Thummess v. Von Hoffman

• Decision Date: 15 January 1940
• Docket Number: No. 7107.,7107.
• Citation: 109 F.2d 291
• Parties: THUMMESS v. VON HOFFMAN. In re VON HOFFMAN.
• Court: U.S. Court of Appeals — Third Circuit

109 F.2d 291 (1940)

THUMMESS v. VON HOFFMAN. In re VON HOFFMAN.

No. 7107.

Circuit Court of Appeals, Third Circuit.

January 15, 1940.

David Goldstein, of Asbury Park, N. J., for appellant.

Matlack & Lautman, of Asbury Park, N. J. (Samuel K. Abrahams, of New York City, of counsel), for appellee.

Before BIDDLE, JONES, and BUFFINGTON, Circuit Judges.

JONES, Circuit Judge.

Section 39, sub. c of the Bankruptcy Act, as amended by the Act of June 22, 1938, c. 575, Sec. 1, 52 Stat. 858, 11 U.S.C.A. § 67, sub. c, provides, in part here material, as follows: "A person aggrieved by an order of a referee may, within ten days after the entry thereof or within such extended time as the court may for cause shown allow, file with the referee a petition for review of such order by a judge and serve a copy of such petition upon the adverse parties who were represented at the hearing."

In the present case, the ten day period following the entry of the referee's order (denying the bankrupt a discharge) expired without a petition for review having been filed or an application for extension of time for such filing having been made. Thereafter, the court below, finding that cause for allowance of extended time for the filing of a review petition had been shown, entered an order allowing the bankrupt five days from the date of the court's order within which to file his petition. From that order, the trustee has appealed, contending that the court was without power to extend the time for the filing of a petition for review, the application therefor not having been made within the ten days following the entry of the referee's order whereof review was sought. The answer to the question, which the appellant thus raises, necessarily depends upon the meaning of the above quoted provision of Section 39, sub. c, of the Bankruptcy Act.

Prior to the inclusion of Subsection c of Section 39 in the Bankruptcy Act, the procedure for the review of an order of a referee was governed by General Order XXVII of the Supreme Court, 11 U.S.C.A. following section 53. As the General Order did not prescribe any time within which a petition for review might be filed, it was held that, to be timely, such a petition should be filed within a reasonable period following the entry of the referee's order. American Trust Co. v. W. S. Doig, Inc., 4 Cir., 23 F.2d 398, 399; Crim v. Woodford, 4 Cir., 136 F. 34; In re Grant, D.C., 143 F. 661; In re Foss, C.C., 147 F. 790. In a number of districts, however, the courts adopted local rules providing that a petition for review might be filed, as a matter of right, within a certain number of days (usually ten) following the entry of the referee's order or thereafter by leave of court upon good cause shown. In re L. & R. Wister & Co., 3 Cir., 237 F. 793; Amick v. Hotz, 8 Cir., 101 F.2d 311; In re Oakland & Belgrade Silver Fox Ranch Co., D.C.Me., 26 F.2d 748; In re Lesher & Son, D.C., E.D., Pa., 176 F. 650; In re J. W. Renshaw's Sons, D.C., E.D.Ill., 3 F. 2d 75.

Obviously, in the districts where the rule prevailed that a petition for review might be filed within a reasonable time after the entry of an order of a referee, no question could, or did, arise, as to any want of power in a bankruptcy court, to entertain a petition for review, on the ground that an arbitrary period of time had elapsed since the entry of the referee's order. And, even in the districts where local rules of court prescribed a definite period for the filing of a petition for review or thereafter by leave of court, where proper cause therefor was shown, the courts entertained petitions for review which had not been filed until after the expiration of the definite period allowed for such purpose by local rule of court. In re Oakland & Belgrade Silver Fox Ranch Co., supra; In re Lesher & Son, supra; In re Wister et al., D.C., 232 F. 898; see Roberts Auto & Radio Supply Co. v. Dattle, 3 Cir., 44 F.2d 159, and In re Hopkins, D.C.R.I., 15 F.2d 206. The practice, which had thus developed under General Order XXVII and local rules of court had the force of law. In re L. & R. Wister & Co., supra; In re Lyders, D.C., 16 F.Supp. 213. To work a change in existing law, whereof Congress is deemed to have knowledge, requires plain terms to such effect in an amendatory statute. Thompson v. United States, 246 U.S. 547, 551, 38 S.Ct. 349, 62 L.Ed. 876.

The purpose of Section 39, sub. c, as expressed by the House Committee on Judiciary at the time the proposed amendment was submitted to Congress, was to establish definitely the practice (i. e., on petitions for review) in the interest of certainty and uniformity¹. This, Congress accomplished by incorporating in the Bankruptcy Act, as Section 39, sub. c, what had been substantially the law in a number of districts under General Order XXVII and local rules of court. The intent of the provision is to place a limitation upon the time within which an aggrieved person can, as a matter of right, file a petition for the review of a referee's order, still leaving to the discretion of the court the allowance thereafter of permission to file such a petition, accordingly, as cause might be shown. If it had been the legislative intent to restrict the court's power in extending the time for filing to cases...