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ROBINSON & CO. V. BELT, 187 U. S. 41 (1902)

U.S. Supreme Court

Robinson & Co. v. Belt, 187 U.S. 41 (1902)

Robinson & Co. v. Belt

No. 46

Argued May 2, 1902

Decided October 27, 1902

187 U.S. 41


The question whether a general assignment for the benefit of creditors is rendered invalid by reason of a provision that the preferred creditors shall accept their dividends in full satisfaction and discharge of their respective claims is one determinable by the local law of the jurisdiction from which the question arises.

Page 187 U. S. 41

Under the Act of Congress of May 2, 1890, the laws of Arkansas respecting assignments for the benefit of creditors, as well as the statute of frauds, are extended and put in force in the Indian Territory. In adopting these laws, the courts of the Indian Territory are bound to respect the decisions of the Supreme Court of Arkansas interpreting them.

Under the laws of Arkansas, thus made applicable to the Indian Territory, a stipulation for a release in a general assignment, which is made only as a condition of preference, does not invalidate the instrument.

Other objections were made in the assignments of error, but, as they did not appear to have been raised in either of the courts below, it was held that they could not be raised in this court.

While it is the duty of this court to review the action of subordinate courts, justice to those courts requires that their alleged errors shall be called directly to their attention, and that their action shall not be reversed for errors which counsel in this court have first evolved from the record.

This was a writ of error to a judgment of the Circuit Court of Appeals for the Eighth Circuit affirming a judgment of the Court of Appeals of the Indian territory, which latter court affirmed the judgment of the United States Court for the Northern District of such territory sustaining an interplea by one King to recover the value of certain property attached and sold by Robinson & Co., which had been conveyed to King as assignee by a deed of assignment made by his codefendant Belt.

The facts of the case are substantially as follows: one John C. Belt, a resident of Arkansas, who was engaged in business in the Indian Territory, on December 29, 1891, made an assignment for the benefit of his creditors to King, as assignee.

On the following day, "J. M. Robinson & Co.," plaintiffs in error, brought suit against Belt in the United States court in that territory, sued out an attachment, and levied upon the property assigned. Belt failed to plead, and judgment by default was taken against him, and the attachment sustained.

On May 31, 1892, defendant in error King filed an interplea,

Page 187 U. S. 43

setting out his deed of assignment and claiming the property as his by virtue of such deed. After so doing, he entered into a stipulation with other attaching creditors, of whom there were a large number, whereby it was agreed that this interplea should be considered as filed in every suit, and, virtually, that the result of the interpleader proceedings in the suit of J. M. Robinson & Co. should control all other suits. The property was, after its attachment, sold under order of court, pursuant to statutes governing such proceedings, and at such sale realized the sum of $7,900.

A demurrer to the interplea was filed and sustained by the court, from which order King sued out a writ of error from the United States court of appeals. He gave no supersedeas bond, however, and the fund was, by order of the court, distributed pro rata to the attaching creditors according to their priorities. The court of appeals reversed the judgment on the demurrer, and on September 19, 1895, Robinson & Co. filed their answer to the interplea, denying that King was owner by virtue of the deed of assignment, and alleged the same to be fraudulent and void; denied that King filed a complete inventory; denied that certain personal property described in the deed of assignment was the property of the wife of Belt, and admitted that the property described in the deed was seized under the attachment.

The trial on the interplea was had before a jury, and resulted in a verdict in favor of the interpleader, which found the attached property to be the property of King, as assignee. A judgment was thereupon entered in his favor, which was subsequently affirmed, first, by the Court of Appeals for the Indian Territory, and then by the Circuit Court of Appeals for the Eighth Circuit. Whereupon a writ of error was sued out by Robinson & Co. from this Court.

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