Court Opinion

ID: 8814663
Source: CourtListenerOpinion
Date Created: 2022-11-26 15:14:11.658323+00
Date Added: 2024-06-11T17:04:25.356470
License: Public Domain

HOUGII, Circuit Judge
(dissenting). The majority decision docs not enforce a specific lien securing either a tax or any other demand; it does recognize a right in the state of New York to preference and priority in the payment of debts over other creditors, by virtue of its sovereignty.
Sovereignty over what? Certainly not over the insolvent corporation, which is of another state, and not over this court (as I suppose), but over the corporate property, because it is physically situated in New York. In other words, when, as here, the state has no lien affecting its debtor’s res, its sovereignty is brought forward to operate in rem.
The doctrine, when not imposed by a modem statute, is a trifle archaic, yet perhaps well enough in a court of New York, which is subject in personam (so to speak) to the same sovereignty. But, so far *730as New York is concerned, the property of the All Package Company might just as well be in the custody of a court of California, or of Canada, as where it is.
Goods in custodia the District Court of the United States cannot be reached by any process of the state in which that court is sitting; legally they are as remote as if in foreign parts, and the physical situation could only affect-legal rights, if the legal custodian were bound by foreign law — in this instance, the law of New York. In matters such as this, it is not so hound by either comity, statute, or coristitutional obligation. The majority judgment can only rest on a belief that the court is affected by the sovereignty aforesaid.
This I deny, and therefore dissent.