Citation Numbers: 114 Va. 70
Judges: Whittle
Filed Date: 9/9/1912
Status: Precedential
Modified Date: 7/23/2022
delivered tbe opinion of tbe court.
This writ of error was awarded to a judgment in behalf of E. L. Barr, trustee in bankruptcy of D. A. Ramey, bankrupt, against Charles T. Kilgore on bis note to Ramey for $373.21. Tbe note was assigned by tbe payee to R; L. Kilgore for tbe benefit of tbe Wise County Bank, and two days after tbe assignment Ramey filed bis petition in bankruptcy.
At a meeting of creditors before tbe referee for tbe purpose of examining tbe bankrupt, tbe question was raised as to whether or not Charles T. Kilgore’s note passed, by tbe assignment, to R. L. Kilgore, or constituted an asset of tbe bankrupt’s estate. To that proceeding tbe Kilgores were made parties on their own motion. They were represented by counsel, and, along with other witnesses, were fully examined in support of their contention. They undertook to sustain tbe validity of tbe assignment by proving an alleged parol agreement between themselves and Ramey, more than four months before tbe filing of bis petition in bankruptcy, by which a store account due by Charles T. Kilgore to Ramey was to be applied as a credit on a note to tbe Wise County Bank, made by Ramey as principal and indorsed by tbe Kilgores; and that in pursuance of that agreement and for tbe purpose of carrying it into effect, tbe note .in controversy was made by Charles T.
The referee, on consideration of the controversy upon the merits, overruled the pretension of the Kilgores and held that the assignment was a voidable preference, and that the note did not pass thereby, but belonged to the bankrupt’s estate. It was, accordingly, surrendered by the assignee to the trustee in bankruptcy, who was directed to collect it as an asset of the estate. Thereupon, Charles T. Kilgore and R. L. Kilgore filed an exception in writing to the ruling of the referee and presented a petition to the district court to review and reverse his order; but the finding of the referee was approved and confirmed.
The sole question for our consideration is whether the bankruptcy court had jurisdiction to determine the issue thus voluntarily submitted to it for adjudication. If it had, it is clear that its judgment was a complete determination of the matter in controversy, establishing the title of the trustee to the note and the liability of the maker theron.
In discussing the subject of jurisdiction of referees in bankruptcy, Professor Staples, in his excellent work, “A Suit in Bankruptcy,” observes (page 102) : “In general, referees are judicial officers, and their orders made in the course of bankruptcy, including adjudications upon allowance and rejection of claims of creditors, are entitled in all courts, state and federal, to the respect and credit due to officers who act judicially (Clendening v. Red River Bank, 11 Am. B. R. 245) [12 N. D. 51, 94 N. W. 901.] Except when otherwise provided in the statute, the word ‘rourt’ may include ‘referee’ and, subject to such limitation, the jurisdiction of the referee is commensurate with that of the court by which he is appointed. In re Huddleston, 1 Am. B. R. 572.”
P. 105: “The orders of the referee upon all questions are subject to review by the court.” Sec. 38.
Let it be conceded, as a general proposition, that where the judgment of a court of limited powers is relied on, its jurisdiction must be shown; nevertheless, we do not admit the pertinency of that principle to courts of bankruptcy, which are not courts of limited but of general jurisdiction, in respect to matters in bankruptcy. But whether the mere failure of the record to show the clerk’s certificate, or an order of reference, general or special, to a referee in bankruptcy in relation to a subject, over which he has jurisdiction, renders his judgments amenable to collateral attack need not be here determined. The circumstance that
The case of In re Steuer (D. C.), 104 Fed. 976, is strongly in point in support of the referee’s jurisdiction. In that case it is said: “Evidence was taken and one or more hearings were had before the referee, at which counsel for the respondents argued their case without making any question of the referee’s jurisdiction. On January 12, 1900, the referee rendered a decree declaring that the
So, also, In re Connolly (D. C.), 100 Fed. 620, it was held that the conduct of the parties amounted to consent to the jurisdiction; that though, as a general rule, consent cannot give jurisdiction, that principle has no application to cases arising under section 23-b, which plainly implies that jurisdiction of a certain class of controversiesVmay be given by consent. Otherwise, it is said, the statute would have no effect. I. Remington on Bankruptcy, sec. 1696; J. B. McFarlan Carriage Co. v. Solanas, 106 Fed. 145, 45 C. C. A. 253, 5 Am. Bankr. Rep. 442, 5 Cyc. 263.
There can be no doubt that if the decision of the referee, affirmed by the district court, in the instant case had been in favor of the plaintiff in error, it would have been conclusive upon the rights of the trustee. And the plaintiff in error, having elected to take chances, in a forum of his own selection with general jurisdiction of the subject, and lost, he cannot now be heard to complain, but must abide the result.
The judgment of the circuit court is without error and must be affirmed.
Affirmed.'