John Marshall Harlan II

“ The Act of 1898 vested title to the bankrupt's property in the trustee at adjudication, but contained nothing to prevent its dissipation in the interval after filing. [3] The courts were therefore left free to devise protective rules to reconcile the competing interests of the estate and of those who dealt with the bankrupt in this period. The fulcrum of those rules was the proposition that a 'petition (in bankruptcy) is a caveat to all the world, and in effect an attachment and injunction.' Mueller v. ”

“ Nevertheless, the bank, also eager for an answer to this intriguing legal problem and facing a claim from the payee for contribution, continued the litigation against the trustee, and the trustee obligingly went along. The respondent trustee's only financial interest is admittedly confined to the question of court costs, [19] incurred as a volunteer. ”

“ Nugent reached transactions which occurred after adjudication. [9] More important, once the draftsmen had elected to vest title in the trustee from filing, they were chiefly anxious to shield debtors from the consequences of unwarranted involuntary petitions. [10] They feared that such a petition might ruin a debtor by inducing others to avoid dealings with him. Section 70d was expected to immunize bona fide transactions after filing, and thus to encourage dealings with the solvent debtor. There is no need for such protection after adjudication. ”

“ There is every indication that its terms faithfully reflect its purposes.
I fully sympathize with the discomfort of the bank's position, but I cannot escape the impact of what Congress has done. [17] The Court has not found s 70 constitutionally impermissible. [18] It has simply measured the statute by the standard of its own conscience, and concluded that equity requires a result which the statute forbids. I had thought it well settled that equity may supplement, but may never supersede, the Act. 1 Collier Bankruptcy 2.09, at 171-172. The Act's language is neither imprecise nor infelicitous ”

“ It therefore seems quite improbable that the 1959 amendments could have inadvertently excluded voluntary proceedings from the scope of § 70d.↑ Judge Soper's reasoning in Lake v. New York Life Insurance Co., 4 Cir., 218 F.2d 394, 399, seems entirely persuasive: 'Whether the line which has been drawn is the best possible solution of the problem is not for the courts to say. ”

“ First, presentment is not strictly a negotiation. Second and more important, other constructions are more consonant with the balance of § 70d. Cf. 70 Harv.L.Rev. 548, 550. 4 Collier, Bankruptcy 70.68, at 1502, n. 3 (14th ed. 1964) . I do not understand the Court to rely upon the proviso.↑ This Court had held that despite the cleavage at adjudication, the trustee took the title as it was at filing. Everett v. Judson, 228 U.S. 474, 33 S.Ct. 568, 57 L.Ed. 927. The situation is summarized in McLaughlin, Aspects of the Chandler Bill to Amend the Bankruptcy Act, 4 U.Chi.L.Rev. ”