In re RYAN

In re RYAN. (District Court, M. D. Pennsylvania. April 4, 1902.) No. 57. Involuntary Bankruptcy — Amount op Claims — Jurisdiction. Payments made by a bankrupt to certain of the petitioning creditors, reducing the aggregate amount of the petitioning creditors’ claims below the statutory limit, does not defeat the jurisdiction of the bankruptcy court, where subsequently enough other creditors come in to raise the amount above the jurisdictional limit In Bankruptcy. Exceptions to report of referee. W. J. Young, for exceptions. C. M. Culver and H. K. Mitchell, for petitioners. [MAJORITY — ARCHBALD, District Judge.] ARCHBALD, District Judge. At the date of filing the petition, October n, 1901, the claims of the petitioning creditors amounted to $513.80. Subsequently, and before the adjudication, the bankrupt made certain small payments to two of them, amounting in all to $38, which reduced the aggregate amount of the claims as they then stood below the statutory limit. Within a few days afterwards, however, two other creditors, holding claims to the amount of $78.60, petitioned to join in the proceedings. Is this sufficient to sustain the jurisdiction of the court, or was it ousted by the reduction of the claims of the original petitioners below the sum of $500? The referee has found in favor of the proceedings, and I am satisfied that this is a correct conclusion. The petition was good when it was filed, and the proceedings which were thus instituted inured to the benefit of all parties. By the express provisions of the bankrupt act (section gpf), other creditors were entitled to come in at any time and join in them, and the petition could not be withdrawn or dismissed without consent or for want of prosecution until notice had been given them. Section 59g. The purpose of the latter provision undoubtedly is to prevent collusion, and enable creditors to exercise the right to come in if they desire. The payments made by the bankrupt i.11 the present instance, in the evident attempt to oust the jurisdiction of the court, were therefore of no effect, enough other creditors having now joined ⅛ the proceedings to raise the amount above the jurisdictional limit. The report of the referee is confirmed, and an adjudication ordered as prayed for.