The Savannah morning news. (Savannah, Ga.) 1900-current, 1903-11-24
NO AUTHORITY FOR
NAMING REFEREE.
Judge speer Handed Down Decision
in the Branch CAGE.

Judge Speer Handed Down Decision
in the Branch CAGE.
Judge Speer handed down his opinion
yesterday morning in the Branch bank
ruptcy case. The court decided that
while the appointment of Mr.. L. w.
Roberts as receiver by the referee in
bankruptcy was unauthorized, in view
of the circumstances, the practical
way out of the difficulty is to take
an order annulling the receivership.
Mr.. Roberts, however, will be con-
tinued as receiver until the trustee is
elected, adjudicating any petition which
may be valid, and then referring the
entire case to the referee, with orders
to go forward to the distribution of
assets as usual in bankruptcy. This
direction will be taken.
The opinion also embodies a con-
trolling ruling defining the powers Of
the referee. A thorough review of the
entire case follows a recitation of the
purport of the different pleadings in
litigation. The two most important
questions involved were whether the
referee acted with authority in APP
pointing the receiver and whether the
proceedings seeking his appointment
were sufficient in law. Both questions
We're answered in the negative.
In conclusion the court states the
referee may perform the duties of
courts of bankruptcy which are not
expressly intrusted to him by the act,
provided rules and orders of such
courts have prescribed those duties for
him. There is no rule, however, au-
thorizing referees to appoint receivers
before adjudication in involuntary
cases. After adjudication in inVolun-
tary cases, and before in voluntary,
he hr,,, !, lNfl
~ to carry on the business, the referee
may appoint custodian and in proper
cases a receiver.
In addition there is the general rule
that only in cases of extreme urgency
should receiver be appointed for the
property of person or corporation
save after notice and hearing. 1t is
one of the highest powers of the court
of chancery, and should be most spar
ingly exerted. While the referees ale
generally judicial officers or lawyers of
great learning, yet they cannot exer-
else the authority of a court of cham
Gerry without explicit authority so to do.
The creditors and the bankrupt are
considered derelict in their duty, in
that they stood by for two months and
allowed this receivership to go on. Had
the referee original power to do what
he did, the court stated that it was
not improbable that it would have re-
fused any order whatever on the petit
ton of the creditors. In conclusion,
the court says:
I'VE are now confronted with the
fact that the property is in the hands
of de facto officer of the court; that
he has collected large sums and has
incurred, no doubt in good faith, some
expense. Besides, the Branch Com
pany now admits its insolvency and it
is willing to be adjudged bankrupt I'M
der the second petition. Both petit
tions are, then, at present before the
court; the Branch Company is con-
fessedly bankrupt and if one petition
is not good the other may be. The
practical way out of the difficulty
| seems to be to take order annulling the
receivership and continuing Mr.. Rob
erts, who has acted as receiver in the
capacity of custodian until the trustee
is elected, proceed to adjudication of
any petition which may be valid and
sufficient, and then refer the entire
case to the referee with order to go
forward to the distribution of assets as
usual in bankruptcy"