, 1876-02-20
Judge Drummond Orders Kim 70
Walk Up and Show Ills
Hand,
For There Are Numerous Creditors OF
the Desnnct State Fire In"
surence Company
Nhe Nonld Like to Know What He, as
Treasurer, Did with Its Money.
Oao Any Means Be Devised to squeeze Blood
from al Alleged Turuip7

Judge DrurunOuu delivered his lonE-e1pec:ed
dec:s:on Yesterday morning in the matter OF the
fuio on George C. Smith to snow c=use why be
should no. pay over to the Assignee Of the State
Insurance Company tho sum Of about e157, COO.
The facts OF the cass arc yet familiar, and will
also be found stated in the opinion. which Is given
in full as follows:
Ihave come to the conclusion that the rule to SHOW
CAVE snail be made absolute, subject to some quat-
ca:onf.
wills this bankrupt proceedings were pending IL
the District Court stipulation ade in That Court
between the 1sstie. to ruie which had bceu entered
why The SUN oi sl20s2a should no; be paid to the
Atsignee of the bankrupt that the rule snona 10 dls-
charged on tie payment ct sl5s,6'3l. IEe 1npaa
Court Thi. approval WIS given without rre5ndce to
tile right Of tie Assigned to sue It law OF IN equity
for the b.l1uce. aud the Payment was made.
ecton OF the District Court for review to ILLS touft
xna theecapon it agreed that Ta1:oas matters ~
controversy tlould e submitted to the Jua2e o! LIS
corrf ,Sose decision WAS be receiyed by the us
hiet Court Accordingly it has tcsn heretofore &c
ided by the Circuit Judge that tho appa2uoa Of tae
s4uons Loan and Trust bina.to prove Up VARIOUS
certificates or dne-bas aeal1ls1 3Ae I4aA19ts S*Ase
kaouid he d.s,l1oHcd. =.
EoscptIy another question w:s argued befors tho
cteS1t soo o ssh to ,sy over to the A.
tsnee The balance Of the money IN bis hands, Ihn
pr1naf=l objections made to thus are: tfrst. that
ou~s lie a1ro1ut due well as tie right o. the As-
sierre to demand pavmtut and. therefore, 90 sum
9ry way Of giving relief Ia not allowable, The Party
ociuc th reby deprived Of regular trial or hearing,
nd Of rhe privilege Of appeal Of writ Of error
sesond tas the creditors wlo ask that tho rule shall
be made absolute are estopped from doing 50 because
Ney accepted dividend o1t Of the money paid under
the stip pull .tson. .
Ine officers Of the insurance company and Of ths
bank The same, George C. Smith being one Of tbs
prnelpz Eaanas Of both and 1t was manfeatly their
purpose to use he capszl pf the insurance company
and suy funds that il might haze on hand tn the II
sscst Of tue to opssat;s t;. the s;tsE Win n
Tie Eulous approx Ration OF the United States
bonds bongiug to the Company to the necessities OF
he bank. and to which George C. S1Mth wss party
py direction or sanction.
Tue inoaey of the Insurance company TEs deposited
10 It's own credit with the bank. The Treasurer, bJ
The depcs, and 1he use Of he funds were with the
knowledge aud consent Of the Treasurer. ChecSs
we're drawn on HIN at the t=nt, and paid by the la-
ranaot claim that the money was not. IN csttain
under his control and trust He was the Treas
user OF the Company, Z bankrupt, subject to the
Ia officer oi The Company may question the amount Of
The clainn and even deny tbs right OF the Court to
to pay, cannot deprive the Court OF the pow
rrotcct the creditors. corporation acts through
its officers. and the Court acts the corporation by
the same manner 1t it the of individual
bsnHopt thsre could Be no doubt Of The powsr and nd
duty Of the Court and corporation cannot claim foE
Its othcers IN immunity not conferred On natural
person.
Tho right Of The bank to pro.e up IT. essims vas
formerly Denied partly the ground that they we're
purchased with the money Of the Company then in the
hank in tbs rnaunat alresdy sisted and tho parties
wlo had been concerned in thAt tr2ns2ctton were
managers md trustees Of the Company Ind therefore
what they did must inure, II to the benefit Of zny
one. to thse Of the Company. It may Be proper,
therefore, in this vew Of the case, to consider What
ever paid Ter those Claims ~ deduction from
he amount in the hands Of tbs bank and Of tho
Tre1Furer.
This case. the Treasurer cannot claim exemption from
Ea,htty account Of the inability Of the bank 70 re
4pond. He ~as party TO the fraudulent ootnhin.-
pany Of the assets which Justly belonged to them.
The only snswer that b n1ada Is his inability
to comply with the rule.
do not think all The creditors hers represented arr
sstopped from insisting On the rule Some Of them
appealed frou the order Of the District Court dis
charging it, They 1t the time making complaint
of the conduct Of tho person who then Assignee.
the fund distributed contained largs amount not
included in the paid under tho stiuulaton- Tbs
view, which w1s prosecuted with reasonable dill
gence, n7s fled in the Circuit Court Intimauuns
we're given by some Of The Creditors red. that tho
nd asked '':s' Il Sc. the csai eide o31ti pd
Tie naste receirt Of the money nro 5ata n,ysnt On
become an estoppef7
When the petition for review was before the Circuit
Court and had been argued ly tbs consent Of tho
the rule bE the District Court should be
rescinded, tast proper security should bc given for
Vi xhep ~ ' thas - vas a. % dons i it I might 10 Dis Dis
eh.rced but security were not given, that thcn the
District Court shoutd proceed 10 the payment Of the
,n which any action OF the District Cont might
be the subject Of review. But In consequence Of the
Ehole mstter beng, referred to the Circuit Judge.
nothing wal done under such suggestion.
In view Of IL these facts. and o. ohtrs that might
b. named. il seems to M that ths receipt Of the