Page:Federal Reporter, 1st Series, Volume 3.djvu/802

 FBOEHA.M V. OOZZENS. 795 �the court, in disposing of them, should do lîkewîse, îs but a natural sequence. �The case presented to the court is substantially this : Wil- liam J. Cozzens, as assignee in bankruptcy of E. Truman Peckham, has in his hands and control the sum of about $3,475, the proeeeds of a parcel of real estate to which he became entitled as assignee, subject, as is alleged, to two mortgages thereon, executed by said Peckham within the two months next preceding the commencement of proceed- ings in bankruptcy against him. The assignee refusing to recognize these mortgages as valid, by order of the court the estate was sold at auction, free and discharged of the claims of the mortgagees, and the proceads, less expenses of sale, paid over to the assignee, to be in his hands, subject to the just claims, if any, of the said mortgagees. �Soon after the sale, one of those mortgagees, Wm. P. Peck- ham, a brother of the bankrupt, filed his biU against the said assignee and the bankrupt, claiming that out of said pro- eeeds he should be paid the amount of his mortgage claiin, (about |1,200,) and the other mortgagee, John G. Smith, a brother-in-law of the bankrupt, filed his bill, claiming that out of said proeeeds he should be paid the amount of his mortgage claims, (about $2,773.46.) Whereupon the said assignee filed what are styled cross-bills against the said mortgagees, respectively. To ail these bills, answers and replications were made as required by the rules, and evidence taken — the parties themselves giving testimony as witnesses before the commissioner. �The mortgagees, in their biUs and answers, assume and aver that their claims are just and undisputable, and the mort- gages to them unimpeachable, despite the provisions of the bankrupt law; while, on the other hand, the bills and answers of the assignee involve and embody a deniai of the allega- tions contained in the bills and answers of the mortgagees, and explicitly charge, in answers as well as in bills, as follows : "That the said E. Truman Peckham was insolvent at the time of the execution and delivery of the mortgage deeds in question, and that the said mortgagees, respectively, had rea- ����