Year: 1867




fed shall be proved or allowed against the estate.
Sec. %. And be it further enacted, That in
| all cases of mutual debts ar mutual credits be-
| tween the parties, the account between them
shall be stated, and one debt set of against the
| other, and the balance only shall be allowed or
| paid, but set off shall be allowed of a claim
| IN its nature not prOYable against the estate !:
| Provided, That no set-Of shall be allowed in
| favor of any debtor TO the bankrupt of a claim
purchased by or transferred TO him after the
filing of the petition. When a creditor bas
mortgage or pledge of real or personal pro-
| perty OF the bankrupt, OF lien thereon for
securing the payment of a debt owing TO him
| from the bankrupt, he shall be admitted as
creditor snly for the balance Of the debt after
deducting the value Of such property, to be as
eertained by agreement between him and the


assignee or by a sale thereof, to be made in such


manner as the court shall direct; or the cred
itOr may release or convey his claim to the


assignee upon such property. and be admitted


to prove his whole debt. If the value of the


property exceeds the sum for which It is so held
creditor the bankrupts right of redemption
therein on receiving such excess; OF he may sell


the property subject to the claim of the creditor


thereon ana in either case the assignee and
creditor, respectively. shall execute all deeds


and writings necessary or proper TO eOnsum-


mate the transaction. If the property is not so


sold or released and delivered up. the creditor


shall not be allowed to prove any part OF his debt
Sec. q. And be it further enacted, That no
creditor proving his debt or claim shall be al
lowed to maintain any suit at law or in equity
/ .GCftlbt AsdlHNt Lit BHuhFWDl. DuL slall De


deemed to have waived all right of action and


suit against the bankrupt, and all proceedings


already commenced, or unsatisied judgments


already obtained thereon, shall be deemed to be


discharged and surrendered thereby: and no


creditor whose debt is proYabe under this act


shall be allowed to prosecute to final judgment


any SUIT at law or IN equity therefore against


the bankrupt, until therquestiOn of the debtors


discharge shall have been determined and any


such suit or proceedings shall, upon the applica-


ton of the bankrupt, be stayed to await the de-


termination of the court in bankruptcy on the


question of the discharge, provided there be no


unreasonable delay on the part of the bankrupt


in endeavOring to obtain his discharge, and pro-


vided, also, that if the amount due the creditor


is in dispute, the suit. by leave Of the court in


bankruptcy, may proceed to judgment for the


purpose of ascertaining the amount due, which


amount may be proved in bankruptcy, but exc


cuti0n shall be stayed aforesaid. If any


bankrupt shall, at the time of adjudication be


liable upon any bill of exchange, promissory


note. or other Obligation IN respect Of distinct


contracts as n member of two more firms


carrying on separate and distinct trades and


having distinct estates to be wound up in bank


ruptcy, or as sole trader and also asl mem


Der of a firm. the circumstance that such firms


are in whole or in part composed of the same


individuals. or that the sole contractor is also


one of the joint contractors, shall not prevent


proof and receipt of dividend IN respect Of such


distinct contracts against the estates respectively


liable upon such contracts.


Sec. p. And be it further enacted, That all


proofs of debts against the estate of the bank
rupt by or in behalf of creditors residing within


the judicial district where the proceedings in


bankruptcy are pending, shall be made before


one OF the registers of the court IN said district


and by or in behalf of nonresident debtors


before any register in BANKRUPTCY in the judicial


district where such creditors or either of them


reside, or before any commissioner of the Circuit


Court authorized to administer oaths in any dis


trict. To entitle q claimant against the estate
of bankrupt to have his demand allowed, il


must be verified by deposition in writing on
oath or solemn affirmation before the proper


register commissioner, setting forth the de-
mand, the consideration whereof whether any


and what securities are held therefor, and
whether any and what payments have been
made thereon that the sum claimed is justly


due from the bankrupt to the claimant; that
the claimant has not, nor has any other person.


for his use received any security or satisfaction
whatever other than that by him set forth. that
the claim was not procured for the purpose of
influencing the proceedings under this act, and
that no bargain or agreement express or I'M
Piled has been made or entered into, by or on
behalf of such creditor; to sell, transfer or dis


pose of the said claim any part thereof against
such bankrupt or take or receive, directly or IN
directly, any money, property, or consideration
whatever, whereby the vote OF such creditor for
assignee or any action on the part Ofsuch credit


or or any other person in the proceedings under
this act is or shall be in any way affected, In-
huenced, or controlled; and no claim shall be
allowed unless all the statements set forth in
such deposition shall appear TO be true. Such
oath or solemn affirmation shall be made by the
claimant, testifying of his own knowledge, IN
I less he absent from tue tuiteQ STATES
/ or prevented by some other good cause
/ from testiEying, in which cases the demand may
/ be verified in like manner By the attorney OF
I authorized agent of the claimant testifying to
| the best of his knowledge, information, and be-
! lief and setting forth his means of knowledge (;
or if in foreign country, the oath Of the eredl-
| tor may be taken before any minister, consul or
| vice consul of the United States; and the court


may if it shall fit, require or receive further
pertinent evidence either for or against the ad-
/ mission of the claim. Corporations may verify
Al, IL aHasara ~
| their president. cashier, or treasurer. II the
] proof is satisfactory to the register or commits
! sioner. it shall be signed by the deponent, and
! delivered or sent by mail to the assignee. who
shall examine the same and compare il with the
| books and accounts of the bankrupt and shall
register, in book to be kept by him for that
| purpose thenames OfcreditOrs WhO,haye proved
! their claims, in the order in which shuch proof
| is received, stating the time Of receipt OF such
proof and the amount and nature Of such debts.
! which books shall be open to the inspection OF
| all the creditors. The court may, on the appll-
cation of the assignee, any creditor OF OF the
! bankrupt, or without any application, examine
upon oath the bankrupt. OF any person tender
| ing or has made proof OF claims, and may sum
! mon any person capable of giving evidence con-


cerning such proof, or concerning the debt sought


to be proved, and shall reject all claims not
! duly proved, or where the pr0OfshOWs the claim
| to be founded in fraud, illegality. or mistake.


See. %. And be it further enacted, That when


claim is resented for proof before the election
| of the assignee and the judge entertains doubts
/ OF Its validity OF the TiRub OF tTtultOI 70
| prove it, and is of opinion that such validity or
| right ought to be investigated by the assignee,
| he may postpone the proof OF the claim until the


assignee is chosen. Amy person who after the
| approval of this act, shall have accepted any
| preference, having reasonable cause to believe


that the same was made or given BY the debtor,
| contrary to any provision OF this act, snail not
| prove the debt or claim on account Of which the
! preference was made or given, nor shall be re-
| ceive any dividend therefrom until he shall first


have surrendered to the assignee all property,
4 au-a1 hy i'm
| under such preference. The court shall allow
| all debts duly proved, and shall cause list
| thereof 30 be made and certified by one oil the


registers and any creditor may act at all meet
ngs by his duly constituted attorney the same AS
! though personally present.


See a. And be il further enacted. That sup
| posed creditor who takes an appeal to the CIR


cuit court from the decision ef the district court


rejecting his claim in whole or in part shall, upon
| entering his appeal in the circuit court, hle m
| the clerks office thereof statement IN writing


of his claim setting forth the same, su 5stential-
| ly as in a declaration for the same cause OF ac-
ton at law and the assignee shall plead or an
| swer thereto in like manner, and like proceed
| ings shall thereupOn be had in the pleadlngs
| trial and determination Ofthe cause as IN action
| at law commenced and prosecuted. in the usual
| manner. in the courts Of the United states, eX-
| cept that no execution shall be awarded against
| the assignee for the amount ct q debt found due
| to the creditor. The final judgment Of the court
shall be conclusive. and the list Of debts shall
.I | if necessary be altered TO conform thereto. The
| party prevailing in the suit shall be entitled q
| costs against the adverse party, to be taxed and
| recovered as in suits at law II recovered agalns


the assignee they shall be allowed out Of the es-


tate. bill Of exchange. promissory note. ol
| other instrument used in evidences upon the proc
| Of claim, and left in court or deposited IN thS
| clerks Office may be delivered, by the register
/ or clerk having the custody thereof to the per
| son who used il, upon his filing copy thereof


attested by the clerk Of the court, who shall en-
| dorse upon it the name OF the party agalns


whose estate it has been proved and the date an'


OF PROPERLY PERIsHABLE AND IN DISPUTE


| Sec. 25 And be Il further enacted, That Wher
| il appears to the satisfaction Of the c0urt that
| the estate OF the debtor, or any part thereoi l.
| Of a perishable nature, OF liable 20 deterloratt
| in value, the court may order ths sel5 20 ~
| sold, in such manner as may be deemed mos
| expedient under the direction OF the messenger
| or assignee, as the case may be- who shsH holG


the fund.- received in place Of the estate disposed


Of: and whenever il apears to the satisfaction ol
| the court that the title 70 any portion OF an es
| tate real or personal. which has come into pos
| session Of the assignee, or which IS claimed bJ
| him Il in dispute, the court may. upon the peti-


tion Of the assignee, and after such notice 70 tnt
| claimant his agent or attorney, as the court snal
| deem reasonable, order il 70 be sold. uRdeT th'
| direction Of the assignee. who shall hOld th'


funds received in place Of the estate disposed Oi;
| and the proceeds Of the sale shall be considsrea
| the measure Of the value Of the property 70 an,


suit OF controversy between the parues 40 ans
| courts But this provision shall not prevent ths


recovery Of the property from the possession o.


the assignee By any proper action commsncea al
| any time before the court orders the sale


| EXAMINATION OF BkEKRUPTS.


Sec. d. And be il further enacted. That th'


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