Chapter I

DEFINITIONS

Sec. 1. (11 U.S.C. § 1.) Meaning of Words and Phrases

The words and phrases used in this Act and in proceedings pursuant hereto shall, unless the same be inconsistent with the context, be construed as follows:

(1) "A person against whom a petition has been filed" shall include a person who has filed a voluntary petition;

(2) "Adjudication" shall mean a decree that a person is a bankrupt;

The original definition read: "Adjudication' shall mean the date of entry of a decree that the defendant in a bankruptcy proceeding is a bankrupt: or if such decree is appealed from, then the date when such decree is finally confirmed." This was unsatisfactory. It referred to a "defendant", and thus would seem to have excluded voluntary bankruptcies. It defined not only the term "adjudication" but also indirectly the phrase "date of adjudication." This was inept because "adjudication" was not a "date". Moreover, no provision was made for cases involving dismissed appeals. The Chandler Act (1938) defined "date of adjudication" separately in section 1(12).

(3) "Appellate courts" shall include the United States courts of appeals and the Supreme Court of the United States;

The Chandler Act, June 22, 1938, had eliminated an obsolete reference to the supreme courts of the territories and inserted "The United States Court of Appeals for the District of Columbia", which no longer requires special mention. There were corresponding changes to sections 24 and 25 of The Bankruptcy Act, and section 128 of the former Judicial Code relating to appeals. The above clause was reduced to its present simple form by the amendment of July 7, 1952, P.L. 456, 82d Cong., 2d Sess., § 1(a), 66 Stat. 420, which took advantage of the amendments to the Judicial Code of June 25, 1948, 28 U.S.C. § 43.

(4) "Bankrupt" shall include a person against whom an involuntary petition or an application to revoke a discharge has been filed, or who has filed a voluntary petition, or who has been adjudged a bankrupt;

"To set a composition aside" was dropped in 1938, the subject matter being sufficiently covered in Chapters XI, XII, and XIII without resort to this definition.

(5) "Bona-fide purchaser" shall include a bona-fide encumbrancer or pledgee and the transferee, immediate or mediate, of any of them;

This definition was inserted in 1938, the term being used in sections 21g, 60a, 67a(3), 67d(5), 67d(6) and elsewhere. It avoids the necessity of repeated mention of encumbrancers and pledgees and their transferees.

(5a) "Circuit" shall mean judicial circuit;

Added by Referees' Salary Act, P.L. No. 464, 79th Cong., 2d Sess. (June 28, 1946), simplified by amendment of July 7, 1952, P.L. 456, 82d Cong., 2d Sess., § 1, to conform to Judicial Code amendments of June 25, 1948, 28 U.S. C. § 41.

(6) "Clerk" shall mean the clerk of a court of bankruptcy; (7) "Conceal" shall include secrete, falsify, and mutilate; This was (22) prior to 1938. The change conforms to the alphabetical arrangement.

(7a) "Conference" shall mean the Judicial Conference of the United States;

Added by the Referees' Salary Act and simplified by the amendment of July 7, 1952, to conform to Judicial Code amendment of 1948, 28 U.S.C. § 331.

(8) "Corporation" shall include all bodies having any of the powers and privileges of private corporations not possessed by individuals or partnerships and shall include partnership associations organized under laws making the capital subscribed alone responsible for the debts of the association, joint-stock companies, unincorporated companies and associations, and any business conducted by a trustee or trustees wherein beneficial interest or ownership is evidenced by certificate or other written instrument;

The reference to limited partnerships in the original text was eliminated from the definition of "corporations," and included in the expanded partnership section (section 5) by the Chandler Act (1938). The definition otherwise reproduces the impractically broad language of the amendment of 1926 and so purports to require associations having none of the attributes of corporations to be administered as such. The purpose of that amendment, to make Massachusetts trusts and the like subject to bankruptcy, would have been less awkwardly achieved by transferring the latter part of the definition into the definition of "persons" (23).

(8a) "Council" shall mean the Judicial Council of the circuit; Added by the Referees' Salary Act and simplified by the amendment of July 7, 1952 to conform to Judicial Code amendments in 1948, 28 U.S.C. § 332. See (5a) supra.

(9) "Court" shall mean the judge or the referee of the court of bankruptcy in which the proceedings are pending;

Previous to 1938 the Act read: "Court' shall mean the judge of the court of bankruptcy in which the proceedings are pending and may include the referee." The present text was introduced by the Chandler Act (1938), which also authorized references to referees before adjudication (sec. 22) and enlarged their jurisdiction (sec. 38). The present definition has the effect of authorizing the referee to exercise the functions of the court, except where action by the judge is expressly specified.

(10) "Courts of bankruptcy" shall include the United States district courts and the district courts of the Territories and possessions to which this Act is or may hereafter be applicable;

Simplified by the Chandler Act (1938) and further simplified by the amendment of July 7, 1952, to conform to Judicial Code amendments in 1948, 28 U.S.C. § 132. See (5a) supra.

(11) "Creditor" shall include anyone who owns a debt, demand, or claim provable in bankruptcy, and may include his duly authorized agent, attorney, or proxy;

"Debt" was inserted by the Chandler Act (1938) to tie in with the definition of that term, infra (14). The words "demand or claim, provable in bankruptcy," are harmless surplusage.

(12) "Date of adjudication" shall mean the date of entry of the decree of adjudication, or, if such decree is appealed from, then the date when such decree is finally confirmed or the appeal is dismissed;

This definition was culled from the old definition of "adjudication." The addition of "or the appeal is dismissed" was necessitated by the conflict between In re Lee, 171 F. 266 (E.D.Pa., 1909) (date of dismissal of appeal), and Moore Bros. v. Cowan, 173 Ala. 536, 55 So. 903 (1911) (date of original decree). The time for filing claims is counted from the date of the first creditors' meeting, which in turn is determined with reference to the date of adjudication (sections 55, 57n).

(13) "Date of bankruptcy," "time of bankruptcy," "commencement of proceedings," or "bankruptcy," with reference to time, shall mean the date when the petition was filed;

(14) "Debt" shall include any debt, demand, or claim provable in bankruptcy;

(14a) "Director" shall mean the Director of the Administrative Office of the United States Courts;

Added by the Referees' Salary Act and simplified by the amendment of July 7, 1952, to conform to Judicial Code amendments in 1948, 28 U.S.C. § 601. See (5a) supra.

(15) "Discharge" shall mean the release of a bankrupt from all of his debts which are provable in bankruptcy, except such as are excepted by this Act;

(16) "Document" shall include any book, deed, record, paper, or instrument in writing;

(17) "Farmer" shall mean an individual personally engaged in farming or tillage of the soil, and shall include an individual personally engaged in dairy farming or in the production of poultry, livestock, or poultry or livestock products in their unmanu

factured state, if the principal part of his income is derived from any one or more of such operations;

This definition was introduced in section 1 in 1938. It follows the substance of section 75r, except that the income requirement is cumulative and not alternative. Between 1938 and 1940 it was arguable that the above definition was operative by way of an implied repeal of section 75r as applied to section 4b. The reenactment of section 75r in 1940 with its express reference to section 4b would seem to work an implied repeal or suspension of section 1(17), since the word "farmer" only occurs in sections 4b and 75. 54 Stat. 40 (1940). Under section 75c as it stands, Oct. 1, 1952, there is no provision for petitions filed under section 75 on or after March 1, 1949. This does not repeal section 75r or its reference to section 4b.

(18) "Holiday" shall include New Year's Day, Washington's Birthday, Memorial Day, Independence Day, Labor Day, Armistice Day, Christmas Day, and any day appointed as a holiday or as a day of public fasting or thanksgiving by the President or the Congress of the United States, or by the Governor or the Legislature of the State in which the proceeding under this Act is filed or pending;

As Amended by the Chandler Act (1938). The original form read: "holiday' shall include Christmas, the Fourth of July, the Twenty-second of February, and any day appointed by the President of the United States or the Congress of the United States as a holiday or as a day of public fasting or thanksgiving."

(19) A person shall be deemed insolvent within the provisions of this Act whenever the aggregate of his property, exclusive of any property which he may have conveyed, transferred, concealed, removed, or permitted to be concealed or removed, with intent to defraud, hinder, or delay his creditors, shall not at a fair valuation be sufficient in amount to pay his debts;

(20) "Judge" shall mean a judge of a court of bankruptcy, not including the referee;

(21) "Oath" shall include affirmation;

(22) "Officer" shall include clerk, marshal, receiver, custodian, referee, and trustee, and the imposing of a duty upon, or the forbidding of an act by, any officer shall include his successor and any person authorized by law to perform the duties of such officer;

"Custodian" was added in 1938. The word is employed in section 48a(1), 62c and d.

(23) "Persons" shall include corporations, except where otherwise specified, and officers, partnerships, and women, and when used with reference to the commission of acts which are forbidden under this Act shall include persons who are participants

in the forbidden acts, and the agents, officers, and members of the board of directors or trustees or of other similar controlling bodies of corporations;

"Under this Act" was substituted for "herein" in 1938 to promote precise expression. "And women" might well be deleted as unnecessary, particularly in view of section 1(33).

(24) "Petition" shall mean a document filed in a court of bankruptcy or with a clerk thereof initiating a proceeding under this Act;

As broadened by the amendment of July 7, 1952, P.L. 456, 82d Cong., 2d Sess., § 1(g). Former definitions related only to petitions in strict bankruptcy, Several other sections have been shortened by using this amended definition.

(25) "To record" shall include to register or to file for record or registration;

This definition was inserted in 1938 to avoid questions as to the meaning of "record," wherever used, especially in section 21f, g, and h.

(26) "Referee" shall mean the referee who has jurisdiction of the case or to whom the case has been referred or anyone acting in his stead;

(27) "Relatives" shall mean persons related by affinity or consanguinity within the third degree as determined by the common law and shall include the spouse;

This definition was introduced by the Chandler Act (1938) for use in connection with sections 35(3), 44a and 59e(2) (qualification of referees, qualification of creditors to vote for trustees, and computation of number of creditors who must join in petition).

(28) "Secured creditor" shall include a creditor who has security for his debt upon the property of the bankrupt of a nature to be assignable under this Act or who owns such a debt for which some indorser, surety, or other person secondarily liable for the bankrupt has such security upon the bankrupt's assets;

Note that "secured creditor" for purposes of bankruptcy is not any creditor with security but only a creditor with security directly or indirectly' from the bankrupt.

(29) "States" shall include the Territories and possessions to which this Act is or may hereafter be applicable, Alaska, and the District of Columbia;

H.R. 5195, 85th Cong. 1st Sess., sponsored by the National Bankruptcy Conference, would insert: (29a) "Statutory lien" shall mean a lien arising solely by force of statute upon specified circumstances or conditions, but shall not include any lien provided by or dependent upon an agreement to give security, whether or not such lien is also provided by or is also dependent upon statute, and whether or not the agreement or lien is made fully effective by statute.