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involuntary provisions were intended to be efficient in the punishment of dishonest debtors, and the distribution of their property among their creditors. That efficiency would be entirely neutralized if the petitioning creditors, instead of acquiring advantages by their proceedings, are to incur heavy pecuniary burdens.
The analogy in the South Carolina case I have cited, does not, however, exist in Pennsylvania, but I do not think it necessary that it should. I base my opinion on the equitable rule that he who shares in a benefit should contribute a like share to the expenses incurred in realizing the benefit. The Bankrupt Law is intended to be an uniform system. If it be just and equitable in South Carolina to tax the compensation of the counsel for the petitioning creditor as part of the costs, as I believe it is, it is just and equitable to do the like in Pennsylvania.
The case Ex parte Plitt, 2 Wall. Jr. 453, is somewhat in point. One Mathias Aspden died in London, 1824, leaving an immense personal estate to his “heir at law” or “lawful heir.” Litigation followed to determine who was entitled to the estate, and occupied the attention of the Federal Courts from 1826 to 1852. Several of the most eminent counsel in the country were concerned in it; and the question presented in Ex parte Plitt in relation to counsel fees was raised by counsel, who, owing to the complex character of the litigation, were instrumental in securing the fund for the successful claimants, though in the end they represented conflicting interests.
Judge Kane, in the absence of Judge GRIER, delivered the opinion of the Circuit Court. I quote as follows:
“Over and above the fees of office, this fund is subject to three classes of charge :
“1st. The necessary expenses of ascertaining it, and reducing it into possession.
“2d. A reasonable compensation for its safe keeping, and the supervision of its interests.
“ 3d. The expenses of ascertaining the proper distributees, and making distribution among them.”
In the first class he included the expenses paid by an unsuccessful claimant for a commission to England, and $1000 as compensation for services in securing a large amount of money to the estate.
In the third class he included the claims for counsel fees, and said: “We have no doubt of the power of the court, where a fund is within its control, as in the case before us, to take care of the rights of the solicitors who have claims against it, whether for their costs, technically speaking, or their reasonable counsel fees.”
Again: “Now, it is the familiar rule of courts of equity, where a suit has been instituted and carried on for the benefit of many, that all who come in to avail themselves of the decree shall bear their just proportion of the charges.
The parallel is sufficiently clear to need no application to the present matter.
Of course this decision would not give to the petitioning creditors the right to enforce contribution from the other creditors in case of failure. It is only when success follows his petition, and there are assets to be distributed, that they can be called on to share the expense.
The petitioning creditor takes these chances; and should he fail to obtain a decree of bankruptcy, or after decree fail to discover assets, he must bear the burden alone.
The only general principle ruled is, that the compensation of the counsel for the petitioning creditor is taxable as costs in cases of involuntary bankruptcy. No general rule can be laid down as to the amount of compensation. That is a subject within the discretion of the court, and cannot be determined by an agreement between the parties. The practice observed in this case is approved, and will be a precedent to govern in all like matters.
Opinion of the court by
McCANDLESS, J.-As the solution of this question does not depend upon any statutory provision, and, as a precedent, is of consequence to the profession and the public, before concurring with the Register, I have given to the subject mature consideration. I have arrived at the conclusion that his opinion is based on sound principles, and sustained by sufficient authority. The fund is within the control of the court, and it is our province so to administer it as to do exact justice to all the creditors. We have judicial knowledge of the professional services rendered by the able counsel of the petitioning creditors, by whose exertions the fund has been realized; and, as we consider the fee charged reasonable, it is proper that their compensation, as one of the incidental expenses, should be deducted before distribution.
The decision of the Register is affirmed.
ABSTRACTS OF RECENT AMERICAN DECISIONS.
SUPREME COURT OF CALIFORNIA.
COURT OF CHANCERY OF NEW JERSEY.?
CONSTITUTIONAL LAW. Regulation of Commerce.—The term “ commerce," as employed in section 8, Art. I. of the Constitution of the United States, is not limited to an exchange of commodities only, but includes, as well, "intercourse" with foreign nations, and between the states; and the term “intercourse” includes the transportation of passengers: People v. Raymond, 34 Cal.
When the Congress, in the exercise of its constitutional right, has hy its legislation established regulations of commerce with foreign nations, and among the several states, its authority is paramount and exclusive, and its enactments supersede all state legislation on those subjects. Whether the states could constitutionally exercise this power in the absence of congressional legislation, not decided : Id.
In the case where the state has not the constitutional power, by means of direct legislation, to regulate the intercourse of its citizens with foreign nations, and with the other states, it cannot accomplish by indirect methods what it is forbidden to do directly: Id.
By the enactment of section 285 of the United States Internal Revenue Act, 2 Bright. Dig. 271, the Act of August 30th 1852, and the Act of March 6th 1855, 10 U. S. Stat. at Large 61, 715, Congress has undertaken to regulate the entire business of transporting passengers by sea : Id.
The act entitled “ An act to provide revenue for the support of the government of this state from a tax upon foreign and inland bills, passengers, insurance companies, and other matters," passed May 14th 1862, has no reference to the execution of the inspection laws of this state, and is not in the nature of a police regulation, but is a measure designed for revenue purposes only: Id.
The stamps which, by the provisions of the act, are required to be purchased from the state, are to be regarded in no other light than as a tax on the contract for passage, to be paid by the passenger. This is a regulation of commerce within the meaning of section 8, Art. I. of the Federal Constitution, and the act is unconstitutional and void : Id.
Certificate of Election to ex officio Office. It is not essential to the right of entry on the discharge of the duties of an ex officio office, that the incumbent should receive a separate certificate of election thereto, or take there for a separate oath of office, when not specially so required by the act creating or regulating such office : People v. Kelsey, 34 Cal.
Power of Legislature.—The legislature has the constitutional power by enactment to divest an officer of an ex officio office to which he had been elected and duly qualified, by a repeal of the law under which he became invested therewith, provided, where such office be created under the Constitution, such repeal does not in effect abolish such office: Id.
1 From J. E. Hale, Esq., Reporter ; to appear in 34 Cal. Rep. 2 From C. E. Green, Esq., Reporter; to appear in vol. 4 of his Reports.
In such case, however, this power does not extend to the transfer of an ex officio office which, under the Constitution, is required to be filled by election, to the incumbent of another office who has not been elected to such ex officio office : Id.
The clause, to wit: “ Assessors and collectors of town, county, and state taxes shall be elected by the qualified electors of the district, county, or town in which the property taxed for state, county, or town purposes is situated,” contained in section 13 of Art. XI. of the Constitution, is imperative and mandatory, and restricts the power of the legislature to a particular mode of providing such assessors and collectors in the first instance, subject to such mode of filling vacancies which may be occasioned by the death, resignation, or other legal disability of the incumbent as the Constitution has, and statute law may, provide : Id.
The legislature may by law devolve the office and duties of tax collector upon the incumbent of any other elective office, but such law must precede the election of such officer, and his election must be by the qualified electors of the tax collector's district: Id.
The act entitled “ An act making the county treasurer of San Joaquin county ex officio tax collector," passed April 2d 1866, was not designed to fill a vacancy in the office of tax collector, but it was to make the treasurer, instead of the sheriff, of San Joaquin county tax collector. In so far as the act provides for the transfer of said office to take place before an election of such treasurer occurs, it is unconstitutional and void : Id.
CONTRACT. See Railroad. Specific Performance-Laches.—A delay of fifteen years in calling for the specific performance of a parol contract for the conveyance of land, without any attempt to enforce it in the lifetime of the contractor, is a circumstance of great weight against the party seeking performance, and will render necessary more strict and fuller proof, and a closer scrutiny of the evidence: Eyre v. Eyre and Others, 4 C. E. Green.
Part performance will take a contract out of the Statute of Frauds, when it has been in part performed in such manner that a refusal would be a fraud on the other party. But for this purpose the contract itself must be clearly proved, and the acts of part performance must be referable to the contract alone: Id.
DEBTOR AND CREDITOR. Fraudulent Conveyance.—A conveyance made in consideration of the grantee's assuming the mortgages upon the property, amounting to onefourth of its value, declared voluntary and void as against the creditors of the grantor, as to three-fourths of the value ; but being positively intended also to delay and defraud creditors, it was declared void in toto, and the purchaser (at a sheriff's sale of the property) entitled to hold the same free from all claim of the grantee except for the amount due on such mortgages held or paid by him and the interest thereon, the
rents and profits to be set off against so much of those debts as are due to the grantee : Mead v. Combs, 4 C. E. Green.
Mortgage fraudulent as to Creditor.-A judgment-creditor purchasing at sheriff's sale, under his judgment, is entitled to have a mortgage upon the property, given by the defendant in execution in embarrassed circumstances, set aside and declared void as against such purchaser on the ground that it was given to delay and defraud creditors, and without consideration : King v. Storey and Others, 4 C. E. Green.
Bill to set aside Conveyance in fraud of Creditor.--A creditor cannot file a bill to set aside a transfer of property fraudulently made by his debtor, until he has a judgment or execution, such as would give a lien on that property if not transferred: Green v. Tantum, 4 C. E. Green. At common law, a judgment or execution gave
the choses in action of the debtor or debts to him. But by the Act of March 7th 1850, to prevent fraudulent trusts and assignments, and the supplements to the Chancery Act, a creditor upon the return of an execution nulla bona, has a lien upon the choses in action of his debtor, and can maintain a suit to set aside a fraudulent assignment: Id.
Although a purchaser of property transferred by a debtor to defraud his creditors, pay full consideration and have no notice that the property is transferred to him for that purpose, yet if the circumstances are such from which he must have inferred that such was the object, the sale will be set aside as against a creditor: Id.
DEED. Variation by parol agreements.- Where a deed expresses a consideration, though merely nominal and never paid, no use results to the grantor, and parol proof that the conveyance was intended to be in trust for the grantor will not raise a trust : Hogan v. Jaques and Others, 4 C. E. Green.
A trust estate cannot be sold by execution : Id.
That a deed absolute on its face was really given as security for a debt and intended only as a mortgage, may be shown by parol proof, but the proof must be very plain where the debt does not remain, or is considered as paid by giving the deed: Id.
A verbal promise by the grantee to the grantor that he would reconvey the land upon receiving back the amount of his debt will not be enforced; much less against a purchaser for valuable consideration, without notice: Id.
EJECTMENT. Writ of Restitution.—A party and her tenants, coming into possession of lands, after an action brought to recover possession, under a prior unrecorded deed from two of the defendants in the action, of which plaintiff had no notice when the action was commenced, were properly dispossessed under a writ of restitution, issued on a judgment for plaintiff in said action : Mayne v. Jones, 34 Cal.
A motion made to set aside the return to the writ, showing the dispossession of said party and her tenants, and to reinstate them in possession, upon a showing of said facts, under the peculiar circumstances of the case disclosed by the record, was properly denied by the court