Court Opinion

ID: 8794495
Source: CourtListenerOpinion
Date Created: 2022-11-26 14:04:57.932977+00
Date Added: 2024-06-11T17:03:32.645924
License: Public Domain

On Rehearing.
The above-entitled cause was heard and decided by this court at the May term, 1914, wherein the judgment of the lower court was reversed on the ground that such court did not have jurisdiction to enjoin the petitioner, who resided in a district Other than the one where the bankruptcy proceedings were instituted. The cause was again heard at this term of the court upon a petition for rehearing.
Counsel for respondent insisted, among other things, that the courts of bankruptcy “have a right to make binding orders in all such proceedings as to parties of such proceedings, and others duly adjudicated as bankrupts. Such proceedings include all matters pertaining to the bankrupt and his estate, and such jurisdiction is exclusive, and intended to be exclusive, of all other courts and persons as to the actual parties to the proceedings in bankruptcy,” and cites the case of United States Fidelity & Guaranty Co. v. Bray, 225 U. S. 205, 32 Sup. Ct. 620, 56 L. Ed. 1055, in support of such contention.
While the position of counsel in this respect is correct, nevertheless ■the opinion of the court was based upon the theory that the petitioner *48was not such a party to the original suit as to give the court jurisdiction for the purpose sought to be accomplished. It is admitted that the wages of the bankrupt for the. months of September, October, and November, 1913, were paid to him. The respondent was adjudicated a bankrupt oil November 3, 1913. Therefore the wages now due and involved in this controversy were earned subsequent to the adjudication:
As we stated in our former opinion, wages earned subsequent to the adjudication cannot be treated as a part of the bankrupt’s estate. Such being the case, the claim of petitioner is adverse, and could only be litigated by ancillary proceedings in the district wherein respondent resides, or by a plenary suit in the state court.
The trustee — the bankrupt in this instance — could have availed himself of either of these remedies, and, having failed to do so, it necessarily follows that the court below was without jurisdiction.
This view is fully sustained by Judge Haight, Judge of the District Court of New Jersey, in a very able and instructive opinion in the case of In re Geller, 216 Fed. 558, in which the various cases bearing tipon this point are reviewed.
After a careful consideration of the authorities, we are still of opinion that the holding of this court in the first instance was correct. Therefore we adhere to our former decision reversing the judgment of the lower court.