The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1871-04-07
BANKRUPTCY CASE.
Failure for 1000, 900 Important Decision
by Judge Blatchford.

The case OF Culver. Penn & Co., an important
bankruptcy suit has for some time past been before
Judge Batchord in The United States District Court.
reorganization of The case would show that In 1854
the bankrupts were bankers In this city. They did
large business with banks in the Pennsylvania oil
region. They failed lin 1860 for over So o0o and
their failure involved q large number OF smaller
honses IN commercial ruin. Subsequently they
made voluntary assignment OF their individual
ana firm estate, and did not again resume business.
In December. 1885, John r. Penn, one OF the nrm,
residing IN this city, filed petition for adjudication
OF bankruptcy for himself and against his partners,
Charles " Culver and Lucien II. Culver whose resi-.
dence was In Pennsylvania. An adjudication OF
bankruptcy was made. the Culvers being consenting
parties to it. The main points discussed in the
Will be found in Judge Batchforo's decision, which
Is given be0w:-
THE DECISION.
On the application for the discharge OF these bank
rupis The question OF the jurisdiction Of the court
TO entertain at all these proceedings In bankruptcy
Is raised. Specifications have been fled III oppoai-
ton 10 the discharge OF TIE banRrupts. Two OF
Jurisdiction. and the case has been argued on that
point alone preliminary. On the 3lst OF December,
ton addressed 10 The Judge of this court setting
forth "tlat the said John X. Penn a copartner III
the nrm of Culver. Tenn 4 Company, cooartner-
snip composed of said petitioner anu Charles V. Cul
yer ana LIcien II. Culver, who both reside In the
couaty OF Venango, 10 The state OF PENNSYLVANIA;
that John X. Penn has resided for more than six
months next Immediately preceding the nng OF
this petition al the City Of New York. within
said judo al district; that the members OF the CO.
partnership owe debts exceeding the amount Of
$500, ana are unable TO pay all their debts IN ful
ana that Charles v. Culver and Lucien II. culver
nave oeen requested by the petitioner to unite with
him III this application and refuse TO do that the
petitioner Is willing to surrender all his estate and
Effects joint and individual, for the benefit Of their
ere liors ami his own, ana desires to Obtain the
benefit OF the Bankruptcy act and desires to effect
an adjudication OF bankruptcy OF the SAID partner
sup and ali the members thereof" Inc petition
refers 10 statement OF the debts OF the coparner
ship and al3o to schedule containing Penn's
individual debts and an inventory OF his estate, and
prays that the copartnership and each member
thereof may be adjudged bankrupts. On the fling
Of this pet ton an order was issued by this Cont
requiring Charles V. Culver and Luclen II. Culver
TO show cause before It. the 30th Of January 1862
granted Rey appeaas BY attorney e that 1' dy
ana fled wri,ted consent to he adludged bank
rupts and on the same day an oraer was made adj
Judging Penn and the two Culvers bankrupts 1t is
contended that the proceeding OF Penn, as against
the Culvers, was proceeding in involuntary bank
ruptCy, and that it was necessary the petition
should allegc as having been committed by the
Cuivers, or Dy the firm some one OF the acts OF
act act In In these views i cannot concur. The
petition OF Penn was so far a5 he was
concerned, q voluntary petition under section II. In
addition 1t states that he is a copartner in a firm
which 1t names, ana whose component members it
names. 1t states the residence Of the then mem.
bers, and ayers that they owe debts which they
unable TO pay. 1t alleges that The other two meIn-
bers OF the irm have been requested by the petition
TO unite with him in the application, and that they
refused 10 DO so, and that ne desires to eject ain
adjudication or bankruptcy or the copartnership.
IL then annexes schedules OF the DEBTS ana assets OF
the coparinersnip, ana prays that each member
thereof may be adl udicated bankrupt Where is the
authority to be found for inserting these avermens
In the petition OF Penn, or fOr fling petition by
Penn, praying for an adjudication as respects the
cuvcrs, unless the Culvers sign the petition con-
thority Is found IN section SO OF the Bankruptcy
aci, ana In General Order No. Is. The thrty-slXlh
section provides that where two or more persons
who are partners in trade shall be adudged bank
rupts either on the petition OF such partners any
one OF them, or on the petition Of any creditor Of the
partners, a warrant Shall issue upon which all the
JOINT stock or property OF the copartuership, aud
also al The separate estate OF each OF the partners
shall be taken" TINS provision clearly contem-
plates that persons who are copartners may be ad-
Judicated bankrupts on three descriptions OF petit
peon Of one S a tine
Ihird-lhe petition OF creditor OF the copartners.
The proceeding oy the peion s, Of all The copar
ton IL. Where they all unite In it jurls-
aiction as to all Of them must appear
OF business. In the present case the Culvers could
not have united in the petition OF Penn because the
required by section IL to give this court juris
diction through residence or the carrying on OF
creditor of the ,copartnefs is purely Involuntary
proceeding under section 80, and requires
the adjudication TO proceed on the commission OF
proceeding by copartners under section ii re-
CURES act OF bankruptcy to set FORTH bu5 only
averment that the debtors are unable To pay all
their debts i'll full, and are willing to surrender all
their estate for the benefit OF tner creditors
and desire to obtain the benefit or the act.
by section IL 10 be an act OF bankruptcy.
The proceeding by the petition of one of two or more
copartners 10 have such copartners adjudicaied
bankrupts IL proceeding which necessarily Is
neither wholly voluntary nor wholly involuntary,
but II Is partly voluntary and partly Involuntary.
SO far the petition 10 concerned, 1t Is voluntary
under section IL SO far as the copartners not petit.
Of section 80 unless The adjudication IL asked
Tor Oh the ground OF the commission VI an act OF
may be involuntary IN the sense OF nothing voun-
tary under section IL. Where III not Involuntary
IN the sense OF section 80 the adjudication may
be asked on the ground that The members
OF the copartnership are unable to pay
all their debts, provided the petition
IS presented by copartner as TO whom the court TO
winch 1t is presented jurisdiction Yet the CO.
partner petitionlng NAV be unable TO pay all his
debts, and his copartncrs may be able to pay all
their debts, ana they may have committed acts Of
bankruptcy under section 80, anu he may have
commitied no acts OF bankruptcy under that Sec
ton, so that under sections SO and 80 the partners
could not nc adludlcaied bankrups on the petition
ofa creditor OF the partners and the copariners OF
bankrupts On the ground of their inability 10 pay
their debts. This would give rise to case Oh
bankrupt because Of his inability to pay his
debts, and TO have his copartners adJudged
bankrupts because OF the commission by
In sectcn 80. These various phases are,
in my Judgment, provided for by section SO, taken
In connection with section III and supple nenie by
General Urder Is Section &c provides that 81 such
copartners'-that -, copartners in trade VINO are
sought 10 he adjudged bankrupis on the petition OF
themselves. or any one Of them, OF OF any creditor
OF thelrs-rcsde III different districts, that Court IN
which the petition IS first led STALL retain exclusive
jurisdiction the case" TINS provision implies
that the Court which irst obtains jurisdiction over
the subject matter OF the petition and the per-
son OF tie petitioner, shall have exclusive urlsdic-
lion over Inc case-that is, over the subject matter
or the petition over all the copai tners II the
non-petitioning copartners he brought by appro-
PIRATE process The objections to the jurisdiction OF
the Court are ovenulea, ana The case VIII stand for
hearing on tue other specifications.
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