Tapp v. Tapp's Trustee

• Decision Date: 06 February 1945
• Citation: 299 Ky. 345,185 S.W.2d 534
• Parties: TAPP et al. v. TAPP'S TRUSTEE.
• Court: Kentucky Court of Appeals

185 S.W.2d 534

299 Ky. 345

TAPP et al. v. TAPP'S TRUSTEE.

Court of Appeals of Kentucky

February 6, 1945

Appeal from Circuit Court, Clark County; Wm. J. Baxter, Judge.

Consolidated actions by H. M. Kessler, trustee in bankruptcy, against James Prewitt Tapp, bankrupt, James M. Tapp, and others, to set aside preferential mortgages and a deed. From a judgment requiring preferential payments to be turned over to plaintiff for administration in the bankruptcy court and allowing interest on the amounts recovered from the time of the filing of the action, defendants James M. Tapp and others appeal.

Affirmed.

M. C. Redwine and Harvey T. Lisle, both of Winchester, for appellants.

R. R Craft, of Winchester, for appellee.

VAN SANT, Commissioner.

The opinion on the first appeal is reported in Kessler v Tapp, 297 Ky. 607, 180 S.W.2d 552. Therein we held that the property rleased from preferential mortgage by a State court under State law becomes property of the bankrupt who attempted to place it in lien, so as to entitle the bankrupt's trustee to administer the property in the bankruptcy court. The property in question is real estate which was sold at public auction prior to the filing of this action by the trustee, and was purchased by one of the creditors preferred in the mortgage executed previous to the sale. In the judgment originally appealed from, the Court refused to set aside the deed executed in pursuance of the sale at public auction, but substituted the proceeds of sale for the property. No objection was made to the substitution by any of the parties interested. Since the proceeds of the sale previously had been distributed to the creditors of the bankrupt preferred by the mortgage, the opinion on the first appeal directed the Court to enter judgment requiring the preferential payments to be turned over to the trustee to be administered in the bankruptcy court. The mandate was filed the Court entered judgment in accordance with this direction and allowed interest on the amounts recovered from the time of the filing of the original action by the trustee. It now is contended that the Court did not have authority to allow judgment against appellants, who received a portion of the proceeds of the sale.

This argument was made on the first appeal, and was decided adversely to appellants' contention. We are of that opinion still, even if it were not controlled by the rule of the law of the case...