Page:Federal Reporter, 1st Series, Volume 8.djvu/760

74:6 ,, PEDEBAL BEPOBTEB. �G-AgKii^ii and otWrS jj, BiNTON and, others. VoN'Utassy and other's u. Gabvin and others. i �[Oireuitr Court, E. D. Pennaylvania. July 1,1881.) �L Faaud— Joint JupfjMBNT— Spcret Frbfebence op One of the PXiAWTrBTs. A number of creditors made a loan to an inso) vent flrm to enable it tb. carry on its business, takiiig as security a' joint judgment, with an understanding tiiat the debtors should give no other judgiaenta. Two of these oreditors secretl^ took ,8 judjgment note from t)ie flrm for the amount of their original claimaj npt including their proportion of the loan. Upon the failure of the flrm these two creditors, in violation of certaiti proriiises made with their knowled^ bj^ the defatoiB and af terinducing delay in the issuing of execution on Uie orlgitial judg- ment, entered up their judgment. note, issued execution, and s^vept: away the entire personal property of the debtors. , Held, that this was a fraud .upoh tjjie other parties to the original judgment, and that in the dtstrifeutlon or the ^ro- ceeds of the detrtor's property the execution thiis obtained should be pSetponed to the execution upon that judgment, :. ; ,.;'I �2. PbiNCIPAI, AN» AgBJST— I'BAUD OP AaENT-rHnSBAIfD-rATTOHNEI'. j; ;. i �Thetwo preferredcreditors vrere rfjpresented bythc^an}.e>ttorneyaj3ihe debt- ors, and one of them was the wife of one of the debtors. The delay'iri issuing execution upon the original judgment was dbtainedj not by the f#6 «ireSiitoTs in person, but by a promise made by the debtors dnd byiihe »ttoiney:>0)f;;t]iaitwo creditors that no other judgment ^houl^ b^ antered. , HMf'^ii&K tiie t>vo credit- ors could not take advautage of such delay. . �3, Baneruptct — PaocuRATioN— What Does not Amount to. �Debtors agreed to give a creditiir notice wheh datigor threatene^, iii order that he might obtain the flrst. execution. Afterwards they iffdniced him, by misrepresentation, to delaiy •pio<i!eedingj, a^id p;;ocured .an: exepuijipn to be issued by anothpr crediter more than sufflcicnt to exliau.st their property. They then gave notice of this execution to the flrst Crediter, who there- upon also issued execution. Hda,,ihBA this notice bythe debtors was nota procuration of the second execution. �Exceptions to Eeport of Master. �This was a bill in equity by assignees in bankrupitcy to sel asiae, on the grpund of procuration, two executions, both levied on tfcie debt- or's property priorto the filing of the petition in bankruptcy. 'A cross-bill was filed jby the plaintiffs in the second execution, cl^iming to set aside the first execution on special equitable grdunds outside of the bankrupt act. The case was referred to a ma-ater, (Edwih T. Chase,) who reported substantiaily tHe f'ollowing f aots ; �The flrm of A,, Benton & Bro., composed of Albert and Charles Benton, were lumber dealei;s in Philadelphia. ' In Juiie; 1876, ttiey b'ecame fluarieiauy embarrassed. In otcfer td carry on ' their business, they ihade' application to sbme.of their iargeSt, icreditors- for a; loan of moiray; representing that *ll©y were not able to meet their obligations, but that if they could obtain 9U«h a loan they " could bridge over their embarrassments." Honorable Charles P. ��� �