The opinion of the court was delivered by: BYERS
This is a motion to confirm the report of the referee in bankruptcy directing an attorney (Shlefstein) to turn over to the trustee the sum of $500.00 held in escrow, and the trustee to pay $750.00 to one Klein, although no petition by her appears in the papers.
This petition was filed on June 23, 1933, and was answered on August 4th by one Kronisch, who had deposited the said $500.00 in escrow, and by the attorney holding the said sum, on August 7, 1933, and who made no claim thereto.
The matter came before the referee on these papers, and such proceedings were had before him on September 19, 1933, that he filed a report consisting of findings of fact and conclusions of law, dated October 16, 1933, now before the court.
The facts are somewhat unusual and should be stated.
On or about August 5, 1932, Kronisch entered into a contract with the bankrupt for the purchase of property therein described, at a price of $10,150.00, of which $500.00 was paid upon signing, and $3,400.00 was to be paid on the closing of title, in cash, and the balance of $6,250.00 by taking the property subject to a mortgage.
Title was to close on August 24, 1932, at the office of Shlefstein, the attorney for the seller, and the said $500.00 down payment by the terms of the contract was "to be deposited with Abram Shlefstein in escrow." The terms of the said escrow are not contained in the findings made by the referee, but are thought to be undisputed, namely (as stated in the Kronisch answer):
"The undersigned on closing of contract between B.J.R.Co.Inc. and Stella Kronisch does hereby acknowledge receipt from Stella Kronisch of the sum of $500. by check subject to collection and which the undersigned agrees to hold in escrow and agrees not to turn over said sum to B.J.R.Co.Inc. until the actual closing of the title to premises located at the northeast corner of Quentin Road and Stuart Street as provided for in the aforesaid contract of sale between B.J.R.Co.Inc. and Stella Kronisch.
"In the event that the said B.J.R.Co.Inc. is unable to deliver title, then said monies is (sic) to be returned to Stella Kronisch.
On a day not disclosed in these papers but prior to that fixed for the closing of title, an involuntary petition in bankruptcy against the vendor was filed, and at that time a mechanic's lien foreclosure action, affecting the premises, was pending in the Supreme Court of the state of New York; a receiver in bankruptcy was appointed in this court, who is now the trustee.
Whether there was an adjournment of title closing on the deed day does not appear, but under date of September 30, 1932, a written stipulation was signed on the part of the bankrupt, the purchaser, and the attorney for the bankrupt, adjourning the closing ...