such debtor may have given preferences, and may turn up but a few months after an arrangement has been consummated, and yet the creditors be barred from ever receiving more than fifty cents on the dollar.
That Congress did not intend this to occur is evident from the fact that under Chapter XI only the debtor can propose an arrangement. U.S.C.A. Title 11 Sec. 706, sub. 5, Sec. 721, 8 Coolier, Bankruptcy, 14th Edition, page 268, note 5, page 269. Here the trustee wife who files the petition is obviously not the 'debtor'- her husband. In fact, counsel agree that she is appointed for the benefit of all, and represents, therefore, not only the debtor, but his creditors, as well. The latter are not authorized to file a petition for arrangement.
Nor are the cases permitting a decedent, by his personal representative, or an incompetent, by his guardian, to go, or be put, into bankruptcy, to the contrary. In re Clinton, D.C.S.D. Cal. 1930, 41 F.2d 749; In re Evanishyn, 2 Cir., 1939, 107 F.2d 742, 125 A.L.R. 1290. Neither a dead nor incompetent debtor can ever be examined by his creditors. The creditors thus lose nothing they can ever hope to attain, when the bankrupt is discharged without such examination. Such cases are not real exceptions to the statutory purpose. Not so, when a debtor has simply disappeared, shortly before his family bring proceedings to pay his creditors fifty cents on the dollar, in return for a discharge. The intent of the Congress to achieve such a result must be more clearly indicated before this Court would feel justified in so construing Chapter XI of the Bankruptcy Act.
Indeed, quite regardless of the fact that the proceedings for the appointment of this 'statutory receiver' were taken some two months after the debtor's disappearance, rather than after the statutory 'one year', it seems doubtful if the New Jersey Legislature intended, if they could, to authorize proceedings in bankruptcy. For the statute in question provides that the state trustee 'shall be under the direction and control of the court appointing him', i.e., of the State Court of Chancery. The statute further provides that such trustee 'shall have full power over the property'. If bankruptcy supervenes, whether under Chapter XI or otherwise, obviously it is the receiver or trustee in bankruptcy who will have full power over the property, Title 11 U.S.C.A. § 732, and this official may not be the estate trustee at all. Of course, it is then the Federal Court which will have full control. Clearly, the New Jersey Legislature intended to put in statutory form some at least of the ancient general power of courts of equity to conserve the property of an insolvent, under its own broad jurisdiction, not under the broader powers, in some aspects, of Federal bankruptcy.
The order of the Referee dismissing the above petition for arrangement is affirmed.