The opinion of the court was delivered by: EGAN
This is a much litigated matter. It was here before on a motion for a turnover order (Bankruptcy Cause No. 24380) which was refused on the ground that defendants had a substantial adverse interest that called for a plenary suit if relief were to be granted. This plenary action for conversion followed.
The facts are as follows: On March 16, 1955, an involuntary petition in bankruptcy was filed against a individual by the name of G. N. Childress, trading and doing business as Childress Transportation Co., in the United States District Court for the Middle District of North Carolina at Greensboro in that State. On March 24, 1955 an order was entered by that Court adjudicating Childress a bankrupt.
Thereafter, the plaintiff here, J. Allen Harrington, a citizen of North Carolina, was duly elected and qualified as trustee in bankruptcy of the bankrupt's estate.
The record before us is barren of many facts but it seems evident that Childress, the bankrupt, was an interstate trucker, and that he leased a terminal at H and Jerome Streets, Philadelphia, from the defendants, Louis Yellin, Jules Yellin and William Lupowitz, who are sometimes herein referred to as 'landlords.'
The defendant, Martin L. Douglass, a citizen of the Commonwealth of Pennsylvania, is a duly elected Constable through whom it is alleged the landlords illegally converted two motor trucks and five trailers, assets of the bankrupt's estate, by distraining upon and selling same on a claim for rent in arrears on March 22, 1955. For convenience, Douglass is sometimes herein referred to as 'Constable.' The sale took place at bankrupt's Philadelphia terminal.
The purchaser of the two trucks and five trailers at the Constable's sale was the defendant, Eastern Battery and Tire Co., a Pennsylvania corporation, for which it is alleged the remaining defendants, Morris Talansky and Barney Talansky, were acting as agents. The Talanskys are citizens of Pennsylvania. As to all three defendants in the purchasers' group, whom we may sometimes hereinafter refer to as 'purchasers,' it is alleged that they 'did trespass upon and convert to their own use the said two motor trucks and five trailers,' the fair and reasonable market value of which at the time of the conversion was $ 11,100.
The suit is here by reason of diversity.
It is a plenary action which was instituted on July 25, 1957, more than two years after the adjudication in bankruptcy.
The case is now before the Court on motions of the several defendants, all of which must be dismissed.
All defendants have moved to dismiss on the ground that the two year period of limitation fixed by Section 11, sub. e of the Bankruptcy Act, 11 U.S.C.A. 29, sub. e, applies and that the action is now barred. Plaintiff contends that this is a common law action for conversion of property and that the six years period of limitation fixed by Pennsylvania law is applicable.
There can be no doubt that the statute of limitations may be raised by a motion to dismiss; Fed.R.Civ.P. 12(b), 28 U.S.C.A.; Wagner v. New York, Ontario and Western Ry., D.C.M.D.Pa.1956, 146 F.Supp. 926; 2 Moore Fed.Prac., pars. 8.28, 12.10 (2d ed. 1948), par. 12.10 (Supp.1956).
The section of the Bankruptcy Act on which defendants rely reads:
'A receiver or trustee may, within two years subsequent to the date of adjudication or within such further period of time as the Federal or State law may permit, institute proceedings in behalf of the estate upon any claim against which the period of limitation fixed by Federal or State law had not expired at the time of the filing of the petition in ...