A discharge may be applied for, but not until one month after, and within the suing twelve months from the adjudication of bankruptcy (with a further extension, by order of court for cause, of six months). No discharge shall be granted if the bankrupt has committed an offence punishable by im prisonment under the act; or, with fraudu lent intent to conceal his condition, etc., has destroyed, concealed, or failed to keep prop er books of account.
A discharge releases all debts evcept taxes due the United States or the state, county, district, or municipality in which the bank rupt resides; judgments on claims for fraud or for obtaining property by false pretences and wilful injuries to the person or property of another; and debts not scheduled (unless the creditor was unknown to the bankrupt or the creditor had knowledge of the proceed ings) ; or created by fraud, embezzlement, etc., as an officer or trustee ; does not release a judgment obtained by a husband against the bankrupt for criminal conversation with his wife ; Tinker v. Colwell, 193 U. S. 473, 24 Sup. Ct. 505, 48 L. Ed. 754; nor a contract made by a divorced bankrupt by which he agreed to pay his wife a sum annually for her support and that of their child ; Dun bar v. Dunbar, 190 U. S. 340, 23 Sup. Ct. 757, 47 L. Ed. 1084. A discharge in bankruptcy will be withheld if the bankrupt is shown to have obtained property on credit upon false representations in writing, and any creditors may avail themselves of this right; In re Harr, 143 Fed. 421.
The right to a trial by jury is given in respect of the fact of insolvency and of the commission of an act of bankruptcy, upon the application of the alleged bankrupt. The right is absolute and cannot be withheld at the court's discretion; Elliott v. Toeppner, 187 U. S. 327, 23 Sup. Ct. 133, 47 L. Ed. 200.
The district court now has jurisdiction of all matters and proceedings in bankruptcy, Jud. Code, § 24, including controversies be tween the trustee and any adverse claimant of his property. Suits by the trustee must be brought in the court where the bankrupt might have brought them, unless by consent of the proposed defendant.
The circuit court of appeals (Judicial Code, § 130) has appellate and supervisory jurisdiction which is to be exercised in the manner provided in the bankruptcy act. By § 25, appeals may be taken to the circuit court of appeals : 1. From a judgment ad judging or refusing to adjudge the defend ant a bankrupt ; 2. From a judgment grant ing or denying a discharge ; 3. From a judg ment allowing or rejecting a debt or claim of $500 or over. Such appeal must be taken within ten days and may be beard by the appellate court in term time or in vacation.
The supreme court has appellate jurisdic tion of 'controversies in bankruptcy from which it has appellate jurisdiction in other cases ; and it exercises a like jurisdiction from courts of bankruptcy not within any organized circuit of the United States and from the supreme court of the District of Columbia.
,An appeal may be taken to the supreme court from the final decision of the circuit court of appeals allowing or rejecting a claim, under such rules as may be prescribed by the supreme court in the following cases : 1. Where the amount in controversy exceeds $2,000 and the question involved is one which might have been taken on appeal or writ of error from the highest court of the state to the supreme court ; 2. Where some justice of the supreme court shall certify that in his opinion the determination of the question in volved is essential to the uniform construc tion of the bankruptcy laws.
Controversies may be certified to the su preme court from other United States courts and the supreme court may exercise juris diction thereof, and may issue writs of cer tiorari pursuant to the laws now in force.
In the computation of time the first day is excluded and the last included.
The act provides for the appointment for two years of a reasonable number of refer ees, to whom all matters may be referred.
Referees in bankruptcy exercise much of the judicial authority of the court ; Mueller v. Nugent, 184 U. S. 1, 22 Sup. Ct. 269, 46 L. Ed. 4()5.
The creditors appoint one or three trus tees at their first meeting, failing which, the court shall do so.
A trustee holds the bankrupt's property subject to all the equities against it ; Secur ity Warehousing Co. v. Hand, 206 U. S. 423, 27 Sup. Ct. 720, 51 L. Ed. 1117, 11 Ann. Cas. 789; he gets no better title than the bank rupt had; Hewit v. Mach. Works, 194 U. S. 296, 24 Sup. Ct. 690, 48 L. Ed. 986. Section 70 gives the trustee title to all property which, prior to the bankruptcy, could have been transferred or levied upon or sold un der judicial proceedings against the bank rupt. The filing of a petition places all the bankrupt property in the custody of the court; Mueller v. Nugent, 184 U. S. 1, 22 Sup. Ct. 269, 46 L. Ed. 405; but it has no jurisdiction against persons to whom the bankrupt made a sale or conveyance before the proceedings in bankruptcy, where it ap pears that the vendee acted In good faith ; Wall v. Cox, 181 U. S. 244, 21 Sup. Ct. 642, 45 L. Ed. 845 ; but where the bankrupt made a general assignment for the benefit of cred itors, and the assignee sold the operty aft er a petition in bankruptcy was filed, it was held that the purchaser had no title superior to that of the trustee, although he bought the property in good faith ; Bryan v. Bern heimer, 181 U. S. 188, 21 Sup. Ct. 557, 45 L. Ed. 814. A contingent remainder does not pass in bankruptcy ; In re Hoadley, 101 Fed. 233. A bankrupt trustee takes only the sur render value of the insurance policies on the bankrupt's life, or if the company has loan ed on it, only the excess of surrender value. The bankrupt is entitled to the policy by paying for it the cash surrender value or the excess over loans made on it at the date of filing the petition; and if the policy ma tures before the adjudication he or his legal representative is entitled to the proceeds of the policy over and above such amount ; and this even though the bankrupt committed suicide prior to adjudication ; Everett v. Jud son, 228 U. S. 474, 33 Sup. Ct. 568, 57 L. Ed. —; Andrews v. Partridge, 228 U. S. 479, 33 Sup. Ct. 570, 57 L. Ed.
The first meeting of creditors shall be held not less than ten nor more than thirty days after the adjudication. Subsequent meetings may be held when all creditors whose claims are allowed sign a written con sent thereto. The court shall call a meet ing whenever one-fourth of those who have proved their claims apply in writing. A final meeting shall be held when the estate is ready to be closed.
Adjudication in bankruptcy terminates the relation of landlord and tenant, and a claim for rent accruing after such adjudication will not be allowed, though the tenant ex ecuted promissory notes therefor; In re Hays, Foster & Ward Co., 117 Fed. 879. A sworn proof of claim against a bankrupt is prima facie evidence of its allegations ; Whitney v. Dresser, 200 U. S. 532, 26 Sup. Ct. 316, 50 L. Ed. 584; and a creditor who knowingly received a preference and gave it up only when compelled by the trustee cannot thereafter prove his claim; In re Owings, 109 Fed. 623. An attorney is not entitled to a preferential claim out of the es tate for professional services in preparing a general assignment for the bankrupt within the four months' period ; Randolph v. Scruggs, 190 U. S. 533, 23 Sup. Ct. 710, 47 L. Ed. 1165; nor for services in resisting an adjudication in voluntary bankruptcy ; id.; but he may prove as an unsecured claim his services in the preparation of a deed of trust ; id. Three or more creditors whose provable claims ag gregate, above any securities, $500, or if all the creditors are less than twelve in num ber, then one whose claim exceeds such amount may petition in involuntary bank ruptoy.