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404; Loud v. Pierce, 25 Me. 233; Keene v. Mould, 16 Ohio, 12; McCormick v. Pickering, 4 N. Y. 276; In re Irwine, i Penn. L. J. 291.
Congress may pass a law which will have the effect to make void an assignment which is valid under the State laws. In re Henry Brenneman, Crabbe, 456.
The power to enact a bankrupt law implies the power to make it efficient. The end implies the means. Russell v. Cheatham, 16 Miss. 703.
Congress has the power not only to establish uniform laws on the subject of bankruptcies, but also to commit the execution of the system to such Federal courts as it may see fit, and to prescribe such modes of pro*cedure and means of administering the system as it may deem best suited to carry the law into successful operation. Sherman v. Bingham, 5 B. R. 34; S. C. 7 B. R. 490; S. C. 3 C. L. N. 258; Goodall v. Tuttle, 7 B. R. 193 ; S. C. 3 Biss. 219; Mitchell v. Manuf. Co. 2 Story, 648.
Congress has the power to define what and how much of the debtor's property shall be exempt from the claims of his creditors. In re Reiman & Friedlander, 11 B. R. 21; S. C. 13 B. R. 128; 7 Ben. 455; 12 Blatch. 562.
To come within the constitutional provision a bankrupt law must be a uniform law throughout the United States. A law which prescribes one rule in one district and a different one in another can not be regarded as a uniform law. Kittredge v. Warren, 14 N. H. 509.
The law established by Congress on the subject of bankruptcies under the power conferred by the Constitution must, indeed, be uniform throughout the United States. But the extent to which this power shall be exercised rests in the discretion of Congress. Uniformity is required in the national legislation only, and the laws of the several States may be left in force so long and to such extent as Congress may see fit. Day v. Bardwell, 3 B. R. 455; S. C. 97 Mass. 246.
The system of bankruptcy is, in a relative sense, uniform throughout the United States, when the assignee takes in each State whatever would have been available to the recourse of execution creditors if the bankrupt law had never been passed. Though the States vary in the extent of their exemptions, yet what remains the bankrupt law distributes equally among the creditors. The bankrupt act does not in any way vary or change the rights of the parties. All contracts are made with reference to existing laws, and no creditor could recover more from his debtor than the unexempted part of his assets, and as the thing is attained by the bankrupt law, it is uniform. In re Beckerford, 4 B. R. 203 ; s. C. 1 Dillon, 45; 1 L. T. B. 241; In re Jordan, 8 B. R. 180; In re Appold, 1 B. R. 621 ; S. C. 1 L. T. B. 83; 6 Phila. 469; In re Ruth, 1 B. R. 154; S. C. 7 A. L. Reg. 157 ; In re Wylie, 5 L. T. B. 330; In re Daniel Deckert, 10 B. R. I; S. C. I A. L. T. (N. S.) 336; 9 A. L J. 390; 6 C. L. N. 310.
A bankrupt law, to be constitutional, must be uniform, and whatever rule it prescribes for one, it must for all. If it provides that certain kinds of property shall not be assets under the law in one place, it must make the same provision for every other place within which it is to have effect. The provision that in each State property specified in the laws thereof, whether actually exempted by virtue thereof or not, shall be exempted, is unconstitutional and void. In re Daniel Deckert, 10 B. R. I; S. C. 1 A. L. T. (N. S.) 336 : 9 A. L. J. 390 ; 6 C. L. N. 310; In re Kerr & Roach, 9 B. R. 566; In re Geo. W. Dillard, 9 B. R. 8; S. C. 6 L. T. B. 490 ; In re Geo. T. Duerson, 13 B. R. 183; In re Shipman, 14 B. R. 570; Bush v. Lester, 55 Geo. 579; contra, In re Kean et al. 8 B. R. 367 ; In re John W. Smith, 8 B. R. 401; S. C. 6 C. L. N. 33; In re Willis A. Jordan, 10 B. R. 427; In re John W. A. Smith, 14 B. R. 295.
The uniformity required is as to the general policy and operation of the law. The bankrupt act in some minor particulars must necessarily operate differently in the different States. Thus, the bankrupt law regards as valid the legal and equitable liens existing by law in the several States, and as the nature, force and effect of such liens are dependent upon the local laws, they will in some respects be different in the different States. In re Jordan, 8 B. R. 180.
State Insolvent Laws. The power granted to Congress may be exercised or declined as the wisdom of that body shall decide. If, in the opinion of Congress, uniform laws concerning bankruptcies ought not to be established, it does not follow that partial laws may not exist, or that State legislation on the subject must cease. It is not the mere existence of the power, but its exercise, which is incompatible with the exercise of the same power by the States. It is not the right to establish these uniform laws, but their actual establishment which is inconsistent with the partial acts of the States. Sturges v. Crowninshield, 4 Wheat. 122; Blanchard v. Russell, 13 Mass. I ; Farmer's Bank v. Smith, 3 S. & R. 63; Betts v. Bagley, 29 Mass. 572; Adams v. Storey, 1 Paine, 79; Pugh v. Bussel, 2 Blackf. 294 ; Alexander v. Gibson, 1 N. & McC. 480; contra, Vanuxem v. Hazelhursts, 4 N. J. 192; Oldens v. Hallet, 5 N. J. 466 ; Golden v. Prince, 3 Wash. 313; Mason v, Nash, i Breese, 16; Ballantine v. Haight, 16 N. J. 196.
One prominent reason why the power was given to Congress, was to secure to the people of the United States as one people, a uniform law by which a debtor might be discharged from his previous engagements, and his future acquisitions exempted from his previous engagements. The rights of debtor and creditor equally entered into the minds of the framers
of the Constitution. The great object was to deprive the States of the dangerous power to abolish debts. In re Edward Klein, 1 How. 277, note; S. C. 2 N. Y. Leg. Obs. 185.
The peculiar terms of the grant deserve notice. Congress is not authorized merely to pass laws the operation of which shall be uniform, but to establish uniform laws on the subject throughout the United States. This establishment of uniformity is perhaps incompatible with State legislation on that part of the subject to which the acts of Congress may extend. Sturges v. Crowninshield, 4 Wheat. 122.
The right of the States to pass a bankrupt law is not extinguished but merely suspended by the enactment of a general bankrupt law. The repeal of that law can not confer the power on the States, but it removes a disability to its exercise, which was created by the act of Congress. Sturges v. Crowninshield, 4 Wheat. 122.
The bankrupt act, as soon as it took effect ipso facto, suspended all action upon future cases arising under the insolvent laws of the State, where the insolvent laws act upon the same subject matter and the same persons as the bankrupt act; and all proceedings upon such cases commenced under the State laws after that time are null and void. Commonwealth v. O'Hara, 1 B. R. 86; S. C. 7 A. L. Reg. 765; 6 Phila. 402 ; Perry v. Langley, 1 B. R. 559; S. C. I L. T. B. 34 ; 7 A. L. Reg. 429; Van Nostrand v. Carr, 2 B. R. 485; s. C. 30 Md. 128; Martin v. Berry, 2 B. R. 629; S. C. 37 Cal. 208 ; 2 L. T. B. 180; Corner v. Miller et al. 1 B. R. 403; Shears v. Solhinger, 10 Abb. Pr. (N. S.) 287 ; in re Reynolds, 9 B. R.
୨ 50 ; S. C. 8 R. I. 485; in re Lucius Eames, 2 Story, 322; Bishop v. Loewen, 2 Penn. L. J. 364; Griswold v. Pratt, 49 Mass. 16; Rowe v. Page, 13 B. R. 366; S. C. 54 N. H. 190.
The State insolvent laws are not entirely abrogated. They exist and operate with full vigor until the bankrupt law attaches upon the person and property of the debtor. In re John Zeigenfuss, 2 Ired. 463; Reed v. Taylor, 4 B. R. 710; S. C. 32 Iowa, 209.
Two statutes having the same general object, and acting upon the same persons and the same cases, by different modes and in different jurisdictions, must be in conflict with each other. Though the modes by which the remedy is administered may vary, yet, where the bankrupt act and the State insolvent law have substantially the same scope and object, and act upon the same persons and cases, the State insolvent law is suspended. The act of Congress is both a bankrupt act and an insolvent act. Martin v. Berry, 2 B. R. 629 ; S. C. 37 Cal. 208; 2 L. T. B. 180; Van Nostrand v. Carr, 2 B. R. 485; S. C. 30 Md. 128.
The jurisdiction of the bankrupt act does not depend upon the right of the debtor to ultimately obtain a discharge. If his case comes within the
provisions of the bankrupt act, he can not obtain a discharge under the State insolvent law, even though his assets are not sufficient to pay thirty per centum on the claims that may be proved against his estate. Van Nostrand v. Carr, 2 B. R. 485; S. C. 30 Md. 128.
If a State court has acquired jurisdiction, under a State law, of a case in insolvency, and is engaged in settling the debts and distributing the assets of the insolvent before or at the date at which the act of Congress upon the same subject takes effect, the State court may, nevertheless, proceed with the case to its final conclusion, and its action in the matter will be as valid as if no law upon the subject had been passed by Congress. Martin v. Berry, 2 B. R. 629; S. C. 37 Cal. 208 ; 2 L. T. B. 180; Meekins, Kelly & Co. v. Creditors, 3 B. R. 511; S. C. 19 La. Ann. 497 ; In re Eli Horton, 5 Law Rep. 462; In re Bela Judd, 5 Law Rep. 328; West v. Creditors, 5 Rob. (La.) 261; S. c. 8 Rob. (La.) 123; Dwight v. Simon, 4 La. Ann. 490; Larrabee v. Talbot, 5 Gill, 426; Lavender v. Gosnell, 12 B R. 282; S. C. 43 Md. 153; Longis v. Creditors, 20 La. Ann. 15.
If the debtor was divested of his property under the State insolvent law at the time of the adoption of the bankrupt law, the jurisdiction of the State court is not affected thereby. Judd v. Ives, 45 Mass. 401.
All proceedings on a petition to compel an insolvent debtor to surrender his property, which are pending at the time when the proceedings in bankruptcy were commenced, should be stayed until an assignee is appointed. West v. Creditors, 4 Rob. (La.) 88; S. C. 8 Rob. (La.) 123.
The jurisdiction of the State court attaches from the moment when it makes the order staying the creditors from all interference with the property of the debtor. From that time the State court has the legal custody and control of his estate. Martin v. Berry, 2 B. R. 629; S. C. 37 Cal. 208; 2 L. T. B. 180; Meekins, Kelly & Co. v. Creditors, 3 B. R. 511; S. C.19 La. Ann. 497
A suit to compel a new surrender is a new suit, and not a continuation of the suit in insolvency previously pending. The suspension of the State insolvent law by the enactment of the bankrupt law before the surrender was ordered, divested the State court of its jurisdiction over cases previously instituted, and no further proceedings can be had therein. Fisk v. Montgomery, 21 La. Ann. 446.
The State laws relating to insolvent corporations were superseded. The State courts have jurisdiction as far as the forfeiture of the charter of a corporation for insolvency is concerned ; but with the decree of forfeiture their jurisdiction ends. They can not go on and administer upon the property of a corporation as the property of an insolvent corporation, for the insolvent laws of a State touching corporations are no longer in force. Thornhill et al. v. Bank of Louisiana et al. 3 B. R. 435; S. C. 5 B. R. 367;
i Woods, 1; 1 L. T. B. 156; 3 L. T. B. 38; In re Merchants' Ins. Co. 6 B. R. 43; S. C. 3 Biss. 162; 2 L. T. B. 243.
The treatment which a corporation may receive at the hands of the State court can not avail to sustain that court's control over the assets. If the fact of insolvency exists, and the corporation is within the provisions of the bankrupt law, the Federal courts sitting in bankruptcy have exclusive jurisdiction of the property, and the fact that a State law does not purport or attempt to relieve the debtor from his debts can not be urged as a reason why the State court should hold the assets and administer them after proper proceedings in bankruptcy have been instituted in the Federal courts. So far as a State law attempts to administer on the effects of an insolvent debtor, and distribute them among creditors, it is, to all intents and purposes, an insolvent law, although it may not authorize the discharge of the debtor from further liability. If the fact of insolvency does not exist, the State court may probably have the right to administer the assets as an incident to a proceeding for the dissolution of the corporation, but when insolvency intervenes so as to make the debtor a proper subject for the operation of the bankrupt law, the exclusive jurisdiction of the bankrupt court attaches, and the State court, and those acting under its mandates, must surrender the control of the assets, whatever may be the final decree in regard to the continuance of the corporation. In re Merchants' Ins. Co. 6 B. R. 43; s. C. 3 Biss. 162; 2 L. T. B. 243 ; Thornhill et al. v. Bank of Louisiana et al. 3 B. R, 435; S. C. 5 B. R. 367; 1 Woods, 1; i L. T. B. 156; 3 L. T. B. 38; in re Independent Ins. Co. 6 B. R. 169, 260; S. C. I Holmes, 103; 2 Lowell, 97; Platt v. Archer, 6 B. R. 465; S. C. 9 Blatch. 559; Shryock v. Bashore, 13 B. R. 481.
A proceeding in bankruptcy is not the exclusive method of winding up insolvent corporations. The bankrupt act does not ipso facto suspend State laws for the collection of debts. Chandler v. Siddle, 10 B. R. 236; S. C. 3 Dillon, 477:
A State law to abolish imprisonment on civil process in certain cases, which is limited to the single instance of involuntary confinement, and whose aim and purpose is simply to liberate the person, is not superseded. Steelman v. Mattix, 36 N. J. 344 ; Shears v. Solhinger, 10 Abb. Pr. (N. S.) 287; in re Reynolds, 9 B. R. 50 ; S. C. 8 R. I. 485; Jordan v. Hall, 9 R. I. 218; in re Rank, Crabbe, 493.
If the distribution of the property is merely incidental to the release of the person from imprisonment, and the debt is not discharged, the proceeding is not a proceeding in bankruptcy. Steelman v. Mattix, 36 N. J. 344.
The bankrupt act can not affect the determination of a debtor's right to be discharged by taking the poor debtor's oath, and of his liability to imprisonment by way of punishment for fraud, upon proceedings which