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such conveyance as may be proper or adequate to evidence the title thereto of the trustee or debtor, as the case may be: Provided, however, That the title of a bone-fide purchaser of such property shall be valid, but if such title is acquired othericise than at a judicial sale held to enforce such lien, it shall be valid only to the extent of the present consideration paid for such property [shall pass to the trustee as a part of the estate of the bankrupt, unless the court shall, on due notice, order that the right under such levy, judgment, attachment, or other lien shall be preserved for the benefit of the estate; and thereupon the same may pass to and shall be preserved by the trustee for the benefit of the estate as aforesaid. And the court may order such conveyance as shall be necessary to carry the purposes of this section into effect: Provided, That nothing herein contained shall have the effect to destroy or impair the title obtained by such levy, judgment, attachment, or other lien, of a bona fide purchaser for value who shall have acquired the same without notice or reasonable cause for inquiry].

Op) The court shall have summary jurisdiction of any proceeding by the trustee or debtor, as the case may be, to hear and determine the rights of any parties under this subdivision a. Due notice of any hearing in such proceeding shall be given to all parties in interest, including the obligee of a releasing bond or other like obligation. Where an order is entered for the recovery of indemnifying property in kind or for the avoidance of an indemnifying lien, the court, upon application of any party in interest, shall in the same proceeding ascertain the value of such property or Tien, and if such value is less than the amount for chich such property is indemnity or than the amount of such lien, the transferce or licaholder may elect to retain such property or ten upon payment of its value, as ascertained by the court, to the trustee or debtor, as the case may be, within such reasonable times as the court shall fis.

(5) The liability of a surety under a releasing bond or other like obligation shall be discharged to the extent of the value of the indemnifying property recovered or the indemnifying lien mullified and voided by the truster or debtor. or, where the property is retained pursuant to the provisions of paragraph Aja of this subdivision a, to the extent of the amount paid to the trustee or debtor.

b. The provisions of section 60 of this Act to the contrary notwithstanding, statutory liens in favor of employees, contractors, mechanics, landlords, or other classes of persons, and statutory liens for taxes and debts owing to the United States or any state or subdivision thereof, created or recognized by the lines of the United States or of any state, may be valid against the frustre, eren though arising or perfected while the debtor is insolvent and within four mouths prior to his bankruptcy. Where by such lairs such liens are required to be perfected and arise, but are not perfected before bankruptcy, they may merertheless be valid, if perfected within the time permitted by and in accordance with the requirements of such lairs, except that if such lairs require the lions to be perfected by the seizure of properti, they shall instead be perfected by filing notice thereof with the court.

c. Where not enforced by sale before bankruptcy, though ralid under subdirixion b. statutory liens, including lieux for taxes or debts owing to the United States or to any state or subdivision thereof, on personal property not accompanied by possession of such property, and Tiens, whether statutory or not, of distress for rent shall be postponed in payment to the debts specified in clauses (1) and (2) of subdivision a of section 64 of this Act, and, ercept ax against other liens, such liens for wages or for rent shall be restricted in the amount of their payment to the same erlent as provided for wages and rent respecfirely in subdirixion a of section 64 of this Act.

d. (1) For the purposex of, and crelusively applicable to, this subdivision d: (a) "Property" of a debtor shall include only his non-exempt property: (by “debf" is any legal liability, whether matured or unmatured, Tiquidated or unliquidated, absolute, fired or contingent; (e) "creditor" ix a person in achose favor a debt crists; (d) a person is “insolvent” when the present fair salable value of his property is less than the amount required to pay hix dehis; and to determine whether a partnership is insolvent, there shall be added to the partnership property the present fair salable value of the separate property of each general partner in excess of the amount required to pay hix separate debts, and also the amount realizable on any unpaid subscription to the partnership of each limited partner; and (c) consideration given for the property or obligation of a debtor is "fair" (1) then, in good faith, in exchange and as a fair equivalent therefor, property is transferred or an antecedent debt ix

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satisfied, or (2) when such property or obligation is received in good faith to secure a present advance or antecedent debt in an amount not disproportionately small as compared with the value of the property or obligation obtained (2) Every transfer made and every obligation incurred by a debtor within one year prior to bankruptcy is fraudulent (a) as to creditors existing at the Time of such transfer or obligation, if made or incurred without fair considergtion by a debtor who is or will be thereby rendered insolvent, without regard to his actual intent; or (b) as to then cxisting creditors and as to other persons who become creditors during the continuance of a business or trase tion, if made or incurred without fair consideration by a debtor who is engaged or is about to engage in such business or transaction, for which the properta remaining in his hands is an unreasonablý small capital, without regard to his actual intent; or (c) as to then existing and future creditors, if made or incurred without fair consideration by a debtor who intends to incur or behoren that he will incur debts beyond his ability to pay as they mature; or (d) as lo then existing and future creditors, if made or incurred with actual intent, ar distinguished from intent presumed in law, to kinder, delay, or defraud either existing or future creditors.

(3) Every transfer made and every obligation incurred by a debtor iniha four months prior to bankruptcy is fraudulent, as to then existing and future creditors, if made or incurred with intent to use the consideration, obtained for the transfer or obligation, to effect a preference to a third person voidable under section 60 of this Act. The remedics of the trustce for the avoidance of such transfer or obligation and of such preference shall be cumulative: Provided, however, That the trustee shall be entitled to only one satisfaction with respect thereto.

(4) Every transfer of partnership property and every partnership obligation incurred within one year prior to the bankruptcy of such partnership, when the partnership is insolvent or will be thereby rendered insolvent, is fraudulent as to partnership creditors existing at the time of such transfer or obligation, acithout regard to actual intent if made or incurred (a) to a partner, whether with or without a promise by him to pay partnership debts, or (b) to a pervor not a partner without fair consideration to the partnership as distinguished from consideration to the individual partners.

(5) For the purposes of this subdivision d, a transfer shall be deemed to hare been made at the time when it became so far perfected that no bona-fide purchaser from the debtor and no creditor could thereafter have acquired any rights in the property so transferred superior to the rights of the transferee therein, but, if such transfer is not so perfected prior to bankruptcy, it shall be deemed to have been made immediately before bankruptc¶.

(6) A transfer made or an obligation incurred by a debtor adjudged a bankrupt under this Act, which is fraudulent under this subdivision d against creditors of such debtor having claims provable under this Act, shall be well and void against the trustec, crcept as to a bona-fide purchaser, lienor or obliget for a present fair equivalent value: Provided, however, That such purchase, licnor or obligee, who, without actual fraudulent intent has given a considera tion less than fair, as defined in this subdivision d, for such transfer, lies or obligation, may retain the property, lien or obligation as security for repayment.

(7) Nothing contained in this subdivision d shall be construed to validate a transfor which is voidable under section 60 of this Act.

e. For the purpose of any recovery or avoidance under this section, where plenary proceedings are necessary, any state court which would have had jurisdiction if bankruptcy had not intervened and any court, of bankruptcy shall have concurrent jurisdiction.

Sec. 68. Set-Offs and CounTERCLAIMS,—a. In all cases of mutual debts of mutual credits between the estate of a bankrupt and a creditor the acronut shall be stated and one debt shall be set off against the other, and the kalaner only shall be allowed or paid.

b. A set-off or counterclaim shall not be allowed in favor of any debtor of the bankrupt which (1) is not provable against the estate and allowable and↑ subdivision g of section 57 of this Act; or (2) was purchased by or transferred to him after the filing of the petition, or within four months before such filing with a view to such use and with knowledge or notice that such bankrupt was insolvent or had committed an act of bankruptcy.

SEC. 69. TAKING POSSESSION OF PROPERTY; RECEIVERS.-a. Whenever a petition is filed to have a person adjudged a bankrupt and an application is made

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to have a receiver or a marshal take charge of the property of the bankrupt, or any part thereof, prior to the adjudication, the applicant shall file in the same court a bond in such amount as the court shall fir, with such surety as the court shall approve, conditioned to indemnify the bankrupt for such costs, counsel fees, expenscs, and damages as may be occasioned by such seizure, taking and detention of such property: Provided, That such property shall be released, if the bankrupt shall file a counter-bond in the same court in such amount as the court shall fix, with such surety as the court shall approve, conditioned that he account for and turn over such property or pay the value thereof in money at the time of scizure to the trustee, in the event the adjudication is made.

b. If the petition for adjudication be dismissed, or withdrawn by the petitioners, the court shall fir and allow to the bankrupt, to be paid by the obligors on such bond, the costs, counsel fecs, expenses and damages occasioned by such seizure, taking or detention of his property, in the manner provided by section 50, subdivision n, of this Act.

c. The judge of any court of bankruptcy which has jurisdiction over a bankrupt's property within its territorial limits may, in aid of a receiver appointed in a bankruptcy proceeding pending in any other court of bankruptcy, appoint for cause shown one or more ancillary receivers. The primary recciver or, if there be more than one primary receiror, then at least one of them, shall be appointed the ancillary receiver, or, if more than one is appointed, one of the queillary reccirers, Ancillary receivers shall be subject to the jurisdiction of the ancillary court, which shall determine and may allow their costs, expense8, and compensation in like manner as provided in the case of receivers.

d. Upon the filing of a petition under this Act, a receiver or trustee, not appointed under this Act, of any of the property of a bankrupt shall be accountable to the bankruptcy court, in which the proceeding under this AAct is pending, for any action taken by him subsequent to the filing of such bankruptcy petition, and shall file in such bankruptcy court a sworn schedule setting forth a summary of the property in his charge and of the liabilities of the estate, both as of the time of and since his appointment, and a sworn statement of his administration of the estate. Such receiver or trustee, with knowledge of the filing of such bankruptcy proceeding, sha!l not make any disbursements or take any action in the administration of such property without first obtaining authorization therefor from the bankruptcy court.

[SEC. 69. POSSESSION OF PROPERTY.—a. A judge may, upon satisfactory proof, by affidavit, that a bankrupt against whom an involuntary petition has been filed and is pending has committed an act of bankruptcy, or has neglected or is neglecting, or is about to so neglect his property that it has thereby deteriorated or is thereby deteriorating or is about thereby to deteriorate in value, issue a warrant to the marshal to seize and hold it subject to further orders. Before such warrant is issued the petitioners applying therefor shall enter into a bond in such an amount as the judge shall fix, with such sureties as he shall approve, conditioned to indemnify such bankrupt for such damages as he shall sustain in the event such seizure shall prove to have been wrongfully obtained. Such property shall be released, if such bankrupt shall give bond in a sum which shall be fixed by the judge, with such sureties as he shall approve, conditioned to turn over such property, or pay the value thereof in money to the trustee, in the event he is adjudged a bankrupt pursuant to such petition.]

SEC. 70. TITLE TO PROPERTY.—a. The trustee of the estate of a bankrupt [. upon his appointment and qualification,] and his successor or successors, if any, Che shall have one or more,] upon his or their appointment and qualification, shall in turn be vested by operation of law with the title of the bankrupt as of the date of the filing of the petition in bankruptcy he was adjudged a bankrupt,] or of the original petition proposing an arrangement or plan under this Act, except insofar as it is to property which is held to be exempt, to all (1) doenments relating to his property; (2) interests in patents, patent rights, copyrights, and trademarks, and in applications therefor: [for patents, copyrights, and trademarks:] Provided, That in case the trustee, within thirty days after appointment and qualification, does not notify the applicant for a patent, copyright, or trademark of his election to prosecute the application to allowance or rejection, the bankrupt may apply to the court for an order revesting him with the title thereto, which petition shall be granted, unless for cause shown by the trustee the court grants further time to the trustee for making such election; and such applicant may, in any event, at any time petition the court to be revested with such title in case the trustee shall fail to prosecute such

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application with reasonable diligence; and the court, upon revesting the bankrupt with such title, shall direct the trustee to execute proper instruments of transfer to make the same effective in law and upon the records; (3) powers which he might have exercised for his own benefit, but not those which he might have exercised solely for some other person; (4) property transferred by him in fraud of his creditors; (5) property, including rights of action, which prior to the filing of the petition he could by any means have transferred or which might have been levied upon and sold under judicial process against him, or otherwise seized, impounded, or sequestered: Provided, That rights of action ex delicto for libel, slander, injuries to the person of the bankrupt or of a relative, whether or not resulting in death, seduction, and criminal courersg. tion, shall not vest in the trustee unless by the law of the state such rights of action are subject to attachment, execution, garnishment, sequestration, or other judicial process; and Provided further, That when any bankrupt, who u a natural person, shall have any insurance policy which has a cash surrender value payable to himself, his estate, or personal representatives, he may, within thirty days after the cash surrender value has been ascertained and stated to the trustee by the company issuing the same, pay or secure to the trustee the sum so ascertained and stated, and continue to hold, own, and carry such policy free from the claims of the creditors participating in the distribution of his estate under the bankruptcy proceedings, otherwise the policy shall pass to the trustee as assets; [and] (6) rights of action arising upon contracts, or usury, or [from] the unlawful taking or detention of or injury to his prop erty; (7) contingent remainders, executory derises and limitations, rights of entry for condition broken, rights or possibilities of reverter and like interests in real property, which were nonassignable prior to bankruptcy and chick, within six months thereafter, become assignable interests or estates or give rise to powers in the bankrupt to acquire assignable interests or estates; and (8) property held by an assignee for the benefit of creditors appointed under an assignment which constituted an act of bankruptcy, which property shall, for the purposes of this Act, be decmed to be held by the assignee as the agent of the bankrupt and shall be subject to the summary jurisdiction of the court. All property which vests in the bankrupt within six months after bankruptcy by bequest, devisc, or inheritance shall vest in the trustee and his successor and successors, if any, upon his or their appointment and qualification, as of the date when it rested in the bankrupt, and shall be free and discharged from any transfer made or suffered by the bankrupt after bankruptcy. All prop erty in which the bankrupt has at the date of bankruptcy an estate or interest by the entirety and which within six months after bankruptcy becomes transferable in whole or in part solely by the bankrupt shall, to the extent it be comes so transferable, vest in the trustee and his successor and successors, if any, upon his or their appointment and qualification, as of the date of bankruptcy. The title of the trustec shall not be affected by the prior posscasion of a receiver or other officer of any court.

b. Within sirty days after the adjudication, the trustees shall assume or refert any executory contract, including uncspired leases of real property: Provided however, That the court may for cause shown extend or reduce such period of time. Any such executory contract not assumed or rejected within such time. whether or not a trustee has been appointed or has qualified, shall be deemed to be rejected. A trustee shall file, within sixty days after adjudication, a statement under oath showing which, if any, of the contracts of the bankrupt art executory in whole or in part, including unexpired leases of real property, and which, if any, have been rejected by the trustce: Provided, however, That the court may for cause shown extend or reduce such period of time. Unless a leane of real property shall expressly otherwise provide, a rejection of such lease of of any covenant therein by the trustee of the lessor shall not deprive the laser of his estate. A general covenant or condition in a lease that it shall wat he assigned shall not be construed to prevent the trustee from assuming the same et his election and subsequently assigning the same; but an exprexx covenant that an assignment by operation of law or the bankruptcy of a specified party theres or of either party shall terminate the lease or give the other party an election to terminate the same shall be enforceable. A trustee who elects to axxume it cl tract or lease of the bankrupt and who subsequently, with the approval of the court and upon such terms and conditions as the court may fix after hearing upon notice to the other party to the contract or lease, assigns such contract or lease to a third person, shall not be liable for breaches occurring after such assignment c. The trustee may have the benefit of all defenses available to the bankrupt

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as against third persons, including statutes of limitation, statutes of frauds, uxury and other personal defensex; and a waiver of any such defense by the bankrupt after bankruptcy shall not bind the trustee. The trustee, as to all property in the possession or under the control of the bankrupt at the date of bankruptcy or otherwise coming into the possession of the bankruptcy court, shall be deemed rested as of the date of bankruptcy with all the rights, remedies, and powers of a creditor then holding a lien thereon by legal or equitable proceedings, whether or not such a creditor actually czists; and, as to all other property, the trustee shall be deemed rested us of the date of bankruptcy with all the rights, remedies, and powers of a judgment creditor then holding an execution duly returned unsatisfied, whether or not such a creditor actually crists.

d. After bankruptcy and ceither before adjudication or before a receiver takes possession of the property of the bankrupt, whichever first occurs.

(1) A transjer of any of the property of the bankrupt, other than real estate, made to a person acting in good faith shall be valid against the trustee if made for a present fair equivalent valuc or, if not made for a present fair equivalent value, then to the extent of the present consideration actually paid therefor, for which amount the transferce shall have a lien upon the property xo transferred; (2) A person indebted to the bankrupt or holding property of the bankrupt may, if acting in good faith, pay such indebtedness or deliver such property, or any part thereof, to the bankrupt or upon his order, with the same effect as if the bankruptcy were not pending:

(3) A person having actual knowledge of such pending bankruptcy shall be deemed not to act in good faith unless he has reasonable cause to believe that the petition in bankruptcy is not well founded;

(4) The provisions of paragrahps (1) and (2) of this subdivision shall not apply where a receiver or trustee appointed by a United States or state court is in possession of all or the greater portion of the non-crempt property of the bankrupt:

(5) A person asserting the validity of a transfer under this subdivision shall have the burden of proof. Ercept as otherwise provided in this subdivision and in subdivision g of section 21 of this Act, no transfer by or in behalf of the bankrupt after the date of bankruptcy shall be valid against the trustee: Provided, honrever. That nothing in this Act shall impair the negotiability of currency or negotiable instruments,

e. (1) A transfer made or suffered or obligation incurred by a debtor adjudged a bankrupt under this Act which, under any federal or state law applicable thereto, is fraudulent as against or voidable for any other reason by any creditor of the debtor, having a claim provable under this Act, shall be null and void as against the trustee of such debtor.

(2) All property of the debtor affected by any such transfer shall be and remain a part of his assets and estate, discharged and released from such transfer and shall pass to, and every such transfer or obligation shall be aroided by, the trustee for the benefit of the estate. The trustee shall reclaim and recover such property or collect its valuc from and avoid such transfer or obligation against whomerer may hold or have received it, except a person as to whom the transfer or obligation specified in paragraph (1) of this subdirisión e is valid under applicable federal or state laws,

[c. The trustee may avoid any transfer by the bankrupt of his property which any creditor of such bankrupt might have avoided, and may recover the property so transferred, or its value, from the person to whom it was transferred, unless he was a bona fide holder for value prior to the date of the adjudication. Such property may be recovered or its value collected from whomever may have received it, except a bona fide holder for value.]

(3) For the purpose of such recovery or of the avoidance of such transfer or obligation, where plenary proceedings are necessary. [any court of bankruptcy as hereinbefore defined, and] any state court which would have had jurisdiction if bankruptcy had not intervened and any court of bankruptcy shall have concurrent jurisdiction.

f. [b] The court shall appoint a competent and disinterested appraiser and upon cause shown may appoint additional appraisers, who shall appraise all the items of real and personal property belonging to the bankrupt estate and who shall prepare and file with the court their report thereof. [All real and personal property belonging to bankrupt estates shall be appraised by three disinterested appraisers; they shall be appointed by, and report to, the court.] Real and personal property shall, when practicable, be sold subject to the approval of the court. It shall not be sold otherwise than subject to the