The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1885-1921, 1902-01-07
RULING IN
BANKRUP toy
Judge Estee Rules
on important
Question.
DECIDES HE HAS
JURISDICTION
Federal Court Has More Power in
Bankruptcy Matters Than
Territorial Courts.

contested on the ground that he was
not within the jurisdiction of the court.
but Judge Estee held that the fact that
the debtor has property within the
Territory was sufficient to have him
assume Jurisdiction.
Among other things it transpired
that J. J. Byrne, of this city. had
claimed a preference by virtue of an
execution issued in the Circuit Court,
and to prevent the sale OF the property
to satisfy the judgment, restraining
order had been issued by High Sheriff
Brown. Regarding the question of
Jurisdiction, the court holds that the
pleadings show Paul J. Voeller to have
been a resident of the Territory with
in the past six months, and that he
now has property within the Territory
Continuing, the court says:
But conceding that the petitioning
creditors have failed to show that
VoelIer had a domicile within this
territorial jurisdiction for the SIX
months preceding the filing of the pc
titiop yet it clearly appears that ne
has property within this jurisdiction
and subject to the jurisdiction OF the
court; to wit, certain real estate set
forth in the schedule attached to the
petition and estimated to be of the
value of some $4,000. This would. in
dependently of the provision of domi-
Gle or residence, bring him within
the purview of the bankruptcy jutis-
diction of this court.
The essential facts which give
court jurisdiction of bankruptcy pro
ceedings appearing afIirmatively and
distinctly in this proceeding, am
therefore of opinion that unless some
other reasons are given why said Noel-
Ter should not be adjudged a bank
rupt the petitioning creditors are en-
titled to an order adjudginS him SUCH
Second-Upon the second objection
raised by counsel to the jurisdiction OF
this court, namely, it's power TO issue
the restraining order to the High
Sheriff of the Territory-it is clear
that the court was fully within its
jurisdictional powers when 1t issued
said order, and it is not true that the
Territorial Courts and the District
Courts of the United States have con-
current or coordinate jurisdiction in
bankruptcy proceedings.
When the bankruptcy law cannot
be properly administered by the court
having jurisdiction, in consequence OF
the interference OF a State court and
it's determination to adjudicate upon
the rights of the parties and property
in the bankruptcy court, the latter
ought not to hesitate to assert its au-
thority; for in this matter the courts OF
the United States and the courts or
the States are not of coordinate au-
thority, but the Federal court is supe-
rior" In re Miller, Fed Cases No. 3,
SOL.
1t would seem quite unnecessary to
state, were it not for the point raised
by counseFs brief, that the United
States District Courts are made courts
of bankruptcy, and ARE invested with
such Jurisdiction in law and in equity
as will enable them to exercise orig1-
nal jurisdiction in bankruptcy pro-
ceedings in vacation, in chambers ana
during their respective term.
Section 1, subdivision ., and section
OF the Bankruptcy Act of 1895.
And are given jurisdiction Ito ap-
point receivers and marshalS, upon ap-
plication of parties in interest
to take charge of the property OF
bankrupts after the filing of the petit
ton and until it is dismissed or the
trustee is qualified" Section ,, sub
division of said act
And in addition to the jurisdictional
powers, specifically enumerated. it is
further provided that this court shall
have power to make such orders. IS
sue such process and enter such Judg-
ments in addition to those specifically
provided for as may be necessary for
this Act" Section =. subdivision 10
Indeed. it has been held that Il bank
ruptcy proceeding is in the nature OF
a proceeding in rem; the acquisition
of jurisdiction is based upon the tax
ing possession by the court. of the
debtors whole property and effects.
and upon its adjudication as to his
status. Hence the Federal Court in
which the bankruptcy proceedings are
commenced has jurisdiction of the
debtors whole estate. wherever situate
Markinson VS.. Henry. Fed. Cases NO
9O9s.
AS regards the rights of creditors the
court quotes from numerous decisions
to show that no one may have pre-
ferred claim in n bankrupt proceeding
and that judgments obtained within
four months prior to the bankruptcy
are void. The court says;
The decisions constituting this sec
ton are clearly to the effect that it
was the intention of Congress by the
aforesaid section to prevent any cred
itor of an insolvent debtor from OBJ
tanning any advantage over other
creditors by legal proceedings during
a period of four months prior to the
filing of petition in bankruptcy,
whether voluntary or involuntary, and
that all such liens were dissolved by
the adjudication.
The province of the court is to mar
shall the assets of the bankrupt so that
there may be 4 proper administration
upon his estate. and also that there
may be a fair and just distribution
the-aof 70 his creditors entitled there