Marshall v. Knox

APPEAL from the Circuit Court for the District of Louisiana; the case being thus:

Marshall was the owner of a plantation in the parish of Avoyelles, in Louisiana, and on the 7th of February, 1867, leased it to Nathan Smith and Henry Fuller for three years, from January 1st, 1867, at $3000 a year, payable in two equal payments. At the end of the first year the tenants were in arrear $1400, and on the 4th of January, 1868, Marshall commenced an action therefor in the District Court of the parish, and applied for and obtained a writ of provisional seizure (as it is called), being the usual process by which a lessor takes possession of his lessee's property found on the premises, for the purpose of enforcing his lien thereon. This writ was served by the sheriff on the 6th of January, 1868, by serving a copy on the lessees, and by a seizure of their property on the land, consisting of mules, wagons, farming implements, and stock, grain, furniture, &c., appraised at $1744.

On the 15th of January, 1868, Smith, one of the lessees, filed in the District Court of the United States for Louisiana a petition to be declared a bankrupt, and was declared such accordingly; and on the 12th of February, 1868, the defendants were appointed his assignees. The controversy in this case arose from the proceedings undertaken by the assignees to take the property aforesaid out of the hands of the sheriff, and to dispose of it under the orders of the bankrupt court. They first obtained from the court a rule upon the lessor and the sheriff to show cause why they should not deliver up the property to the assignees, alleging that various creditors of the bankrupt claimed a privilege on the property, and that it was necessary for a proper adjustment of all claims, privileges, and liens, that the possession should be surrendered to the assignees, to be subject to the bankrupt court. The lessor contested this rule, stated his own rights and proceedings, and claimed possession of the property through the sheriff, for the purpose of selling the same to raise the amount of his rent. The rule, however, was made absolute, without, so far as appeared, any other proof on the subject. The lessor appealed, but the district judge would not allow the appeal, and there was no justice of this court at that time (April, 1868) assigned to that circuit to whom application could be made. The lessor thereupon filed a bill, the present bill, in the court below for an injunction to prohibit the assignees from proceeding under the said order of the bankrupt court, and from taking possession of the property, and for a decree that they be directed to pursue any residuary interest of the bankrupt in the lessor's suit in the District Court of the parish, and not molest him in detaining and subjecting the property to the payment of his rent, and for further relief. Failing to obtain a preliminary injunction, and the property being taken and sold by the assignees, the lessor filed a supplemental bill, complaining of the illegality of the proceedings, asking for a review of the same, and for an account and damages. The bill and supplemental bill set out the lease, the provisional seizure, the proceedings in the bankrupt court, and the acts of the assignees; and complained that the lessor was injured by a sacrifice of the property; and stated that before filing the original bill he had offered the assignees a bond, with sufficient sureties, to protect any persons claiming any superior liens to his on the property, if any such there were, which, however, he denied.

The defendants, in their answer, alleged that the lessees had a counter claim for repairs and permanent improvements, and that a number of hands employed on the plantation had a privilege for their wages superior to that of the lessor; but no proof of these facts was offered in the case.

The principal allegations of the complainant were proved, and the defendants on their part adduced proof to show that they had acted in good faith under the orders of the bankrupt court, and that they had sold the property fairly, and held the proceeds for distribution, according to the rights of the parties in due course of the bankruptcy proceedings.

On hearing, the bill was dismissed for want of jurisdiction; and Marshall, the lessor and complainant, appealed.

Three questions now came before this court:

1st. Was this decree dismissing the bill for want of jurisdiction rightly made? Ought not the court below contrariwise, to have entertained the case and decided it on its merits?

2d. Supposing that it ought to have done so, how stood the case on the merits? and

3d. If these were with the complainant, what relief ought he to have?

Messrs. E. T. Merrick and G. W. Race, for the appellant; no opposing counsel.

Mr. Justice BRADLEY delivered the opinion of the court.