The Hawaiian star. [volume] (Honolulu [Oahu]) 1893-1912, 1904-05-05
ASSIGNMENT
AND BANKRUP toy

United States Judge Dole this morn
ing rendered a decision adjudicating
Hirose Shoten a bankrupt, in spite of
his assignment to one Tashiro before
the bankruptcy petition was begun, and
holding that such an assignment even
though consented to by the creditors
who now begin bankruptcy proceedings
does not prevent such creditors from
having the respondent declared bank
rupt. The petitioners asking that Hi
rose Shoten be declared bankrupt, some
time ago approved or consented to his
making an assignment. They are II.
Hackfeld & Company, the Seattle Brew
ing and Mailing Company and Hoff-
schlaeger & Company. On March %
they served notice that they withdrew
their approval of the assignment, not
being satisfied with the assiguee's
mana cement of the business. Judge
Dole in his decision says:
by the Act of Bankruptcy of 1898, an
assignment for the benefit of creditors
is made an act of bankruptcy ana cred
itors may apply for an adjudication of
the debtor as a bankrupt within four
months after the time of said assign
ment.
Two questions arise in connection
with this showing, whether, under the
circumstances, the deed OF assignment
is void or voidable and whether the
petitiOning creditors who have assent
ed to said assignment, and to some ex-
tent acted under it, are estOpped from
M X-iY, ha no q ind
ed a bankrupt.
1T is fully recognized by the authorl-
ties that all insolvent laws of the vari-
Gus States in the United States We're
superseded by the Bankrupt Act, and
that, as against proceedings in bank
ruptcy, assignments under such stat
utes are void
The right of making a general as
signment for the benefit of creditors eX-
listed by statute in some of the States
and in others under the common law.
This is the status of the assignment in
this case there being no local law Of
insolvency and the authorities allow
ing such assignments, if good under the
common law, to be good for all pur-
poses against proceedings in bank
ruptcy instituted under the Bankrupt
Act within four months from their ex-
ecution. If then this petition is allow
ed and the respondent is declared n
bankrupt it Yoids the assignment and
transfers the bankrupt's properly 10 the
possession of the bankrupt court.
"On the question of estoppel it does
not appear that the petitioners have re-
ceived any benefits from the said as
sgnmeuts and the administration
thereof by the assignee, except that
such assignee has sold some of the per-
sonal property Of respondent and has in
his possession from the sale the sum Of
$322.95.
1t appears from the evidence in this
case that a question Of the title TO GER
tain property has arisen between the
petitioning creditors and the assignee,
the petitioners claiming that certain
property consigned to the respondent
through an agent is properly a part Of
the bankrupt or insolvent property,
while the assignee renounces any claim
to such property. Moreover, it appears
that a certain creditor, Pang ChOng, at
tached and sold some of the respond
ent's goods and this creditor was al
lowed to take away other goods includ-
ing a valuable safe. 1t also appears
that the assignee was not under bond
to any one. Under these circumstances,
the petitioning creditors became alarm
ed and lost what confidence they may
have originally had in the assignee and
withdrew their approval of the assign
ment and filed this petition for adjudi-
cation.
From these authorities and from the
provisions Of the statute, it appears to
me that the law applicable to this case
does not justify ruling that the petit
tioning creditors are estopped by their
acts referred to from applying 10 have
the respondent adjudged a bankrupt
The facts brought out in the evidence
in regard to the unsatisfactory admin
istration of the assignee are not neces-
sary to this conclusion. They are illus