The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1933-03-02
DEBT RELIEF
BILL ON WAY
TO PRESIDENT
Measure Provides for Aid
to Railroads, Farmers
and individuals.
LA GUARDIA SKEPTICAL
Petition May Be Filed in
Court, Asking Extension
of Time 10 Pay.
BY RUTH FINNEY
Times STAFF Writer

WASHINGTON, March 2.-The
individual and railroad debt relief
bill was on its way to President
Hoover for signature today and NAV
become law before night.
AS finally adopted, it had the ap-
proval of administration members
OF both house and senate and also
OF Democratic leaders. 1t was hur-
ried through the house Wedncs-
day without amendment, in expec-
u on Of immediate receiyerships
Tor several railroads.
Although railroads, individual
debtors, and farm debtors are all
provided for specifically under terms
of the bill, Representative F. H. La
Guardia (Rep., N. " warned Just
before the final vote that little is
accomplished for these last two
classes.
May Appeal to Court
For individual debtors the bill
provides:
A debtor may file petition in
federal court stating that he is in
anu hNhAl Co W GllIGb d COIl-
position or an extension of time to
pay his debts. The judge appoints
a custodian or receiver of his prop
erty who makes an inventory of it.
The receiver then calls a meeting
Of creditors. If a majority of them
agree TO the plan for composition
or extension offered by the debtor,
hearings are held by the court.
which confirms the proposal if it is
satisfied that it includes an equita-
BILE and feasible method of liquida-
ton for secured creditors, that it is
in the best interests of all creditors,
and that it is made in good faith.
Such acceptance and confirmation
excuse the debtor from any pay
ments not provided for in the agree
ment.
Either the scaling down or ex-
tension proposals may include Sc
cured debts, such as mortgages, but
only if consent is given by those
holding security. An extension may
be imposed on secured creditors by
a majority of other creditors only
with approval of the court.
Applies to Farms
Farmers may file proceedings I'M
der this section, or if fifteen of them
in any county so desire, they may
ask a court of bankruptcy to APP
point a conciliatory commissioner
for that county. If this is done,
the commissioner receives the farm
er's proposal for adjustment of
debts and calls together creditors
to pass upon it.
The court retains final juriSdic-
ton. Here, likewise, mortgage hold
ers al not be required to scale
down their debts, but can be re-
CURED to agree to an extension if
a majority of the other creditors
so decide.
The bill as finally adopted con
tanned no provision for corporate
reorganization, but did provide for
railroad reorganization.
Under its terms, ar insolvent rail-
road files a petition for reorgani-
cation with the federal court in
whose jurisdiction it has its prin-
cipal Office, and also with the in
terstate commerce commission.
The judge appoints a trustee from
a panel of standing trustees pre-
viously selected by the interstate
commerce commission. The commits
sion holds a hearing at which plans
for reorganization may be presented
by the debtor, by the trustee, or by
the creditors.
May Draw Own Plan
The commission may approve n
of these plans or draw one of its
own, but after it has decided on
some plan two-thirds of the credit
ors of each class whose claims
would be affected by the plan must
consent to it before it goes to the
judge for final approval.
A provision written into the bill
by the senate and agreed to by the
house specifies that neither judge
nor trustee may change wages or
working conditions of railroad en-
ployes; that they shall not ques-
ton the right of workers to join
labor organizations, and that nei-
Their may use the funds under the
courts jurisdiction in maintaining
company unions.