Kal W. Lines v. Falstaff Brewing Co.

In one of the finest passages in judicial literature, Chief Judge Cardozo of the New York Court of Appeals —later Associate Justice of the United States Supreme Court—laid down the high standards that should be demanded of a trustee:

Imposed both by ethics and equity, these high standards are exacted of bankruptcy trustees as much as of other species of the genus. “The punctilio of an honor the most sensitive” must be observed in the selection of such trustees as well as in their own discharge of their duties.

1. Statement of the Case

The appellees, sixteen creditors of Alfonso Paul Sanfilippo, who was adjudged a voluntary bankrupt on April 19, 1954, had claims aggregating $3,735.56. These claims, plus those of four other creditors, Edwin J. Marino, Pacific Coast Brands, Eagle Vineyard Products and Gallo Sales Company, were all presented for voting at the first meeting of creditors by the attorneys in fact designated in the powers of attorney in their respective proofs of claim.

These twenty claims, aggregating $4,-508.67, were voted for John M. England, as trustee. Only one of these claims, that of Pacific Coast Brands, for $193.85, was not objected to by the appellant.

On…