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8 654. Reopening estates in bankruptcy. The bankruptcy courts have jurisdiction to "close estates, whenever it appears that they have been fully administered, by approving the final accounts and discharging the trustees, and reopen them whenever it appears they were closed before being fully administered.”' There is no statutory limitation of the time within which a bankrupt's estate that has been closed may be reopened, but such an application may be denied for laches. An estate may be reopened after a trustee has been discharged, in order





otherwise which a rose within four months prior to the proceeding and which would have been dissolved by an adjudication of bankruptcy, Re Lilienthal, C. C. A., 256 Fed. 819; but not other liens, the holders of which did not share in the composition. Oil. fields Syndicate v. Am. Improvement Co., 256 Fed. 979; Cobb v. First Nat. Bank, 263 Fed. 1000. It discharges debts which were not filed and proved within the statutory time. Re Maytag-Mason Motor Co., 223 Fed. 684; Cobb v. First Nat. Bank, 263 Fed. 1000; supra, 8 646. It has been held that a creditor whose claim is not dischargeable is entitled to share in the benefits of the composition without prejudice to subsequent proceedings by him to collect his claim. Re Alpert, 237 Fed. 295. Unscheduled creditors, who had no notice of the bankruptey proceedings, are not barred by the composition, Re Lockwood, 104 Fed. 794. But they have no right to share therein, unless they present their claims before it has been confirmed, Re Abrams Rubins, 173 Fed. 430; nor even, it has been held, unless they present these before the referee has made a rule nisi why the order of confirmation should not be entered, Re Ennis, 183 Fed. 859. It has been said that the only remedy in such a case is to set aside the confirmation for fraud. Re Abrams & Rubins, 173 Fed. 430. It does not operate to extend the time for filing claims beyond one year after adjudication, nor has the court authority to allow claims filed after

expiration of that time. Re Bickmore Shoe Co., 263 Fed. 926. The composition does not prevent liquidating trustee to whom the assets

thus transferred from maintaining a suit under a State statute to set aside a preferential transfer by the bankrupt, Kobre Assets Corp. v. Baker, 178 App. Div. (N. Y.) 62. It does not deprive the referee of jurisdiction to pass on the accounts of the trustee and to direct that he be discharged and the estate closed, U. S. v. Sondheim, 188 Fed. 378. Otherwise the approval of the composition ordinarily terminates the jurisdiction of the Court of Bankruptcy over the property, Re Frischknecht, C. C. A., 223 Fed. 417; Re Hollins, C. C. A., 229 Fed. 349; Re Hollins, C. C. A., 238 Fed. 787; see Re Kligerman, 253 Fed. 778; and also, it has been held, over any trustee thereby appointed to collect and distribute the


Guaranty Trust Co. v. McCabe, C. C. A., 250 Fed. 699. Unless otherwise therein provided, it vests the title to the assets in the bankrupt free of all claims of creditors except those which would not be barred by a regular discharge in bankruptcy. Cumberland Glass Mfg. Co. y. De Witt, 237 U. S. 447; Re Rider, 96 Fed. 808, 809, per Coxe, J.; Re MeNeil Corp. 249 Fed. 765, 767. It has been held that where notes given by a trustee in bankruptcy pursuant to an order confirming a composition with creditors are not paid, the original debt revives. Am. Woolen Co. v. Friedman, 97 Misc. (N. Y.) 593.

$ 654,


1 The estate is not closed from the trustee when the sale had by the discharge of the bankrupt, not been legally perfected. Re Re Margolies, C. C. A., 266 Fed. Minners, 253 Fed. 360. There must 203; although the time for revok- be a reasonable prospect of realing the discharge and for indicting izing assets which are unadminishim for the concealment of assets tered and evidence that the creditors has not expired, Re Levy, 261 Fed. or other parties in interest would 432; and he may be subsequently be thereby benefited. Re Graff, C. compelled to deliver to the trustee C. A., 250 Fed. 997.

A case may property which he has fraudulently be re-opened because of the discovconcealed. Ibid. It has been held ery of assets which the bankrupt that when there has been no final. had fraudulently concealed. meeting of creditors, the estate is Paine, 127 Fed. 246. The court not closed although the referee has cannot open the estate for the sole declared its closing. Re Levy, 261 purpose of permitting the bankrupt Fed. 432. The closing of the estate to amend his schedules by adding does not transfer to the bankrupt the names of other creditors, when the title to unadministered assets the administration of the estate has which have not been duly rejected been completed. Re Sayer, 210 Fed. by the trustee. Re Lighthall, 221 397. Fed. 791; Supra, $ 643.

3 Re Paine, 127 Fed. 246; Traub 2 30 St. at L. 544, § 2, subd. 8. v. Marshall Field & Co., C. C. A., The motion to re-open is addressed 182 Fed. 622. to the sound discretion of the 4 Vary v. Jackson, C. C. A., 164 court. Re Graff, C. C. A., 250 Fed. Fed. 840, seven years.

For a case 997. It has been said that cred- where a delay of two years was itors alone can make such an ap- held to be no laches, see Traub v. plication, Ibid; and not creditors Marshall Field & Co., C. C. A., 182 who have not proved their claims, Fed. 622. After the expiration of Re Paine, 127 Fed. 246; Re Meyer, the two years statutory limitation, 181 Fed. 904. See supra, $ 646; the court may refuse to re-open the nor, the trustee who has been dis- estate in order to enable the trustee charged. Ibid. It has been held to attack a sale by the bankrupt for that no creditors who have failed fraud which he might have discovto prove their debts can share in ered during such time. Kinder v. the newly discovered assets. Ibid. Scharff, 231 U. S. 517. See supra, An estate was re-opened upon the

$$ 181, 643. petition of

a purchaser of land




that a new trustee may be appointed to receive a preference." The effect of the reopening is not to reinstate the trustee; but a new trustee must be appointed.

8 655. Discharge of bankrupts. “(a) Any person 1 may, after the expiration of one month and within the next twelve months subsequent to being adjudged a bankrupt,2 file an application for a discharge in the court of bankruptcy in which the proceedings are pending; if it shall be made to appear to the judge that the bankrupt was unavoidably prevented from filing it within such time, it may be filed within but not after the expiration of the next six months. “There shall be thirty days' notice of all

6 Re B. Feinberg & Sons, 187 Fed. to apply for a discharge.' Re Morse, 283.

168 Fed. 157. After eighteen 6 Re

Rochester Sanitarium & months from the adjudication in Baths Co., C. C. A., 222 Fed. 22; bankruptcy have expired, no extenRe Graff, C. C. A., 250 Fed. 997; sion can be granted. Re Snell, 244 Re Minners, 253 Fed. 360.

Fed. 613. Nor can any order be $ 655. 1 A corporation may re- made nunc pro tunc granting the ceive a discharge in bankruptcy. Re extension, unless an application for Hargadine-McKittrick Dry Goods the

made and orally Co., 239 Fed. 155. It has been granted within that period. held, that where a partnership has Wolff, 100 Fed. 430; Re Taunton, been adjudicated a bankrupt, the 216 Fed. 987. Contra, Daly, 224 partners may obtain a discharge Fed. 263, See Re Anderson, 134 from their individual indebtedness Fed. 319; International Harvester although there has been no adjudi- Co. of America v. Carlson, C. C. A., cation against them individually. 3 30 St. at L. 544, § 14, as Armstrong v. Norris, C. C. A., 247 amended 36 St. at L. 838, 841; Re Fed. 253. See supra § 618.

Wheeler, 5 Fed. 299; Re Wolff, 100 2 It has been held that the bank- Fed. 430; Re Levenstein, 180 Fed. rupt may file the application any 957; Lindeke v. Converse, C. C. A., time within thirteen months after 198 Fed. 618; Re Agnew, 225 Fed. the adjudication. Re Walters, 209 650. The filing of the petition withFed. 133; Re Daly, 224 Fed. 263; out the leave of the court, after the Re Jacobs, C. C. A., 241 Fed. 620. expiration of a year and within the Contra, Re Holmes, 165 Fed. 225. succeeding six months, is insufficient. As to the mode of computation, see Re Knauer, 133 Fed. 805. See Re Re De Lewandowski, 243 Fed. 787, Daly, 244 Fed. 263. The lack of supra, $ 608.

The court has no sufficient means by a bankrupt to power to set aside an adjudication, pay an attorney, when accompanied entered upon a default in involun- by sickness of himself and his famtary proceedings, and to make an- ily was held to be an unavoidable other order to the same effect in prevention. Re Casey, 195 Fed. order to extend the bankrupt's time 322. So was the illness of his atapplications for the discharge of the bankrupts given to creditors torney. Re Waller, C. C. A., 249 erally. Re Fahy, 116 Fed. 239. Cf. Fed. 187. But not the fact that Re Wagner, 139 Fed. 87. The credihis business was in such a condition tor may be estopped by laches from that he did not have the time to file moving to set aside an order of the application; Re Daly, 205 Fed. extension, Re Casey, 195 Fed. 322; 1002; nor that he was in contempt or by filing objections to the disof court for disobedience to an or- charge. Re Churchill, 197 Fed. 111. der with which he afterwards com- It has been held that the question plied after its modification, Re whether a bankrupt was unavoidGeasberg, C. C. A., 197 Fed. 896; ably prevented from applying for nor because if the application had a discharge within the year should been filed within the year, it would

be raised within the next six necessarily have been denied be: months. Re Chase, 186 Fed. 408. cause of his previous discharge in Re Maier, 256 Fed. 60. The order voluntary proceedings within six extending the time cannot be reyears, Re Vaine, 186 Fed. 535; Re viewed upon the hearing of objecChase, 186 Fed. 408; nor that no tions to the discharge. Re Casey, trustee was appointed within a year 195 Fed. 322. A petition was after the adjudication. Hinman v. treated as filed on the day when it Barrett, 244 Fed. 621. It is not was offered to the clerk, although the duty of the referee to notify the it was subsequently taken away by bankrupt when the time expires for the attorney because of an erronefiling the petition for discharge, Re statement by the former in Knauer, 133 Fed. 805, and the stat- accordance with instructions by the utory period of limitations cannot judge as to the practice. Re Swain, be enlarged because the referee mis- 243 Fed. 781. So where the applicaled the bankrupt's attorney by in- tion was filed with the referee, incorrect information in that respect. stead of the clerk, but was with the Ibid. The extension, if granted other proceedings before the former within the eighteen months, cannot filed with the latter within a year be attacked collaterally but only after the adjudication, no objection by a motion to set the order aside. liaving previously been made. Re Re Agnew, 225 Fed. 650. Where Taylor, 188 Fed. 479. It seems that the petition for the discharge was creditors are not entitled to notice filed more than a year, but less than of the application for an extension eighteen months, after the adjudi- of time. Re Churchill, 197 Fed. cation; it was held that it could not 111; Re Fritz, 173 Fed. 560. The be impeached collaterally, since it

petition for an extension because must be presumed that an exten- the bankrupt was unavoidably presion of time had been granted by vented from applying within the the court. Re Haynes & Sons, 122 year is not evidence of the facts Fed. 560. But where the petition therein alleged and must be suswas filed after the expiration of tained by proof, although not foreighteen months; it was held that mally traversed. Re Glickman & a discharge granted thereupon was Pisnoff, 164 Fed. 209. The insufvoid and could be attacked collat- ficiency of the evidence to establish


by mail to their respective addresses as they appear in the schedule or as afterwards filed with the papers in the case by the creditors, unless they waive notice in writing." 4 "(b) The judge shall hear the application for a discharge, and such proofs and pleas as may be made in opposition thereto by the trustee or other parties in interest, at such time as will give the trustee or parties in interest a reasonable opportunity to be fully heard, and investigate the merits of the application and discharge the applicant unless he has (1) committed an offense punishable by imprisonment as herein provided; or (2) with intent to conceal his financial condition, destroyed, concealed, or failed to keep books of account or records from which such condition might be ascertained; or (3) obtained money or property on credit upon a materially false statement in writing, made by him to any person for the purpose of obtaining credit from such purpose; or (4) at any time subsequent to the first day of the four months


the unavoidable prevention does not deprive the court of jurisdiction to grant the application for an tension. Ibid.

4 30 St. at L. 544, 561, $ 58, as amended 36 St, at L. 838, 841. Re Blaesser, 230 Fed. 528; Re Lengfeldt, 253 Fed. 458. This notice should be a copy of an order of the court in fixing the date in accordance with Form 57. Re Hockman, 205 Fed. 330. But see S. D. N. Y. Rule 7. The order cannot be made by the referee. Ibid. Where one of the petitioners in an involuntary proceeding fails to give such notice to the creditors, it is incumbent upon the bankrupt so to do. Re - Wollowitz, C. C. A., 192 Fed. 105. It seems that notice of the application should be given by publication, as well as sent by mail, to the creditors. Hanover Nat. Bank v. Moyses, 186 U. S. 181, 191, 192, 46 L. ed. 1113, 1120, 1121; Remington on Bankruptcy, $ 2432. See Re Sykes, 106 Fed. 669. As to what is proper proof of service of notice

Fed. Prac. Vol. III-84

to the creditors, see Re Downing, 199 Fed. 329. When a creditor has died, notice should be given to his executor or administrator or if there is none such his widow and next of kin if the record shows who they are; but need not be served upon his own creditors who might possibly take out letters of administration. Re Blaesser, 230 Fed. 328. Failure to serve written notice upon the receiver of the property of the creditor when the former's name and address were disclosed by the proofs, and that of the latter was not in the schedules, was held to be no ground for setting aside the order for a discharge, where the notice was duly served by publication and there was no proof of fraud. Re Fri 173 Fed. 560. A discharge was not denied because, in a voluntary proceeding by Max Elkind and Boris Schwartz, the advertisement of notice of the first meeting of «reditors described them as “Max Elkurd and Boris Schwartz." Re Elkind, C. C. A., 175 Fed. 64.

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