Court Opinion

ID: 3552296
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:04:34.555025+00
Date Added: 2024-06-11T13:55:34.876331
License: Public Domain

The effect of the bankrupt law appears to be to make the assignee a trustee, his trust being in the first instance to pay the expenses of the proceeding, then the debts of the bankrupt, and finally, if anything remains, to hold it for the use of the bankrupt, and to pay it over to him. I do not find any such express enactment as to the residuum, if any, in the present bankrupt law, but I think that must be the effect of it. If the defendant in the suit desires to protect himself from the assignee's claim upon him, he  should be permitted to do so by causing the assignee to have notice to come in and take upon himself the prosecution of the suit.
It may be that for some sufficient reason the assignee does not interfere. Perhaps the creditors will not indemnify him against the expense of the proceeding. And yet there may be in the suit valuable claims which, if the creditors will not assert them, ought to belong to the bankrupt. After the assignee, having been by order of the court duly summoned in to take upon himself the conduct of the proceedings, has neglected to do so, justice requires that he should be held to have abandoned the claim, which thereafter should stand in the same position as any residuum which might be left after payment of all the expenses and debts of the bankruptcy, i. e., should be held to belong to the bankrupt, and he should be permitted to prosecute the claim for his own benefit.
Exceptions sustained. *Page 152