National Surety Co. v. Coriell, 289 U.S. 426 (1933)

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National Surety Co. v. Coriell

No. 8

Argued December 15, 1932
Decided May 22, 1933
289 U.S. 426

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE SECOND CIRCUIT

Syllabus

1. It is improper for the District Court in a receivership case to pass upon the wisdom and fairness of a plan of reorganization and the rights of nonassenting creditors without definite, detailed and authentic information. Held that a decree of approval, made without any trustworthy appraisal of assets, or account showing the result of recent operations of the business; without an accurate determination of the number of creditors, the amounts of their respective claims, and the extent to which collateral given or payments made to some of them might be deemed preferences, must be reversed. P. 435.

2. The error of the District Court in not requiring such relevant information before approving a plan of reorganization over objections of dissenting creditors is not cured by a direction from the Circuit Court of Appeals a year later declaring those creditors entitled to an aliquot share of what, it may be estimated, the property would have brought at public sale, and allowing them recovery accordingly if assets to satisfy their claims are then available. P. 436.

54 F.2d 255 reversed.

Certiorari, 286 U.S. 537, to review the reversal of a decree approving a plan of reorganization in a receivership case.