[H. R. 8664, Sixty-eighth Congress, first section]

A BILL To amend section 34 of an act to establish a uniform system of bankruptcy throughout the United States, approved July 1, 1898, and the amendments thereto

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 34 of an act to establish a uniform system of bankruptcy throughout the United States, approved July 1, 1898, and the amendments thereto, be amended to read as follows:

"SEC. 34. Appointment, remOVAL, AND DISTRICTS OF REFEREES. (a) Courts of bankruptcy shall, within the territorial limits of which they respectively have jurisdiction, (1) appoint referees, each for a term of two years, and may, in their discretion, remove them because their services are not needed or for other cause, and (2) the limits of the districts of referees shall be each county, where the services of a referee are needed, and each county shall constitute at least one district."

[H. R. 5426, Sixty-eighth Congress, first session]

A BILL To amend an act entitled "An act to establish a uniform system of bankruptcy throughout the United States," approved by the President July 1, 1898, and acts amendatory thereof and supplementary thereto.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 3 (a), section 14 (b), section 24, section 25 (a), section 29 (a), (b), and (d), section 57 (n), section 60 (a), and section 64 (a) and (b) of an act entitled "An act to establish a uniform system of bankruptcy throughout the United States," approved July 1, 1898, and acts amendatory thereof and supplementary thereto, be, and the same are hereby, amended and supplemented so as to read as follows:

"SEC. 3. (a) Acts of bankruptcy by a person shall consist of his having (1) conveyed, transferred, concealed, or removed, or permitted to be concealed or removed, any part of his property, with intent to hinder, delay, or defraud his creditors, or any of them; or (2) transferred, while insolvent, any portion of his property to one or more of his creditors with intent to prefer such creditors over his other creditors; or (3) suffered or permitted, while insolvent, any creditor to obtain a preference through legal proceedings, and not having at least five days before a sale or final disposition of any property affected by such preference vacated or discharged such preference; or (4) suffered or permitted, while insolvent, any creditor to obtain through legal proceedings any levy, attachment, judgment, or other lien, and not having vacated or discharged the same at least five days before the expiration of four months from the date of obtaining such levy, attachment, judgment, or other lien; or (5) made a general assignment for the benefit of his creditors; or, being insolvent, applied for a receiver or trustee for his property, or because of insolvency a receiver or trustee has been put in charge of his property under the laws of a State, of a Territory, or of the United States; or (6) admitted in writing his inability to pay his debts and his willingness to be adjudged a bankrupt on that ground.

"SEC. 14. (b) The judge shall hear the application for a discharge and such proof 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 or any person or his representative for the purpose of obtaining credit from such person; or (4) at any time subsequent to the first day of the twelve months immediately preceding the filing of the petition transerred, removed, destroyed, or concealed, or permitted to be removed, destroyed, or concealed, any of his property with intent to hinder, delay, or defraud his creditors; or (5) has been granted a discharge in bankruptcy within six years; or (6) in the course of the proceedings in bankruptcy refused to obey any lawful order of, or to answer any material question approved by the court: Provided, That a trustee shall not interpose objections to a bankrupt's discharge until he shall be authorized so to do at a meeting of creditors called for that purpose.

"SEC. 24. (a) The Supreme Court of the United States, the circuit court of appeals of the United States, and the supreme courts of the Territories, in vacation in chambers and during their respective terms, as now or as they may be hereafter held, are hereby invested with appellate jurisdiction of controversies arising in bankruptcy proceedings from the courts of bankruptcy from which they have appellate jurisdiction in other cases. The Supreme Court of the United States shall exercise a like jurisdiction from courts of bankruptcy not within any organized circuit of the United States and from the Supreme Court of the District of Columbia.

"(b) The several circuit courts of appeal shall have jurisdiction in equity, either interlocutory or final, to superintend and revise in matter of law the proceedings of the several inferior courts of bankruptcy within their jurisdiction. Such power shall be exercised on due notice and petition by any party aggrieved. (c) Appeals and reviews under this section shall be taken within thirty days after the judgment or order, or other matter complained of, has been rendered or entered.

"SEC. 25 (a) Appeals, as in equity cases, may be taken in bankruptcy proceedings from the courts of bankruptcy to the circuit court of appeals of the United States, and to the supreme courts of the Territories in the following cases, to wit: (1) From a judgment adjudging or refusing to adjudge the defendant a bankrupt; (2) from a judgment granting or denying a discharge; and (3) from a judgment allowing or rejecting a debt or claim of $500 or over. Such appeal shall be taken within thrity days after the judgment appealed from has been rendered, and may be heard and determined by the appellate court in term or vacation, as the case may be.

"SEC. 29. (a) A person shall be punished by imprisonment for a period not to exceed five years upon conviction of the offense of having knowingly and fraudulently appropriated to his own use, embezzled, spent, or unlawfully transferred any property or secreted or destroyed any document belonging to a bankrupt estate which came into his charge as trustee, receiver, custodian, or other officer of the court.

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‘(b) A person shall be punished by imprisonment for a period not to exceed two years upon conviction of the offense of having knowingly and fraudulently (1) concealed any property belonging to the estate of a bankrupt; or (2) made a false oath or account in or in relation to any proceeding in bankruptcy; (3) presented under oath any false claim for proof against the estate of a bankrupt, or used any such claim in composition personally, or by agent proxy, or attorney, or as agent, proxy, or attorney; or (4) received any material amount of property from a bankrupt after the filing of the petition, with intent to defeat this Act; or (5) extorted or attempted to extort any money or property from any person as a consideration for acting or forbearing to act in bankruptcy proceedings. (d) A person shall not be prosecuted for any offense arising under this Act unless the indictment is found or the information is filed in court within three years after the commission of the offense, except where he has been absent from the jurisdiction of the court, in which case the time during which such person has been so absent shall not be a part of the period of limitation prescribed herein.

"SEC. 57. (n) Claims shall not be proved against a bankrupt estate subse quent to six months after the adjudication; or if they are liquidated by litigation and the final judgment therein is rendered within thirty days before or after the expiration of such time, then within sixty days after the rendition of such judgment: Provided, That the right of infants and insane persons without guardians, without notice of the proceedings, may continue six months longer. "SEC. 60. (a) A person shall be deemed to have given a preference if, being insolvent, he has, within four months before the filing of the petition, or after the filing of the petition and before the adjudication, procured or suffered a judgment to be entered against himself in favor of any person, or made a transfer of any of his property, and the effect of the enforcement of such judgment or transfer will be to enable any one of his creditors to obtain a greater percentage of his debt than any other of such creditors of the same class. Where the preference consists in a transfer, such period of four months shall not expire until four months after the date of recording or registering of the transfer, if by law such recording or registering is required or permitted.

"SEC. 64. (a) The court shall order the trustee to pay all taxes legally due and owing by the bankrupt to the United States, State, county, district, or municipality, in the order of priority as set forth in paragraph (b) hereof: Provided,

That no order shall be made for the payment of a tax assessed against real estate of a bankrupt in excess of the value of the interest of the bankrupt estate therein as determined by the court.

"Upon filing the receipts of the proper public officers for such payments, the trustee shall be credited with the amounts thereof, and in case any question arises as to the amount or legality of such tax the same shall be heard and determined by the court.

"b. The debts to have priority, in advance of the payment of dividends to creditors, and to be paid in full out of bankrupt estates, and the order of payment shall be (1) the actual and necessary cost of preserving the estate subsequent to filing the petition; (2) the filing fees paid by creditors in involuntary cases; and, where property of the bankrupt, transferred or concealed by him either before or after the filing of the petition, shall have been recovered for the benefit of the estate of the bankrupt by the efforts and at the expense of one or more creditors, the reasonable expenses of such recovery; (3) the cost of administration, including the fees and mileage payable to witnesses as now or hereafter provided by the laws of the United States, and one reasonable attorney's fee, for the professional services actually rendered, irrespective of the number of attorneys employed, to the petitioning creditors in involuntary cases while performing the duties herein prescribed, and to the bankrupt in voluntary cases, as the court may allow; (4) where the confirmation of composition terms has been refused or set aside upon the objection and through the efforts and at the expense of one or more creditors, in the discretion of the court, the reasonable expenses of such creditor or creditors; (5) taxes payable under section a hereof; (6) wages due to workmen, clerks, traveling or city salesmen, or servants which have been earned within three months before the date of the commencement of proceedings, not to exceed $300 to each claimant; and (7) debts owing to any person who by the laws of the States or the United States is entitled to priority."

SEC. 2. Nothing herein shall have the effect to release or extinguish any penalty, forfeiture, or liability incurred under any act or acts of which this act is amendatory.

SEC. 3. That all parts of acts inconsistent herewith be, and the same are hereby, repealed.

SEC. 4. This act shall take effect and be in force on and after the expiration of three months from the date of its passage and approval.

[H. R. 9560, Sixty-eighth Congress, first session]

A BILL To amend an act entitled "An act to establish a uniform system of bankruptcy throughout the United States," approved July 1, 1898, and acts amendatory thereof and supplementary thereto

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 1 (a), subdivisions 1 and 15, of an act entitled "An act to establish a uniform system of banrkuptcy throughout the United States,' approved July 1, 1898, and acts amendatory thereof and supplementary thereto, be, and the same hereby is, amended to read as follows: "SECTION 1. (a) The words and phrases used in this act and in proceedings pursuant hereto shall, unless the same be inconsistent with the context, be construed as follows:

"(1) A person against whom a petition has been filed' shall include a person who has filed a voluntary petition and shall also include, for the purpose of section 29 of this act, the agent or representative of the bankrupt;"

"(15) A person shall be deemed insolvent within the provisions of this act, whenever the aggregate of his property, exclusive of all property exempt by statute from sale under execution, and also exclusive of any property that he may have conveyed, transferred, concealed, or removed, or permitted to be concealed or removed with intent to defraud, hinder, or delay his creditors, shall not, at a fair valuation, be sufficient in amount to pay his debts."

SEC. 2. That section 2, subdivisions 3, 17, and 20, of said act, as so amended, be, and the same hereby is, amended to read as follows:

(3) Appoint receivers, custodians, auditors, and inspectors, as hereinafter provided;

"(17) Pursuant to the recommendations of creditors or when they neglect to recommend the appointment of trustees, appoint trustees, except when official receivers are continued as provided in section 44 (b) of said act, and, upon the complaint of any person in interest, remove receivers, custodians, trustees, auditors, and inspectors for cause, upon hearing and after notice to them;"

"(20) Exercise jurisdiction over persons or property within their respective territorial limits in aid of a receiver or trustee appointed in any bankruptcy proceedings pending in any other court of bankruptcy. Nothing in this section contained shall be construed to deprive a court of bankruptcy of any power it would posses were certain specific powers not herein enumerated;"

SEC. 3. That section 3 (a) of said act as so amended, be and the same hereby is, so amended as to read as follows:

"SEC. 3. (a) Acts of bankruptcy by a person shall consist of his having (1) conveyed, transferred, concealed, or removed, or permitted to be concealed or removed, any part of his property with intent to hinder, delay, or defraud his creditors or any of them; or (2) transferred, while insolvent, any portion of his property to one, or more of his creditors with intent to prefer such creditors over his other creditors; or (3) suffered or permitted, while insolvent, any creditor to obtain a preference through legal proceedings, and not having at least five days before a sale or final disposition of any property affected by such preference vacated or discharged such preference; or (4) suffered or permitted while insolvent any creditor to obtain through legal proceedings any levy, attachment, judgment or other lien and not having vacated or discharged the same at least five days before the expiration of four months from the date of obtaining such levy, attachment, judgment or other lien; or (5) made a general assignment for the benefit of his creditors, or being insolvent, applied for a receiver or trustee for his property or because of insolvency a receiver or trustee has been put in charge of his property under the laws of a State, of a Territory, or of the United States; or (6) admitted in writing his inability to pay his debts and his willingness to be adjudged a bankrupt on that ground.'

SEC. 4. That section 3 (b) of said Act, as so amended, be, and the same hereby is, amended to read as follows:

(b) A petition may be filed against a person who is insolvent and who has committed an act of bankruptcy within four months after the commission of such act. Such time shall not expire until four months after (1) the date of the recording or registering of the transfer or assignment when the act consists in having made a transfer of any of his property with intent to hinder, delay, or defraud his creditors or for the purpose of giving a preference as hereinbefore provided, or a general assignment for the benefit of his creditors, if by law such recording or registering is required or permitted, or, if it is not, from the date when the beneficiary takes notorious, exclusive, or continuous possession of the property, unless the petitioning creditors have received actual notice of such transfer or assignment. A petition filed hereunder shall state definitely whether or not it is made, directly or indirectly, at the request or in behalf of the person alleged to be insolvent or to have committed an act of bankruptcy."

SEC. 5. That section 6 of said act, as so amended, be, and the same hereby is, amended to read as follows:

"SEC. 6. (a) This act shall not affect the allowance to bankrupts of the exemptions which are prescribed by the State laws in force at the time of the filing of the petition in the State wherein they have had their domicile for the six months or the greater portion thereof immediately preceding the filing of the petition: Provided, That no property acquired by the debtor when he has knowledge of his insolvency shall be allowed as exempt.'

SEC. 6. That section 7, subdivision 8, of said act, as so amended, be, and the same hereby is, amended to read as follows:

(8) If a voluntary bankrupt, file with his petition a list of his creditors, with their addresses, as full and complete as is possible, to the end that his creditors may be notified of such application for the appointment of a receiver as the court may direct, and, whether a voluntary or an involuntary bankrupt, prepare, make oath to, and file in court within ten days, unless further time is granted, after the adjudication if an involuntary bankrupt, and within ten days after the filing of the petition if a voluntary bankrupt, a schedule of his property, showing the amount and kind of property, the location thereof, its money value in total, and a list of his creditors, showing their residence, if known, or if unknown, that fact to be stated, the amounts due to each of them, the consideration thereof, the security held by them, if any, and a claim for such exemptions as he may be entitled to, all in triplicate, one copy of each for the clerk, one for the referee, and one for the trustee."

iSSEC. 7. That section 12 (b) of said act, as so amended, be, and the same hereby is amended to read as follows:

(b) An application for the confirmation of a composition may be filed in the court of bankruptcy after, but not before, it has been accepted in writing by

a majority in number of all creditors whose claims have been allowed, which number must represent a majority in amount of such claims, and the consideration to be paid by the bankrupt to his creditors, and the money necessary to pay all debts which have priority and the cost of the proceedings, have been deposited in such place as shall be designated and subject to the order of the judge: Provided, That upon the acceptance of an offer of composition by the creditors the bankrupt shall file a sworn statement of the amounts paid by him for expenses, including the amount paid his attorney or to the attorney of any other creditor or for any purpose connected with the bankruptcy proceeding, and each creditor receiving a payment or benefit under such composition shall, before receiving the same, file with the referee a sworn statement that he has not received or entered into any agreement to receive from the bankrupt or his estate any sum or thing of value over and above the amount available for his claim under the terms of the composition agreement.'

SEC. 8. That section 12 of said act, as so amended, be, and the same hereby is, amended by adding at the end thereof a new paragraph, (f) to read as follows: "(f) The consideration named in the composition agreement shall be paid only to such creditors as shall have proved a claim and, if an assignee of a creditor, the amount of consideration paid by him for the assignment of such claim, within six months after the composition agreement is confirmed; and if any part of the fund deposited remains undistributed at the expiration of said period, the same shall be distributed by order of the court, on application of any creditor where debt has been allowed, ratably among creditors whose debts have been allowed." SEC. 9. That section 14 (a) and (b) of said act, as so amended, be, and the same hereby is, amended to read as follows:

"SEC. 14. (a) Any person may, after the expiration of one month and within the next twelve months subsequent to being adjudged a bankrupt, 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 expiration of the next six months. The petition must be accompanied by a certificate of the trustee or receiver from which it must appear that the bankrupt has conformed with all the requirements of law, answered all proper questions which have been put to him upon his examinations, produced all books and papers which he has been required to produce, filed a schedule of his assets and listed his liabilities, as required by law, and had in all other respects submitted himself to the orders of the court or referee. There shall also be filed with every such application a certificate from the auditor stating whether or not he has made an audit or inspection of the bankrupt's estate and setting forth the state of facts disclosed by such audit or inspection, if made.

“(b) The judge shall hear the application for a discharge, and such proofs and pleas as may be made in opposition thereto by the trustees or any 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 who has not kept books of account such as are ordinarily kept in the business conducted by him; or (3) obtained money or property on credit upon a materially false statement in writing made by him to any person or his representative for the purpose of obtaining credit from such person; or (4) at any time subsequent to the first day of the twelve months immediately preceding the filing of the petition shall have transferred, removed, destroyed, or concealed, or permitted to be removed, destroyed, or concealed any of his property, with intent to hinder, delay, or defraud his creditors; or (5) been granted a discharge in bankruptcy within six years; or (6) in the course of proceedings in bankruptcy refused to obey any lawful order of, or to answer any material question approved by the court or failed to comply with any other requirement of this section. No discharge granted under the provisions of this section shall apply to, or operate to relieve, the bankrupt of any debt or liability created by or resulting from his fraud, embezzlement, misappropriation or defalcation, without limitation as to his official or fiduciary capacity: Provided, That where it appears the books of account of the bankrupt have been destroyed or concealed or have not been kept the burden of showing that such situation was not brought about with intent to conceal his financial condition shall be upon the bankrupt and not upon the objecting creditors: Provided, further, That a trustee or receiver shall not interpose objections to a