The Birmingham age-herald., 1922-02-18
Offer of State to Purchase MonteUaHo Properties as Made By GoUernor, Stands
Governor Kilby Writes Referee in Reference to Alleged Withdrawal of Original Offer-Says State Is Able, Ready and Willing to Buy Property-Judge
 Dryer Pleased With Assurance That State
 Stands Ready to Make Offer Good"

and to purchase the property upon the terms mentioned in the offer. Very truly yours,
 THOMAS E. KGLBY.
 Governor.
 Judge Dryers Reply
 Judge Dryers reply follows.
 Honorable Thomas E. Kilby, Gov ernor of the State of Alabama Mont gomery, Alabama.
 Dear Sir; l am in receipt of your letter of 18th inst. which, with copy of this. I file in the bankruptcy pro- ceedings of Montevallo Mining com pany, corporation, bankrupt, in bank ruptcy, No. 17.764. Southern divisioa of the Northern District of Alabama, as the official declaration of record by the State of Alabama that its of fer dated February 1. 1922, and filed in the bankruptcy proceedings on February 2. 1922. is still made good in letter and spirit.
 As the representative of the
 bankruptcy court, I wish to ex-
 press qualification for assurance,
 not only that the original offer on e the file stands. hut that the state
 stands ready to make the offer
 good in spirit, as well as in let
 
 sion has heretofore existed, 1t iS
 now dispelIed. The court. until
 1t otherwise appears of record,
 will treat and consider this offer
 of the state ns made in good faith
 for performance both in letter
 and spirit.
 In order that there may be no mis- understanding, on tho part of the , state or any other person or party in interest, I think certain fundamen- tai and guiding principles in all cases, and especially in this case, should now be stated and explained, viz: In handling bankruptcy estates, this court of bankruptcy has under control and management trust funds. ! which. ultimately. must be distribut- cd in the order of priority prescribed by the acts of Congress. There is an equal duty to every class. It is, thus, ! of prime importance that the assets produce the highest possible price which can be obtained for them. In l ttis connection, the court is not, in the least. bound or influenced by the Valuations given in the schedules of tn bankrupt. It would be helpless, indeed, if it were.
 l The cardinal rule is to handle and sell the property with the same care and circumstances as if the officers | having that duty and responsibility in charge were the owners of it. This 1 requires careful and conscientious in- vcstiga tion of the property and of the business to which the property is 1 devoted in it's ordinary use.
 The trustee in bankruptcy, in the proper discharge of his duties, must make such investigation, and the trus- tee in bankruptcy in this case has heretofore been given instruction sc to proceed, and is doing so. Later soon. no doubt--the trustee will have finished such investigation and will be in position 10 form an opinion upon the existing offer of the state of any other offer, if any should be made and to advise whether or not, in his opinion any should be accepted or rejected.
 In short, when it comes to making a sale of the assets of the estate whether recommended or not recom- mended by the trustee in bankruptcy or any one else, this court will mol lapprove any proposed sale unless con vinced that the estate is receiving the full, fair and adequate value of the property itself.
 The present offer of the state, 1T the form in which it, is made, coulC not be entertained; but it can ant Is entertained in the spirit in whici 1t is made. l rbfer more particular! to the offer to pay specific claims Il specific amounts, and no more.
 The law designates distribution Q the proceeds of the sale, and the or der of distribution. Claims may be and in practice always are, filed ant allowed. which do not appear upol the schedules of the bankrupt. In business of any size, it is impossible for the bankrupt at the beginning to schedule all such claims.
 Besides. yet unascertained taxes duo the United States, state, count. and city, as we'll as all admins tration charges. must be ascertaine and paid in due course of law. Tn offer of the state does not provid for this, nor to pay provable claim not scheduled, nor, in full, tn scheduled claims if not now sched uled in sufficiently large amounts.
 This explanation is given in orde that it may be made clear to yo that the offer of the state as writ ten is not an offer to pay the debt of the bankrupt as such debts ma be proved and finally allowed in du course of administration. As your letter of 18th instant. frs above referred to, indicates such 1 be the spirit of the offer, I sugges if you mean it to be so, that you s amend the offer in order that bot in substance and form it undertake to pay off and discharge the cost and expenses of the administration and all of the debts of the bankrup both secured and unsecured, as the may be finally proved and ailowe in due course in this bankruptcy pra ceeding.
 But do not misunderstood; thi suggestion is not made as a propc sition in any sense of the word. have above outlined the path c duty of the court which will be fo = ! 1oUed