Form No. 358 SPECIFICATIONS OF OBJECTION TO CONFIRMATION OF COMPOSITION (Hagar and Alexander's Bankruptcy Forms [2d Ed.], No. 305.) In the District Court of the United States, a creditor and person the above-named interested in the estate of (alleged) bankrupt, does hereby oppose and object to the confirmation of the composition offered by said (alleged) bankrupt, and, for grounds of such opposition and objection, does file the following specifications:1 I. That said composition is not for the best interests of the creditors herein, on the ground that the assets belonging to this estate properly handled and administered will pay a considerably larger dividend to creditors and for that reason the proposed composition should not be confirmed. II. That the (alleged) bankrupt has been guilty of acts which would be a bar to his discharge, in that he has, etc. [Here set forth specifically such acts.] III. That the offer and its acceptance are not in good faith, because of the fact that: [Here set forth acts or conduct complained of.] Wherefore, .. objects to the confirmation of the composition herein and asks a hearing of the Court thereon. Cross-references.- Consult § 12, Vol. I, ante. See also General Order XXXII. Vol. II, ante. Specifications of objection.- [See § 12, ante.] Only grounds available are those set forth in § 12(d). In re Rudwick, 2 Am. B. R. 114, 93 Fed. 787. Must be definite and certain in the language of the Act. Should be framed with great precision, with averment of facts, not conclusions. In re Rider, 3 Am. B. R. 178, 96 Fed. 808. Who may file. Creditor or " party in interest." An assignee of an original claim against a bankrupt entitled to file. In re Comstock, 19 Am. B. R. 65, 154 Fed. 747. The number of creditors objecting is immaterial. In re Godwin, 10 Am. B. R. 252, 122 Fed. 111. In re Olman, 13 Am. B. R. 395, 134 Fed. 681. In re Frazin and Oppenheim (So. Dist. N. Y.), (not reported). In re Levy (D. C., Mass.), 22 Am. B. R. 769, 172 Fed. 780. Burden of proof on objector. City Nat. Bank v. Doolittle (C. C. A., 5th Cir.), 5 Am. B. R. 736, 107 Fed. 236, 46 C. C. A. 258. Burden on those attacking the composition as against the best interests of creditors to show the offer is inadequate and that a substantially larger sum might reasonably be expected to result from administration in regular course of bankruptcy. In re Hoxie (D. C., Me.), 25 Am. B. R. 32, 180 Fed. 508. Grounds of objection. [See § 12, ante.] Because against the best interests of the creditors. Adler v. Jones (C. C. A., 6th Cir.), 6 Am. B. R. 245, 109 Fed. 967, 48 C. C. A. 761, affg. 103 Fed. 444. As a general rule the fact that a majority in number and amount of creditors have accepted is prima facie evidence that it is for the best interests of all. In re Waynesboro Drug Co., 19 Am. B. R. 487, 157 Fed. 101. In re Arrington Co., 8 Am. B. R. 64, 113 Fed. 498. In re Criterion Watch, etc., Co., 8 Am. B. R. 206. In re Woodend, 12 Am. B. R. 768, 133 Fed. 593. In re Hoxie (supra). In re Barde & Levitt, 31 Am B. R. 161, 207 Fed. 654. In re Spiller, 36 Am. B. R. 399. There must be a majority in number and amount of individual as well as partnership creditors for individual composition of bankrupt partner. In re L. Ullman & Co. (D. C., N. Y.), 24 Am. B. R. 755, 180 Fed. 944. Because of the commission of acts or failure to perform duties which would bar a discharge. [See § 12, ante.] In re Wilson, 5 Am. B. R. 849, 107 Fed. 83. In re Comstock, 19 Am. B. R. 65, 154 Fed. 747. In re Olman, 13 Am. B. R. 395, 134 Fed. 681. In re Godwin, 10 Am. B. R. 252, 122 Fed. 111. Materially false statement to obtain credit. In re O'Callaghan, 29 Am. B. R. 304, 199 Fed. 662. In re McLellan, 30 Am. B. R. 325, 204 Fed. 482. Failure to keep books. In re Sabsevitz, 28 Am. B. R. 623, 197 Fed. 109. In re B. Jacobson & Son Co. (C. C. A., 3d Cir.), 28 Am. B. R. 492, 196 Fed. 949, 116 C. C. A. 499. Because of the absence of good faith.- [See § 12, ante.] In re Seligman, 20 Am. B. R. 774, 163 Fed. 549. In re Comstock (supra). Secret preferences render illegal. In re Chaplin, 8 Am. B. R. 121, 115 Fed. 162. McCormick v. Solinsky (C. C. A., 5th Cir.), 18 Am. B. R. 540, 152 Fed. 984, 82 C. C. A. 134. Continuing liability of indorser of note not an inducement vitiating a compositon. In re Jacobson & Son Co. (C. C. A., 3d Cir.), 28 Am. B. R. 492, 196 Fed. 949, 116 C. C. A. 499. Inequality among creditors. In re Kinnane Co. (D. C., O.), 34 Am. B. R. 119, 221 Fed. 762. An agreement by a trustee in bankruptcy whereby, without the knowledge of other creditors, he personally guarantees to one creditor the payment of a certain dividend in order to induce such creditor to sign a composition agreement, constitutes a secret preference to such creditor, and although it does not render the composition void, is unenforceable as against public policy. Jacobs v. Siff (N. Y. Sup. App. Term), 27 Am. B. R. 189, 74 Misc. (N. Y.) 58, 131 N. Y. Supp. 656. Compare Hanover Nat. Bank v. Van Nostrand, 142 N. Y. 405. Form No. 359 EXCEPTIONS TO SPECIFICATIONS (Hagar and Alexander's Bankruptcy Forms [2d Ed.], No. 306.) his attorney, hereby excepts to the specifications of objection filed to the confirmation of his proposed herein by 1. He excepts to the first of said specifications of objection as indefinite, insufficient in law and as constituting no ground under the Bankruptcy Act and the amendments thereof, for withholding confirmation of the proposed composition. 2. He excepts to the second of said specifications on the ground that there are no specific averments of fact from which an issue may. be raised and tried. Wherefore this exceptant asks that said specifications be dismissed. Attorney for Bankrupt. City of... Form No. 360 ORDER OF REFERENCE TO SPECIAL MASTER IN COMPOSITION In the District Court of the United States for the District of IN THE MATTER OF Bankrupt. In Bankruptcy No. Whereas, application has been made for the confirmation of a composition offered by the above-named bankrupt and a hearing set to consider the same, and bankrupt, having appeared by a creditor of said Esq., his attorney, and filed a specification of objection to such confirmation; now, on motion of .. .... It is ordered: Esq., attorney for ... That the issue made by such application and such specification of objection be referred to Esq., as special master, to ascertain and report the facts, with his conclusions thereon. This form will not be used if the judge determines to hear the matter himself. See § 12, generally, and the foot-notes to forms just ante and post. Form No. 361 REPORT OF SPECIAL MASTER IN COMPOSITION In the District Court of the United States for the of . IN THE MATTER OF ... District On receipt of said order, I set the .... day of at ...... o'clock, M., at .... in the ......... 19..., do hereby said district, as the time and place at which such reference should be. proceeded with, and notified the respective attorneys; that, at such time and place, the bankrupt was represented by.... Esq., his attorney, and the objecting creditor by 3 Esq., his attorney, and that there were the following additional appearances:.. That, thereafter, the proceedings were as indicated in the recordbook of such reference, which, with the testimony taken and the depositions used, is handed up herewith. 3. If there were no additional appearances strike this out. |