CHAPTER V.

OFFICERS, THEIR DUTIES AND COMPENSATION.

§ 496. Act of 1898. SEC. 33. CREATION OF TWO OFFICES.a. The offices of referee and trustee are hereby created.

These officers were formerly called in America registers and assignees.

§ 497. Act of 1898.-SEC. 34. APPOINTMENT, REMOVAL, AND DISTRICTS OF REFEREES. a. Courts of bankruptcy shall, within the territorial limits of which they respectively have jurisdiction, (1) appoint referees, each for a term of two years, and may, in their discretion, remove them because their services are not needed or for other cause; and (2) designate, and from time to time change, the limits of the districts of referees, so that each county, where the services of a referee are needed, may constitute at least one district.

It seems to be the intention that the districts of referees shall be contained within the limits of a county, and the court is given power to divide a county into as many districts as is necessary (§ 37). There is no power to appoint more than one referee to any one district.

§ 498. Act of 1898.-SEC. 35. QUALIFICATIONS OF REFEREES.-a. a. Individuals shall not be eligible to appointment as referees unless they are respectively (1) competent to perform the duties of that office; (2)

not holding any office of profit or emolument under the laws of the United States or of any State other than commissioners of deeds, justices of the peace, masters in chancery, or notaries public; (3) not related by consanguinity or affinity, within the third degree as determined by the common law, to any of the judges of the courts of bankruptcy or circuit courts of the United States, or of the justices or judges of the appellate courts of the districts wherein they may be appointed; and (4) residents of, or have their offices in, the territorial districts for which they are to be appointed.

Consanguinity is relationship by blood and affinity by marriage, and the degrees are determined in the same way.1 Relatives in the third degree as reckoned by the common law are great grandson, great grandfather, great uncle, son of a great uncle, second cousin, son of a first cousin, and grandson of a brother.2

$499. Act of 1898. SEC. 36. OATHS OF OFFICE OF REFEREES.a. Referees shall take the same oath of office as that prescribed for judges of United States

courts.

Form 16 prescribes the oath of office which must be taken by referees. The judge administers the oath and subscribes to it as administering officer.

§ 500. Act of 1898. SEC. 37. NUMBER OF REFEREES.a. Such number of referees shall be appointed as may be necessary to assist in expeditiously transacting the bankruptcy business pending in the various courts of bankruptcy.

1 Bouvier's Dictionary, Tit. Affinity.

2 Bouvier's Dictionary, Tit. Consanguinity; 2 Bla. Comm. 202.

§ 501. Act of 1898. SEC. 38. JURISDICTION OF REFEREES.a. Referees respectively are hereby invested, subject always to a review by the judge, within the limits of their districts as established from time to time, with jurisdiction to (1) consider all petitions referred to them by the clerks and make the adjudications or dismiss the petitions; (2) exercise the powers vested in courts of bankruptcy for the administering of oaths to and the examination of persons as witnesses and for requiring the production of documents in proceedings before them, except the power of commitment; (3) exercise the powers of the judge for the taking possession and releasing of the property of the bankrupt in the event of the issuance by the clerk of a certificate showing the absence of a judge from the judicial district, or the division of the district, or his sickness, or inability to act; (4) perform such part of the duties, except as to questions arising out of the applications of bankrupts for compositions or discharges, as are by this Act conferred on courts of bankruptcy and as shall be prescribed by rules or orders of the courts of bankruptcy of their respective districts, except as herein otherwise provided; and (5) upon the application of the trustee during the examination of the bankrupts, or other proceedings, authorize the employment of stenographers at the expense of the estates at a compensation not to exceed ten cents per folio for reporting and transcribing the proceedings.

Proceedings before the register were subject to revision by the judge under the last law. Referees are to make a record of the evidence in contested matters as agreed to by the parties

1 Act of 1857 §§ 4, 6, 14 Stats. 519, England. Re Cronmire (1894), 2 Q. B. 520, R... 3 5003, 5010. And so in 246.

and transmit it to the judge (§ 39 (5.)) The person applying for a review shall petition the referee setting out the error. The referee shall then certify to the judge a summary of the evidence relating to the question and his finding thereon.1

The petitions referred to referees are voluntary and unopposed involuntary petitions when the judge is out of the district at the time of filing (§ 18 ƒ, g).

The judge is given power in certain instances to take possession of the property of the bankrupt.2 If the judge is absent or sick or unable to act, the referee under clause 3 may exercise these powers on receiving a certificate from the clerk of the judge's absence, sickness or inability to act. This clause does not give the referee power in the absence of the judge to appoint receivers, as it applies only to cases where a petitioning creditor desires to take possession of the estate and files a bond.3 Receivers are to be appointed only in cases of urgent necessity, and it appears clearly from the terms of § 2 (3) that the judge is to pass on the question. Rule XII. provides that after a case is referred to the referee he shall take all proceedings except those which a judge must pass on, but the receiver will be appointed usually before the adjudication and therefore before the reference of the case. It has been held by Mr. Referee Moss of the northern district of New York that a referee may appoint a receiver, but the decision seems doubtful. The opinion of Judge Brown in Re Gutwillig seems inconsistent with it. It is the practice in New York for a referee to grant an injunction. This is directly contrary to the prohibition of Rule XII. and is wrong. But the referee is nowhere forbidden to grant a restraining order and the desired result may be reached in this way.

Rule XII. gives the referee jurisdiction over everything except matters relating to compositions and discharges, petitions

1 Rule XXVII., see Form 56. 2 See supra, § 466.

8 See §§ 466, 532. In Re Rogers, 1 N. B. N. 211, it was held that when the judge was unable to act the referee

might issue an injunction. This de cision is contrary to Rule XII.

4 Re Abrahamson, 1 N. B. N. 23. 5 90 Fed. Rep. 475, 1 N. B. N. 18.

6 Re Adams, 1 N. B. N. 167.

7 Clause (4) of the present section.

for adjudication when the judge is present, the removal of trustees 2 the appointment of receivers,3 the taking possession of property if the judge is not absent, proceedings for punishment for contempt,5 and applications for an injunction. The judge must approve the referee's bond and the bonds required in case of an application for taking possession of property.8

The judge may refer an application for a discharge or composition or an injunction to the referee to report on the facts.9

§ 502. Act of 1898. SEC. 39. DUTIES OF REFEREES.-a. Referees shall (1) declare dividends and prepare and deliver to trustees dividend sheets showing the dividends declared and to whom payable; (2) examine all schedules of property and lists of creditors filed by bankrupts and cause such as are incomplete or defective to be amended; (3) furnish such information concerning the estates in process of administration before them as may be requested by the parties in interest; (4) give notices to creditors as herein provided; (5) make up records embodying the evidence, or the substance thereof, as agreed upon by the parties in all contested matters arising before them, whenever requested to do so by either of the parties thereto, together with their findings therein, and transmit them to the judges; (6) prepare and file the schedules of property and lists of creditors required to be filed by the bankrupts, or cause the same to be done, when the bankrupts fail, refuse, or neglect to do so; (7) safely keep, perfect, and transmit to the clerks the records, herein required to be kept by them, when the cases are

1 Act of 1898, § 18.

2 Rule XIII.

3 See supra.

4 Clause (3) of this section. 5 Act of 1898, § 41 b.

6 Rule XII. 3.

7 Form 17.

8 Forms 9, 10.

Rule XII. 3.