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d gas deposit all the heirs of Pa. 117, 17 A
C. A. 41, and Barnes v. Keys, 36 Okl. 6, 127 Pac. 261, 45 L. R. A. (N. S.) 178, Ann. Cas. 1915A, 515. See, also, as bearing upon this ques. tion: Raynolds v. Hanna (C. C.) 55 Fed. 783, 801, and cases there cited; Lacey v. Newcomb, 95 Iowa, 287, 294, 63 N. W. 704, and its citations; State v. Evans, 99 Minn. 220, 108 N. W. 958, 9 Ann. Cas. 520, and note; Appeal of Bedford, 126 Pa. 117, 17 Atl. 538. It was therefore to the interest of all the heirs of the allottee; Emma Derrisaw, that the oil and gas deposits in this homestead should be disposed of at an opportune time, and the proceeds arising therefrom invested or otherwise conserved for the support of the minor Julia during the term for which she is entitled to the use thereof, and the remainder for the benefit of all the heirs after the expiration of such term.
The fact that the oil wells had not been drilled prior to the death of Emma Derrisaw is quite immaterial; for by the lease of the adult, and the minor heirs by their guardian, under authority of the probate court, it was intended that the oil and gas deposits should be removed from the land, and the lease authorized the sinking of requisite wells, in order that such deposits might be removed and the proceeds conserved, as before stated.
As to the minor defendant, Tootie Riley, and the defendant Doc Willingham, it appears that Tootie Riley was born prior to March 4, 1906, but whether before or after September 1, 1902, does not definitely appear; but, whether before or after that date, she was entitled to enrollment as a member of the Creek Nation, and to participate in the allotment and distribution of its lands and funds under the acts of April 26, 1906 (34 Stat. c. 1876, p. 148), and June 21, 1906 (34 Stat. c. 3504, pp. 325, 341), amending the act of 1902, as held in the case of Gritts v. Secretary of the Interior, 224 U. S. 640, 32 Sup. Ct. 580, 56 L. Ed. 928. Doc Willingham married Emma Derrisaw in July, 1905, and the minor Julia is the issue of that marriage, born February 11, 1907. Veither the minor Tootie Riley nor Doc Willingham is therefore entitled to anything under the act of May 27, 1908, except as they may inherit from the allottee Emma Derrisaw, and as such heirs their rights are subject to the right of the minor Julia Willingham in this homestead; and it seems to me that the purpose of section 9 of that act is to enable minor children born since March 4, 1906, to have the use of the homestead of their parents dying intestate for the term granted by that section, and it should be given a liberal construction to effectuate that purpose.
Whether or not the provisions of section 6 of the act of May 27, 1908, which confers upon the probate courts of Oklahoma jurisdiction of the persons and property of these minors, deprives the Secretary of the Interior of the right to remove restrictions against alienation of the property of such minors after their rights become vested, is a question not raised in the trial court, has not been discussed here, and need not be considered.
The record fails to show what amount of the royalties arising from the lease in question will be sufficient for the reasonable support of the minor Julia during the term for which she is entitled to such use; the cause should be remanded to the District Court, to ascertain the reason
able value of such support, and to provide for its payment to her out of the royalties now in the custody of the superintendent or disbursing agency of the Five Civilized Tribes, or that it may hereafter receive for such royalties, before the remainder of such fund is distributed to the legal heirs of Emma Derrisaw.
In re MIDTOWN CONTRACTING CO.
1. BANKRUPTCY Om 293(1)—JURISDICTION OF COURTS OF BANKRUPTCY-ADVERSE CLAIMS.
Bankr. Act July 1, 1898, c. 541, § 23a, 30 Stat. 552 (Comp. St. 1916, $ 9607), provides that United States Circuit Courts shall have jurisdiction of all controversies at law and in equity, as distinguished from proceedings in bankruptcy, between trustees and adverse claimants concerning property acquired or claimed by the trustees, to the saine extent only as though such controversies had been between the bankrupts and such adverse claimants. Subdivision “b” provides that suits by the trustee shall only be brought or prosecuted in the courts where the bankrupt might have brought or prosecuted them, if proceedings in bankruptcy had not been instituted, unless by consent of the proposed defendant. Held that, if a real adverse claim exists, as distinguished from one merely colorable, the claimant cannot be compelled against his will to try the issue in the bankruptcy court, and whether the claim is real or colorable does not depend upon whether it turns upon a question of fact or one of law, but on whether the claim rests upon mere pretense of fact or law, not put forward in good faith, and if there is a real question, either of law or fact, the trustee must institute his independent action in a court having jurisdiction of the subject-matter.
[Ed. Note.-For other cases, see Bankruptcy, Cent, Dig. 8 411.) BANKRUPTCY 288(1)_SUMMARY PROCEEDINGS-NATURE OF CLAIM.
A contract for the construction of a school building authorized the board of education, upon the contractor's default, to stop all work by the contractor and complete the contract itself, and in such case to use all equipment and materials found upon the work. Held that, where the board had declared the contractor in default and taken possession of his plant and building material before a petition in bankruptcy was filed, its claim to such material and plant involved a substantial question of law, which could not be determined in a summary proceeding, except with the board's consent.
[Ed. Note. For other cases, see Bankruptcy, Cent. Dig. $ 447.]
Petition to Revise Order of the District Court of the United States for the Southern District of New York.
In the matter of the Midtown Contracting Company, bankrupt. On petition to revise an order (238 Fed. 871) reversing an order of the referee denying a petition of the trustee for a summary order requiring the Board of Education of the City of New York to deliver certain property to him. Reversed, and trustee's motion denied.
For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes
Lamar Hardy, Corp. Counsel, of New York City (R. Percy Chittenden and Joseph L. Pascal, both of New York City, of counsel), for petitioner. . Olcott, Gruber, Bonynge & McManus, of New York City (David W. Kahn, of New York City, of counsel), for trustee.
Before WARD, ROGERS, and HOUGH, Circuit Judges.
ROGERS, Circuit Judge. The petitioner claims to be entitled to use certain building material and equipment brought by the bankrupt upon the grounds of the Evander Childs High School, in the borough of the Bronx, in the city of New York, for the completion of the high school under a certain contract for the construction of the building entered into between the petitioner and the bankrupt, dated October 13, 1914. The contract provided that the contractor should furnish all the labor and material necessary for the erection of the building for the sum of $414,141.00 to be paid in certain installments. Pavments under the contract have been made to the amount of $275,721.39.
It appears that before the work called for by the contract was completed the contractor found itself in financial difficulties and did not prosecute the work. Thereupon in July, 1916, the superintendent of school buildings certified to the committee on school buildings of the board of education that the performance of the work under the contract was unnecessarily and unreasonably delayed, and that the contractor was willfully violating the conditions and covenants of the contract, and that the work was not being done or progressing according to the terms of the contract. And on the 9th day of August, 1916, the committee on school buildings passed resolutions declaring the contractor to be in default, and notified the contractor to discontinue all work under this contract, and that it would proceed to complete the building under the provisions of clause Q of the contract.
A written notice to the foregoing effect, signed by the chairman of the committee on school buildings, was served upon the contractor on the 11th day of August, 1916, on which day the board of education of the city of New York took possession of the building material and plant on the grounds of the Evander Childs High School, which had been brought there by the contractor, and it placed watchmen to take care of the uncompleted building and of the building material and plant on the grounds. Thereafter the board relet the contract for the completion of the Evander Childs High School to Conners Bros. Company, by which contract the board gave to Conners Bros. Company the right to use the building material and plant of the Midtown Contracting Company upon the line of the work in the completion of the building.
Clause Q of the contract contained the following provision: * * * * If at any time the superintendent of school buildings shall be of the opinion, and shall so certify in writing to the committee on buildings, that the performance of the contract is unnecessarily or unreasonably delayed, or that the contractor is willfully violating any of the conditions or covenants of this contract, t * * the committee on buildings shall notify the contractor to discontinue all work or any part thereof, under this contract, * * * and thereupon the contractor shall discontinue the work or such part thereof, and the board of education shall thereupon have the power to contract for the completion of the contract in the manner prescribed by law, or to place such and so many persons as it may deem advisable, by contract or otherwise, to work at and complete the work herein described, or such part thereof, and to use such materials as he may find upon the line of the work, and to procure other materials for the completion, so as to fully execute the same in every respect, and the cost and expenses thereof at the reasonable market rates shall be a charge against the contractor, who shall pay to the party of the first part the excess thereof, if any, over and above the unpaid balance of the amount to be paid under this contract; and the contractor shall have no claim or demand to such unpaid balance, or by reason of the nonpayment thereof to him, and shall forfeit all claim to any moneys retained ; and no molds, models, centers, scaffolding, planks, horses, derricks, tackle, implements, power plants, or building material of any kind belonging to or used by the contractor shall be removed so long as the same may be wanted for the work.”
On the 15th day of August, 1916, or six days after the board of education had declared the Midtown Contracting Company to be in default, and after the board had taken possession of the building material and plant of the contractor upon the line of the work under clause of the contract, an involuntary petition in bankruptcy was filed, and on the 7th day of September, 1916, the contractor was adjudged a bankrupt. The trustee of the bankrupt on December 9, 1916, made a motion before the referee in bankruptcy for an order requiring the department of education to turn over to the trustee all of the building material and equipment brought on the ground of the high school by the bankrupt for use in the construction of the building under the contract, and declaring that the claim of title thereto set up by the department of education was colorable and void as against the trustee.
The attorneys for the trustee contended before the referee that the above provision of the contract, whereby the contractor gave to the board of education of the city of New York the right to use its materials and plant upon the line of the work to complete the building in case the contractor defaulted, was invalid as against the trustee of the bankrupt contractor; and the attorney for the city of New York asserted that a question of fact was involved, and denied that the referee was without jurisdiction to pass upon the issues raised by the opposing affidavits. On the record, the assets in controversy appear to have been purchased from unspecified materialmen and to have been brought on the ground by the contracting company after the date of the contract, and at all times thereafter to have been owned by the contractor. The record also discloses that possession of the assets was taken by the department of education before the filing of the petition in bankruptcy.
The referee denied the petition of the trustee for the summary order requested, stated that he was satisfied that the controversy was one in which the parties should be remitted to a plenary action, and that he was without authority to grant a summary order. The District Judge has reversed the referee, and held that the trustee is entitled to the summary order asked for by him. Judge Mayer in his opinion declares that there is no dispute of fact between the parties, and adds, whether or not a summary order is the proper relief depends solely upon whether the question involved is one of fact or one of law.
It is not disputed that, at the time the board of education took possession of the property involved herein, the bankruptcy proceedings had not been instituted. With this fact conceded, we are led to inquire as to the effect of the appointment of the trustee in bankruptcy upon the rights of the board of education in this property. The property being of a tangible nature and in possession of the city of New York, which claims a beneficial interest therein, can the city be compelled by the trustee to have its rights adjudicated in a summary proceeding in a court of bankruptcy, or is the city entitled to be heard in a plenary action?
Section 23 of the Bankruptcy Act reads as follows: “Sec. 23. a. The United States Circuit Courts shall have jurisdiction of all controversies at law and in equity, as distinguished from proceedings in bankruptcy, between trustees as such and adverse claimants concerning the property acquired or claimed by the trustees, in the same manner and to the same extent only as though bankruptcy proceedings had not been instituted and such controversies had been between the bankrupts and such adverse claimants.
"b. Suits by the trustee shall only be brought or prosecuted in the courts where the bankrupt, whose estate is being administered by such trustee, might have brought or prosecuted them if proceedings in bankruptcy had not been instituted, unless by consent of the proposed defendant, except suits for the recovery of property under section sixty, subdivision b; section sixty-seven, subdivision e; and section seventy, subdivision e. * * *"
U. S. Compiled Statutes (1916) Ann, volume 9, § 9607.
The exceptions under clause "b" do not now concern us, and they relate to certain cases over which the federal and state courts are given a concurrent jurisdiction. The Supreme Court repeatedly held under the Bankruptcy Act of 1867 (Act March 2, 1867, c. 176, 14 Stat. 517) that the right of an assignee in bankruptcy to assert a title in property transferred by the bankrupt before the bankruptcy to a third person who thereafter claimed to hold it adversely to the assignee could only be enforced by a plenary suit at law or in equity under the second section of the act, and not by summary proceedings under the first section thereof. Smith v. Mason, 14 Wall. 419, 20 L. Ed. 748 (1871); Marshall v. Knox, 16 Wall. 551, 557, 21 L. Ed. 481 (1872); Eyster v. Gaff, 91 U. S. 521, 525, 23 L. Ed. 403 (1875). In the case last cited the court, speaking through Mr. Justice Miller, said:
"The opinion seems to have been quite prevalent in many quarters at one time, that, the moment a man is declared bankrupt, the District Court which has so adjudged draws to itself by that act not only all control of the bankrupt's property and credits, but that no one can litigate with the assignee contested rights in any other court, except in so far as the Circuit Courts hare concurrent jurisdiction, and that other courts can proceed no further in suits of which they had at that time full cognizance; and it was a prevalent practice to bring any person, who contested with the assignee any matter growing out of disputed rights of property or of contracts, into the bankrupt court by the service of a rule to show cause, and to dispose of their rights in a summary way. This court has steadily set its face against this view. The debtor of a bankrupt, or the man who contests the right to real or personal property with him, loses none of those rights by the bankruptcy of his adversary. The same courts remain open to him in such contests, and the statute has not divested those courts of jurisdiction in such actions. If it has for certain classes of actions conferred a jurisdiction for the benefit