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Frost v. Hotchkiss

1 Abb. N. Cas. 27 Court N. Y. Supreme Court, Second District, Special Term, English

Delivered by Barnard, J.

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p. 27
FROST v. HOTCHKISS.
N. Y. Supreme Court, Second District, Special Term,
June, 1876.

Headnote

Jurisdiction on State Courts.—Bankruptcy.
Under the Bevised Statutes of the United States, the Supreme Court of Hew York has no jurisdiction of an action by an assignee or trustee in bankruptcy to recover property alleged to have been conveyed by the bankrupt, in fraud of his creditors.
Demurrer to complaint.
p. 28
Jonathan B. Frost, trustee in bankruptcy of Elias Hotchkiss, brought this action against Elias Hotchkiss and Mary L. Hotchkiss, his wife.
The plaintiff described himself in the title of the cause and the complaint as trustee of the estate of Elias Hotchkiss in bankruptcy, and in that capacity he claimed to be entitled to recover real estate in Westchester County, which, he alleged, was conveyed by the defendant, Elias Hotchkiss, to his wife, the defendant Mary L. Hotchkiss, in fraud of creditors.
The plaintiff, in his complaint, deduced his title to the property through and under a judgment of the district court of the United States, for the southern district of New York, declaring Mr. Hotchkiss a bankrupt. After setting up this judgment, the complaint stated that at a meeting of the creditors of said Eliza Hotchkiss, called under and in pursuance of said (bankruptcy) act, the plaintiff was duly chosen trustee of the estate of the said bankrupt, to whom all of the estate, property, rights, and things in action of the said bankrupt were assigned, and who as such trustee (that is, as trustee chosen at a meeting of creditors), became and was vested with the title thereto, and with a right to the possession of, and to sue for and recover the same.
The action was commenced in April, 1874.
The plaintiff’s proceedings were stayed for some time under an order by the court, pursuant to section 817 of the Code, requiring the plaintiff to give security for costs, in the sum of one thousand five hundred dol lars.
During the continuance of the stay, the revised statutes of the United States came into force.
Afterwards, in July 28, 1874, the defendants served a demurrer to the complaint, in which they claimed that the court had no jurisdiction, and that the plain tiff did not show faces sufficient to constitute a cause
p. 29
of action, inasmuch as he did not show that the title to the property had vested in him.
F. N. Bangs, for defendants.
I. The complaint does not show that title has vested in the plaintiff under section 43 of the Bankruptcy Act of 1867; title does not vest until certain resolutions have been passed by creditors, and approved by the court: nor until the choice of trustee and committee has been approved by the court: nor until the debtor has executed a deed to the trustee. The mere statement that the plaintiff has been chosen trustee does not show title in him (Wright v. Johnson, 8 Blatchf. 150 ; U. S. R. S. §§ 5046, 5103).
II. This court has no jurisdiction (U. S. R. S. see § 717; Martin v. Hunter’s Lessee, 1 Wheat. 304 , 337; The Moses Taylor, 4 Wall. 411 ; Exp. McCardle, 7 Id. 506 ; Curtis v. Leavitt, 15 N. Y. 9 ; Town of Danville v. Pace, 25 Gratt. 1 ).
Elliott F. Shepard, for plaintiffs.

I think the revised statutes of the United States take away the jurisdiction of the State court in the action, although passed after the action was commenced. Judgment for defendant on demurrer, without costs.[1]

* The act of 1867 did not have this effect. Claflin v. Houseman. U. S. Supreme Ct. Oct. 1876.

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