In voluntary proceedings the schedules must be all ready to file with the petition. In involuntary pro ceedings they are filed within ten days after the de cree has been signed. In either case they are filed on standard forms which can be procured at any law 15. Valid, provable and allowable dif ference in the words "valid," "provable" and "allow able" as applied to claims against a bankrupt's estate is important and should be understood at the outset. First, let it be known that allowable claims must be provable and must be proved before the question of allowance arises and that all provable claims must be valid. Therefore, there may be valid claims that are not provable and provable claims that are not allowable.
16. Valid claim is valid which outside of bankruptcy proceedings is not subject to any de fense that might be raised by the debtor. A valid claim must have foundation in law. Thus, for ex ample, if a father is banluupt, some person whom his minor son has injured might make a claim against the bankrupt's estate. The claim would not be valid since every infant is responsible for his own wrongs. In this case no question as to the provability of the claim would arise. The claim would be rejected immedi ately since it is not valid.
17. Provable claims.—Before claims may be al lowed against the estate, they must be proved. This is done, to use the words of the Bankruptcy Act, by the creditor who fills a formal affidavit "setting forth the claim, the consideration therefor, and whether any, and if so what, securities are held therefor and whether any, and if so what, payments have been made thereon, and if the sum claimed is justly owing from the bankrupt to the creditor." The United States Supreme Court is given power to supplement the bankruptcy law in such ways as it may deem expedient. In some of its general orders it has prescribed the form in which proof of claims shall be made. The creditor will do well to follow this form by procuring an official blank from a law stationer. When the claim is on a promissory note, the original note should be attached to the proof of claim.
Generally, tort claims such as claims for damages from negligence, slander or trespass, and contingent claims are not provable. Rent due or accrued before the petition is filed is provable; rent due after the pe tition is filed may not be used as a claim against the estate unless the trustee elects to treat the lease as an asset of the estate. Claims actually arising be
fore filing the petition, no payable thereafter, are provable. Claims arising after the petition is filed are not provable and remain as a charge against the bankrupt after his discharge in bankruptcy.
As we shall see, bankrupts are not discharged from the burden of judgments obtained for fraud, deceit or the like, but the claims arising therefrom are prov able. Unliquidated contractual debts are provable but must be liquidated before being allowed. Thus a doctor may prove his claim for services, but the amount due must be settled before the claim can be allowed.
Provable claims must be proved within one year from The credit man as a matter of good business, should proceed immediately to file his claim as soon as he learns that the decree has been filed.
18. Allowable before the first meeting of creditors, many proofs of claims will have been filed. If they are not in proper form or if they are in the class of improvable claims, they will be re jected. If, however, they are provable and have been proved, the next question to decide is whether they shall be allowed. Generally all provable claims are allowable. The two important exceptions are first, secured claims which are allowable only to the ex tent of the difference between the amount of the claim and the value of the bankrupt's property securing the claim, and, second, claims with voidable prefer ences which will not be allowed till the preferences are surrendered.
19. Voidable preferences.—A preference is defined by the Bankruptcy Act as follows: A person shall be deemed to have given a preference if, being insolvent, he has, within four months before the filing of the petition or after the filing of the petition and before the adjudication, procured or suffered a judgment to be entered against himself in favor of any person, or made a transfer of any of his property, and the effect of the en forcement of such judgment or transfer will be to enable any one of his creditors to obtain a greater percentage of his debt than any other of such creditors of the same class. Where the preference consists in a transfer, such period of four months shall not expire until four months after the date of the recording or registering of the transfer, if by law such recording or registering is required.