Commonwealth Trust Co. v. Bradford, 297 U.S. 613 (1936)

Commonwealth Trust Co. v. Bradford


No. 273


Argued February 5, 6, 1936
Decided March 30, 1936
297 U.S. 613

CERTIORARI TO THE CIRCUIT COURT OF APPEALS
FOR THE THIRD CIRCUIT

Syllabus

1. The District Court has jurisdiction over suits by receivers of national banks. 28 U.S.C. §§ 41(1) and (16). P. 617.

2. A suit by a receiver of a national bank to determine his right of participation as cestui que trust in a trust originally set up and administered by the bank but turned over, with the receiver’s consent, to a successor trustee appointed by a state court is a suit within the equity jurisdiction of the federal court. P. 618.

3. Its jurisdiction having been invoked in such a suit, it is the duty of the federal court to determine the issues involved. Id.

4. Such a suit is not in rem; the decree sought determines the right of the receiver against the trustee, but does no interfere with the trustee’s possession or with the power of the state court to order distribution of assets, and its prosecution is not opposed to rules of comity. Pennsylvania v. Williams, 294 U.S. 176, and Penn General Casualty Co. v. Pennsylvania, 294 U.S. 189, distinguished. P. 619.

5. Property in the possession of a trustee is not in custodia legis, as is property in the possession of a receiver. P. 619.

78 F.2d 92 affirmed.

Certiorari, 296 U.S. 564, to review the question of jurisdiction and its appropriate exercise in a suit by the receiver of a national bank against a trustee appointed by a state court, to establish the rights of the plaintiff in the trust fund. The court below affirmed with modifications the decree of the district court in favor of the receiver.