Court Opinion

ID: 3553263
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:05:12.061194+00
Date Added: 2024-06-11T13:42:09.803385
License: Public Domain

When creditors pursue their claims by means of the trustee process, the relations of all the parties are necessarily equitable, and the rights and liabilities of the parties are determined on equitable principles. The trustee has been charged for the books of account, a receiver has been appointed, and by order of the court the books have been delivered to the receiver. For the money collected on the accounts contained in the books and deposited with the trustee after the satisfaction of its own claim, the trustee had already been charged. The delivery of the books to the principal defendants, after service of the plaintiff's writ upon the trustee, was on the advice of counsel, and with no intention of defrauding the plaintiff or other creditors of the defendants. The concealment of the books by the defendants, and their subsequent collection of accounts and appropriation of the money to their own use, were without the direction, authority, knowledge, or consent of the trustee, which was not chargeable for the amount of the uncollected accounts nor for money never in its possession, and with the collection of which it had nothing to do. If the delivery of the books to the principal defendants afforded them the means of collecting and appropriating the money, it was done in entire good faith, and without consenting to or even anticipating any fraud upon the plaintiff's by the defendants; and the trustee not being chargeable, at the time, for the amount of the uncollected accounts, it would be inequitable to charge it now for money never in its possession, and for the collection of which it has been in no fault. For the $2,683.88 collected by the defendants while the books were withheld from the receiver the trustee cannot be charged.
Exception sustained.
STANLEY, J., did not sit: the others concurred.