Taylor v. Sternberg Duty v. Same
| Decision Date | 07 January 1935 |
| Docket Number | 262,Nos. 261,s. 261 |
| Citation | 97 A.L.R. 1355,79 L.Ed. 599,293 U.S. 470,55 S.Ct. 260 |
| Parties | TAYLOR v. STERNBERG. DUTY v. SAME |
| Court | U.S. Supreme Court |
Mr. W. N. Ivie, of Rogers, Ark., for petitioners.
Mr. Clinton R. Barry, of Fort Smith, Ark., for respondent.
These cases, depending upon the same facts, present the same question. On January 10, 1931, in an insolvency proceeding, Taylor was appointed by a state chancery court in Arkansas receiver of the Parks Dry Goods Company, and Duty as his attorney. On February 11th, a month later, a petition in bankruptcy against the corporation was filed in the federal District Court having jurisdiction. Two days later, the corporation was adjudicated a bankrupt. On the same day, the chancery court allowed Taylor compensation as receiver in the sum of $1,500, and Duty compensation as attorney in the sum of $500. The receiver turned over the estate to the trustee with the exception of these sums, which petitioners refused to deliver. The trustee applied for a summary order upon petitioners, directing them to turn over to him the sums thus withheld. The referee granted the trustee's application, which the District Court sitting in bankruptcy, affirmed; and this, in turn, was affirmed upon appeal by the Circuit Court of Appeals. 71 F.(2d) 157. Upon these facts, the question presented is whether the bankruptcy court had authority to compel the turnover by summary proceeding and order, or whether petitioners were adverse claimants so that a plenary action was required.
Upon adjudication in bankruptcy, an the property of the bankrupt rests in the trustee as of the date of the filing of the petition. Upon such filing, the jurisdiction of the bankruptcy court becomes paramount and exclusive; and thereafter that court's possession and control of the estate cannot be affected by proceedings in other courts, whether state or federal. Gross v. Irving Trust Co., 289 U.S. 342, 344, 53 S.Ct. 605, 77 L.Ed. 1243, 90 A.L.R. 1215; Acme Harvester Co. v. Beekman Lum. Co., 222 U.S. 300, 307, 32 S.Ct. 96, 56 L.Ed. 208; In re Diamond's Estate (C.C.A.) 259 F. 70, 73. This applies while the possession is constructive as well as when it becomes actual. Mueller v. Nugent, 184 U.S. 1, 14, 22 S.Ct. 269, 46 L.Ed. 405; Taubel-Scott-Kitzmiller Co. v. Fox, 264 U.S. 426, 432, 433, 44 S.Ct. 396, 68 L.Ed. 770; Orinoco Iron Co. v. Metzel (C.C.A.) 230 F. 40, 44, 45, and cases cited.
The status of a receiver is unlike, for example, that of an assignee for the benefit of creditors. The receiver is an officer of the court which appoints him. Stuart v. Boulware, 133 U.S. 78, 81, 10 S.Ct. 242, 33 L.Ed. 568. The property in his hands is not, in a legal sense, in his possession. It is in the possession of the court, whose appointee he is, by him as its officer. Thompson v. Phenix Ins. Co., 136 U.S. 287, 297, 10 S.Ct. 1019, 34 L.Ed. 408; Fosdick v. Schall, 99 U.S. 235, 251, 25 L.Ed. 339. In the present case, with the supervening bankruptcy, the possession of the state court came to an end, and that of the bankruptcy court immediately attached. This result was binding upon the state court and equally binding upon the receiver as custodian for that court. Before the petition in bankruptcy was filed, the receiver's compensation as well as that of his counsel were matters wholly within the control of the state court. Stuart v. Boulware, supra, at pages 81, 82, of 133 U.S., 10 S.Ct. 242; High on Receivers (4th Ed.) § 781. But with the filing of the petition in bankruptcy, the power of the state court in that respect ceased; and its order fixing the compensation of the receiver and his counsel was a nullity because made without jurisdiction, such jurisdiction then having passed to the bankruptcy court. Gross v. Irving Trust Co., supra.
Since the order of the state court was the sole foundation for their claims and that was void, petitioners had no more right to...
To continue reading
Request your trial
-
Caruth v. US
......6 . At the same time (April of 1978), Caruth was considering a "capital contribution" to ...This appears to be a case of first impression, and "the duty of this Court is to give effect to the intent of Congress.. Consequently, ......
-
Magnolia Petroleum Co. v. Thompson
...301 U.S. 278, 286, 57 S.Ct. 705, 81 L.Ed. 1085; Schumacher v. Beeler, 293 U.S. 367, 55 S.Ct. 230, 79 L.Ed. 433; Taylor v. Sternberg, 293 U.S. 470, 55 S.Ct. 260, 79 L.Ed. 599; First Nat. Bank v. Conway Road Estates Co., 8 Cir., 94 F.2d 736, 737; In re Prima Co., 7 Cir., 98 F. 2d 952, Upon th......
-
In re Southern Metal Products Corporation, 6049.
...51 S.Ct. 270, 75 L.Ed. 645; Gross v. Irving Trust Co., 289 U.S. 342, 53 S.Ct. 605, 77 L.Ed. 1243, 90 A.L.R. 1215; Taylor v. Sternberg, 293 U.S. 470, 55 S.Ct. 260, 79 L.Ed. 599. An examination of these cases reveals that they involve and apply to state insolvency proceedings, that is, procee......
-
Southgate Master Fund ex rel. Montgomery v. U.S., Civil Action No. 3:06-CV-2335-K.
...... close with full government approval, as it was completed around the same" time the Huarong I deals were signed but not yet closed. . \xC2"... Cinda's contractual obligations as Southgate's loan servicer and its duty to help reform China's SOEs, as mandated by the Chinese government. The ......
-
Can the battle be won? Compaq, the sham transaction doctrine, and a critique of proposals to combat the corporate tax shelter dragon.
...the laws, and the courts, are concerned with substance and realities, and formal written documents are not rigidly binding."); Gregory, 293 U.S. at 470 (disallowing the tax benefits arising from a transaction because "It]he whole undertaking, though conducted according to the terms of [the ......
-
Reframing Arbitration & Bankruptcy.
...91 U.S. 656, 662 (1875) ("[A] decree adjudging a corporation bankrupt is in the nature of a decree in rem"). (18) Taylor v. Sternberg, 293 U.S. 470, 472 (19) 28 U.S.C. [section] 157(a). (20) See Ware & Levinson, supra note 14, [section] 28(a)(3) (2017); Michelle M. Harner, The Uneasy Re......
-
Rethinking the impact of sales taxes on government procurement practices: unintended consequences or good policy?
...Doctrines in Tax Law, 43 SANTA CLARA L. REV. 699, 700 (2003). (232) 69 F.2d 809 (2d Cir. 1934), affd, 293 U.S. 465 (1935). (233) 293 U.S. at 470. (234) Id. at (235) Id. (236) Id. (237) Revenue Act of 1928, § 112(i)(1)(b) (currently I.R.C. § 368(a)(1) (1991)), discussed in Gregory, 293 U.S. ......