Appeals to this Court from decrees of the circuit courts of
appeals revising proceedings of the inferior courts of bankruptcy
under § 24
b of the bankruptcy law will not lie.
Two separate proceedings were commenced in the District Court of
the United States for the District of Washington, on January 19,
1901, against D. N. Holden and Lizzie Holden, to the end that each
be adjudicated a bankrupt, which were consolidated, and on the
ensuing twenty-fifth of February, they were, respectively, so
adjudicated. The creditors of each of the bankrupts were the
same.
Thereupon J. A. Stratton was duly elected trustee in
bankruptcy
Page 191 U. S. 116
of the estate of each of the bankrupts, and qualified as such.
The bankrupts, and each of them, applied for exemption in their
favor of two certain policies of life insurance in the hands of the
trustee. D. N. Holden was insured, and Lizzie Holden was the
beneficiary, in both, with the provision that, if she should not
survive him, payment should be made to his executors,
administrators, and assigns.
The exemption was disallowed by the referee, who reported his
action to the court. The bankrupts filed exceptions to the report,
and the court, on July 16, 1901, set it aside and adjudged the
policies to be exempt. Stratton then filed a petition in the
Circuit Court of Appeals for the Ninth Circuit for a revision of
this order. It was therein alleged, among other things, that the
policies had a present cash surrender value combined of about
$2,200. The circuit court of appeals, accepting the ruling of that
court in the previous case of
In re Scheld, 104 F. 870,
held that the policies were not exempt, and decreed a revision of
the order of the district court accordingly. 113 F. 141. From this
decree an appeal was prayed to this Court, and allowed February 12,
1902, and the record was filed here April 14, 1902. And
subsequently a certificate of a Justice of this Court was filed
herein that, in his opinion, the determination of the questions
involved was essential to a uniform construction of the Bankruptcy
Act throughout the United States.
The appeal was submitted on a motion to dismiss, and also on the
merits.
MR. CHIEF JUSTICE FULLER delivered the opinion of the Court.
It will be perceived that the jurisdiction of the circuit court
of appeals was invoked on an original petition under section
Page 191 U. S. 117
24
b of the bankruptcy law, which provides:
"The several circuit courts of appeal shall have jurisdiction in
equity, either interlocutory or final, to superintend and revise in
matter of law the proceedings of the several inferior courts of
bankruptcy within their jurisdiction. Such power shall be exercised
on due notice and petition by any party aggrieved."
This supervisory jurisdiction in matter of law was conferred on
the circuit courts by the Act of March 2, 1867, 14 Stat. 518, c.
176, § 2; Rev.Stat. § 4986, and it was settled under that act that
appeals to this Court did not lie from the decisions of the circuit
courts in the exercise of that jurisdiction.
Morgan v.
Thornhill, 11 Wall. 65;
Conro v. Crane,
94 U. S. 441. The
ruling is decisive here unless the present act elsewhere otherwise
provides. But this it does not do, the special and summary
character of the revision contemplated being substantially the same
as in the prior act, and the provision for appeals not embracing
appeals from decrees in revision.
Section 25
a provides
"that appeals, as in equity cases, may be taken in bankruptcy
proceedings from the courts of bankruptcy to the circuit court of
appeals of the United States, and to the supreme court of the
territories, in the following cases, to-wit, (1) from a judgment
adjudging or refusing to adjudge the defendant a bankrupt; (2) from
a judgment granting or denying a discharge, and (3) from a judgment
allowing or rejecting a debt or claim of five hundred dollars or
over."
And § 25
b for appeals to this Court "from any final
decision of a court of appeals, allowing or rejecting a claim under
this act," where the amount in controversy exceeds the sum of two
thousand dollars, and the question involved was one which might
have been taken from the highest court of a state to the Supreme
Court of the United States, or where some Justice of the Supreme
Court certifies that,
"in his opinion, the determination of the question or questions
involved in the allowance or rejection of such claim is essential
to a uniform construction of this act throughout the United States.
"
Page 191 U. S. 118
This case was not taken to the court of appeals by appeal, as in
equity cases, to be reexamined on the facts as well as the law, nor
could it have been, for it was not one of the cases enumerated in §
25
a. The order of the district court was not "a judgment
allowing or rejecting a debt or claim of five hundred dollars or
over," or the revising order of the circuit court of appeals, "a
final decision, allowing or rejecting a claim," within the intent
and meaning of either subdivision
a or
b. By
section 2, subd. 2, courts of bankruptcy are vested with the power
to "allow claims, disallow claims, reconsider allowed or disallowed
claims, and allow or disallow them against bankrupt estates," and
section 57 comprehensively covers the subject of the proof and
allowance of claims, treating them as moneyed demands.
And while the word "claim" is used in its signification of the
demand or assertion of a right in subd. 11 of section 2 in respect
of "all claims of bankrupts to their exemptions," it is also used
in many parts of the act, and, as we think, in section 25, as
referring to debts (which by sub-sec. 11 of section 1 include "any
debt, demand, or claim provable in bankruptcy") presented for proof
against estates in bankruptcy.
Hutchinson v. Otis,
190 U. S. 552,
190 U. S. 555;
In re Whitener, 105 F. 180;
In re Columbia Real Estate
Co., 112 F. 645.
The allowance or rejection of a debt or claim is a part of the
bankruptcy proceedings, and not an independent suit, and, under the
act of 1867, it was held that this Court had no jurisdiction to
review judgments of the circuit courts dealing with the action of
the district courts in such allowance or rejection, because they
were not final.
Wiswall v. Campbell, 93 U. S.
347;
Leggett v. Allen, 110 U.
S. 741. The jurisdiction now given is carefully
restricted, and cannot be expanded beyond the letter of the grant.
It is an exception to the general rule as to appeals and writs of
error obtaining from the foundation of our judicial system.
McLish v. Roff, 141 U. S. 661.
The distinction between steps in bankruptcy proceedings proper
and controversies arising out of the settlement of the
Page 191 U. S. 119
estates of bankrupts is recognized in sections 23, 24, and 25 of
the present act, and the provisions as to revision in matter of law
and appeals were framed and must be construed in view of that
distinction.
First Nat. Bank v. Klug, 186 U.
S. 202;
Elliott v. Toeppner, 187 U.
S. 327,
187 U. S.
333-334.
Section 6 of the Act of March 3, 1891, has no application, as
that refers to cases carried to the circuit court of appeals by
appeal or writ of error. But, in view of the terms of that act and
of the nature of the writ, we have held that, under a reasonable
construction of subdivision
d of section 25, certiorari
lies to decrees in revision.
Bryan v. Bernheimer,
175 U. S. 724,
s.c., 181 U. S. 181 U.S.
188;
Mueller v. Nugent, 180 U.S. 640,
s.c.,
184 U. S. 184 U.S.
1;
Louisville Trust Co. v. Comingor, 181 U.S. 620,
s.c., 184 U. S. 184 U.S.
18. In the case first cited, it is pointed out that the circuit
court of appeals treated the case as if before it on a petition for
revision, though it had been carried there by appeal, and we
considered the decree as rendered in the exercise of the
supervisory power.
181 U. S. 181
U.S. 192-193.
Appeal dismissed.
