler, another witness testified that he had joined in the deeds for the lot in Owassa, and the 20 acres sold to S'Renco by Morris Kessler; he never received anything for his interest; that he had never seen S'Renco; had no business connection with Morris Kessler who was his brother-in-law and also his cousin by marriage. It was also shown in evidence that no such sums of money were deposited in the bank in which Morris Kessler kept an account; that Kessler had a safety deposit box at the First National...