Witters v. Sowles

• Decision Date: 05 October 1887
• Citation: 32 F. 762
• Parties: WITTERS v. SOWLES and others.
• Court: U.S. District Court — District of Vermont

32 F. 762

WITTERS v. SOWLES and others.

United States Circuit Court, D. Vermont.

October 5, 1887

Chester W. Witters and Albert P. Cross, for orator.

Willard Farrington and Henry A. Burt. for defendants.

WHEELER J.

The orator is receiver of the First National Bank of St. Albans and the defendants Lewis and Leach are assignees of the estate of the defendant Sowles in bankruptcy. This bill is brought to confirm the title of the orator as receiver to notes and evidences of debt of the face value, on the twenty-ninth day of December, 1883, of about $9,800, and to 255 shares of the capital stock of the National Union Bank of Swanton, and to a contract of the face value of $890, called the Wright contract,-- all of which formerly belonged to defendant Sowles, and are claimed by the other defendants as his assignees. They have filed a cross-bill, praying that these securities, or the proceeds of the securities, may be decreed to them. The facts in respect to the insolvency of Sowles, his knowledge of it, the cause which the officers of the bank had to believe it, and the commencement and prosecution of proceedings in insolvency against him, are as stated in the other case between the same parties. According to the testimony, on the twenty-ninth of December, 1883, he got those securities together, and computed their value with a view to using them in payment or security of his indebtedness to the bank. On the twenty-first day of January 1884, he went to the National Union Bank of Swanton, and transferred his stock in that bank to the First National Bank of St. Albans. On or about the twenty-fifth day of that January he discharged $10,000 of his paper held by the First National Bank of St. Albans, and placed those notes and evidences of debt among the assets of the bank, as the property of the bank, and treated them as bonds, and that item on the books of the bank was increased that amount. On the second day of February, 1884, he discharged $10,000 more of his paper, held by the bank, and put certificates of 255 shares of the stock of the National Union Bank of Swanton among the assets of the bank as its property, and treated them as bonds, and that item was further increased that amount on the books of the bank. The transfer of the bank stock was made by advice of the national bank examiner. These transactions were had without the knowledge of any of the officers or agents of the bank.

The Wright contract was put with the rest, in the latter part of March, and all were found among the assets of the bank when possession was taken by the officers of the government resulting in this receivership. The petition of May 31, 1884 was presented to the judge of the court of insolvency, asking that the prior petition be proceeded with. There was not reservation of any control over it, but it was left to be proceeded with by the judge in due course, according to his judicial discretion and judgment, and it was filed to be proceeded with accordingly. The delay upon that was the delay of the court. The adjudication of insolvency was made upon the first petition so taken up, and carried along by that. When that petition was presented, there was an active application made to the court, and, when it was so taken into the files of the court to be proceeded with, it was filed within the meaning of that part of the statute of the state relating to insolvency which avoids preferences made within four months of the filing of the petition. Rev. Laws Vt. Sec. 1760.

These conveyances, transfers, or payments were made upon good consideration, to secure or satisfy just debts, and were honest, proper, and lawful at common law, and...