1 and may recover the property so transferred, or its value, from the 2 person to whom it was transferred, unless he was a bona fide holder 3 for value prior to the date of the adjudication: Such property may 4 be recovered or its value collected from whomever may have received it, except a bona fide holder for value.

5

6 (3) For the purpose of such recovery, or for the avoidance of such 7 transfer or obligation where plenary proceedings are necessary, any 8 court of bankruptey as hereinbefore defined, and any State court 9 which would have had jurisdiction if bankruptcy had not intervened, 10 and any court of bankruptcy shall have concurrent jurisdiction. (Weinstein-Adair.)

11

(NOTE. This provision with respect to concurrent jurisdiction appears in the present 70 e. We have expanded the provision in order to provide for the avoidance of a void obligation where in a particular case a plenary action may be found necessary or advisable. We have specifically provided that the concurrent jurisdiction shall relate only to "plenary proceedings." For the sake of clarity and certainty, we have reversed, as suggested by Referee Adair, the order in which the courts are mentioned.-Weinstein.)

f. b. The court shall appoint a competent and disinterested ap12 praiser and, upon cause shown, may appoint additional appraisers, 13 who shall appraise all the items of real and personal property belonging 14 to the bankrupt estate, and shall prepare, and file with the court their 15 report thereof. All real and personal property belonging to bank16 rupt estates shall be appraised by three disinterested appraisers; 17 they shall be appointed by, and report to, the court. Real and 18 personal property shall, when practicable, be sold subject to the ap19 proval of the court; it shall not be sold otherwise than subject to 20 the approval of the court for less than 75 seventy five per centum of 21 its appraised value.

(Weinstein.)

(NOTE. This subdivision has been recast and made more flexible. In many cases, one appraiser is sufficient, rather than the three specified by the present Act. In order to save expense, we require the appointment only of one appraiser. However, if necessary, we permit the appointment of additional appraisers, the number of whom is not limited. In the case of a large chain store, it is obvious that more than three appraisers may be required. The court is given a discretion as to their number, to be exercised according to the circumstances of the particular case.--Weinstein.)

1

CLERKS OF DISTRICT COURT TO KEEP BANKRUPTCY RECORDS, ETC. 233

g. e. The title to property of a bankrupt estate which has been

2 sold, as hercin provided, shall be conveyed to the purchaser, by the

3

4

trustec.

(No change, except lettering, "c" to "g".)

h. Whenever an arrangement or wage earner plan composition 5 shall be set aside, or discharge revoked, the trustee shall, upon his 6 appointment and qualification, be vested as herein provided with the 7 title to all of the property of the bankrupt as of the date of the final 8 decree setting aside the arrangement or wage earner plan composition or revoking the discharge.

9

10

(Weinstein.)

(NOTE-A conforming change, by substituting "an arrangement" for

"a composition".-Weinstein.)

i. Upon the confirmation of an arrangement ● composition 11 offered by a bankrupt, the title to his property shall thereupon 12 revest in him, or vest in such other person as may be provided by the

13 arrangement.

14

(Weinstein-Adair.)

(NOTE. The changes here are also changes co-ordinating this provision with the new section 12, subsection I, "Arrangements".-Weinstein.)

Sec. 71. Clerk's Indexes, Certificates of Search and Dockets, 15 Clerks of district court to keep bankruptcy records, etc.-a. That 16 The clerks of the several district courts of the United States shall 17 prepare and keep in their respective offices complete and convenient 18 indexes of all petitions and discharges in bankruptcy heretofore or 19 hereafter filed in the said courts, and shall, when requested so to do, 20 issue certificates of search certifying as to whether or not any such 21 petitions or discharges have been filed; and said clerks shall be entitled 22 to receive for such certificates the same fees as now allowed by law 23 for certificates as to judgments in said courts: Provided, That said 24 bankruptcy indexes and dockets shall at all times be open to inspec25 tion and examination by all persons or corporations without any 26 feo or charge therefor.

(Weinstein.)

(NOTE--Under the definition contained in section 1, clause (23), the word "persons" includes "corporations", so that the words "or corporations" are omitted in the proviso.-King.)

1 Sec. 72. Limitation of Compensation of Officers of Court. 2 Compensation restricted.—a.

That No Neither the referee, re

3 ceiver, marshal, or ner trustee shall in any form or guise receive, nor 4 shall the court allow him, any other or further compensation for his 5 services as required by this Act than that expressly authorized and 6 prescribed in this Act.

(King.)

(NOTE.-The substantive change would make possible compensation for services not required by the Act.-King.)

7 Sec. 73. Additional jurisdiction.

(No change. If Subsection I of Section 12 of H. R. 12889 is enacted, as recommended by the Conference, Section 73 should be amended by eliminating reference to Section 74.-King.)

8 Sec. 74. Compositions and extensions.

(This section is covered by Subsection I of Section 12 of H. R. 12889 If the Subsection is enacted, Section 74 will be eliminated.-King.)

9 Sec. 75. Agricultural compositions and extensions.

(Inasmuch as this section is but temporary and expires by its own limitation, the Conference makes no recommendation with reference to it. In the event of its elimination debtors now entitled to its benefits would find relief under Subsection I of Section 12.-King.)

10 Sec. 76. Extensions.

(Repeal recommended by Sec. 3 of H. R. 12889.—King.)

11 Sec. 77. Reorganization of railroads engaged in interstate commerce.

(While Section 77 might doubtless be perfected, the Conference has not considered it with a view to amendment, and therefore makes no recommendation concerning it at this time.-King.)

12 Sec. 77A. Additional jurisdiction.

13 Sec. 77B. Corporate reorganizations.

(Fully covered by Subsection II of Section 12 with improved phrasing and better arrangement. See explanatory notes prefacing Section 12. If the Subsection is enacted, these sections will be eliminated.--King.)

14 Sec. 78. Declaration of policy.

15 Sec. 79. Additional jurisdiction.

16 Sec. 80. Municipal debt readjustments.

(These sections were abrogated by decision of United States Supreme Court

of Monday, May 25, 1936.-King.)

1

Sec. 2. Effect of Act.-a. Nothing herein contained shall have

2 the effect to release or extinguish any penalty, forfeiture, or liability

3 incurred under any Act or Acts of which this Act is amendatory.

4

(No change from Amendatory Act of 1926.)

b. The provisions of this amendatory Act shall govern proceed

5 ings, so far as practicable and applicable, in bankruptcy cases pending

6

when it takes effect; but as to proceedings in cases pending when this

7 Act takes effect to which the provisions of this amendatory Act are

8

9

not applicable such proceedings shall be disposed of conformably

to the provisions of said Act approved July 1, 1898, and the Acts 10 amendatory thereof and supplementary thereto.

11

(King.)

(NOTE. The word "bankruptcy" is eliminated so that the subdivision may apply to all pending cases, "so far as practicable and applicable."-King.)

Sec. 3. Section 76 of said Act, entitled "An Act to establish a 12 uniform system of bankruptcy throughout the United States", 13 approved July 1, 1898, as amended, and all Acts or parts of Acts 14 inconsistent with any provisions of this amendatory Act are hereby 15 repealed.

16

(NOTE. It is recommended that Sec. 76 be repealed. It is inequitable, unsound in principle, and, insofar as its application is retroactive, would seem to be unconstitutional. The purpose of the section is to pass on to guarantors or sureties of obligations the benefits given to an embarrassed debtor who has obtained relief by way of a composition or extension. As written, by reason of the specific language used, it may be restricted to cases of guaranties by bond and mortgage guaranty and credit insurance companies, and the like. In such cases premiums are paid, usually by the creditor himself, for such guaranty or insurance. It is manifestly most inequitable and against good conscience to impair such contract of guaranty or insurance between a creditor and the guarantor or insurer, to which the primary obligor or debtor is not a partyWeinstein.)

Sec. 4. This Act shall take effect and be in force on and after

17 three months from the date of its approval.

(NOTE.- The Act of 1898 provided that it "shall go into full force and effect upon its passage"; the Amendatory Act of 1926 took effect on and after three months from the date of its approval; while that of March 3, 1933, became operative "from and after the date of its approval". It would seem desirable that a reasonable period of time be afforded for parties litigant, attorneys praeticing at the Bar and courts to become familiar with the changes made, and three months is about as brief a time as could properly be fixed for that purpose.-King.)

JUNE 7 (calendar day, JUNE 9), 1938.-Ordered to be printed

Mr. DIETERICH, from the Committee on the Judiciary, submitted the

following

REPORT

[To accompany H. R. 6963]

The Committee on the Judiciary, to whom was referred the bill (II. R. 6963) to amend the Bankruptcy Act by adding a section to be known as section 77C for the purpose of providing an administrative agency to aid the Federal courts in the administration of sections 74 and 77B of said Bankruptcy Act, having considered the same, report favorably to the Senate with the recommendation that the bill do pass. Attached hereto and made a part hereof is a copy of the report submitted by the House Judiciary Committee.