§ 638. References. Referees are appointed by the Courts of Bankruptcy within the territorial limits of their jurisdiction, each for a term of two years, subject to removal because their services are not needed, or for other cause.1 "Whenever the office of a referee is vacant, or its occupant is absent or disqualified to act, the judge may act, or may appoint another referee, or another referee holding an appointment under the same court may, by order of the judge, temporarily fill the vacancy."2 "Referees shall take the same oath of office as that prescribed for Judges of the United States Courts. "Referees, before assuming the duties of their offices, and within such time as the district courts of the United States having jurisdiction shall prescribe, shall respectively qualify by entering into bond to the United States in such sum as shall be fixed by such courts, not to exceed five thousand dollars, with such sureties as shall be approved by such courts, conditioned for the faithful performance of their official duties."4 § 638. 130 St. at L. 544, 555, § 34. 2 Ibid., § 43. See Bray v. Cobb, 91 Fed. 102. The limits of the districts of the referees are designated by the courts that appoint them, which have power to change the same from time to time, so that each county, where the services of a referee are needed, may constitute at least one district. 30 St. at L. 544, 555, § 34. Each court of bankruptcy has discretion as to the number of referees which it shall appoint. 30 St. at L. 544, 555, § 37. When there are two District Judges in the same district, it seems that either, when holding a Court of Bankruptcy, may appoint as many referees as he deems proper. Birch v. Steele, C. C. A., 165 Fed. 577; affirming Ex parte Steele, 156 Fed. 854; s. c., 161 Fed. 886; overruling Ex parte Steele, 162 Fed. 694. "Individuals shall not be eligible to appointment as referees unless they Fed. Prac. Vol. III-75 are respectively (1) competent to perform the duties of that office; (2) not holding any office of profit or emolument under the laws of the United States or of any State other than commissioners of deeds, justices of the peace, masters in chancery, or notaries public; (3) not related by consanguinity or affinity, within the third degree as determined by the common law, to any of the judges of the Courts of Bankruptcy or Circuit Courts of the United States, or of the justices or judges of the appellate courts of the districts wherein they may be appointed; and (4) residents of, or have their offices in, the territorial districts for which they are to be appointed." 30 St. at L. 544, 555, § 35. 3 Ibid, § 36. 4 Ibid, § 50. An order allowing fees and compensation to a referee cannot be collaterally attacked in an action by the United States "a. After a person has been adjudged a bankrupt the judge may cause the trustee to proceed with the administration of the estate, or refer it (1) generally to the referee or specially with only limited authority to act in the premises or to consider and report upon specified issues; 5 or (2) to any referee within the territorial jurisdiction of the court, if the convenience of parties in interest will be served thereby, or for cause, or if the bankrupt does not do business, reside or have his domicile in the district. b. The judge may, at any time, for the convenience of parties or for cause, transfer case from one referee to another." 6 It has been said, that the referee "is, in fact, the judge of the Bankrupt Court." Their jurisdiction is as follows: “Referees respectively are hereby invested, subject always to a review by the judge, within the limits of their districts as established from time to time, with jurisdiction to (1) consider all petitions referred to them by the clerks and make the adjudications or dismiss the petition; upon his bond for the benefit of the persons interested in the estate. U. S. v. Brainerd, C. C. A., 250 Fed. 1011. It has been said that the bond gives no right of action to the United States but is merely collateral security for performance by the referee of the duties imposed by the bankruptcy law which if so can only be enforced by an order in a bankruptcy proceeding. Ibid. 5 The powers of a special referee previously appointed are superseded by an adjudication and an order of general reference. Re Ruos, 164 Fed. 749. But see U. S. v. Liberman, 176 Fed. 161, infra, § 639. 630 St. at L. 544, § 22. It has been held that this authorizes the judge to refer the proceedings to any referee within the territorial jurisdiction. Re Western Inv. Co., 170 Fed. 677. Where members of a bankrupt firm resided in different counties it was held that the pro (2) exercise the powers vested ceeding might be referred to a 8 The clerk canot refer a petition in involuntary bankruptcy to a referee for adjudication where an issue is made upon the allegations in the petition by the bankrupt or any other creditor. Re L. Humbert Co., 100 Fed. 349. Where, after the reference of a petition by part of a firm, the other partners appeared and contested the adjudication, it was held that the referee must certify the issue to the judge. Re Murray, 96 Fed. 600. A deputy clerk has no power to refer a petition in bankruptcy. Bray v. Cobb, 91 Fed. 102. But an order of reference made by the judge, and attested by the deputy, is valid. Bray v. Cobb, 91 Fed. 102. The clerk cannot refer a petition, whether voluntary or involuntary, unless the in courts of bankruptcy for the administering of oaths to and the examination of persons as witnesses, and for requiring the production of documents in proceedings before them, except the power of commitment; 10 (3) exercise the powers of the judge for the taking possession and releasing of the property of the bankrupt in the event of the issuance by the clerk of a certificate showing the absence of a judge from the judicial district, or the division of the district, or his sickness or inability to act; 11 (4) perform such part of the duties, except as to questions arising out of the applications of bankrupts for compositions or discharges, as are by this act conferred on courts of bankruptcy, and as shall be prescribed by rules or orders of the courts of bankruptcy of their respective districts, except as herein otherwise provided; and (5) upon the application of the trustee during the examination of the bankrupts, or other proceedings, authorize the employment of stenographers at the expense of the estates at a compensation not to exceed ten cents per folio for reporting and transcribing the proceedings." 12 The duties of referees are thus prescribed: "a. Referees shall (1) declare dividends and prepare and deliver to trustees dividend sheets showing the dividends declared and to whom payable; (2) examine all schedules of property and lists of creditors filed by bankrupts, and cause such as are incomplete or defective to be amended; (3) furnish such information con judge is absent from the division of the district where the proceeding is pending at the time when the reference may be made. Re L. Humbert Co., 100 Fed. 439. Where an answer to an involuntary petition in bankruptcy is filed, the judge may refer the proceeding to a special commissioner to take the testimony upon the issues and to report the same with opinion, where no jury trial has been demanded; although the judge has determined the issues, upon a former petition by other creditors, in favor of the alleged bankrupt. Re Lacov, C. C. A., 134 Fed. 237. 9 The order for the production of books of account need not specify their importance. Re Soloway & Katz, 195 Fed. 103. 10 Re Magen, 179 Fed. 572; Re Epstein, 219 Fed. 635. 11 In case of the disability or absence of the judge, upon the certificate of the clerk to that effect a referee may, before adjudication, appoint a receiver. Re Kelly Dry Goods Co., 102 Fed. 747; supra, $634; and order a receiver to sell assets, Re Kelly Dry Goods Co., 102 Fed. 747. 12 30 St. at L. 544, 555 § 10. cerning the estates in process of administration before them as may be requested by the parties in interest; 13 (4) give notices to creditors as herein provided;" 14 but it has been held that the bankrupt cannot complain of an omission to serve a few creditors with notice of the first meeting; 15 (5) make up records embodying the evidence, or the substance thereof, as agreed upon by the parties in all contested matters arising before them, whenever requested to do so by either of the parties thereto, together with their findings therein, and transmit them to the judges; 16 (6) prepare and file the schedules of property and lists of creditors required to be filed by the bankrupts, or cause the same to be done, when the bankrupts fail, refuse, or neglect to do so; (7) safely keep, perfect, and transmit to the clerks the records herein required to be kept by them, when the cases are concluded; (8) transmit to the clerks. such papers as may be on file before them whenever the same are needed in any proceedings in courts, and in like manner secure the return of such papers after they have been used, or, if it be impracticable to transmit the original papers, transmit certified copies thereof by mail; (9) upon application of any party in interest, preserve the evidence taken, or the substance thereof as agreed upon by the parties before them. when a stenographer is not in attendance; and (10) whenever their respective offices are in the same cities as towns where the courts of bankruptcy convene, call upon and receive from the clerks all papers filed in courts of bankruptcy which have been referred to them. b. Referees shall not (1) act in cases in which they are directly or indirectly interested; (2) practise as attorneys and counselors at law in any bankruptcy proceedings; 17 or (3) purchase, directly or indirectly, any property of an es 13 A creditor of a bankrupt is a "party in interest' although he has not formally proved his claim. Re Samuelson, 174 Fed. 911. 14 30 St. at L. 544, 556, § 39. The referee was allowed his fees for sending out notices of a final meeting of creditors after a composition had been accepted by them and affirmed by the court. Re McNeil Corp., 249 Fed. 765. 15 Re Schiller, 96 Fed. 400. 16 The referee has no power to correct or amend the record of a State court. Re Dubosky, 232 Fed. 380. 17 Whether it is proper for their partners to do so has not been decided. It was raised by the author in re Albey Press, supra; but the attorney withdrew from the case. tate in bankruptcy." 18 It has been held that a referee who is a debtor to the bankrupt is not disqualified: but that the court. upon being apprised of that fact may revoke the order of reference and send the case to another referee.19 Each referee must account to the judge under oath with vouchers on the first Tuesday of each month.20 "a. The records of all proceedings in each case before a referee shall be kept as nearly as may be in the same manner as records are now kept in equity cases in Circuit Courts of the United States. b. A record of the proceedings in each case shall be kept in a separate book or books, and shall, together with the papers on file, constitute the records of the case. c. The book or books containing a record of the proceedings shall, when the case is concluded before the referee, be certified to by him, and, together with such papers as are on file before him, be transmitted to the court of bankruptcy and shall there remain as a part of the records of the court."21 The General Orders provide as follows: "1. The order referring a case to a referee shall name a day upon which the bankrupt shall attend before the referee; and from that day the bankrupt shall be subject to the orders of the court in all matters relating to his bankruptcy, and may receive from the referee a protection against arrest, to continue until the final adjudication on his application for a discharge, unless suspended or vacated by order of the court. A copy of the order shall forthwith be sent by mail, to the referee, or be delivered to him personally by the clerk or other officer of the court. And thereafter all the proceedings, except such as are required by the act or by these general orders to be had before the judge, shall be had before the referee." 22 After the general order of reference the referee. may grant injunctions and restraining orders; 23 but he is with 18 30 St. L. 544, 556, § 39. 19 Bray v. Cobb, 91 Fed. 102. 20 General Order XXVI. 21 30 St. at L. 544, 556, 557, § 42. The record should be so kept that a full and fair review of the proceedings can be had. Re Romine, 138 Fed. 837. 22 General Order XII. 23 Re Steuer, 104 Fed. 976, 980; Re Martin, 105 Fed. 753; Re 219 Fed. 635. It has been held a |