In re Rouse
| Citation | 91 F. 514 |
| Parties | In re ROUSE et al. |
| Decision Date | 03 January 1899 |
| Court | U.S. District Court — Northern District of Illinois |
W. T Irwin, for claimants.
James M. Flower, for bankrupts.
On the 31st of August, 1898, the firm of Rouse, Hazard & Co. manufacturers of bicycles, suspended business; its property being on that date seized by the sheriff of Peoria county Ill., under executions issued upon judgments rendered against the corporation in the courts of the state of Illinois. Subsequently the property was sold by the sheriff, and the proceeds held by him subject to further order. On the 1st of November, 1898, a petition was filed in this court by creditors, alleging the foregoing facts, and such other as in law constituted the firm of Rouse, Hazard & Co. involuntary bankrupts. Having determined that the sale made by the sheriff was as favorable as could be expected under further proceedings, and having taken, therefore, by the concurrence of all parties, the proceeds in the hands of the sheriff in lieu of the bankrupts' property, the only remaining question is whether certain claimants are entitled in the distribution of these assets. to a preference.
The claimants are the workmen of Rouse, Hazard & Co., and their claims are for wages earned within four months before the 31st of August, 1898, not to exceed $300 to each claimant. The objection made to the allowance of priority is that the bankruptcy proceedings were not commenced until the 1st of November, 1898, and that, therefore, under the strict letter of the act,-- section 64b (4), --no priority attaches for wages, except such as may have been earned within three months preceding such 1st of November.
The bankruptcy law went into effect July 1, 1898, but provided (section 71a) that no petition for involuntary bankruptcy should be filed until four months after, or the 1st of November, 1898. It is provided, however (section 3b), that any of the acts of bankruptcy set forth, occurring within four months before the filing of the petition, may be made the basis of proceedings in involuntary bankruptcy. Thus it happens that the failure of Rouse, Hazard & Co., occurring on the 31st of August brings their estate within the jurisdiction of the bankrupt court, although the creditors' petition was not filed and could not have been filed, until the 1st of November following. If the claim for priority under consideration is to be...
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