ority of the United States is only a "priority of payment, but not of possession." It is in the nature of a lien or mortgage for the payment of the duties. Conard v. Atlantic Ins. Co. 1 Pet. 441; Trar:y v. fJwartwout, 10 Pet. 95; U. S. v. Lyman, 1 Mason, 499; Howland v. Harris, 4 Mason, 497. The custody of the collector is superseded and discharged when the property is seized under legal process. U. S. v. Cuse of Silk, 13 Int. Rev. Rec. 58. The case of Harris v. Dennie,: 3 Pet. 292, relied on by the collector, has been overruled in Conard Pacific Ins. Co. 6 Pet.271. The property being in the custody of the court it had power to make the order asked for. Bach v. Colbath, 3 Wall. 341. The duties having been tendered to the collector he has no longer any right to interfere.
John K. Valentine, U. S. Dist. Atty., for the collector.
This proceeding being against an officer acting under a revenue law, on account of a right claimed by him, is within section 643, Rev. St. A foreign attachment is a suit within the statute. Taylor v. Carryl, 20 How. 597; Weston v. City Council of Charleston, 2 Pet. 464.' In this case an attempt is made to compel the collector to accept the duties-an act which he could not be compelled to do by'mandamus. Kendall v. U. S.12' Pet. 52t>;McClung ,,";illiman, 6 Wheat. 598; Same v. Same, 2 Wheat. 369; McIntire v. Wood, 7 Cranch, 504; Marbury v. Madison, 1 Cranch, 137. Attaclnllents issued out of a state court do not affect the rights ·of the United States to hold the merchandise until the payment of duties. HarTis v. Dennie, 3 Pet. 292. This case was not overruled by Conard v. Pacific Ins. Co. 6 Pet. 262. .Judge story delivered the opini'On of the supreme court in both cases, and in the latter case Judge Baldwin, in the court below, expressly distinguished them. Tbe 110ctrine of Harris v. Dennie was reaffirmed in Taylor CarTyl, 20 How. 594. See, also, U. S. v. Lyman, 1 Mason, 482
The court filed a decree refusing the motion to remand, and setting aside the service of the writ as to John F. Hartranft, the collector. No opinion was filed.
:Oircuie Oourt, lV, D. illinois.
the final disposition of the case.
2. CASE S'l'ATED.
Order denying a bankrupt his discharge for want of timely application reversed, where the application was made before a tinal order closing tile case, though after an order permitting a creditor to move for '6 final ord'er.
James Coleman, for bankrupt. John W. Ranstectd, contra.
ilN RE YOUNG.
DRUMMOND, C. J. The bankrupt in this case was adjudged a bank. rupt in 1878. On the sixth of September, 1880, no application for a discharge having beenmade to the district court by him, that court made an order that all bankrupts who should not take the necessary steps to have the question 'of their right to a discharge ready tobe determined on. or before the first Monday in December following, would be deeIlled to have unreasonably delayed in endeavoring to obtain a discharge, and it was declared that any creditor or other person interested in the bankrupt's estate might, without notice, mO\'e for a final order closing the case and denying the discharge for want of timely application therefor. The bankrupt had notice of this order, but the counsel who had attended to his case being sick, he states that he waf.' informed and believed,. on that account, no steps would be taken to prejudice his right to make the application for discharge. . On the the fifteenth of December the bankrupt caused an applicati9,n in due form to be made for his discharge and presented to clerk of the district court, who refused to receive it, because of the order of the cOllrt. of the sixth of September. On the third of January, 1881, the matter was brought to the notice of the district court by a petition in due fomi. alleging these facts, and on thesam.e day a creditor of the bankrupt, who had previously proved his debt against the estate, made. an application to the conrt for a final order Closmg the case and denying a discharge to the bankrupt, and the court thereupon granted the application of the creditor, and denied the bankrupt his discharge for want of a timely applicatibn for. a discharge. It is this order. of the district court which the bankrupt asks to have reversed, and that the district court ahouldgrant his discharge, and the only question in the case is whether he should have been permitted to apply for a discharge under the facts stated. There can be no doubt it was entirely competent for the district court to make the order of September 6, 1880. Proceedings were pending in many cases without any application having been made for the dis'charge of the bankrupts reFipectively, and it was quite proper that some action should be taken by the court in order to finally close all these various proceedings. The only question is whether the court could refuse the application before the case was finally closed by some action which had that effect. The law upon this subject, as it was modified by the amendment of July 26, 1876, is as follows:
"At any time after the expiration of six montus from the adjudication of bankruptcy, or if no debts have been proved against the bankrupt, or if no assets have come into the hands of the,assignee at any time after the expiration of 60 days,and bej'ore the final disposition oj' thecanse, the bankrupt may apply to the court for a discharge from his debts. This section shall apply in all cases heretofore or hereafter commenced." ,
If there had been an order of the district court made, as contemplated by that of the sixth of September, 1880, finally closing the case, before the application was made by the bankrupt for a discharge ,on the fifteenth of December, there could have been no doubt that it would have been too late; but, in fact, no action was taken by the court, finally closing the case, until after the application for dischargewas made to the clerk oithe c o u r t , ' On, the third of January, 1881, the bankrupt called the attention of the court the fact that he had made his appllcatiOIi on the fif· teenth of December, 1880. He ought not to be prejudiced by the refusal of the clerk then to receive and file the petition for a discharge. At that time,the case had not been finally disposed of, and it was not until the third of January, 1881. I adhere to the ruling made in case <ilf re Forsyth, Chi. Leg. News, Dec. 11, 1880, "that in order to deprive the"bankrupt of the right to make his application for a charge there should be some action of the court to the effect that the had been finally disposed of." So that, I think, the true; construction of the order of the district court of the sixth of September, 1880, when considered in connection with the act of congress upon this sulJject, already referred to, must be that, until the final disposition of the cause by some action of the court, the effect of which is to show such disposition, the bankrupt has a right to present his application for a discharge, because the statute gives him that right, and if there is no other reason than such as appears in this case his discharge ought to be granted. The order of the district court, therefore, will be reversed, and that court directed to proceed and grant the discharge, unless some other reason is found to exist than that stated in the order here sought to be reviewed.
ALEx:Al'I'PER V. GALT.
and others,Assignaes, etc., v.
(District Oourt, N. D.lllinoi8. November 1, 1881.)
1. BANKRUPTcy-PREFERENCEB-WHEN VALID.
Preferential payments, made more than three months before bankruptcy, assignee in cannot be set aside in favor of
Assignees in bankruptcy do not succeed to the. rights of assignees in insolvency whose assignment they have had set aside.
In Bankruptcy. McFarren, f()r plaintiffs. Chas. H. Roberts and Manahanet Ward, for defendant. :BLODgETT, D. J. This action of trover to recover a proml.f3sory note 'madebyoJ;le Williams to the hankrupts, Patterson & Co., aiid by them, as is a,llegeq. by .plaintiffs, fraudulently indorsed. and delivered to defendants. <The niateriaJfacts; as shown without disvute in the or by iJtipulation in writing, are as follows:"
Patterson & Co. wereenga:ged inJlUsil1ess !bankers at Sterling, in this district, from 1869. to the sixteenth of. January, J878. On the seventeenth of January, 1878, said Arm made a voluntary assignment of their property to one Roswell Champion, in trust; for the payment of t.heir debts, but Champion; the assignee, did not file his inventory and bond with the clerk of the county courtof Whiteside county, wheretbeparties resided, pursuant to the statute of this state in regard to voluntary assignlllents, approved May 22, 1877, until the fifth of February, 1878. . On the twenty-fourth day of April, 1878, a petition in bankruptcy was flIed in this court against Patterson & .co., on which they were subsequently adjUdged bankrupts, and plaintiffs have been duly appointed and qualified assignees; and, under a decree of this court, in a suit brought by plaintiffs as assignees in bankruptcy, the assignment to Champion was set aside on the twentieth of July, 1879. It also appears in proof, and is undisputed, that defendant, Galt, was treasurer of a cheese factory in the vicinity of Sterling, and kept his funds as such treasurer on deposit with Patterson & Co., and that on the sixteenth of January, 1878, there was to his credit on this deposit . account about $1,540; that about two months before the sixteenth of January, defendant told J. M. Patterson, one of the firm, that the money to his credit as treasurer belonged to the cheese factory, and that he would draw it out unless he was sure of getting it or having it protected, and that Patterson then told him he should be protected. On the sixteenth of January Patterson & Co. were insolvent and on the eve of making an assignment for the benefit of their creditors, whenJ. M. Patterson took the note in question from the tiles of bills receivable belonging to his banking firm, computed the interest on it to that date, and charged the sum then due for principal and interest to the defendant's account as treasurer, indorsed the note with the firm name, and placed it, in an envelope, before them in the bank vault, containing some