In re Barden

101 F. 553, 1900 U.S. Dist. LEXIS 277
CourtDistrict Court, E.D. North Carolina
DecidedMay 15, 1900
StatusPublished
Cited by15 cases

This text of 101 F. 553 (In re Barden) is published on Counsel Stack Legal Research, covering District Court, E.D. North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Barden, 101 F. 553, 1900 U.S. Dist. LEXIS 277 (E.D.N.C. 1900).

Opinion

PURNELL, District Judge

(after stating the facts as above). The question presented by the foregoing finding of facts, of which the individual bankrupt partners ask a review, seems to be one of first impression. No opinion in point is cited, except two district court opinions, in which I. cannot concur; and, if there has been any other decision, it has been overlooked by . counsel, referee, and court. The decision must depend on a construction of the statute itself, gathering the legislative intent, from the provisions therein,— “from the four comers” of the act. .Section 52 of the bankruptcy act, after prescribing the duties of the clerk, says: “Clerks shall respectively receive as full compensation for their services in each estate a filing fee of ten dollars, except where a filing fee is not required of a voluntary bankrupt.” . This section, further provides for the fees of the marshal. The case at bar is not one of those excepted. Section 40 'of the act provides:1 “Referees shall receive as full compensation for their serv: [555]*555ices payable after they are rendered a fee of ten dollars deposited with the clerk at the time the petition is filed in each case,” etc.; the remaining clause referring to commissions, which are not pertinent to or material in the present inquiry. Section 48 provides for a fee of five dollars and commissions for the trustee “in each case.”

What do the expressions “in each estate” and “in each case” mean, as used in the statute, when a partnership files a petition in bankruptcy? Among the definitions peculiar to the act is that of “person,” which (section 1, subsec. 19) shall include partnerships, showing the legislative intent was to recognize firms as legal entities, separate and distinct from the individual members of the firm or partnership. Section 4, applying this definition, provides for a voluntary petition in bankruptcy of a partnership, and the next section (5), without the aid of the definition, provides expressly for such adjudication. Subsection (d) of this section provides that the trustee shall keep separate accounts of the partnership property and of tbe individual partners; (e) that the expenses shall he paid from the partnership property and the individual property in such proportion as the court may determine; that the proceeds of the partnership property shall be appropriated lo the payment of the partnership debts, and the net proceeds of the individual estate of eacli partner to the payment of the individual debts; the surplus, should there he any, after paying the individual debts, is to’ be applied to the payment of partnership debts, and vice versa; and (g) the court may permit the proof of the claim of the partnership estate against the individual estates, and vice versa, and may marshal the assets of the partnership estate and individual (¡state so as to prevent preferences, and secure the equi table distribution of the property of the several estates. The following provision is for the administration of the partnership estate when all partners are not bankrupt. Other sections might he quoted to illustrate the provisions peculiar to partnerships, but the foregoing are sufficient to show a recognition of the partnership as a distinct entity, 'and the legislative intent to recognize different estates when a partnership and the individual partners are adjudged bankrupt, — ■ the sense in which the words “each estate” are used in the section providing for the payment of the clerk’s fees. Most of the decisions which have been made on this line apply to the commissions allowed by the act, and none has been cited or found applicable to the filing fees. In Re Meyer, 39 C. C. A. 368, 98 Fed. 976, the circuit court of appeals of the Second circuit took the same view, above expressed, as to the distinct entity of a partnership and individual partners, and field, in an involuntary proceeding against a firm and its members, no adjudication can be made against a partner who has not committed, or participated in committing, any of the acts specified in the statute as acts of bankruptcy. In general order No. 8 the supreme court seems to recognize this distinction as it does in the prescribed forms. 18 Sup. Ct. v. Form No. 2 (Id. xviii.) closes with a prayer that the firm be adjudged bankrupt, and No. 1 (Id. xi.) is the individual petition. In short, the proceedings are separate; the estates different. The only logical conclusion from the act itself, keeping in view the legislative intent deducible therefrom, “estate” having no [556]*556restricted technical meaning, but meaning the ownings, real and perr sonal property^ choses in action, whatever may belong to the person as1 - defined in the statute, is that congress meant exactly what the statute provides. Clerks shall receive for their services tb each estate a filing fee of $10; that is, $10 for filing the petition and schedules-,of the partnership, and $10,for filing the petition and schedules of each individual member thereof, — $10 from each estate to be administered. And if congress thus used the words “each estate,” it is not- probable the phrase “in each case” was used in a more restrictive sense.. In section 1 special meanings are given to the words and phrases used in the act, “unless the same be inconsistent with the¡ context.” Congress thus, in addition to the rule of construction, by express terms made the context the test for the meaning of the words' and phrases used in the act.

(.'■■The labors of the referee and trustee are greater in every case than- those of the clerk. The referee, by section 89, is required to prepare dividends, examine schedules, and,- if defective, cause them to be amended, furnish information to parties in interest, prepare records, prepare and file schedules of property and list of creditors, etc. In short, he is the court in many respects, as defined in section 1. As the estafes must be kept separate, the petitions and schedules being different, many questions may arise as to the estates of the firm or •individual .members, thus making several cases. Because the papers ■aré or may be filed in the same files case, jacket, or envelope does not, !of necessity, make them one and the same case. The case at bar ■’is a part- of the original proceeding of J. P. Wilson & Co., as was the ease of J. E. Pollock, recently decided, but they involve questions which could not arise in the original proceeding; hence are separate eases..- The trustee, too, whose duties are defined, must keep separate •accounts of each estate. In short, the act recognizes separate estates, and it is a logical conclusion from the act itself it was intended that each petition, set of schedules, and estate should in the bankhuptcy court constitute separate cases. “Case” has no technical restrictive legal meaning. Congress evidently used the word to apply as above considered, and not, while allowing to the clerk a filing fee in each estate, require the officers created by the act to administer, collect, distribute, and settle possibly half a dozen estates as one case. The duties of these officers are more responsible, burdensome, and laborious than those of the clerk, and it is not reasonable to suppose' congress intended the narrow construction to be given to the !act which would require of them so much more for so much less compensation in this peculiar class of proceedings.

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Bluebook (online)
101 F. 553, 1900 U.S. Dist. LEXIS 277, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-barden-nced-1900.