Edward Douglass White

“ Disposing of the right asserted against the proceeds of the stock of merchandise, it was decided that whatever might have been the infirmity, for want of delivery, if any, of the agreement constituting the stock as a security, it was two late to raise such question on behalf of the Merchants Bank and the Bank of Bale, after the trustee had virtually, as a result of the agreement, sanctioned by an order of the court, taken possession of the stock for the purpose of carrying out the agreement. ”

“ By the effect of the bankruptcy, the rights of the parties became fixed. The collateral note holders had a fund specially applicable to the payment of their debt, and the general creditors had the general fund, to which alone they could look for the discharge of what was due them. It was in the power of neither class to set aside or frustrate, as against the other, the rights fixed by the adjudication, and which it was the duty of the trustee to conserve and administer. The fund on deposit to the credit of the general estate was an asset of that estate. ”

“ On October 30, 1907, Kessler & Company made a general assignment, and were adjudicated bankrupts on November 6 following, when Lawrence E. Sexton was designated as receiver, and was appointed trustee on December 30. In the nearly three and one half years which elapsed between the agreement of July, 1904, and the adjudication in bankruptcy, in 1907, Kessler & Company advanced a large amount of money to the company, and at the date of the bankruptcy there were outstanding notes to the amount of $96,000, given by the company under the agreement. ”