An Act to amend the Bankruptcy Act, as amended
PL 87-681 (H.R.5393), enacted 09/20/1962

570 
PUBLIC LAW 87-681-SEPT. 25, 1962 
[76 STAT. 
Public Law 87-681 
September 25, 1962 
[H. R. 5393] 
AN ACT 
To amend the Bankruptcy Act, as amen(le<l. 
Bankruptcy Act, 
amendment. 
66 Stat. 420. 
Bankruptcy 
courts. 
Jurisdiction. 
52 Stat. 844; 
66 Stat. 421. 
52 Stat. 853. 
Evidence. 
Certified copies 
of proceedings, 
etc. 
74 Stat. 198. 
Trustees, con^ 
pensation. 
11 u s e 68. 
52 Stat. 866. 
Secured claims, 
settlement provi-
sions. 
Be it enacted hy the Senate and House of Representatives 
of the 
United States of America in Congress assembled^ That clause (1) of 
subsection a of section 2 of the Bankruptcy Act approved July 1, 
1898, as amended (11 U.S.C. 11(a)(1)), is amended to read as follows: 
"(1) Adjudge persons bankrupt who have had their principal 
place of business, resided, or had their domicile within their 
respective territorial jurisdictions for the preceding six months, 
or for a longer portion of the preceding six months than in any 
other jurisdiction, or who do not have their principal place of 
business, reside, or have their domicile within the United States, 
but have property within their jurisdiction, or in any cases trans-
ferred to them pursuant to this Act;". 
SEC. 2. Subsection a of section 2 of the Bankruptcy Act (11 U.S.C. 
11 (a)) is amended (1) by deleting the word "and" at the end of clause 
(20); (2) by striking out the period at the end of clause (21) and 
inserting "; and"; and (3) by adding the following new paragraph: 
" (22) Exercise, withhold, or suspend the exercise of jurisdiction, 
having regard to the rights or convenience of local creditors and 
to all other relevant circumstances, where a bankrupt has been 
adjudged bankrupt by a court of competent jurisdiction without 
the United States." 
SEC. 3. Subsection d of section 21 of the Bankruptcy Act (11 U.S.C. 
44d) is amended to read as follows: 
"d. Certified copies of proceedings before a referee, or of papers, 
when issued by the clerk, referee, or an employee of the referee desig-
nated by his order, which shall be filed in the office of the clerk, shall 
be admitted as evidence with like force and effect as certified copies of 
the records of district courts of the United States are now or may 
hereafter be admitted as evidence." 
SEC. 4. The first paragraph of subsection c of section 48 of the Bank-
ruptcy Act (11 U.S.C. 76c) is amended to read as follows: 
"c. Trustees. Tlie compensation of trustees for their services, pay-
able after they are rendered, shall be a fee of $10 for each estate, de-
posited with the clerk at the time the petition is filed in each case, except 
where installment payments may be authorized pursuant to section 40 
of this Act, and such further sum as the court may allow, as follows:" 
SEC. 5. Subsection i of section 57 of the Bankruptcy Act (11 U.S.C. 
1)3(i)) is amended to read as follows: 
"i. Whenever a creditor whose claim against a bankrupt estate is 
secured, in whole or in part, by the individual undertaking of a per-
son, fails.to prove and file that claim, that person may do so in the 
creditor's name, and he shall be subrogated to the rights of the creditor, 
whether the claim has been filed by the creditor or by him in the 
creditor's name, to the extent that he discharges the undertaking except 
that in absence of an agreement to the contrary, he shall not be entitled 
to any dividend until the amount paid to the creditor on the under-
taking plus the dividends paid to the creditor from the bankrupt estate 
on the claim equal the amount of the entire claim of the creditor. Any 
excess received by the creditor shall be held by him in trust for such 
person." 
SEC. 6. Clause (6) of subsection a of section 68 of the Bankruptcy 
Act (11 U.S.C. 94(a) (6)) is amended to read as follows: 
"(6) the proposed compromise of a controversy unless the 
court, for cause shown, directs that notice be not sent;". 
76 STAT. ] 
PUBLIC LAW 87-681-SEPT. 25, 1962 
571 
SEC. 7. Subsection b of section 59 of the Bankruptcy Act (11 U.S.C. 
95(b)) is amended to read as follows: 
66 stat. 425. 
"b. Three or more creditors who have provable claims not contin- 
Petitions, 
gent as to liability against a person, amounting in the aggregate to 
Requirements. 
$500 in excess of the value of any securities held by them, or, if all of 
the creditors of the person are less than twelve in number, then one or 
more of the creditors whose claim or claims equal that amount^, may 
file a petition to have him adjudged a bankrupt; but the claim or 
claims, if unliquidated, shall not be counted in computing the number 
and the aggregate amount of the claims of the creditors joining in the 
petition, if the court determines that the claim or claims cannot be 
readily determined or estimated to be sufficient, together with the 
claims of the other creditors, to aggregate $500, without unduly delay-
ing the decision upon the adjudication." 
SEC. 8. Clause (1) of subsection a of section 64 of the Bankruptcy 
Act (11 U.S.C. 104(a) (1)) is amended to read as follows: 
66 stat. 426. 
"(1) the costs and expenses of administration, including the 
order of pay-
actual and necessary costs and expenses of preserving the estate '"ent*. 
subsequent to filing the petition; the fees for the referees' salary 
and expense fund; the filing fees paid by creditors in involuntary 
cases or by persons other than the bankrupts in voluntary cases; 
where property of the bankrupt, transferred or concealed by him 
either before or after the filing of the petition,'is recovered for 
the benefit of the estate of the bankrupt by the efforts and at the 
cost and expense of one or more creditors, the reasonable costs and 
expenses of the recovery; the trustee's expenses in opposing the 
bankrupt's discharge or in connection with the criminal prosecu-
tion of an offense punishable under chapter 9 of title 18 of the 
United States Code, or an ofl'ense concerning the business or 
is use 151-155. 
property of the bankrupt punishable under other laws. Federal or 
State; the fees and mileage payable to witnesses as now' or here-
after provided by the laws of the LTnited States, and one reason-
able attorney's fee, for the professional services actually rendered, 
irrespective of the number of attorneys employed, to the bankrupt 
in voluntary and involuntary cases, and to the petitioning cred-
itors in involuntary cases, and if the court adjudges the debtor 
bankrupt over the debtor's objection or pursuant to a voluntary 
petition filed by the debtor during the pendency of an involuntary 
proceeding, for the reasonable costs and expenses incurred, or 
the reasonable disbursements made, by them, including but not 
limited to compensation of accountants and appraisers employed 
by them, in such amount as the court may allow. Where an order 
is entered in a proceeding under any chapter of this Act directing 
that bankruptcy be proceeded with, the costs and expenses of 
administration incurred in the ensuing bankruptcy proceeding 
shall have priority in advance of payment of the unpaid costs 
and expenses of administration, including the allowances pro-
vided for in such chapter, incurred in the superseded proceeding 
and in the suspended bankruptcy proceeding, if any;". 
SEC. 9. Subsection b of section 70 of the Bankruptcy Act (11 U.S.C. 
110(b)) is amended to read as follows: 
52 stat. sso. 
"b. The trustee shall assume or reject an executory contract, includ- 
Executory con-
ing an unexpired lease of real property, within sixty days after the f^cts. 
adjudication or within thirty days after the qualification of the trustee, 
w^hichever is later, but the court may for cause shown extend or reduce 
the time. Any such contract or lease not assumed or rejected within 
that time shall be deemed to be rejected. 
If a ti-ustee is not appointed, 
any such contract or lease shall be deemed to be rejected within thirty 
days after the date of the order directing that a trustee be not 
572 
PUBLIC LAW 87-681-SEPT. 25, 1962 
[76 STAT. 
appointed. 
A trustee shall file, within sixty days after adjudication 
or within thirty days after he has qualified, whichever is later, unless 
the court for cause shown extends or reduces the time, a statement 
under oath showing which, if any, of the contracts of the bankrupt 
are executory in whole or in part, including unexpired leases of real 
property, and which, if any, have been rejected by the trustee. 
Unless 
a lease of real property expressly otherwise provides, a rejection of the 
lease or of any covenant therein by the trustee of the lessor does not 
deprive the lessee of his estate. A general covenant or condition in 
a lease that it shall not be assigned shall not be construed to prevent 
the trustee from assuming the same at his election and subsequently 
assigning the same; but an express covenant that an assignment by 
operation of law or the bankruptcy of a specified party thereto or of 
either party shall terminate the lease or give the other party an elec-
tion to tenninate the same is enforcible. 
A trustee who elects to 
assume a contract or lease of the bankrupt and who subsequently, with 
the approval of the court and upon such terms and conditions as the 
court may fix after hearing upon notice to the other party to the con-
tract or lease, assigns the contract or lease to a third person, is not 
liable for breaches occurring after the assignment." 
SEC. 10. Subsection f of section 70 of the Bankruptcy Act (11 U.S.C. 
52 Stat. 882. 
110(f)) is amended to read as follows: 
>^praisers. 
"f. The court sliall appoint a competent and disinterested appraiser 
and upon cause shown may appoint additional appraisers, who shall 
appraise all the items of real and personal property belonging to the 
bankrupt estate and who shall prepare and file with the court their 
report thereof. Real and personal property shall, when practicable, 
be sold subject to the approval of the court. It shall not be sold other-
wise than subject to the approval of the court for less than 75 per 
centum of its appraised value. Whenever a sale of real or personal 
property of a bankrupt is made by or through an auctioneer employed 
by the court, receiver, or trustee, the auctioneer must be a duly licensed 
or authorized auctioneer in the place where the sale is to be conducted." 
SEC. 11. Subsection a of section 77 of the Bankruptcy Act (11 U.S.C. 
49 Stat. 911. 
205 (a)) is amended to read as follows: 
Railroads. 
"(a) Any railroad corporation may file a petition stating that it is 
rerf**^°z^tion 
insolveut or unable to meet its debts as they mature and that it desires 
to effect a plan of reorganization. The petition shall be filed with the 
court in whose territorial jurisdiction the corporation, during the pre-
ceding six months or the greater portion thereof, has had its principal 
executive or operating office, and a copy of the petition shall at the 
same time be filed with the Interstate Commerce Commission (herein-
after called the 'Commission'). When any railroad, although engaged 
in interstate commerce, lies wholly within one State, the proceedings 
shall be brought in the United States district court for the district 
in which its principal operating office has been located during the pre-
ceding six months or the greater portion thereof. The petition shall be 
accompanied by payment to the clerk of a filing fee of $150. Upon the 
filing of such a petition, the jud^e sliall enter an order either approv-
ing it as properly filed under this section, if satisfied that it complies 
with this section and has been filed in good faith, or dismissing it, if 
he is not so satisfied. If the petition is so approved, the court in which 
the order is entered shall, during the pendency of the proceedings 
under this section and for the purposes thereof, have exclusive juris-
diction of the debtor and its property wherever located, and shall have 
and may exercise in addition to the powers conferred by this section 
all the powers, not inconsistent with this section, which a court of the 
United States would have had if it had appointed a receiver in equity 
of the property of the debtor for any purpose. Process of the court 
76 STAT. ] 
PUBLIC LAW 87-681-SEPT. 25, 1962 
573 
shall extend to and be valid when served in any judicial district. The 
Supreme Court of the United States shall promulgate rules relating 
to the service of process outside of the district in which the proceeding 
is pending, and any other rules which it may deem advisable in order 
to aid district courts and courts of appeal in exercising the jurisdiction 
herein conferred upon them. 
The railroad corporation shall be re-
ferred to in the proceedings as a 'debtor'. Any railroad corporation 
"Debtor." 
the majority of the capital stock of which having power to vote for 
the election of directors is owned, either directly or indirectly through 
an intervening medium, by any railroad corporation filing a peti-
tion as a debtor may file, with the court in which the other debtor has 
filed such a petition, and in the same proceeding, a petition, a copy 
of which shall also be filed at the same time with the Commission, 
stating that it is insolvent or unable to meet its debts as they mature, 
and that it desires to effect a reorganization in connection with, or as a 
part of the plan of reorganization of the other debtor; and upon the 
filing of the petition, the judge shall enter an order either approving it 
as properly filed under this section, if satisfied that it complies with 
this section and has been filed in good faith, or dismissing it if not so 
satisfied, and thereupon the court, if it approves the petition, shall 
have the same jurisdiction with respect to such debtor, its property 
and its creditors and stockholders, as the court has with respect to 
the other debtor. Creditors of any railroad corporation, having claims 
aggregating not less than 5 per centum of all the indebtedness of the 
corporation as shown in the latest annual report which it has filed with 
the Commission at the time when the petition is filed, may, if the cor-
poration has not filed a petition under this section, file with the court 
in which the corporation might file a petition under this section, a 
petition stating that the corporation is insolvent or unable to me^t its 
debts as they mature and that the creditors have claims aggregating 
not less than 5 per centuin of all such indebtedness of the corporation 
and propose that it shall effect a reorganization; copies of the petition 
shall be filed at the same time with the Commission and served upon 
the corporation. The corporation shall, within ten days after such 
service, answer the petition. If the answer admits the jurisdiction of 
the court and the material allegations of the petition, the judge shall 
enter an order approving the petition as properly filed if satisfied 
that it complies with this section and has been filed in good faith, or 
dismissing it, if not so satisfied. If the answer denies either the juris-
diction of the court or any material allegation of the petition, the 
judge shall summarily determine the issues presented by the pleadings 
without the intervention of a jury, and if he finds that the material 
allegations are sustained by the proofs and that the petition complies 
with this section and has been filed in good faith, the judge shall 
enter an order approving the petition; otherwise, he shall dismiss 
the petition. If such a petition is so approved, the proceedings thereon 
shall continue with like effect as if the railroad corporation had itself 
filed a petition under this section. If a petition is dismissed, neither 
the petition nor the answer of a debtor constitute an act of bank-
ruptcy or an admission of insolvency or of inability to meet maturing 
obligations or be admissible in evidence, without the debtor's consent, 
in any proceedings then or thereafter pending or commenced under 
this Act or in any State or United States court. If, in any case in 
which the issues have not already been tried under the provisions of 
this subdivision, any of the creditors, prior to the hearing provided 
for in paragraph (1) of subsection (c) of this section, appear and 
controvert the facts alleged in the petition, the judge shall determine, 
as soon as may be, the issues presented by the pleadings, without the 
intervention of a jury, and, unless the material allegations of the peti-
tion are sustained by the proofs, shall dismiss the petition." 
574 
PUBLIC LAW 87-681-SEPT. 25, 1962 
[76 STAT. 
52 Stat. 888. 
Trustees. 
52 Stat. 901. 
Hearings. 
52 Stat. 903. 
52 Stat. 914. 
Unregistered 
securities. 
SEC. 12. Section 160 of the Bankruptcy Act (11 U.S.C. 560) is 
amended to read as follows: 
"SEC. 160. In any case, the judge at any time, without or upon cause 
shown, may appoint additional trustees and cotrustees, or remove 
trustees and appoint substitute trustees; and upon each such appoint-
ment the judge shall fix a hearing to be held within thirty days to 
consider objections to the retention in office of the trustee. At least 
ten days' notice of the hearing shall be given to the persons designated 
in section 161 of this Act." 
SEC. 13. Section 247 of the Bankruptcy Act (11 U.S.C. 647) is 
amended to read as follows: 
"SEC. 247. The judge shall fix a time of hearing for the consideration 
of applications for allowances, of which hearing notice shall be given 
to the applicants, the trustee, the debtor, the creditors, stockholders, 
indenture trustees, the Securities and Exchange Commission, and such 
other persons as the judge may designate, except that notice need not 
be given to any class of creditors or stockholders which does not par-
ticipate under the plan as confirmed by the court from which no appeal 
is pending and the time allowed for appeal has expired. In the case 
of allowances for services and reimbursement in a superseded bank-
ruptcy proceeding, notice need be given only to the applicants, the 
debtor, the trustee, and the unsecured creditors, and may be given to 
such other classes of creditors or other persons as the judge may des-
ignate. In the case of the dismissal of a proceeding under this chapter 
and the entry of an order therein directing that bankruptcy be pro-
ceeded with, notice of the hearing to consider allowances need not be 
given to stockholders." 
SEC. 14. Clause (6) of subsection a of section 265 of the Bankruptcy 
Act (11 U.S.C. 665(a) (6)) is amended to read as follows: 
"(6) copies of plans, alterations or modifications in plans, and 
any notices of hearings on the plans, alterations, or modifica-
tions ;" 
SEC. 15. Clause (7) of subsection a of section 265 of the Bankruptcy 
Act (11 U.S.C. 665(a) (7)) is amended to read as follows: 
"(7) the orders approving any plan or plans or alterations or 
modifications in plans;" 
SEC. 16. Clause (2) of subsection a of section 393 of the Bankruptcy 
Act (11 U.S.C. 793(a) (2)) is amended to read as follows: 
"(2) any transaction in any security issued pursuant to an 
arrangement in exchange for claims against the debtor or partly 
in exchange and partly for cash and/or property, or issued upon 
exercise of any right to subscribe or conversion privilege so issued, 
except (A) transactions by an issuer or an underwriter in connec-
tion with a distribution otherwise than pursuant to the arrange-
ment, and (B) transactions by a dealer as to securities constituting 
the whole or a part of an unsold allotment to or subscription by the 
dealer as a participant in a distribution of such securities by the 
issuer or by or through an underwriter otherwise than pursuant 
to the arrangement." 
Approved September 25, 1962. 
76 
STAT.] 
PUBLIC LAW 87-683-SEPT. 25, 1%2 
575 
Public Law 87-682 
AN ACT 
To extend to fishennen the same treatment accorded farmers in relation to 
estimated income tax. 
September 25,1962 
[H. R. 6413] 
Be it enacted hy the Senate and House of Rej^resentatives of the 
United States of America in Congress assembled^ That (a) the follow-
ing provisions of the Internal Revenue Code of 1954 are amended by 
inserting "or fishing" after "from farming" each place it appears: 
(1) Section 6015 (f) (relating to treatment of return as declara-
tion or amendment). 
(2) Section 6073(b) (relating to time for filing declarations of 
estimated income tax by individuals). 
(3) Section 6153(b) (relating to installment payments of esti-
mated income tax by individuals who are farmers). 
(4) Subsections (b) and (d)(1)(C) of section 6654 (relating 
to additions to tax for failure by individual to pay estimated 
income tax). 
(b) Section 6073(a) of the Internal Revenue Code of 1954 (relating 
to time for filing declarations of estimated income tax by individuals 
other than farmers) is amended by striking out "individuals not 
regarded as farmers" and inserting in lieu thereof "individuals 
regarded as neither farmers nor fishermen". 
(c) The headings of subsections (a) and (b) of section 6073, and 
subsection (b) of section 6153, of the Internal Revenue Code of 1954 
are each amended by inserting "OR FISHERMEN" after "FARMERS". 
SEC. 2. The amendments made by the first section of this Act shall 
apply only with respect to taxable years beginning after December 31, 
1962. 
Approved September 25, 1962. 
Taxes. 
Declaration by 
fishermen. 
68A Stat. 737; 
72 Stat. 1660. 
68A Stat. 750. 
Effective date. 
Public Law 87-683 
AN ACT 
To amend the Act of June 6, 1924, chapter 270 (43 Stat. 463), relating to the 
National Capital Park and Planning Commission, as amended by the National 
Capital Planning Act of 1952 (66 Stat. 781; 40 U.S.C. 71). 
September 25, 1962 
[H. R. 
9954] 
Be it enacted hy the Sen/ite and House of Representatives 
of the 
United States of America in Congress assembled, That section 2b of the 
National c ap it ai 
Act of June 6, 1924 (43 Stat. 463), relating to the National Capital ^^^^"^ '=°"''"i^ 
Park and Planning Commission, as amended by the Act of July 19, 
1952, chapter 949, known as the National Capital Planning Act of 1952 
(66 Stat. 781; 40 U.S.C. 71 (a) (b) (1)), is hereby amended by inserting 
before "the chairmen of the committees" the words "the Administrator 
of the National Capital Transportation Agency,". 
Approved September 25, 1962. 
si on. 
Membership. 
40 u s e 71a.