The Daily state journal. [volume] (Alexandria, Va.) 1868-1874, 1873-05-15

Meath the Stripes and the Stars.
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Important Decision In bankruptcy
by Judge Rtves.
.-,. HARRIsoNBURG, May ID.
An important decision was rendered in
the United States district court, sitting
here, in bankruptcy, to-day. 1t was in
the matter Of III. Fl. Propes, bankrupt in
bankruptcy for the bankrupt, f. HI.
Bruce; for the creditors, Menefee & Borst.
The case came from Page county. Suit
had been brought for the sale of land to
satisfy judgment liens and decree ordered
for sale, and commissioners for making
sale appointed; and restraining order
awarded to stay the sale.
The judge delivered an elaborate oral
opinion, setting forth the law of jurisdic-
ton as to the bankrupt court. He referred
the bar to the case of Christie, decided by
Justice Joseph Story, and reported in 3D.
Howard, (also in 18th Curtis's Condensed
Reports.) He said comparison of the
language of Justice Story with that used
in clauses of the bankrupt law of March,
1867, showed that Congress had intended
to give such jurisdiction to the bankrupt
courts as was claimed by Judge Story in
Christe's case. The act was not only an
adoption of the principles announced by
Judge Story, but, in sort, rejection Of
the principles laid down by Justice Grier
in the more recent case OF Peck and Jen-
ness, 7th Howard, az Curtis's Condensed
Reports.l w ~ a
1t was Judge Story's decision that the
bankrupt court had Of right full, complete,
and exclusive jurisdiction of the bank
rupt's estate wherever found and in
whatever state Of litigation, with power
to terminate litigation i'll other courts and
to collect, marshal and administer all
assets. This power is necessarily exclu-
sive, and must be exercised exclusively to
prevent vexatious and expensive litigation.
Especially will this court refuse to per-
init sales under DEGREES which have been
rendered after the bankrupt has been adj
Indicated bankrupt where he is therefore
ciUiliter moytuus, and his assignee has
now been substituted in his stead in the
proceedings in the state court.
But the Judge said, that notwithstanding
the law as laid down by Judge Story, vet
the l4th section seemed to contemplate the
litigation Of questions affecting bankrupts'
estates by the assignee, in authorizing that
officer to "prosecute and defend all suits
at law or in equity" This gave the dis
trict court discretion to allow litigation
to proceed in the state courts in the
name of the assignee, OF not. In the
exercise of that discretion, the Judge
stated that he could not interfere
with state courts where the litigation had
gone to sales and judgments in favor of
purchase money, especially where the
bankrupt had been party consenting to
such proceedings ;-as was the fact in
jones' case which he decided at Lynch
burg. In the exercise of the discretion
stated the judge declared that he
would be guided by the county which should
always subsst between courts having the
relation to each other of the state and fed
eral courts. s
Counsel had referred to recent decision
of the supreme court of the United States
upon a case from Georgia, in which the SUI
preme court had virtually sustained the
decision of the court of appeals of Virginia
rendered the 18th June last, to the effect
that the homestead exemption allowed by
state constitution could not be set up
against dntecedem debts: being in violation
of the provision of the constitution of the
United States forbidding "a state from
passing any law impairing the obligation Of
a contract" The judge expressed salts
faction at this decision and remarked that
it was noticeable as deciding that the reme-
dy existing at the time of the contract is
part of the contract, and falls within con
temptation of the national constitution for
bidding state from impairing that contract.
But the Judge held that this decision OF
the supreme court of the United States
only went to deny the power OF a
state to give retrospective homestead ex-
emption. 1t did not and could not i'm
peach the power of congress to pass a
bankrupt law impairing the obligation
of contracts by giving retroactive home
stead exemptions or in any other way,
not in conflict with the only limitation i'm
posed upon congress in this matter by the
national constitution, namely, that the
bankrupt law should be uniform. The
Judge considered that the amendatory
bankrupt law of March 3D., 1873, was uni
form, as well as the laws of which it was
amendatory and therefore constitutional. He
held that it was the very essence of bank.
rupt law to impair the obligation Of con-
tracts and the iact that by giving home
stead as against p~e-existing debts, it inn
paired the obligation of contracts, was nc
argument against the constitutionaity of its
bankrupt laws. The decision Of the
supreme court of the United States in the
Georgia case went only to deny the power
of q state to pass retroactive homestead
exemption. and not of The po,oer of con.
gress ; and has no bearing upon the acts o.
June sth, 1872, and March 3rd, 1878.
The judge said that this court had moi
been disposed in the past to go very fal
in wrestling from the state courts jurisdic.
ton which had been exercised by them
and he had especially been in the habit
where q sheriff had made actual levy uptr
personal property, of refusing TO stop hi
sale of the property. But he said thai
the tendency now was everywhere to COR
centrate jurisdiction IN the bankrupt courts
The judge referred the bar to the cas-,
of er pa,fe Mallory, from Iowa. re
vised by Justice Field, where sale hat
been arrested by the bankrupt court afte
levy by the sheriff; and to the elaborat
and able opinion delivered in the case b,
the district judge and fully adopted an,
approved by Judge Field. Judge Rive
minated that he would feel bound hereai
ter to adopt the practice sanctioned b