ELKUS, PETITIONER. (IN THE MATTER OF THE MADSON STEELE COMPANY, BANKRUPT.)
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The Supreme Court held that a federal district court has ancillary jurisdiction to compel examination of witnesses and production of documents located within its district, even when the main bankruptcy proceeding is pending in another district. The Court affirmed that district courts sitting in bankruptcy possess the power to issue orders and process in aid of bankruptcy proceedings administered in other districts, thereby allowing a trustee in the Northern District of Illinois to examine New York witnesses in connection with recovering a voidable preference.
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Mr. Chief Justice Fuller delivered the opinion of the court.
The certificate, with the accompanying statement of facts, is as follows:
“On the 28th day of February, 1908, a petition in involuntary bankruptcy was filed in the United States District Court for the Northern District of Illinois, against the Madson Steele Company, and in due course the said corporation was adjudicated a bankrupt, and Frank M. McKey was appointed its trustee in bankruptcy.
“Application was made to the United States District Court for the Southern District of New York for an authorization to examine, pursuant to the provision of section 21a of the national bankruptcy act, the officers of a New York corporation which it was alleged had, within four months prior to the filing of the petition in bankruptcy received a payment under circumstances which would permit of recovery by the trustee in bankruptcy as a voidable preference. These officers were residents of the Southern District of New York.
“The application in the Southern District of New York was' made on behalf of the trustee of the bankrupt’s estate, which was being administered in the Northern District of Illinois, and thé order proposed for signature required the examination of witnesses within the jurisdiction of the District Court .for the Southern District of New York and the production of books and vouchers which contained transactions between the bankrupt corporation and the New York corporation. ’
“The United States District Court for the Southern District of New York refused to direct the appearance and examination of the said witnesses on the ground that it had no jurisdiction to grant an order for examination in a proceeding which was not pending within its own district, and from the order denying the right tp examine the petition to review was taken to this court.
“The questions submitted are:
“I. Did the United States District Court for the Southern District of New York have jurisdiction to grant an order for. the examination of witnesses, who were residents of that district, when the bankrupt proceedings in which the examination was desired were being administered in the Northern District of Illinois? “II. Have the respective District Courts of the United States sitting in bankruptcy ancillary jurisdiction to make orders and issue process in aid of proceedings pending and being administered in the District Court of another district?”
On the authority of Babbitt, Trustee, v. Dutcher, just decided, ante, p. 102, we answer both questions in the affirmative, and it will be
So certified.
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Acme Harvester Co. v. Beekman Lumber Co., 222 U.S. 300 (U.S. 1911)…court of bankruptcy was a subject of much discussion and divers decisions in the Federal courts. In Babbitt, Trustee, v. Dutcher, 216 U. S. 102, and on the petition of Elkus in the matter of the Madison Steel Company, a bankrupt, Elkus, Petitioner, 216 U. S. 115, the matter came before this court, and it was there determined that there was ancillary jurisdiction in the courts of bankruptcy, in aid of the original jurisdiction in the bankruptcy court, to make orders and issue processes summarily in aid of th…
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Robertson v. R.R. Labor Bd., 268 U.S. 619 (U.S. 1925)…Asbestos Co., 253 Fed. 294. Ancillary proceedings are brought in the other district. Babbit v. Dutcher, 216 U. S. 102. Resort is likewise had to ancillary proceedings to secure the evidence of a person living in another district. Elkus, Petitioner, 216 U. S. 115. The Commerce Court created by Act of June 18, 1910, c. 309, 36 Stat. 539, could issue process through the United States. P. 541. Upon its repeal by Act of October 22, 1913, c. 32, 38 Stat. 208, 219, 220, it was provided that the process of the app…
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The Inter-State Nat'l Bank OF Kan. City v. Luther, 221 F.2d 382 (10th Cir. 1955)…rustee had sought an order on appellant for the delivery of books and papers such as was asked in Babbitt v. Dutcher, 216 U.S. 102, 30 S.Ct. 372, 54 L.Ed. 402, or an order for the examination of witnesses such as was asked in [Re] Elkus, Petitioner, 216 U.S. 115, 30 S.Ct. 377, 54 L.Ed. 407. We have been cited to no authority for the proposition that a creditor or other petitioner asking specific relief against a bankrupt’s estate, as provided by the Bankruptcy Act, thereby becomes subject to summary orders…
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