In re Allen B. Wrisley Co.

GROSSCUP, Circuit Judge (dissenting).

To my mind, in a case, such as presented by this petition, the court should have allowed the petition to háve been filed; and, the facts being established by the proofs,'-have entered an order, without prejudice to the composition, so far as it affected creditors not joining in the petition, and without prejudice to the creditors joining in the petition, so far as the com-' position was an executed matter, requiring the bankrupt and the trustee, the wrong doers, to account for any advantage obtained by them .through the wrong perpetrated. Had the purchaser of the bankrupt’s assets been an innocent third party, the petition might be'unavailing. But the composition money came, not from an innocent third person, but from the trustee. A trustee cannot be allowed thus either to help himself or his cestui que trust; and as to him there cannot be applied the considerations that in the case' of an innocent purchaser, would preclude the opening up of the. máíter. I think that the majority opinion, while recognizing clearly the fraud on the bankruptcy law that the facts averred disclose, fails to recognize the power in the possession of a court of equity to circumvent such fraud by requiring the wrong doer to surrender' up the advantages of the fraud.

The order is affirmed.