Court Opinion

ID: 5280877
Source: CourtListenerOpinion
Date Created: 2022-01-06 21:56:37.392026+00
Date Added: 2024-06-11T08:28:22.867948
License: Public Domain

Finch, J.
(dissenting). I agree that a trustee cannot rightfully sue except for the use and benefit of the bankrupt’s estate. The latter is what the trustee is doing in the case at bar, since it is specifically alleged in the complaint that the assignments are for the benefit of the estate. I know of no prohibition which prevents a trustee in bankruptcy from receiving for the benefit of the estate of which he is trustee any assets coming into his hands. Any question of expense to the estate of collecting such assigned claims is not available as a defense to a defendant who is sued.
. The foregoing is in accord with the succinct opinion rendered by Judge Learned Hand in an unreported case identified as Alton v. Breitung, decided July 27, 1923. The plaintiff sued as trustee in bankruptcy upon two causes of action assigned to him as trustee for the benefit of the bankrupt estate. The defendant moved for dismissal on the ground that the trustee had no authority to accept such an assignment or to sue thereon. The motion was denied, Judge Hand saying: “ I think as indicated before that the question cannot be raised in this action whether the plaintiff has exceeded his duties as trustee in bankruptcy. No one disputes the validity of the assignment as such, i. e., that the cause of action is assignable. If so it passed to the assignee named in the assignment; he became, as we now view such matters, at law as well as in equity the actual obligee of the cause of action. The obligor has no interest in the obligee except to see that judgment will protect him from a second *15action. But if the assignment be valid, i. e., if it actually pass ‘ title ’ as one may say, then judgment will be a valid bar. What else can the defendant ask? He must stand suit on the claim and the only person now authorized to sue is the assignee, who is this plaintiff. All difficulties in which he may be involved with the court of bankruptcy are wholly foreign to any interest which the defendant has. These are limited to a final disposition of this controversy.”
I, therefore, vote to affirm the order of the Special Term in this respect, and also with respect to the refusal to grant the relief prayed for in regard to the form of the pleading.
Order reversed, with ten dollars costs and disbursements, and motion granted, with ten dollars costs.