Court Opinion

ID: 8760806
Source: CourtListenerOpinion
Date Created: 2022-11-26 12:05:12.773343+00
Date Added: 2024-06-11T17:01:32.905862
License: Public Domain

MAXEY, District Judge
(after stating the facts). Upon the subject of notices to creditors, it is provided by section 58 of the bankruptcy act (Act July 1, 1898, c. 541, 30 Stat. 561 [U. S. Comp. St. 1901, p. 3444]), among other things, as follows:
“Creditors shall have at least ten days’ notice by mail, to their respective addresses as they appear in the list of creditors of the bankrupt or as after-wards filed with the papers in the case by the creditors, unless they waive notice in writing, of * * * (2) all hearings upon applications for the confirmation of compositions for the discharge of bankrupts.”
Form 57 (89 Fed. lvii; 32 C. C. A. Ixxxi), promulgated by the Supreme Court, as well as the order adopted by this court, requires (1) that notices of the hearings, upon' applications for discharge, shall be published in a newspaper, etc.; and (2) that the “clerk shall send by mail to all known creditors copies of the petition- and the order, addressed to them at-their places of residence as stated.” By section 64 of the act of bankruptcy (30 Stat. 563 [U. S. Comp. St. 1901, p. 3447]), it is provided that:
“The debts to have priority, except as heroin provided, and to be paid in full out of the bankrupt estates, and the order of payment shall be * * * (3) the cost of administration,” etc.
*659And General Order No. 10 of the Supreme Court (89 Fed. vi; 32 C. C. A. xiii) provides:
“Before incurring any expense in publishing or mailing notices, or in traveling, or in procuring the attendance of witnesses, or in perpetuating testimony, the clerk, marshal or referee may require, from the bankrupt or other person in whose behalf the duty is to be performed, indemnity for such expense. Money advanced for this purpose by the bankrupt or other person shall be repaid him out of the estate as part of the cost of administering the same.”
From an examination of the act of bankruptcy and the orders of court it thus appears: (1) That costs of administration are payable out of the bankrupt’s estate; (2) notices must be given to creditors of hearings upon applications for the discharge of bankrupts; (3) notices so required to be given must be published in a newspaper and sent by the clerk through the mails to creditors; and (4) moneys advanced by the bankrupt to the referee, clerk, and marshal for the publication and mailing of notices shall be repaid him out of the estate as part of the costs of administration. The application for discharge and the issuance, publication, and mailing of notices to creditors, upon the application, constitute a step, and one of extreme importance to the bankrupt, in the administration of the estate. That notices of the hearing of the application for discharge in the present case were legally issued and published is not denied. The cost of the notices was advanced by the bankrupt; and General Order No. 10, quoted above, requires the money so advanced to be repaid him out of the estate.
It follows that the referee erred in passing the order complained of, and the same should be reversed, and the cause remanded for further proceedings not inconsistent with the views herein expressed. And it is so ordered.