Case ID: f_161/html/0387-01.html
Source: Caselaw Access Project
Author: {"author": "PLATT, District Judge.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

In re HALE.
    (District Court, D. Connecticut.
    May 6, 1908.)
    No. 2,014.
    Bankruptcy — Judgment—Execution—Stay.
    A bankrupt had been agent for M. & Co. for Hie sale of coal, under an arrangement by which the bankrupt agreed to pay M. & Co. $0.20 for each ton sold; ho to retain for his services the balance received above such sum, and the title to the coal to remain in M. & C'o. until sold. The bankrupt not having accounted to M. & Co. for some of the coal, they recovered judgment against him in conversion in the state court. Held, that such judgment was a provable debt iu the bankruptcy proceedings, from which the bankrupt would be released by a discharge, and that he was therefore entitled to a stay of execution until 32 months after adjudication, or until the bankrupt's application for a discharge shall have been determined, if made within that time.
    
      In Bankruptcy. On petition for a stay of execution on a judgment of the state court. Granted.
    Frank H. Foss, for bankrupt.
    James A. Marr, for Frank Miller & Co.
   PLATT, District Judge.

The was a coal dealer in Hartford, and it appears that prior to adjudication he entered into a contract with Frank Miller & Co., of Bridgeport, to act as their agent to sell their coal. The title to the coal was to remain in said Miller & Co., and the bankrupt was to pay them $6.20 for each ton of coal which he sold and obtained pay for, retaining as commission any balance paid to him above the $6.20 per ton for the coal delivered into the possession of the bankrupt in, Hartford. Some of the coal he sold the bankrupt paid for, and some he did not. Said Miller & Co. sued the bankrupt in the proper state court, in trover, claiming that he had converted the money received to his own use. The bankrupt entered a general denial, and upon that issue the jury returned a verdict for Miller & Co., and judgment has been entered thereon, but” no execution issued. The bankrupt prays that said action in the state court shall be stayed until 12 months after the adjudication, or, if wi'thin that time the said bankrupt shall apply for a discharge, then until the question of such discharge shall be determined, and that the said Frank Miller & Co., their attorneys, agents, and servants, shall be during that time prohibited from arresting said bankrupt on execution of judgment in said suit.

If the claim in question is a provable debt, and of such a nature that it would be released by a discharge in bankruptcy, the prayer ought to be granted: It is certainly a provable debt. Would it be released by a discharge ? The facts seem to me to present a plain case of an ordinary mercantile transaction, wherein one acts for another in the sale of any commodity.. In all such cases the title to the property remains in the principal, and it is the duty of the agent to account for his sales. His profit lies in what he gets above the agreed amount 'which he müst turn over to his principal. If he fails to account, he can be sued in assumpsit or for a conversion. It is necessary to be too technical if one tries to distinguish this case from the common ones with which the country teems. It must be assumed that the contractual relation was one which required the bankrupt to separate the money received by him for each ton of coal into two piles, one containing $6.20 multiplied by the number of tons sold, and to hasten to his principal with that amount. Commission business is not done in that way, or in any way at all like that, as I understand it.

I think the case of Crawford v. Burke, 195 U. S. 176, 25 Sup. Ct. 9, 49 L. Ed. 147, is precisely in point. That was a broker’s case; but it is beyond my capacity to draw a logical line between' agents, brokers, factors, auctioneers, conditional vendees, and the like. The facts before us do not impute positive fraud, involving moral turpitude or intentional wrong. There was neither a technical trust at the beginning of the contractual relation nor moral turpitude in its breach.

The right to a stay, as prayed for, is clear. Det it be issued.