In re Goldberg & Bros.

• Decision Date: 09 April 1906
• Docket Number: 136.
• Citation: 144 F. 566
• Parties: In re GOLDBERG & BROS.
• Court: U.S. District Court — District of Maine

144 F. 566

In re GOLDBERG & BROS.

No. 136.

United States District Court, D. Maine.

April 9, 1906

B. L Fletcher, for creditor.

Charles A. Knight, pro se.

HALE District Judge.

Mr Little, one of the referees of this court in bankruptcy, has certified to me a question which has arisen in the course of proceedings in the above case, as follows:

'Whether a claim of Charles Hayward & Co. for $37.20 was entitled to priority; said claim being for writ, clerk of court's fee, and sheriff's fee in attachment on writ in favor of Charles Hayward & Co. against said bankrupts, and the same having been incurred prior to the filing of petition in said case. The attachment was continued after the filing, and sheriff's fees were incurred before as well as after the filing. They were for the benefit of the estate and necessary for preserving it. On receipt of the proof of debt, which is annexed to the petition for payment in full as a priority claim, I ruled that same be payable and same ought to be paid in full.'

Section 64 of the bankrupt act provides for debts which have priority (Act July 1, 1898, c. 541, 30 Stat. 563 (U.S. Comp. St. 1901, p. 3447)). Subdivision b of said section 64 provides that:

'The debts to have priority, except as herein provided, and to be paid in full out of bankrupt estates and the order of payment shall be: * * * (5) Debts owing to any person who by the laws of the states or the United States is entitled to priority.'

By Rev. St. Me. c. 72, Sec. 36, the assignee in insolvency proceedings could prosecute to final judgment a suit commenced by creditor within four months prior to commencement of insolvency proceedings, and could in his own name levy upon and sell the property attached in such suit, in the same manner as the creditor might have done had no insolvency proceedings been commenced. That section further provides as follows:

'And such attachment and the proceeds of the property so attached shall be held for the benefit of the estate of such insolvent; and when such attachment is made in good faith, the creditor shall be paid out of the estate the costs and expenses arising from such suit and attachment, and the safekeeping or sale of the property so seized and attached, and the expenses of any levy made upon the same, incurred prior to the appearance of such assignee in such suit; and such creditor may prove his debt or claim upon which such suit is brought in the same manner as if a suit had not been commenced. If the assignee elects not to appear and prosecute such suit and if it appears to the court that it was commenced in good faith for the benefit of all the creditors, it shall order said costs and expenses incurred prior to the assignment of the estate to the assignee, to be paid out of the estate.'

Section 42 of said chapter 72 of the Revised Statutes of Maine provides that in making a dividend in insolvency the following claims shall be first paid in full in their order:

'(2) The fees, costs and expenses of suits and proceedings in insolvency.'

The costs and expenses referred to in the two sections of the Revised Statutes, which I have cited, are debts entitled to priority by section 64b, cl. 5, of the bankrupt act, to which I have referred, unless this construction is excluded by some other provision of the act. It has been urged that section 64b, cls. 1 to 3, so regulates the priorities given to all costs that such costs as are now before me are excluded from the priority allowed them by the state law and are intended by Congress to be proved under 63a, cl. 3. 30 Stat. 562, c. 541 (U.S. Comp. St. 1901, p. 3447).

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