Melville Fuller

“ The proposition was that, as matter of law, where property of a bankrupt has come into the hands of a third party before the filing of the petition in bankruptcy, as the agent of the bankrupt, and to which he asserts no adverse claim, the bankruptcy court has no power by summary proceedings to compel the surrender of the property to the trustee in bankruptcy duly appointed. ”

“ The circuit court of appeals had in prior cases recognized the general proposition that those courts are confined on petitions for review to matters of law arising on the record of the courts below, and may well have assumed that there was no necessity for a specific ruling on the motion to expunge the new matter accompanying the petition in this instance. ”

“ The rulings of the referee appear to be right, and are approved and confirmed, and his recommendation as to punishing the respondent for the contempt adjudged will be acted upon with appropriate vigor. . . .
'The judgment of the court, in the exercise of its statutory discretion, will be that the respondent, W. T. Nugent, for his contempt aforesaid, be imprisoned in the county jail until he shall deliver to Arthur E. Mueller, the trustee, said sum of $14,233.45 ”

“ Section 41 provides that 'a person shall not, in proceedings before a referee, (1) disobey or resist any lawful order, process, or writ;' and that ('b) the referee shall certify the facts to the judge, if any person shall do any of the things forbidden in this section. ”

“ The court ordered that the marshal take possession, and that notice by given to the purchaser to appear in ten days and propound his claim to the property, or, failing to do so, be decreed to have no right in it. ”

“ A copy of this order was served on William T. Nugent, October 8, 1900, and on October 13 he appeared in person and by counsel, and filed a response to the rule. In this respondent set forth that 'neither the court or the referee in bankruptcy herein has any jurisdiction either of this respondent or the matter involved, to make any order or to require this respondent to answer thereto, because he says that said records herein show that if respondent received said money or any part thereof, it was before the petition in bankruptcy was filed ”

“ This court held that the summary proceeding was properly entertained, that the purchaser had no title in the property superior to the bankrupt's estate, and that the equities between him and the creditors might be determined by the district court, bringing in the assignee if necessary. ”

“ Respondent accordingly filed his petition for a review of the order of October 16. The referee thereupon certified to the judge the question presented, a summary of the evidence relating thereto, and the finding and order of the referee thereon. He pursued in so doing form No. 56 of the forms in bankruptcy. 172 U.S. 718, 43 L. ed. 1226, 18 Sup. Ct. Rep. xlv. The question certified was 'the validity of the said order of October 16th, 1900, above set forth in full.' At the same time the referee reported the disobedience of William T. Nugent, and recommended that he be committed. ”

“ The matter was summed upon these words:
'The respondent has the money in his hands as agent or bailee only. His possession is that of his principal. His principal was his father up to a certain stage of these proceedings, but whether up to the filing of the petition or up to the adjudication we need not stop to inquire, as it is immaterial in this case. ”

“ And we repeat general order XXVII.: 'When a bankrupt, creditor, trustee, or other person shall desire a review by the judge of any order made by the referee, he shall file with the referee his petition therefor setting out the error complained of ”