The Birmingham age-herald., 1909-05-23

Ward & Rudulph, Lee J. Marx, Powell
 & Blackburn, A. Leo Oberdorfer and the
 trustees in bankruptcy
 The questions now before the court are
 First, Is the sum of $5000 a reasonable
 and proper compensation to be paid to
 the attorneys for the petitioning creditors
 for preparing the petition and procuring
 the adjudication in bankruptcy; and, sec
 ond, should the attorneys fee for peti-
 tionng creditors, when allowed in this
 case, be equally divided between the at
 torneys for the first petitioning creditors
 and the attorneys for the second peti-
 tioning creditors. or should the said fee
 be paid alone to the attorneys for the
 first petitioning creditors or alone to the
 attorneys for the second petitionlng cred
 itors
 The law in reference to the allowance
 of attorneys fees in bankruptcy to the
 petitioning creditors has been fixed by
 statute and has been construed by the
 courts The decision of the court of ap-
 peals of the Seventh circuit (In re Cur
 tis, Am. B. R. IT, fl c. c. A. 6l, 100
 Fed. 7S5-6) upon this question has been
 approved by the court of appeals in this circuit Smith vs. Cooper, Am. B. K.
 75O as the Srule upon which such fees are to be fixed and determined. ln the
 Curtis case, supra, the court said:
 "In the administration of an estate in bankruptcy the law permits the allow ance of one reasonable attorneys fee for the professional services actually ren-
 dered to the petitioning creditors in in voluntary cases. (3O Stat, chap. 541, sec.
 64b subd. 8. U. S. Comp. St. 1901, p. 344S) The attorney for the petition ing creditors Is entitled to this reason
 able fee as of right. Its allowance or dlsallowance Is not a matter of discre-
 ton. So. also. the amount to be allowed does not rest in mere discretion. The amount must in all cases be reasonable. to be determined upon evidence of the
 service performed and of Its value, and, in the absence of evidence of it's value, by the court from knowledge of it's worth. The amount to be allowed rests in legal | Judgment and judicial discretion, but not 1 in unrestrained discretion"
 Easing the remuneration to be paid as a fee for the petltioning creditors upon | the services performed by their attor- neys in preparing the petition and in procuring the adjudication. 1t is the opin- ion of the court that the amount of
 s5O00, as fixed by the special referee here
 in is reasonable and proper; and the conclusion of the referee in that respect is approved and affirmed.
 The next question to be determined is, to which attorneys shall this fee be paid. or shall it be divided equally between | the attorneys for the first petitioning creditors and the attorneys for the sec ond petitioning. creditors. At the time | of the presentation of the petition for
 the first petitioning creditors the second l petition was also presented, and the good l faith in reference to the filing of the l first petition was brought into question | by the second petitioning creditors, and 1 1t was contended: First, that the peti-
 ton filed by the first petitioning creditors was a collusive one with the bankrupt
 the Southern Steel company, for the pur- l pose of permitting the bankrupt to se- | cure the appointment of receivers of its own choice who woulds conduct the bus l mess of the corporation not for the ben l eft of the creditors but in reality for 1 the benefit of the bankrupt corporation l itself; and, second. that the averment of the act of bankruptcy in the first pe- 1 tition could not be sustained as matter l' of law and was but mere subterfuge l on the part of the bankrupt corporation to permit 1t to secure the appointment
 of receivers of it's own naming.
 Upon the first proposition this court by a decree rendered on the Fist day | of January, 1908, determined that upon 1 the evidence then presented the conten- 1 tions of the second petitioning creditors
 were sustained Birmingham Coal and | Iron Go. vs. Southern Steel Co.,, 169 Fed. l 212). From that decree no appeal was | ever taken, and subsequent proceedings l in this cause only tend to sustain the l contention of the second petitioning cred 1 itors, made at the time of the filing of 1 their petition.
 l Upon the second proposition the only | evidence to sustain the averment in the l first petition that "the Southern Steel l company committed an act of banqruptoy
 in that it did admit in writing its ina
 bility to pay its debts. and it's willing
 ness to be adjudged bankrupt on that
 grounds" was the proof that at a meet l ing of the board of directors of the South ern Steel company in New York city on
 October %, 1907. a resolution was adopt ed In words and figures as follows to- wit:
 Whereas certain creditors have threat ened to institute proceedings In volun- tary bankruptcy against the company and
 thereby secure advantage In the appoint nlent of a temporary receiver, and in or- der to avoid permitting them to secure
 this advantage we deem 1t to the bene- fit of all interested that the assent of
 the company be given to the appointment of temporary receiver, or receivers In bankruptcy if 1t becomes necessary.
 Now, therefore. be it resolved, that O.
 R. Hood, attorney for the company be,
 and he hereby is. authorized and em-
 powered to represent the company gener-
 ally in any suit or suits. or bankruptcy proceedings that are now pending, or that
 may be brought against the company looking to the placing of 1t In involun- tary bankruptcy and to the appointment of the temporary receivers, and that he be, and is hereby give full power and
 authority to exercise his discretion in agreeing in the name of and on behalf
 of the company in such a proceeding to
 the appointment of temporary receiver or receivers, and to authorize and give
 its assent to all things necessary or ex-
 pedient in connection herewith
 Subsequently at Birmingham, Ala, O.
 R. Hood, as attorney for the Southern
 Steel company, wrote the Sayre Mining
 and Manufacturing company as follows; Birmingham, Ala, October 24 1907.
 "Sayre Mining and Manufacturing Com pany:
 "Gentlemen--In regard to your claim
 against the Southern Steel company l
 beg to say that we are in a position
 where we cannot pay 1t. We regret to
 make this statement and admission; un-
 der these circumstances we are forced
 to make the admission to you and all
 others concerned that the Southern Steel company is unable to pay it's debts and is willing to be adjudged bankrupt on
 that ground. Very truly yours,
 SOUTHERN STEEL COMPANY,
 By O. R. Hood, Attorney"
 There can be but one conclusion from
 reading of these resolutions, in con
 nection with the other evidence In this case, and that is that their sole pur-