1. The proper procedure for taking appeals under § 250 of the
Bankruptcy Act, as amended, from orders making or refusing to make
allowances of compensation or reimbursement under Chapter X, is by
filing in the Circuit Court of Appeals, within the time prescribed
by § 25(a), applications for leave to appeal, not by filing notices
of appeal in the District Court. P.
311 U. S.
581.
2. Rule 73(a) of the Federal Rules of Civil Procedure, which
provides that, when an appeal "is permitted by law from a District
Court to a Circuit Court of Appeals," it may be taken by filing
with the District Court a notice of appeal, is inapplicable to
appeals under § 250 of the Bankruptcy Act, which may be had only in
the discretion of the Circuit Court of Appeals. P.
311 U. S.
581.
3. Although appeals under § 250 must be "taken to" the Circuit
Court of Appeals within the time prescribed by § 25(a), it is not
required also that they be "allowed" within that time. P.
311 U. S.
582.
4. Ambiguities in statutory language should not be resolved so
as to imperil a substantial right which has been granted. P.
311 U. S.
582.
5. Where, subsequent to
London v. O'Dougherty, 102 F.2d
524, and prior to
Dickinson Industrial Site v. Cowan,
309 U. S. 382,
notices of appeals from compensation orders under § 77B of the
Bankruptcy Act were filed in the District Court, within the appeal
period prescribed by § 25(a), although no application for leave to
appeal was made to the Circuit Court of Appeals,
held that
the Circuit Court of Appeals was not without jurisdiction to allow
the appeals. Pp.
311 U. S. 580,
582..
111 F.2d 37 reversed.
Certiorari, 310 U.S. 622, to review a judgment dismissing
appeals from compensation orders of the bankruptcy court.
Page 311 U. S. 580
MR. JUSTICE DOUGLAS delivered the opinion of the Court.
Dickinson Industrial Site, Inc. v. Cowan, 309 U.
S. 382, decided on March 11, 1940, held that appeals
from all orders making or refusing to make allowances of
compensation or reimbursement under Chapter X of the Chandler Act,
52 Stat. 840, 883, may be had only at the discretion of the Circuit
Court of Appeals. Prior to that decision, the Circuit Court of
Appeals for the Second Circuit had held that appeals from such
orders (involving $500 or more) could be had as a matter of right.
London v. O'Dougherty, 102 F.2d 524. Subsequent to the
decision in the
London case and prior to the decision of
Dickinson Industrial Site, Inc. v. Cowan, supra,
petitioners endeavored to take appeals from compensation orders,
which had been entered in reorganization proceedings under former §
77B, 48 Stat. 912 by filing within the appeal period provided by §
25(a) of the Bankruptcy Act notices of appeal in the District
Court. No application for leave to appeal was made to the Circuit
Court of Appeals at any time. Some of the appeals were argued in
May, 1939, the balance in February, 1940, some of the notices of
appeal having been filed in the District Court in March, 1939, and
some in November, 1939. While the matter was under advisement in
the Circuit Court of Appeals, we decided
Dickinson Industrial
Site, Inc. v. Cowan, supra. Thereupon, certain respondents
moved for dismissal of the appeals for want of jurisdiction. All of
the appeals were
Page 311 U. S. 581
dismissed, some on those motions and some by the court
sua
sponte. In re Prudence-Bonds Corp., 111 F.2d 37. The
case is here on petition for certiorari which we granted in view of
the importance of the procedural problem in administration of the
Bankruptcy Act and of the asserted substantial conflict of the
decision below with
Baxter v. Savings Bank, 92 F.2d 404,
and
Wilson v. Alliance Life Ins. Co., 102 F.2d 365,
decided by the Circuit Court of Appeals for the Fifth Circuit.
Section 250 of the Chandler Act provides that appeals from
compensation orders "may, in the manner and within the time
provided for appeals by this Act, be taken to and allowed by the
circuit court of Appeals." Petitioners contends that, when § 250
states that such appeals may be taken "in the manner . . . provided
for appeals by this Act," it necessarily makes applicable § 24(b),
which provides that such appellate jurisdiction shall be exercised
"by appeal and in the form and manner of an appeal." They argue,
therefore, that Rule 73(a) of the Federal Rules of Civil Procedure,
which allows an appeal to be taken "by filing with the district
court a notice of appeal" in those cases where an "appeal is
permitted by law from a district court to a circuit court of
appeals," governs appeals under § 250 as well as other appeals,
since General Order No. 36 makes those rules applicable to appeals
in bankruptcy, "except as otherwise provided in the Act." In our
view, however, Rule 73(a) is not applicable to appeals under § 250
(
see 2 Collier on Bankruptcy, 14th Ed., p. 918), for they
are permissive appeals which may be had not as of right, but only
in the discretion of the Circuit Court of Appeals. Since § 250
provides that they may "be taken to and allowed by the circuit
court of appeals," the proper procedure for taking them is by
filing in the Circuit Court of Appeals, within the time prescribed
in § 25(a), applications for leave to appeal, not by filing notices
of
Page 311 U. S. 582
appeal in the District Court as was done here. As respondents
maintain, that is the fair implication from our conclusion in
Dickinson Industrial Site, Inc. v. Cowan, supra, at p.
309 U. S. 385,
that such appeals "may be had only at the discretion of the Circuit
Court of Appeals." But, while the appeals under § 250 must be
"taken to" the Circuit Court of Appeals within the time prescribed
in § 25(a), we do not think it is the fair intendment of that
section that they must also be "allowed" within that time.
Cf.
In re Foster Const. Corp., 49 F.2d 213;
Price v. Spokane
Silver & Lead Co., 97 F.2d 237. If that were true, the
existence of the right to appeal would be subject to contingencies
which no degree of diligence by an appellant could control.
Ambiguities in statutory language should not be resolved so as to
imperil a substantial right which has been granted.
The court below was in substantial agreement with the foregoing
construction of § 250. It went on to hold, however, that, since
petitioners did not seek an allowance of their appeals in that
court within the time prescribed in § 25(a), it had no jurisdiction
to allow them. We take a different view.
The procedure followed by petitioners was irregular. Normally,
the Circuit Court of Appeals would be wholly justified in treating
the mere filing of a notice of appeal in the District Court as
insufficient. But the defect is not jurisdictional in the sense
that it deprives the court of power to allow the appeal. The court
has discretion, where the scope of review is not affected, to
disregard such an irregularity in the interests of substantial
justice.
Cf. Taylor v. Voss, 271 U.
S. 176, dealing with appeals and petitions for revision
under earlier provisions of the Act. In this case, the effect of
the procedural irregularity was not substantial. The scope of
review was not altered. There was no question of the good faith of
petitioners, of dilatory tactics, or of frivolous appeals. Hence,
it would be extremely harsh to hold that
Page 311 U. S. 583
petitioners were deprived of their right to have the court
exercise its discretion on the allowance of their appeals by reason
of their erroneous reliance upon the permanency of
London v.
O'Dougherty, supra. This conclusion does not do violence to
Shulman v. Wilson-Sheridan Hotel Co., 301 U.
S. 172. As we indicated in
Dickinson Industrial
Site, Inc. v. Cowan, supra, the
Shulman case stated
the rule of permissive appeals which was carried over into § 250.
The failure to comply with statutory requirements, however, is not
necessarily a jurisdictional defect.
Cf. Alaska Packers Assn.
v. Pillsbury, 301 U. S. 174.
For the reasons stated, we hold that the Circuit Court of
Appeals had the power to allow the appeals.
Reversed.
MR. JUSTICE REED, concurring.
I am of opinion that timely application to the circuit court of
appeals for leave to appeal is a jurisdictional requirement, and
that the practice followed in this case cannot be reduced to a mere
procedural irregularity.
Farrar v. Churchill, 135 U.
S. 609,
135 U. S.
612-613;
Old Nick Williams Co. v. United
States, 215 U. S. 541;
Shulman v. Wilson-Sheridan Hotel Co., 301 U.
S. 172. However, when petitioners filed their notices of
appeal in the district court, the proper procedure was not settled,
and petitioners were misled by the decision of the court below in
London v. O'Dougherty, 102 F.2d 524. In these unique
circumstances, I think that reversal of the judgment is justified
by our broad power to make such disposition of the case as justice
requires.
Watts, Watts & Co. v. Unione Austriaca,
248 U. S. 9,
248 U. S. 21;
Montgomery Ward & Co. v. Duncan, 311 U.
S. 243. In rare instances, such as the case at bar, this
power is appropriate for curing even jurisdictional defects.
Cf. Rorick v. Commissioners, 307 U.
S. 208,
307 U. S.
213.
MR. JUSTICE ROBERTS joins in this opinion.