The Birmingham age-herald., 1904-01-20


 suit in state court for the purpose of establishing lien in it's favor upon the banlrupt's exempt property.
 For the purposes of this opinion the 1 foregoing facts are treated as so many postulates.
 Objects of Bankrupt Law.
 The great objects of the bankrupt law are to secure an equality of payment to I all creditors of the same class and a speedy and economical administration of l bankrupt estates. To accomplish these ends the courts of bankruptcy in addi- ton to their statutory powers, are clothed with equity Jurisdiction. The filing of the present petition to be allowed to liti- gate in a state court admits the com plete jurisdiction of this court over the subject matter therein presented; for if this court can grant the prayer of that petition it can, for good and sufficient reason, refuse 1t. If the prayer is re- fused, it is the duty of this court to af- I ford adequate relief to the petitioner. l It may be premature, at this time, to indicate how that relief can or will be given, but a fair and simple method would be to arrange the creditors in three | classes.
 First. those holding liens, second those holding notes or other contracts with the bankrupt's waiver of exemptions, and third those whose claims are not secured by liens or strengthened by a waiver of I exemptions.
 'The claims having been filed, the trus- tee would be required to set aside one thousand dollars of the bankrupt estate out of which he would be directed to pay the claims as to which the exemption was waived and the balance, If any, to turn over to the bankrupt The creditors of the third class would have to look to the l property over and above the amount of the exemption for the satisfaction of their l claims. and those of the first class would be paid according to the tenor of their respective liens and in preference to the second and third classes. However, this plan is tentative, and better one will be adopted when presented.
 Status of Case.
 "As the case now stands, all of the property of the bankrupt, exempt and non exempt. Is in the hands of the trustee and under control of this court. no portion of it has been set aside to bankrupt. This l fact differentiates 1t from the case of Lockwood recently decided by the su- preme court of the United States. In the Lockwood case the facts were, that the property claimed by him as exempt under the laws of Georgia, had been set aside 1 to him by order of the court of bankrupt cy and received by him from the trustee. After getting 1t into possession. certain creditors, who held his notes waiving ex- l empt1ons, commenced suit in court of the state of Georgia. and sought to sub ject his exempted property to the pay i ment of their claims. Lockwood petition ed the United States district court for Georgia to restrain said creditors from | prosecuting said suits and his petition was granted On appeal, the supreme court held that after the property, claimed as exempt, had been set aside to him, the court of bankruptcy had exhausted it's Jurisdiction and was without power or authority to restrain suits in state courts that sought to subject the exempted prop erty to the payment of Lockwood's debts, as to which he had waived his exemp- | tions.
 ProftIess to AnaIyze.
 Numerous authorities have been cited by counsel in this, and other cases, in- volving the same question. It would be profitless to attempt the analysis of them for the reason that they are so antago- nistic in the conclusions reached that their authoritative quality is destroyed. To adopt and follow one of them, would be to ignore the rest; to formulate rule from concensus of these varied opin- ions. would end in doubt and perplexity. It is with much diffidence that the rul- ing in this case is announced; but if it Is erroneous, 1t is consoling to know that one more false note will not materially increase the discord of the chorus.
 "The instant case is entirely different from the Lockwood case. as above shown | and I refuse to grant the petition for the reasons that to do so, would result In multiplicity of expensive and useless suits, and that this court will afford the petitioner all the relief 1t could possiDiy obtain in a state court and at great