Bilder v. Ellis

ciency could only be served if the supplemental complaint was intended to supersede the original complaint (Stearns v. Lichtenstein, 48 App. Div. 498 , 62 N. Y. Supp. 949 ; Sayer v. Beirne, 78 App. Div. 491 , 79 N. Y. Supp. 696 ), and is not authorized where the supplemental complaint merely alleges additional facts to those which have been alleged in the original complaint for the purpose of supplementing that complaint, and a demurrer to such supplemental complaint raises no issue (Haywood v. Hood, 44 Hun, 128 ; Harris v. Elliott, 29 App. Div. 568 , 51 N. Y. Supp. 1012 ; Latimer v. McKinnon, 85 App. Div. 224 -228, 83 N. Y. Supp. 315 ). The plaintiff had attempted by a reference thereto to embody in his supplemental complaint certain of the allegations of the original complaint. This was unnecessary, as the original complaint stands in its entirety, and these allegations will be treated as surplusage. Their existence, however, affords some justification for the defendant’s construing the supplemental complaint as one intended to be served in lieu of the original. The situation presented, therefore, by the pleadings is that there is an original complaint and answer thereto, by which triable issues are raised, and a supplemental complaint alleging as additional facts proceedings in bankruptcy in the United States District Court for the District of New Jersey, in which it is claimed that the very matters in controversy were determined in plaintiff’s favor and against the defendant, in which proceedings the defendant was fully heard, to which supplemental complaint defendant has not answered.

The sole question to be determined is, Is the order of the referee in bankruptcy in itself a judgment or decree of a competent court determining the matters in controversy? The defendant contends that, as this proceeding is statutory, it is necessary to allege the facts showing the compliance with the statute. This might be true if the proceeding were one brought against a third person to recover property held adversely under a claim of right, or because of a lien thereon, under section 23 of the Bankruptcv act (Act July 1, 1898, c. 541, 30 Stat. 552 [U. S. Comp. St. 1901, p. 3431]). The proceeding which resulted in the order set forth in the supplemental complaint, however, is to compel an officer of the bankrupt to turn over assets of the bankrupt to the trustee. The jurisdiction over the bankrupt corporation and its officers was obtained by the District Court upon the filing of the petition. Upon the adjudication of bankruptcy and the appointment of the trustee, he became vested with the title to the assets of the bankrupt. All the facts necessary to show jurisdiction in the District Court were set forth in the original complaint, and admitted by the answer thereto. According to the bankruptcy act and the general orders in bankruptcy, all subsequent proceedings with respect to the bankrupt’s property are heard and determined by the referee, subject only to review on petition therefor by the court. Unless a petition for a review is filed, the order of 'the referee is final, and determines the matters litigated without further order of the court. Mueller v. Nugent, 148 U. S. 1 , 22 Sup. Ct. 269 , 46 L. Ed. 405 . Compare Louisville Trust Co. v. Comingor, 148 U. S. 18 , 22 Sup. Ct. 293 , 46 L. Ed. 413 . In so far, therefore, as the matter tried and determined before the referee was the same as that set forth in the original complaint, it was a final determination of the matters in controversy in this action by a competent court. In addition to those matters, the referee found that said Ellis and Graves were indebted to the bankrupt corporation for the sum of $23,456.27, received as such officers for and in behalf of said corporation “from other sources,” and the plaintiff seeks to recover in this action this sum in addition to the $371,674.50. This would appear to be an independent cause of action not set forth in the original complaint, and must be recovered in a separate action. Motion for judgment on the pleadings granted, with $10 costs. Judgment for $371,674.50, with interest thereon from the 4th day of August, 1904, and costs of the action.

W. Bernard Vause, for appellant.

Julius Henry Cohen, for respondent.