In Re Convisser, 6 F.2d 177 (9th Cir. 1925)

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US Court of Appeals for the Ninth Circuit - 6 F.2d 177 (9th Cir. 1925)
June 15, 1925

6 F.2d 177 (1925)

In re CONVISSER.
NEWMAN
v.
CLAUSSEN.

No. 4507.

Circuit Court of Appeals, Ninth Circuit.

June 15, 1925.

*178 Edgar C. Levey, of San Francisco, Cal., for appellant.

Brownstone & Goodman, of San Francisco, Cal., for appellee.

Before HUNT, RUDKIN, and McCAMANT, Circuit Judges.

RUDKIN, Circuit Judge (after stating the facts as above).

As already stated, the case is before this court both on appeal and on petition for revision, and the parties have discussed the testimony as though the case were properly here on appeal. But it is well settled that the order in question is an administrative order in the ordinary course of bankruptcy between the filing of the petition and the final settlement of the estate, and is not appealable. In re Loving, 224 U.S. 183, 32 S. Ct. 446, 56 L. Ed. 725; In re Mueller, 135 F. 711, 68 C. C. A. 349; In re Patterson-MacDonald Shipbuilding Co. (C. C. A.) 288 F. 546; In re Irving Whitehouse Co. (C. C. A.) 293 F. 287. The appeal is therefore dismissed and our jurisdiction on revision is limited to matters of law.

Section 2955 of the Civil Code prohibits the mortgage of the stock in trade of a merchant, and section 3440 prohibits the sale, transfer, or assignment in bulk of the stock in trade, or a substantial part thereof, without first giving or recording the notice therein prescribed. The manifest purpose of these provisions was to protect the stock in trade against liens and transfers of every kind for the benefit of general creditors. But, notwithstanding these express statutory prohibitions, the petitioner earnestly insists that a merchant may still pledge the whole, or a substantial part of his stock in trade, because a pledge is not a sale, transfer, or assignment, within the meaning of the law. With this contention we are unable to agree. As already stated, we think it was the plain purpose of the Legislature to prohibit liens and transfers of every kind of the merchant's stock in trade, and that the language employed was ample for that purpose. While section 1039 defines a transfer as an act of the parties, or of the law, by which the title to property is conveyed from one living person to another, section 2924 defines a pledge as follows:

"Every transfer of an interest in property, other than in trust, made only as a security for the performance of another act, is to be deemed a mortgage, except when in the case of personal property it is accompanied by actual change of possession, in which case it is to be deemed a pledge."

A pledge is therefore a transfer of personal property accompanied by an actual change of possession, and section 3440 makes no distinction between transfers accompanied by a change of possession and transfers which are not. So far as we are advised, this particular provision of section 3440 has never been construed by the Supreme Court of the state, but the decisions of that court on kindred questions are in harmony with the views we have expressed. Thus in Dubois v. Spinks, 114 Cal. 289, 46 P. 95, the court said: "It makes no difference whether the transaction be a sale or a pledge, since, in either case, it is a `transfer of personal property,' in the sense of the statute." See, also, Scholle v. Finnell, 173 Cal. 372, 159 P. 1179.

For these reasons we are of opinion that the pledge or transfer in question was void as against creditors, and the petition for revision is therefore denied.

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