S. Ct. 94, 71 L. Ed. 846; Metz v. Knobel, 2 Cir., 21 F.2d 317, 318; In re Empire Coal Sales Corp., 45 F.Supp. 974, 976, affirmed Kleid v. Ruthbell Coal Co., 2 Cir., 131 F.2d 372; see also 2 Collier on Bankruptcy, 530, et seq. The summary jurisdiction of the court is necessarily limited in its scope by the issues thus raised.
It does not follow, however, that a court of bankruptcy may summarily enter an affirmative judgment in favor of the debtor and against the creditor in the absence of a counterclaim praying such relief, Accord Cumberland Glass Co., v. DeWitt, 237 U.S. 447, 456, 457, 35 S. Ct. 636, 59 L. Ed. 1042; In re Potts, supra, 142 F.2d at pages 883, 887. There can be little, if any doubt, that a court of bankruptcy has summary jurisdiction to enter an affirmative judgment on a counterclaim asserted against a creditor upon his consent to the exercise of such jurisdiction. Section 23 of the Act, 11 U.S.C.A. § 46; Florance v. Kresge, 5 Cir., 93 F.2d 784, 786; Columbia Foundry Co. v. Lochner, 4 Cir., 179 F.2d 630, 633-635; see also 2 Collier on Bankruptcy, 531. It has been held that the mere filing of a proof of claim is a sufficient consent to the summary jurisdiction of the court of bankruptcy to enter an affirmative judgment on the counterclaim asserted by the debtor. Ibid debtor. Ibid. It should be noted that the decisions in the cited cases were limited to the situations therein presented.
The general principles which govern set offs under Sec. 68, sub. a of the Act were discussed in In re Potts, supra. It was therein stated, 142 F.2d at page 887: 'It is settled law that parties interested in the estate may set off in reduction or extinguishment of the allowance of a provable claim, any debt or counterclaim which passes to the trustee and which the bankrupt or any of his creditors might have asserted against the claimant. The section is not self-executing and its benefit is to be had only on action of the Bankruptcy Court properly invoked. The statute does not enlarge the general doctrine of set off or counterclaim. It only becomes operative when the case is brought within the general principles of set-off. The debt sought to be set off must ordinarily be a mutual one and must be of the same nature as the creditor's claim, and where the set-off of a debtor is sought in arrangement proceedings, the debtor must observe and comply with all conditions governing perfection of his rights to recover from a claimant in an ordinary proceeding.' (Emphasis by the court.)
The claim of the Debtor, based upon its right to the return of the deposit, accrued upon the termination of the lease by operation of law. The claim of the Creditor for damages accrued upon the rejection of the unexpired lease. The claim of the Debtor was enforceable in this proceeding but only as a counterclaim. There was no jurisdiction in the court of bankruptcy to enter an affirmative judgment in the absence of such a counterclaim. Accord Cumberland Glass Co. v. DeWitt, and In re Potts, both supra.
The Rules of Civil Procedure govern proceedings under the Act, 'in so far as they are not inconsistent with the Act.' General Order 37, 11 U.S.C.A., following Section 53; Moonblatt v. Kosmin, 3 Cir., 139 F.2d 412, 414; Rule 13, Fed. Rules Civ. Proc., 28 U.S.C.A, requires that a counterclaim be asserted in a responsive pleading. This was not done in this proceeding. The formal objections filed by the Debtor may not be regarded as a 'counterclaim' within the meaning of the rules; considered in the light most favorable to the Debtor they must be regarded as nothing more than an answer or defensive pleading. In re Empire Coal Sales Corp., supra. It is our opinion that in the absence of such a counterclaim the summary jurisdiction of the court of bankruptcy was exhausted upon the disallowance of the Creditor's claim for future rents.
It is argued that the claim of the Debtor's estate should have been set off against the Creditor's claim for the rental value of the premises for the months of May and June, the claim allowed. We cannot agree with this argument. Section 68, sub. a of the Act is not applicable to this situation because of the absence of the required mutuality. The debts upon which these claims were predicated did not arise out of the same right. Accord United States v. Roth, 2 Cir., 164 F.2d 575, 578; Standard Oil Company of New Jersey v. Elliott, 4 Cir., 80 F.2d 158, 159, 160. The claim of the Creditor for the rental value of the premises for the months of May and June was based solely on the Receiver's use and occupancy of the premises for these months. The debt was one incurred by the Receiver as an officer of the court and not as an agent or representative of the Debtor. The claim of the Creditor was predicated not on the lease but on its equitable. right to compensation for the use and occupancy of the premises from which it was excluded. In re United Cigar Stores Co. of America, 2 Cir., 69 F.2d 513, 515; Meehan v. King, 1 Cir., 54 F.2d 761, 763; In re Chakos, 7 Cir., 24 F.2d 482, 486; In re Mille. Lemaud, Inc., 1 Cir., 16 F.2d 780. The expense was properly chargeable as an administration expense. Ibid.
The petition for review is dismissed.
The references herein to 'Collier on Bankruptcy' are the 14th Edition.
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