Gottschalk & Co. v. Smith

Robinson, J., delivered the opinion mf the Court.. Proceedings in involuntary insolvency, were instituted against Eorster, Clark & Co., and pending the proceedings, and before they were adjudicated to he insolvents, attachments were issued by certain creditors, and the main question is whether the attaching creditors thereby acquired a lien upon the property of the insolvent debtors; and this, turns upon the construction of sec. 11, Art. 47, of the Code, which says: “The 'estate of the insolvent shall he distributed according to the principles of equity, and no creditor shall acquire a lien by fieri facias or attachment, unless the same be levied before the filing of his petition.” The language of the last sentence, it will he observed, is “his petition,” thus showing, it is argued, that the Legislature meant, that this section should apply to cases, only of voluntary insolvency, where the application is by the petition of the ⁵⁶³ debtor. In the original Act of 1854, chapter 193, and in the old Code, the language is, “the petition’” and why the pronoun “his” was substituted for the Article “the” in the present Code, is a matter we are unable to explain. Be that as it may, we all agree, that the provisions of this section apply alike to voluntary and involuntary insolvency; and that the Legislature meant, that in all cases of insolvency, the property of the insolvent, shall be distributed according to the principles of equity, and that no creditor should acquire a lien by attachment or by any other process, unless the same shall have been levied before the proceeding in insolvency was instituted.

In fact, since the decision in Pinckney vs. Lanahan, 62 Md., 448 , this can hardly be considered an open question. The proceeding in that case, was in involuntary insolvency, and after the filing of the petition, and before the debtors had been adjudged to be insolvents, an attachment was issued by a creditor, and the Court held that the title of the trustee in insolvency related back to the filing of the proceeding,, and was a bar to the attachment. In Gottschalk’s Case, however, it is contended that the attachment was, in fact, issued before the filing of the petition in insolvency. But this contention