IN BE KINNE.
(Di8trict Oourt, D. NetD JtrS6Y. December 6, 1880.)
1. BAl'lKRUPTC1· - SECURED CREDITOR - PnOPERTY SOLD SUBJECT TO
ST. t 5075.-A creditor may prove his debt as unsecured, and consent to the discharge of the bankrupt, where the property of the debtor, after being mortgaged for the debt, was subsequently sold under an execution subject to such mortgage.-[En.
In Bankruptcy. On Specifications against Discharge. NIXON, D. J. Several specifications have been filed against the discharge of the bankrupt in this case, but they all seem to grow out of or revolve around one transaction, to-wit: the proof of a. secured debt by one of the consenting creditors without surrender of the security. The facts were these: One Michael Van Iderstine, in the month of November, 1872, sold to the bankrupt a tract of land in the city of Paterson, and accepted his bond for $5,000, a portion of the consideration money, the payment of which was secured by a mortgage upon the premises purchased. The property was subsequently sold by the sheriff of the county of Passaic as the property of the bankrupt, upon executions issued upon two judgments against him, but sold subject to the above-recited mortgage. Cornelius Hardenburgh became the purchaser, and received from a sheriff a deed for the premises on the twenty-fourth of November, 1877, and has since been the owner. Michael Van Iderstine departing this life, Tennis Van Iderstine became the. acting executor of the estate, and held the said bond of the bankrupt, seCll,red by the real estate of Hardenburgh. He made no surrender of the n;l.Ortgage, but proved his bond as the unsecured debt of the bankrupt, and afterwards signed a power of attorney, authorizing the attorney named to consent to the discharge of· the bankrupt for the payment of his debts. The single question presented is whether the holding of security for a debt, on property not owned by the bankrupt, prevents the creditor from proving his debt as unsecured and
from consenting to the discharge. It would seem that there ought not to be any difficulty or doubt about such a question. It ha,s been settled for a long time. The creditor holds the bond of bankrupt as an evidence of the bankrupt's indebtedness to him. The only security which the act requires him to surrender, before he proves his claim in order to participate in the dividends of the estate, is a. "mortgage or pledge of real or personal property of the bankrupt." See section 5075, U. S. Rev. St. He may retain whatever other security he is fortunate enough to have, and may look to and exhaust all the sources of payment which he holds, until his claim is fully satisfied. Such was the dictum of Lord Chancellor Hardwick, in 1743, in Ex parte Bennett, 2 Atk. 527; and such has been the -uniform ruling of the English and American courts in bankruptcy c%ses from that day to this. Exparte Parr, 18 Ves. 65; English v. Braley, 2 Bas. & Pul. 62; In '1'6 Babcock, 3 Story, 393; In ,.6 Cram, 1 N. B. R. 504; In re Dunkerson, 4: Biss. 253 j In '1'6 Anderson, 12 N. B. R. 502. The bankrupt is entitled to his discharge.
ESTES & CARTER.
(Cweuit (Jowrt, D. Oregon. December 13, 1880.)
FRAUDULENT CONVEYANCE-SUBSEQUENT JUDGMENT..,;..LtEN.-The
statute of Oregon concerning fraudulent conveyances provides, among other things, that every conveyance of any estate in lands "made with intent to hinder, delay, or defraud creditors of their lawful demands, * · · as against the person so hindered, delayed, or defrauded, shall be void." Held, under this statute, that until the conveyance is set aside a mere equitable right remains in the creditor, which he mayor may not enforce, and until he does enforce it the estate is in the grantee, and upon it a judgment creditor acquires no lien by his judgment.-[ED.
In Bankruptcy. Error to the district eonrt. FIELD, C. J. In July, 1877, Levi Estes and Charles M. Carter, 8S partners, composing the firm of Estes & Carter,