The New Jersey Fidelity & Plate Glass Insurance Company is a surety company organized under the laws of that state. In 1932, it became insolvent; was upon its petition placed by a New Jersey court for liquidation in the hands of Kelly, the New Jersey Commissioner of Banking and Insurance; and he sought to take possession of its assets wherever situated. In 1930, the company had deposited securities of the face value of $75,000 with the state treasurer of Florida in order to qualify there pursuant to sections 6302 and 6303 of Florida Compiled General Laws. It entered into many surety obligations in Florida prior to its insolvency; but no unsatisfied judgment against it was outstanding there when the New Jersey liquidation proceeding was begun.
Kelly brought suit in Florida against State Treasurer Knott to restrain disposition of the deposited securities except upon order of that court. After the institution of his suit, an amendment to section 6303 made by chapter 16248 of the Florida Laws 1933, provided that in case the assets of a surety company should be placed in liquidation in the state of its incorporation, a Florida court 'shall have jurisdiction, upon bill filed by any party in interest, to take charge of the securities so deposited with the State Treasurer' and 'distribute the proceeds of the sale of said securities proportionally among all of the Florida creditors who may make proof of their claims,' 'the surplus, if any, to be disposed of by proper order of such court.' Thereupon, a Florida creditor brought suit under the amendment; that suit was consolidated with the one which Kelly had instituted; and a receiver was appointed who took possession of the securities and sold them.
In the receivership proceeding the United States filed, and under Revised Statutes, § 3466 (31 U.S.C.A. § 191), claimed priority for, a debt of $14,075, that sum being the aggregate of twenty judgments which it recovered against the company in Florida on estreated appearance, or bail, bonds given there. The Florida officials insisted that the claim of the United States must be postponed to those of Florida creditors; the New Jersey commissioner, that priority can be accorded the United States, in any event, only in the domiciliary proceeding. The trial court denied it priority; and directed that debts due Florida, its political subdivisions, citizens or residents, be paid. The decree left undetermined whether the United States was entitled to receive in Florida payment from the residue after satisfaction of such Florida debts, or whether the residue should be transmitted to the domiciliary liquidator. The United States appealed on the ground that it has been denied priority; the New Jersey commissioner on the ground that the domiciliary liquidator was entitled to the residue remaining after satisfying the claims of creditors reduced to judgment prior to the institution of the proceedings in New Jersey. The order of the trial court was affirmed by the Supreme Court, with some modification. Kelly v. Knott, 120 Fla. 580, 163 So. 64. We granted certiorari, because of the importance of the question involved. 297 U.S. 700, 56 S.Ct. 498, 80 L.Ed. 989.