Source: https://m.openjurist.org/297/us/216/duparquet-huot-moneuse-co-v-evans
Timestamp: 2019-06-18 02:42:51
Document Index: 277527840

Matched Legal Cases: ['art 7', '§ 21', '§ 21', '§ 3', '§ 21', '§ 21']

297 U.S. 216 - Duparquet Huot Moneuse Co v. Evans
297 US 216 Duparquet Huot Moneuse Co v. Evans
DUPARQUET HUOT & MONEUSE CO. et al.
Section 77B, enacted in 1934, was born of that demand. The remedy to be supplanted or more efficiently controlled had no relation to receiverships for the collection of rents and profits in actions of foreclosure. The remedy in view was the one generally known as an 'equity receivership,' whereby the assets of a corporation were committed to the custody of a court until the time should arrive when they could be returned to the rehabilitated debtor, or if that should be impossible, divided among creditors. The receivership might come into being at the instance of a stockholder (cf. Bryan v. Welch (C.C.A.) 74 F.(2d) 964), or oftener a creditor, but always the end to be served was essentially the same. The end was reorganization or liquidation or something akin thereto. Cf. Continental Illinois Nat. Bank & Trust Co. v. Chicago, Rock Island & P. Ry., 294 U.S. 648, 672, 55 S.Ct. 595, 79 L.Ed. 1110; Gordon v. Washington, 295 U.S. 30, 38, 55 S.Ct. 584, 79 L.Ed. 1282. Neither the members of the legal profession nor the legislators were in danger of confusing decrees directed to such an end with the sequestration of rents in an action of foreclosure. Bar associations had their special committees on 'equity receiverships,' with elaborate reports which were submitted to Congressional Committees.1 Witnesses, appearing in support of one statute or another, discoursed to Congressional Committees on the failings of 'equity receiverships,' and on the measures needed for correction.2 However colloquial and uncertain the words had been in the beginning, they had won for themselves finally an acceptance and a definiteness that made them fit to play a part in the legislative process. They came into the statute through an amendment proposed when the bill which was adopted as section 77B was passing through the Senate. Congressional Record, vol. 78, part 7, 73d Congress, 2d Session, p. 7889. They came there freighted with the meaning imparted to them by the mischief to be remedied and by contemporaneous discussion. Humphrey's Executor v. United States, 295 U.S. 602, 625, 55 S.Ct. 869, 79 L.Ed. 1611. In such conditions history is a teacher that is not to be ignored.
The suggestion is faintly made that under section 3 of the Bankruptcy Act (11 U.S.C. § 21, 11 U.S.C.A. § 21) the respondent corporation has committed an act of bankruptcy, and hence may be declared a debtor irrespective of the meaning of an 'equity receivership' in section 77B. An act of bankruptcy results inter alia if a 'person,' natural or corporate, has made a general assignment for the benefit of creditors, or if 'while insolvent, a receiver or a trustee has been appointed, or put in charge of his property.' Bankruptcy Act, § 3(a)(5), 44 Stat. 662, 663; 11 U.S.C. § 21(a)(5), 11 U.S.C.A. § 21(a)(5). There is support for the view that to satisfy this provision the receivership must be general, as contrasted with a receivership incidental to the enforcement of a lien. Standard Accident Insurance Co. v. E. T. Sheftall & Co. (C.C.A.) 53 F.(2d) 40, 41. We need not go into that question now. Enough for present purposes that the receiver was not appointed or put in charge 'while' the debtor was 'insolvent.' By the petitioners' admission the value of the assets far exceeds the liabilities. In re Edward Ellsworth Co. (D.C.) 173 F. 699; In re William S. Butler & Co. (C.C.A.) 207 F. 705; Meek v. Beezer (C.C.A.) 28 F.(2d) 343; Standard Accident Insurance Co. v. E. T. Sheftall & Co., supra.
Hearings, sup a, at pages 1—28. Cf. Senate Report 482, Corporate Reorganizations, March 15, 1934, 73d Congress, 2d Session.