Court Opinion

ID: 8633390
Source: CourtListenerOpinion
Date Created: 2022-11-24 19:41:12.624669+00
Date Added: 2024-06-11T16:55:50.911581
License: Public Domain

DILLON, Circuit Judge.
This is an action under the 35th section of the bankrupt act, to recover back money paid, as alleged, to the defendants, by way of illegal preference. The court below, in its declaration of law, asserted the composition agreement to be binding, and was of the opinion that the extension it provided for must be “considered as relieving the debtors from a state of immediate insolvency.” Aside from the compromise agreement it is clear that the payment to the defendants would be within the prohibition of the act.
The agreement contained a provision that it “is not to be binding on any one unless it shall be agreed to and signed by all of the creditors of the firm.” Defendants were creditors of the firm and did not sign it or agree to it. We hold that this agreement applies to “all the creditors of the firm,” secured as well as unsecured, and hence, as the defendants did not assent to or sign the same, it was not binding on any of the creditors. See Cobleigh v. Pierce, 32 Vt. 788; Paulin v. Kaighn, 3 Dutch. [27 N. J. Law] 512; Sohier v. Loring, 6 Cush. 537, 543; Spooner v. Whiston, 8 Moore. C. P. 580.
The declaration of law, therefore, was in this respect erroneous.
If all the creditors signed except the defendants, and became parties to the agree-*643•merit, knowing that the defendants had not .signed it and would not, but notwithstanding this they entered upon and proceeded with the compromise, this might, it may be conceded, amount to a waiver of this clause •of the contract, but the district court did not find or declare that there was any such waiver or any acquiescence, nor put its decision for the defendants upon this ground. See Mont. Comp. 39; Id. Append. 125; Ex parte Shaw, 1 Madd. 598; Ex parte Kilner, Buck, 104; Ex parte Lowe, 1 Glyn & J. 81; Forsyth, Comp. (American Ed. 1845) 23.
Reversed.
[See Bean v. Amsinck, Case No. 1,167; Bean v. Brookmire, Cases Nos. 1,168-1,170; Bean v. Laflin, Case No. 1,172; Brookmire v. Bean, Id. 1,942; In re Kintzing, Id. 7,833.]