Case ID: ad2d_228/html/0417-02.html
Source: Caselaw Access Project
Author: {"author": "", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Barry J. Leon et al., Appellants, v Hal M. Hirsch et al., Defendants, and Eric C. Kurtzman et al., Respondents.
    [643 NYS2d 420]
   Bankruptcy trustees may sue and be sued in State court, without leave of the appointing court, when the debtor represented by the trustee would have been a proper party to the action (see, 28 USC § 959; 11 USC § 323; Pereira v Phillips, 154 Misc 2d 155). However, when a trustee is sued personally for wrongful conduct involving the assets of a bankrupt estate, the Bankruptcy Court has exclusive subject matter jurisdiction (see, Maguire v Puente, 120 Misc 2d 871; Chappel v First Trust Co., 30 F Supp 765).

The causes of action that were dismissed by the Supreme Court were interposed against the defendant Eric C. Kurtzman personally or against his law firm, the defendant Kurtzman & Haspel, for wrongful acts allegedly committed while Kurtzman was a bankruptcy trustee. These causes of action are within the exclusive jurisdiction of the Bankruptcy Court which appointed Kurtzman and cannot be maintained in the Supreme Court. Mangano, P. J., Thompson, Florio and McGinity, JJ., concur.