GILBERT V. QUIMBY.
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ture as well as present laws and expenses, so far as they are germane to the office; and, moreover, the condition is general to account as such disbursing agent, which is an undertaking to account as such public agents are by law required to account. The defendants took no exceptions to the rulings of the district judge, but it was necessary to consider We po"nts which I have decided, not only because it comes within the exceptions of the plaintiff, but because, if upon the admitted facts the bond was void, the judge was right in or<:1ering a verdict for the defendants. I do not find it necessary to decide whether any case is made by the declaration, became that may be nor whether a part of the transcripts from the treasury department was not properly verified, because, before the next trial, a further verification may be obtained. So far, however, as the defendants' objection is that the collector was only bound to pay the expenses of his district at some time, before or after he had left office, and that the bond does not require him to pay anything to the United States under any circumstances, I ought to say that, in my opinion, the condition to account and pay over obliges him to pay the expenses while he holds office, and that, when he retires, he must pay the balance in his hands to his successor, or to Bome other officer duly authorized by the United States to receive it. Upon the broad ground which I have been considering the order must be for a venire de novu.
GILBERT
v.
QUIMBY
and others. January 20, 1880.)
(Circuit Court, S. D. New York. BANKRUPTCy-ATTACHMENT OF
HELmF.-A bill in equity will not lie in favor of a partnership creditor, to restrain the application of a dividend in the ha.nds of an assignee in bankruptcy to the debt of an individual creditor, where both of the crerlilors have sUlh dividend under process issued by a state court.
112
FEDERAL REPORTER.
WHEELER, J. One Alden J. Adams and the defendant Union Adams were partners, and the defendant Lynch had a partnership debt against them. The interest of Alden Adams in the partnership assets was transferred to Union Adams, for which the latter became indebted to the former in the sum of $6,000. Union Adams became insolvent, and assigned.,hHI property to the defendant Woolton, for the benefit of his creditors. Afterwards he was adjudged a bankrupt and the defendant Mitchell became his assignee in bankruptcy, 9.nd as such re:3overed the property. Lynch assigned his debt against Union Adams to the defendant Quimby, and both the latter and Alden Adams proved their claims against the estate of Union Adams in bankruptcy. Quimby has received a dividend upon his claim, and Union Adams has received a discharge. A dividend to Alden Adams upon his claim has been ordered and is still in the hands of the assignee. Quimby commenced suit in his own name, under the laws of New York, in the courts of New York, against Alden Adams, recovered judgment therein, took out execution on the judgment and placed it in the hands of the defendant Carpenter, who is sheriff of Westchester county, and of the defendant Connor, sheriff of New York county, who have claimed to attach thereon the dividend of Alden Adams in the hands of Mitchell, assignee. The orator has proceeded in the same manner with his debt against Alden Adams, but the attachment in his case is subsequent to Quimby's. He claims that he is an individual creditor of Alden Adams, and that as such he is entitled to have his debt satisfied out of the individual property of the debtor in preference to Quimby, who is a partnership creditor, and has brought this bill to have application of the dividend to Quimby's debt restrained, and application of it to his debt decreed. The defendant Quimby insists that the dividend represents AldenAdams' share in the partnership assets, as to which the orator is not entitled to any priority; that he is entitled to precedence because of the priority of his attachment; and that the fund is not so before this court that it
113
,an be marshalled here. The orator urges against the defendant's claim of priority of attachment that no attachment of the dividend in the hauds of the assignee, au process out of the state court, could be made. 'rhat the dividend was not attachable on process from the state courts would seem to be quite clear. While in the hands of the assignee it would be a part of the estate of the bankrupt in the custody of the court. It would not be held the property of the debtpr, but would only be property that would become his when he should get it. He could not maintain any suit against the assignee for it, nor obtain it by any legal proC':lss other than by application to the district court having control of the fund as a party to the proceedings in that court. Money in the hands of a disbursing officer of the United States, due to a private person, cannot be attached on process against such person out of a state court, because the money will not be his, but will remain the property of the United States until it is paid to him. Buchanan v. Alexander, 4 How. 20. Neither can any fund be so attached that it is so situated that the debtor in the process is not entitled to sue for and recover it. McLaughlin v. Sloann, 18 How. 217; GeLSsett v. G1'oUt, 4 Met. 486-488. These reasons are applicable to a dividend in the hands of an assignee. Colby v. Coates, 6 Cush. 558; Cappel v. Smith, 47 R. 312, anJ Grant v. Harding, in note; In re Bridgman, 2 Nat. Bank Reg. 252. The order of the district court would be that the dividend be paid to Alden Adams, and there would not appear to be any tenable ground on which any other court or officer could order it paid to anyone else, or order that payment to another should be payment to him, or answer the effect,of the order. And if the attacl{ments were both wholly inoperative, as the orator claims and it seems they are, there is no ground left for making the plaintiff in the first attachment or the attaching officers parties here. Payment of the dividend to them by the assignee on such would be no more than payment to them or anyone else without process, and he :would remain subject to the order to pay to Alden Adams the sallie v.1,no.3-8
114
as before, and no interposition through this court would make his liability any greater or different. And if the process of the state court would have any validity or effect in attaching the dividend, there is another reason why they should not be proceeded against in this manner here. The U. S. Rev. St. § 720, provide that writs of injunction shall not be granted by any United States courts to restrain proceedings of a state court, except where authorized by law relating to proceedings in bankruptcy. The express authority to restrain such proceedings in the bankrupt law extends only to suits against the bankrupt himself. U. S. Rev. St. § 5106. The implied authority would extend only to proceedings to realize the assets and bring them into the custody of the bankruptcy court. ld. § 4972. This dividend is a part of the bankrupt estate of Union Adams, but this suit has no reference to it as such, but only as a part of the property of Alden Adams. Peck v. Jennes, 7 How. 612. It is argued for the orator that the jurisdiction given to the circuit c0"!1rt in bankruptcy matters warrants proceeding in this manner against this fund. This jurisdiction is given by sections 4979 and 4986, Rev. St. The provisions of the former section evidently relate to actions for the recovery, defence or ascei-tainment of the estate of the bankrupt for his creditors. Lathrop v. Drake, 91 U. S. 516; Burbank v. Bigelow, 92 U. S. 179; and those of the latter section to the review of decisions upon questions that have arisen in the course of the proceedings in the district court. In re Alexander, 3 Nat. Bank Reg. 6, and 8 Am. Law Reg. 423; \ Morgan v. Thornhill, 11 Wall. 65. This is not a case of either class, as is apparent from the reasons before staten, and this court has not any fund as such before it, or in custody, as it would have if it were administering upon the bankrupt estate, nor on account of any other proceedings of its own, as the court in Burbank v. BigeloUJ had, by the appointment of a receIver. Still the parties are residents of different states, and the amount in controversy is more than $500, so that this court has jurisdiction of the parties and of the c:Ll1se of action, if
115
there is any ground of relief. It is doubtless true that, by the law of New York, where this partnership was and these transactions took place, individual creditors have a preference as to individual property over firm creJitors, (3 Kent Comm. 64; Murray v. Murray, 5 John. Cll. 60,) although the law may be different in some other places. Bardwell v. Perry, 19 Vt. 292. But whether the orator has such paramount lien or not, does not seem to be very material to the decision here, for the defendants are not asserting any lien that the orator is bound to take notice of, 01' that can affect his rights in any degree, aceording to his own argument. If the defendants were about to dispose of individual property by creating a lien upon it, which would be good but for the orator's paramount equity, there would be occasion for him to assert his equity. Till then he has no ground to complain. The assignee holding the dividend ordered to be paid t() Alden Adams, and the creditors of Alden, are both before the court, and if there were grounds fOf it the dividend should be taken to pay his debt. He is not a party to this suit, but should be, if his property and rights are to be adjudicated upon in it. If that lack could be supplied, then the question would remain whether a court of equity could grant the relief. A bill for the purpose of appropriating the dividend to the debt would be in effect an action at law, (Wilson v. Koontz, 7 Cranch, 202;) and if the dividend not be reached at law, there is no good reason apparent why it could be by such a bill. There is no relief about the dividend which a court of equity could furnish to any party that a court of law could not. The fund is subject to the order of the district court,. and neither could interfere with that. There must be some ground for equitable relief in reaching the property of the debtor before a bill will lie in such a case. Public' Works v. Columbia College, 17 Wall. 521. There does not appear to· be a ny ground on which the bill can be sustained. Let there be a decree dismissing the bill of complaint, with costs to such defendants as have answered the biJI.
116
FEDERAL REPORTER
KnYS'l'ONE BRIDcn COMPANY
BRITTON.
(Circuit Court, 8. D. Nezo York.
January 20,1880.)
CONTRACT-RECEIPT-EVIDENCE.-Where, upon sufficient consideration, a statement is written across the face of a note by the party signing such statement, to the effect that fund; have IJeen placed in his hands, as trustee, for the payment of such note at maturity, the party so signing becomes personally liable for the payment of the note, although evidence was admissible to prove that the payee of the note knew that such signer actually had no such funds in his possession at the time he signed the statement, nor had subseqently received sulllcieut to pay the note in full at its mntur.ty.
Man et Parsons, for plaintiff. Tracy, Olmstead cf Tracy, for defendant. WHEELER, J. The orator built a bridge across the Mississippi river, at St. Louis, for the Illinois & St. Louis Bridge Company, in which the defendant was interested, and of which he was treasurer. After the bridge was completed, but while it was still in the possession of the orator, the lllinois & St. Louis Bridge Company executed its promissory note for $51,510.95, payable in ten months after date, to its own order, at the Bank of Commerce, in New York. Although the defendant at that time had not funds in his hands, as trustee or otherwise, for the payment of the note, which the orator knew, it was arranged between him and the Illinois & St. Louis Bridge Company that he sbould receive the tolls of the bridge for that purpose, which they thought would be suffi-cient to pay it, and a statement written across the face of the naL, in these words, "Funds for the payment of this note .at maturity have been placed in my hands, as trustee," was signed by the defendant to induce the orator to accept the note and deliver up the bridge. The note was indorsed by the Illinois & St. Louis Bridge Company, aLCl delivered to tht:J -orator. The note was equal in amount to the balance due the orator for building the bridge. The orator took the note .and delivered up the bridge, and the defendant received the tolls of the bridge. All tolls received by the defendant have .been applied to the payment of the note, but they were not