In re Russell

Decision Date31 August 1928
Docket NumberNo. 549.,549.
PartiesIn re RUSSELL et al. Petition of MERRILL.
CourtU.S. District Court — District of Delaware

William T. Knowles, of Wilmington, Del., for bankrupt Merrill.

George W. Lilly, of Wilmington, Del., for bankrupt Russell.

MORRIS, District Judge.

Upon a single involuntary petition filed against them, William Thomas Russell, John Davis Merrill, and Diamond State Products Company, a partnership of which they were the copartners, were each and all adjudged bankrupt. For extraordinary reasons, deemed sufficient by the referee, one person was appointed trustee of the estate of Merrill, one of the estate of Russell, and a third of the partnership estate. To this no objection has been made by any one. By reason of a combination of peculiar circumstances, the partnership assets sold for more than enough to pay the administration costs and expenses and all indebtedness of the partnership and of each partner. The bankruptcy adjudication having been deemed by the parties in interest and the referee to have effected by operation of law a dissolution of the partnership (22 A. & E. 2d Ed. 202; 20 R. C. L. 959), the partnership trustee paid the surplus to the trustees for the individual partners in the proportion of their respective interests in the partnership (Bankruptcy Act, § 5f, 11 USCA § 23(f). Upon final accounting, the referee made an order allowing to the trustee of the partnership estate commissions on all moneys disbursed or turned over by him to any person, including the trustees for the individual estates, and as well to each of the trustees for the individual estates commissions upon the moneys received by them from the partnership trustee and disbursed or turned over by them to the individual partners.

By petition for review one of the partners now challenges the validity of that order, in so far as it makes any allowance of fees to the trustee of his individual estate, and also in so far as the commissions allowed the partnership trustee were based upon the sums paid by him to the trustees for the individual estates for payment to the partners.

The first of these objections is planted upon section 48(a) of the Bankruptcy Act (11 USCA § 76(a) and the decisions in Willis v. Hart, 11 F.(2d) 530 (C. C. A. 5), In re Rider (D. C.) 220 F. 193, In re Langslow (D. C.) 98 F. 869, and In re Gay (D. C.) 98 F. 870. The section of the statute so relied upon provides that "trustees shall receive for their services * * * a fee of five dollars deposited with the clerk at the time the petition is filed in each case (italics mine), * * * and such commissions on all moneys disbursed or turned over to any person, including lienholders, by them, as may be allowed by the courts, not to exceed" the prescribed percentages on the moneys disbursed or turned over.

The petitioner contends that a single petition in bankruptcy against the partnership and one or more of the partners constitutes but one "case," within the meaning of the foregoing statute, although the partnership estate and the individual estates are all administered and discharges granted to the partners individually in the proceedings instituted by the one petition. He likewise contends that the statute itself, by providing in section 52a (11 USCA § 80 (a) thereof that "clerks shall respectively receive as full compensation for their service to each estate (italics mine), a filing fee of ten dollars * * *" makes a distinction between a "case" under section 48a and an "estate" under section 52a. He further asserts that, as section 72 of the act (11 USCA § 112) provides that certain officials, including trustees, shall not receive "any other or further compensation for his services than that expressly authorized and prescribed in this act" there is not only a want of statutory authority, but, as well, an express denial of authority, for the allowances made by the referee herein to the respective trustees of the individual estates.

In proceedings instituted by a voluntary petition, identical contentions were sustained by the Circuit Court of Appeals for the Fifth Circuit in Willis v. Hart, supra. In In re Rider, supra, too, "case" and "estate" were held to have been used by the Congress, not synonymously, but as counter or contrasting terms. Upon this ground the court held that, a single involuntary petition having been filed against a partnership and the two individuals composing it, the sole trustee was not entitled to have his fees and commissions separately computed upon the several estates. In In re Langslow, supra, Judge Coxe held that, under section 40a of the Bankruptcy Act (11 USCA § 68(a), providing that "referees shall receive, as full compensation for their services, * * * a fee of fifteen dollars deposited with the clerk at the time the petition is filed in each case, * * *" the referee was entitled to a single fee only, and not to an added fee for each partner in the bankruptcy case. A like decision was made by Judge Aldrich of the District Court of New Hampshire in In re Gay, supra.

A different view of the meaning of this statute has recently been taken by the District Court of New Hampshire in In re Thompson, 17 F.(2d) 601. There the present judge for that district held that, where used in the statute with respect to payment for services, the words "each case" and "each estate" are used synonymously, and that the fees and commissions are payable for each estate. This view finds support in at least two other districts. In In re Farley (D. C.) 115 F. 359, Judge McDowell held that, notwithstanding but a single voluntary petition had been filed, and a...

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  • United States v. Brandt
    • United States
    • U.S. District Court — Northern District of Ohio
    • 29 d5 Julho d5 1955
    ...of words in a statute where such meaning is repugnant to the true intention of the lawmaking body. 50 Am.Jur., Sec. 240; In re Russell, D.C., 28 F.2d 48; In re Blalock, D.C., 31 F.2d 612; Fleischmann Const. Co. v. United States, 270 U.S. 349, 46 S.Ct. 284, 70 L.Ed. 624; Helvering v. Hammel,......

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