no adjudication was made and no trustee appointed as in such case the title never left the bankrupt.691 Other matters dealing with the effect of a composition have already been considered.692

INDEXES AND SEARCHES OF CLERKS

§ 71. That the clerks of the several district courts of the United States shall prepare and keep in their respective offices complete and convenient indexes of all petitions and discharges in bankruptcy heretofore or hereafter filed in the said courts, and shall, when requested so to do, issue certificates of search certifying as to whether or not any such petitions or discharges have been filed; and said clerks shall be entitled to receive for such certificates the same fees as now allowed by law for certificates as to judgments in said courts: Provided, that said bankruptcy indexes and dockets shall at all times be open to inspection and examination by all persons or corporations without any fee or charge therefor.*

I. ADDITIONAL DUTIES OF CLERKS

This section was added by the amendatory act of 1903. It was not in the bill as introduced, but was originally inserted by the Judiciary Committee of the House of Representatives. The only explanation of it is found in the report1 accompanying the bill. The Senate Judiciary Committee modified it, but not in any important particulars. Clearly the section should be a subdivision of § 51. Indeed, its necessity may be doubted. The chief purpose seems to be to require clerks to keep bankruptcy indices; this was already the practice in most of the districts. The provisions for certificates as to petitions and discharges seem to duplicate general provisions of law long enforced. The proviso clause is perhaps aimed at the practice of excluding the public from the clerk's files and records in vogue in some quarters. The provisions of the section are all new. They are carefully phrased, and do not require further comment. Under the rule phrased in § 19 of the amendatory act of 1903, this section affects only cases begun on or after February 5, 1903.

* This section was added by the amendatory act of 1903.

1. See House Report, No. 1,698, 57th Congress, first session.

The last amendment is one generally demanded, and is in the interest of all persons who deal with property. It requires the clerks to prepare and keep indexes of all petitions and discharges in bankruptcy and to issue certificates in relation thereto when

required. It also requires that these be kept open to inspection and examination. It is frequently desirable to know whether a person has filed a petition in bankruptcy, and also whether he has been discharged, and it is many times impossible within a reasonable time to ascertain these facts in the absence of convenient indexes.

SECTION SEVENTY-TWO

LIMITATION ON FEES OF CERTAIN OFFICERS

§ 72. That neither the referee, receiver, marshal, nor trustee, shall in any form or guise receive, nor shall the court allow him, any other or further compensation for his services than that expressly authorized and prescribed in this act.*

Analogous provisions: In U. S.: None.

In Eng. Act of 1914, § 82; General Rule 103.

In Can.: Act of 1919, §§ 40, 67; General Rule 57.

Cross-references: To the law: §§ 1 (13), 2 (3) (7) (15), 3-e, 7 (4) (5), 12, 13, 14, 15, 47-a (2), 48, 60-b, 67-e, 69.

To the General Orders: XVIII, XXVIII.

To the Forms: Nos. 13, 43, 44, 45, 46, 172, 200.

SYNOPSIS OF SECTION

I. Limitation on Referees' and Trustees' Fees, 1788.

a. Scope of section, 1788.

b. Its effect, 1788.

c. Additional compensation for conducting business, 1789. d. Fees of special masters, 1790.

I. LIMITATION ON REFEREES' AND TRUSTEES' FEES

a. Scope of section. This section was added by the amendatory bill of 1903. It should be read in connection with §§ 40 and 48, and General Order XXXV (2) (3). It is a statutory ratification of the rule promulgated by the Supreme Court in the General Order just mentioned, which was perhaps too liberally interpreted in some districts and in others ran counter with antagonistic rules already in force at the time and Supreme Court orders became operative.

b. Its effect. The purpose of the law-making power in enacting

*This section was added by the amendatory act of 1903, and amended by the Amendatory Act of 1910.

this section was to forestall any of those scandals due to the fee system for compensating the officers mentioned which first made the law of 1867 odorous and then pointed the way to its repeal. Under the present law, the practice had grown up, and even in certain districts been ratified by rules, of permitting the referee to charge for specified services, as, for instance, a small sum for mailing each notice or a per diem for hearings and continuances, in addition to the fees allowed by the law; while devices to increase the trustee's compensation, either through larger allowance to his attorney or by a per diem for extra work, as, for instance, in managing a going business, were often resorted to and have been frequently defended as essential to the proper administration of the law. Doubtless with knowledge of these practices, and surely of the reasons for them, the law-making power has both increased the compensation of these officers,' and to guard against similar local rules in the future, has, in this section, riveted the rule that the same shall be full compensation. Clearly, hereafter, neither a referee nor a trustee can receive any compensation as such, save that "expressly authorized and prescribed in this act." Thus, the court is without power to allow special compensation to the referee, where a contested application for a discharge is refused under General Order 12,3 or to the trustee for services in investigating the bankrupt's disposition of property and the loss of his stock by fire.*

2

c. Additional compensation for conducting business.-"Additional compensation" can only be construed in relation to the fact that where a trustee is authorized to conduct the bankrupt business as a going concern he thereby receives extra compensation because he receives the commissions on all moneys disbursed by him in the conduct of such going concern, which includes moneys paid out for salaries and material necessary to the conduct of such business. This was not allowed to trustees previous to the amendment of 1903, the trustees then being only allowed compensations on sums paid out as dividends and commissions. It, therefore, appears that Congress, in the amendment referred to, by allowing commissions on all moneys

1. See Bankr. Act, §§ 40 and 48, also § 2 (3), all as amended by the Act of 1903.

2. Matter of Webster Loose Leaf Filing Co. (D. C., N. J.), 42 Am. B. R. 125, 252 Fed. 959; United States v. Ward (C. C. A., 8th Cir.), 43 Am. B. R. 711, 257 Fed. 352.

3. In re Wilcox (D. C., Mich.), 19

Am. B. R. 241, 156 Fed. 685; In re Coventry-Evans Furniture Co. (D. C., N. Y.), 22 Am. B. R. 623, 171 Fed. 673.

A contract for extra compensation has been held void as against public policy. Devries v. Orem (Ct. Appeals, Md.), 17 Am. B. R. 876, 65 Atl. 430.

4. In re Screws (D. C., Ga.), 17 Am. B. R. 269, 147 Fed. 989.

disbursed, intended to provide additional compensation to a trustee for conducting the bankrupt business as a going concern.5

d. Fees of special masters.-Although this section does not allow the referee to receive any further compensation for his services than as expressly authorized in the act, yet it has been the practice to allow compensation for services in the nature of masters' services outside of the duties of the referee." Here the rule of Fellows v. Freudenthal still pertains. References to the referee as such may, of course, be made under the authority of General Order XII (3). Such references are rare, for the reason that, the judicial service performed being by the statute limited to the judge, there is no provision for compensating the junior officer. References are, therefore, usually made, not under this order, but under the general power of the court to call to its assistance a master in chancery. While serving as such, the referee does not sit as referee, and would seem to have the same right to compensation as when appointed by the judge while sitting on any of the other sides of his court. The referee is in this simply an individual practitioner, who from experience and training is best qualified to pass on bankruptcy questions. The cases under the original law are, therefore, most of them still in point.s

5. Matter of Hart & Co. (D. C., Hawaii), 17 Am. B. R. 480.

Cross reference.- See also under section 2, ante, subtitle "Continuance of going business Compensation of re

ceiver or trustee."

Compensation of referee for conduct of business.-A referee who, without the express sanction of the court, authorizes the trustees, by order, to continue the bankrupt's business, for the purpose of completing partly executed contracts of the bankrupt, is not entitled to a commission of one per cent upon all funds paid out by the trustees in the conduct and administration of the business ordered to be continued, though in all that he did the referee was supported by the creditors and trustees and their counsel, and expended much time and performed great labor, showing the utmost fidelity to his trust throughout. Bray v. Johnson, 21 Am. B. R. 383, 166 Fed. 57.

6. Matter of Hart & Co. (D. C.,

Hawaii), 18 Am. B. R. 137; United
States v. Ward (C. C. A., 8th Cir.),
43 Am. B. R. 711, 257 Fed. 352, citing
Collier on Bankruptcy (11th ed.), 1184.

Rules of court.- Where, in a reclamation proceeding, the parties, through attorneys orally agreed, in the presence of the special master, that the fees and expenses of the master should be paid by the party to whom the property should be awarded, but did not fix the master's compensation, the amount is limited by the rules of the District Court which cannot be changed nunc pro tunc so as to grant a greater allowance. Matter of Growe Const. Co. (D. C., N. Y.), 42 Am. B. R. 654, 253 Fed. 981.

7. Fellows v. Freudenthal, 4 Am. B. R. 490, 102 Fed. 731.

8. Fellows v. Freudenthal, supra; In re McDuff, 4 Am. B. R. 110, 101 Fed. 241; Bragassa v. St. Louis Cycle, 5 Am. B. R. 700, 107 Fed. 77; In re Grossman, 6 Am. B. R. 510, 111 Fed. 507. See