IN BE .TAMES B. NICHOLS.
843
CHOATE, J. This is an application to compel the bankrupt to execute necessary instruments to enable the assignee to make available, as assets of the bankrupt's estate, a seat in the New York Stock Exchange held by the bankrupt at the time of the filing of his petition. More than three years before this motion was made the bahkrupt was discharged. He has now appeared by counsel, and takes the objection that since his discharge he is not subject to the summary jurisdiction of the court, nor can be compelled by an order in the bankruptcy proceeding to execute writings or instruments to enable the assignee to demand, recover and receive the property assigned. He also claims that in this case it was determined by the court that the seat in the stock exchange was not property to which the assignee is entitled. This decision is claimed to have been made in passing on the application of the bankrupt for his discharge. An examination of the record, however, shows that the specifications of the opposing creditors were for wilfully and fraudulently omitting this item from his schedule, wilfnlly swearing falsely to the truth of the affidavit annexed to the schedule which omitted, this asset, and wilfully swearing falsely in his examination that he had no other property than that named fu the schedule. It is evident that the overruling of these specifications as not proved, and the granting of the discharge, were not a determination of the question whether or not the seat was an asset of the estate in bankruptcy. The charges were of willful and concealment, and wilfully false swearing. And it is clear that, to find these charges proved, the court must have been satisfied that the bankrupt, knowing and believing that the seat was property to which his creditors were entitled,' intentionally omitted it from his schedule, and wilfully swore falsely about it. The objection that the question is res adjudicata must, therefore, be overruled. , The objection that the bankrupt is liable to the summary order of the court, such as is now asked for, only before his discharge, is, I think, well taken. Revised Statutes, § 5604, provides: "The bankrupt shall at all times, until his dis-
8U
FEDERAL REPORTER.
charge, be subject to the order of the court, ana shall, at the expense of the estate, execute all proper writings and ments, and do all acts required by the court, touching the assigned property or estate, and to enable the assignee to demand, recover and receive all the property and estate assigned, wherever situated. For neglect or refusal to obey any mder of the court the bankrupt may be committed and punished as for a contempt of court." This was part of section 26 in the original act. By section 14, which defined the title and powers of the assignee, it was also provided that "the debtor shall also, at the request of the assignee, and at the expense of the estate, make and execute any instruments, deeds and writings which may be proper to enable the assignee to possess himself fully of all the assets of the bankrupt." This is re-enacted in the revised statutes as section 5051. In the case of In re Dole, 11 Bl. 499, it was held that the summary power of the court to compel the bankrupt to submit to examination_under section 26 was limited to the time prior to his discharge, and that the discharge was the termination of his proceeding, so far as he is concerned. The argument is still stronger against the exercise of the summary power to compel the execution of papers after the discharge, because this part of the section contains the words "until his discharge," which seem designed to limit this very power. The provision cited above, from section 14:, does not enlarge the power of the court. The provision in section 26 is evidently intended to give a remedy for enforcing the duty imposed on the bankrupt by section 14:, which declares it to be his duty to make and execute all such necessary instruments at the request of the assignee. Construing them together as parts of a single law they are, it would seem, subject to the same limitation that the act required to be done is to be done during the pendency of the proceeding and before the discharge. The use of the word "debtor," instead of "bankrupt," in section 14:, is relied on as giving that section a more liberal construction. But I cannot see how it has any such force. After his discharge the former bankrupt is no longer a "debtor," any more than he is a "bankrupt."
IN BE SIMON MOSES.
845
Whether, in suit in equity, the assignee can now have any relief against the former bankrupt to compel his aid, if required, in realizi.ng the value of this asset, it is unnecessary to determine. Having failed to ask, within the time limited by the statute, for the summary aid of the court for the purpose, he cannot have any relief in this form. Motion denied.
IN
THE MATTER OF SIMON MOSES.
(District Oourt, S. D. New YO'l'k.
March 4,1880.)
BAIDmUPTCy-PROPERTY SUBJECT TO A.SSIGNMENT-TITLE OF TJlIRD PERSON-IN RE BEAL, 2 N. B. R. 587.-Whatever money or property
is in the possession of the bankrupt at the time of filing his petition, which be is actually using and holding as his own, passes to his assignee in bankruptcy, and he cannot set up in defence to the claim of the assignee the title of a prior assignee under a general assignment for the benefit of creditors, merely for the purpose of retaining 8uch property in his own possession.
G. A. Seixas, for creditors. F. R. Lawrence, for bankrupt. CHOATE, J. This is an application on the part of creditors of the bankrupt, by petition, to compel the bankrupt to deliver to the assignee certain moneys and property alleged to be in his possession at the time of filing his petition in ,bankrnptcy and not delivered to his assignee. The bankrupt has answered, denying that he had any such money or property; but he now objects to any further proceedings, and moves to dismiss the petition on the ground that, upon the case as stated in the petition, the assignee in bankruptcy has no title or claim to the property, but that, if the bankrupt still holds it, it belongs to his assignee under a voluntary assignment for the benefit of creditors, executed before the filing of the petition in bankruptcy. The case made by the petition is shortly this: The general assignment for the benefit of creditors was executed December 19, 1877. The petition in bankruptcy was filed June 27, 1878. At and prior to the making of the general assignment
846
the bankrupt had a large amount of money and personal property, which, with the knowledge and connivance of his voluntary assignee, and to defraud his creditors, he was permitted to use as his 'own in continuing his business. That part of his property, if any, which he did deliver to the voluntary assignee was delivered in form only, and really remained subject to the control and use of the bankrupt in his business, the assignee permitting the money to be deposited in a bank account opened in his name as assignee, and to be drawn out by or for the use of the bankrupt, and for the bankrupt's own business purposes. The bank account of the assignee was, on the case made, a mere blind for creditors. . This state of things continued till the assignee died, having rendered no account, and having to his credit, in the bank, only about $500. A new assignee has, since his death, been appointed by the court, having jurisdiction of the trust, on the application of the present petitioners. The moneys and property now alleged to be in the hands of the bankrupt are the proceeds and result of the business so carried on, or, perhaps, partly the very money which the bankrupt failed to deliver to his voluntary assignee. Upon this case I am clearly of opinion, if the facts shall be established by the evidence, that the bankrupt should be compelled to pay over and deliver the money and property to the assignee in bankruptcy. Whatever money or property is in the possession of the bankrupt at the time of filing his petition, which he is actually using and holding as his own, passes to his assignee in bankruptcy, and he cannot set up in defence to the claim of the assignee a title in a third person, merely for the purpose of holding on to it himself. If third persons have the possession this court cannot, on summary petition, order it to be delivered to the assignee. But if the bankrupt has it, it passes to the assignee, subject to the liens or rights of third persons, whatever they may be. After the assignee gets the property any third person may, by petition or suit, assert his rights in it. II the bankrupt has property which he is using as his own the court will not be curious to inquire how he came by it.
