Rule 725.

726.

727.

728.

729.

Substitution of Parties.

General Provisions Governing Discovery.

Depositions Before Adversary Proceedings or Pend-
ing Appeal.

Persons Before Whom Depositions May Be Taken.
Stipulations Regarding Discovery Procedure.

730. Depositions upon Oral Examination.

Depositions upon Written Questions.

Use of Depositions in Adversary Proceedings.
Interrogatories to Parties.

Production of Documents and Things and Entry
upon Land for Inspection and Other Purposes.
Physical and Mental Examination of Persons.
Requests for Admission.

Failure to Make Discovery: Sanctions.
Dismissal of Adversary Proceedings.

Consolidation of Adversary Proceedings; Separate
Trials.

744.1 Determination of Foreign Law.

731.

732.

733.

734.

735.

736.

737.

741.

742.

752. Findings by the Court.

754. Judgments; Costs.

Summary Judgment.

770. Judgment for Specific Acts; Vesting Title.

Rule 1. Scope of Bankruptcy Rules and Forms; Short Title.

The rules and forms in this Title I govern the procedure in courts of bankruptcy in bankruptcy cases under Chapter I-VII of the Bankruptcy Act. These rules may be known and cited as the Bankruptcy Rules. These forms may be known and cited as the Official Bankruptcy Forms.

NOTES OF ADVISORY COMMITTEE ON RULES

A "bankruptcy case," as defined in Rule 101, is one wherein a petition has been filed by or against a person seeking his adjudication as a bankrupt. The case includes all of the proceedings and matters which arise in connection with the case and of which the court of bankruptcy is given jurisdiction by Chapters I-VII of the Bankruptcy Act. These rules and forms in this Title I thus do not apply to a case initiated or ordered to proceed under any of the debtor-relief chapters of the Act. The rules and forms to Title VII govern the procedure in Chapter XIII cases, and Titles II-VI are reserved for cases that are commenced or proceed under Chapters VIII-XII of the Act. These rules do not prescribe except incidentally the procedure for actions or "plenary proceedings" brought in state courts or federal district courts to determine controversies that arise in connection with a bankruptcy

case.

"Courts of bankruptcy" are defined in § 1(10) of the Bankruptcy Act, 11 U.S.C. § 1(10), to "include the United States district courts and the district courts of the Territories and possessions to which this Act is or may hereafter be applicable." (References to the Bankruptcy Act hereinafter will be to the Act and will omit citations to Title 11 of the United States Code.) The courts of bankruptcy clearly include the district courts of Guam and the Virgin Islands. 1 Collier, Bankruptcy ¶ 1.10, at 71-72 n.22 (14th ed.rev. 1968), citing relevant statutory provisions. (Hereinafter citations to the Collier treaties will omit the title and reference to the edition but will include the date of the revision of the cited material.) It is problematical whether the District Court for the District of the Canal Zone is a bankruptcy court, but it appears that this court has not undertaken to act as a court of bankruptcy. 1 Collier, supra at 72.

Rule 101. Commencement of Bankruptcy Case.

A bankruptcy case is commenced by filing a petition with the court by or against a person for the purpose of obtaining his adjudication as a bankrupt.

NOTES OF ADVISORY COMMITTEE ON RULES

A Proceeding initiated by a petition for an adjudication under the Bankruptcy Act is designated a "bankruptcy case" for the purpose of these rules. The term embraces all the controversies determinable by the court of bankruptcy and all the matters of administration arising during the pendency of the case. This usage of the word "case" conforms to that employed in many provisions of the Bankruptcy Act. See, e.g., §§ 22, 32, 39b, 40c, 42, and 59d. The word "proceeding" as used in these rules generally refers to a litigated matter arising within a case during the course of administration of an estate. See particularly Rule 703. The rule assumes the continuing applicability of the definition of “petition" in § 1(24) of the Act, but as used in the rules in this title, the word refers to the document commencing a bankruptcy case. The place of filing a petition is more fully particularized in Rule 509.

Rule 102. Reference of Cases; Withdrawal of Reference and Assignment.

(a) Reference.

Upon the filing of a petition the clerk shall refer the case forthwith to a referee or, if a local rule so provides, to more than one referee concurrently. Thereafter all proceedings in the case shall be before the referee except as otherwise provided by subdivision (b) of this rule, by Rules 115(b), 409 (c), and 920, by § 2a (15) of the Act when a complaint seeks an injunction to restrain a court, by § 43c of the Act when the office of the referee is vacant, and by the provisions in the Act and the rules in Part VIII governing appeals from judgments of the referee.

(b) Withdrawal of Reference and Assignment.

The district judge may, at any time, for the convenience of parties or other cause, withdraw a case in whole or in part from a referee and either act himself or assign the case or part thereof to another referee in the district.

NOTES OF ADVISORY COMMITTEE ON RULES Subdivision (a). The first sentence of subdivision (a) of this rule is derived from § 22a of the Act but deletes the clause authorizing the judge or judges to modify the provision for automatic reference. The practice, which has become established in some districts under § 22a of the Act, of referring cases concurrently to 2 or more referees of the court is recognized as proper by this rule.

The second sentence of subdivision (a) is adapted from General Order 12(1). A district judge may act in a bankruptcy case only when he withdraws a case from the referee pursuant to subdivision (b); when the office of the referee becomes vacant as provided in § 43c of the Act; when jury trial before a judge is demanded pursuant to Rule 115(b); when the trial of an issue is placed on the jury calendar of the district court pursuant to Rule 409 (c); when the district judge hears and determines issues under Rule 920 on a certification that contempt has been committed; when a complaint seeks injunctive relief against another court, which may be granted under § 2a (15) of the Act only by the judge; and when a judgment of the referee is being reviewed on appeal pursuant to §§ 2a (10) and 39c of the Act. The rules in Part VIII govern the procedure on review by the district judge of judgments of the referee. Sections 24a and b of the Act and the Federal Rules of Appellate Procedure govern the procedure on appeals to the courts of appeals, and § 24c of the Act and the Rules of the Supreme Court of the United States apply to review of judgments by that Court in bankruptcy cases. As pointed out in the Note to Rule 701, these rules do not govern plenary actions in the district courts of the United States or in the state courts.

Subdivision (b) consolidates the provisions for transfer of a case from one referee to another in § 22b of the Act and for withdrawal of a reference in § 43c of the Act. The withdrawal and reassignment may be on motion or on the court's own initiative. Cause for withdrawal of a reference includes the statutory grounds specified in § 43c, viz., temporary absence or disqualification of the referee and the need for expediting the business of the court. As noted above, § 43c continues to govern the situations in which a referee's office is vacant. Subdivision (b) makes explicit what is implied by the statutory provisions, viz., that the judge may assign or withdraw a part as well as the whole of a case from a referee. See In re Press Printers & Publishers, Inc., 12 F.2d 660, 664-65 (3d Cir. 1926), cert. denied, 276 U.S. 633 (1928). If the reason for assignment or withdrawal ceases to be operative, the case or proceeding may be remanded to the same referee. In district courts having more than one judge the authority conferred by this rule should be exercised according to the rules and orders of the court as provided by 28 U.S.C. § 137.

Subdivision (b) governs only the assignment of a case or proceeding to a referee within the territorial jurisdiction of the court. Cf. In re Schenectady Engineering &

Construction Co., 147 Fed. 868 (N.D.N.Y. 1906). The transfer of a case to another district is dealt with in Rule 116 and the transfer of an adversary proceeding to another district is governed by Rule 782. Section 43c of the Act governs the assignment of a referee from without the district.

Rule 103. Voluntary Petition.

A voluntary petition shall conform substantially to Official Form No. 1. An original and 2 copies of the petition shall be filed, unless a different number of copies is required by local rule.

NOTES OF ADVISORY COMMITTEE ON RULES Official Form No. 1 (Petition for Voluntary Bankruptcy) has been simplified and shortened but retains the essential features of the official form for a debtor's petition promulgated under former § 30 of the Act. Although no copy of a voluntary petition is required to be served on any adverse party, the rule continues the requirement of § 59c of the Act that the petition be filed in triplicate, but a local rule may modify the requirement. Only the original need be signed and verified, but the copies must be conformed to the original. See Rule 911 (c). The petition must be filed with the clerk as provided in Rule 509 (a). As provided in Rules 401 and 601, the filing of the petition acts as a stay of certain acts and proceedings against the bankrupt and his property.

Rule 104. Involuntary Petition.

(a) Form and Number.

An involuntary petition shall conform substantially to Official Form No. 9. An original and 2 copies of the petition shall be filed, unless additional copies are required by local rule.

(b) Participation in Act of Bankruptcy.

A creditor may not file or join in a petition alleging the commission of an act of bankruptcy other than the sixth act, if he consented to, participated in, or secured the commission of the act alleged. Notwithstanding the foregoing, if a creditor, without inducing it, participated in any general assignment, receivership, or other mode of adjustment or settlement of the affairs of the debtor and did not consent in writing thereto, or if he did so consent but without knowledge of facts which would constitute commission of the first, second, or third act of bankruptcy or which would be a bar to the discharge of the debtor in bankruptcy, he may nevertheless act as a petitioning creditor and may allege any act of bankruptcy including such assignment or receivership.

(c) Particularity of Allegations.

The facts constituting an act of bankruptcy shall be alleged with sufficient particularity to identify the transaction or occurrence.

(d) Transferor or Transferee of Claim.

A person who has transferred or acquired a claim for the purpose of commencing a bankruptcy case shall not be a qualified petitioner. A petitioning creditor who is a transferor or transferee of a claim, whether transferred unconditionally, for security, or otherwise, shail annex to the original and each of the 2 copies of the petition a copy of all documents evidencing the transfer, and a signed statement setting forth the consideration for and terms of the transfer and that the claim was not transferred for the purpose of commencing a bankruptcy case.

(e) Joinder of Petitioners After Filing. Creditors other than the original petitioners may join in an involuntary petition at any time before its dismissal. If the answer to an involuntary petition filed by one or 2 creditors avers the existence of 12 or more creditors, the alleged bankrupt shall file with the answer a list of all his creditors with their addresses, a brief statement of the nature of their claims, and the amounts thereof. If it appears that there are 12 or more creditors as counted under § 59e of the Act, the court shall thereupon afford a reasonable opportunity for other creditors to join in the petition before a hearing is held thereon.

NOTES OF ADVISORY COMMITTEE ON RULES Subdivision (a). Official Form No. 9 (Creditors' Petition for Bankruptcy), prescribed for use by creditors as petitioners to have a debtor adjudged an involuntary bankrupt, is a revision of the official form for an involuntary petition promulgated under former § 30 of the Bankruptcy Act. A petition by fewer than all the general partners to have a partnership adjudged bankrupt is governed by Rule 105(b). The requirement of § 59c of the Act that the petition be filed in triplicate is continued, although under the bankruptcy docket and case reporting system in cffect since January 1, 1963, the clerk of the United States district court typically sends to the referee all copies of the original petition and schedules. AOUSC Bulletin No. 506, dated Oct. 17, 1962, at p. 6. A local rule may require additional copies. One copy of the petition is served on the bankrupt pursuant to Rule 111, another is retained by the referee as part of the record of the case, and the third copy, together with the schedules and the statement of affairs, is for the trustee. If, as in some districts where there is a geographical separation of the clerk's and referee's offices, the judges require the clerk to retain a copy of the petition and schedules, the rule recognizes the validity of a variant local rule requiring an additional copy. Only the original need be signed and verified, but the copies must be conformed to the original. See Rule 911 (c). The petition must be filed with the clerk as provided in Rule 509 (a). As provided in Rules 401 and 601, the filing of the petition acts as a stay of certain acts and proceedings against the bankrupt and his property.

Subdivision (b) is substantially a statement of the case law on the effect of participation by a petitioner in an act of bankruptcy, as supplemented by § 59h of the Act. See 3 Collier ¶ 59.39 (1964); MacLachlan, Bankruptcy § 60 (1956); Anno., 6 A.L.R.3d 476 (1966). The provision in the second sentence relieving a petitioner from the disqualification otherwise imposed by participation in an adjustment or settlement when such participation was without knowledge of the commission of one of the first three acts of bankruptcy may go beyond existing law, but it is supported by the rationale of the cases. See, e.g., In re Thomas, 211 F Supp. 187, 191 (D.Colo. 1962), aff'd sub nom. Thomas v. Youngstown Sheet & Tube Co., 327 F.2d 667 (10th Cir.), cert. denied, 379 U.S. 827 (1964); Dinerman v. Bowley & Travers, Inc., 301 F.2d 464, 467 (2d Cir. 1962); In re Curtis, 94 Fed. 630, 632 (7th Cir. 1899).

Subdivision (c) is a statement of case law. See 1 Collier 113.106, 3.207 (1961; MacLachlan, Bankruptcy § 59 (1956). Compare Rule 8(b) of the Federal Rules of Civil Procedure, requiring particularity in all averments of fraud, discussed in 2 Moore, Federal Practice 19.03 (2d ed. 1948). (Hereinafter citations to the Moore treaties will omit the title and reference to the edition but will include the date of the revision of the cited material.) The amenability of the allegations of a petition respecting the commission of an act of bankruptcy to an amendment that will relate back to the date of the filing of the petition is governed by the case law construing Rule 15(c) of the Federal Rules of Civil Procedure, which is made applicable to such an amendment by Rule 121. See Dworsky v. Alanjay Bias Binding Corp., 182 F.2d 803, 805 (2d Cir. 1950); Glint Factors, Inc. v. Schnapp, 126 F.2 207 (2d Cir. 1942); 2 Collier 18.26 (1966); 3 Moore, [15.15[5] (1964).

Subdivision (d) is a revision of General Order 5(2). A signed statement of the petitioning creditor is made acceptable in lieu of the affidavit required by the general order, in line with the policy declared in Rule 911(b) and discussed in the Note accompanying that provision. The implication of the general order that a transfer for the purpose of commencing a bankruptcy case is a ground for disqualification of a party to the transfer as a petitioner is made explicit. Compare § 146(1) of the Act; Rule 23.1(1) of the Federal Rules of Civil Procedure. The subdivision requires disclosure of any transfer of his claim by the petitioner as well as a transfer to him and applies to transfers for security as well as unconditional transfers. Cf. In re 69th & Crandon Bldg. Corp., 97 F.2d 392, 395 (7th Cir.), cert.denied, 305 U.S. 629 (1938), recognizing the right of a creditor to sign a bankruptcy petition notwithstanding a prior assignment of his claim for the purpose of security. This rule does not, however, quality the requirement of § 59b of the Act that a petitioning creditor must have a provable claim not contingent as to liability. Subdivision (e) is derived from § 59d and f of the Act but does not include the provision of § 59d for notice by the court to all creditors. The interests of creditors are adequately protected by a provision requiring a reasonable opportunity for other creditors to join in the petition before the hearing is held. The list of creditors filed by the bankrupt affords a petitioner in such a case the information needed to enable him to give notice for the purpose of obtaining the copetitioners required to make the petition sufficient. The statutory requirement that the list be verified is eliminated pursuant to the policy expressed in Rule 911(b). It has been held that a creditor who desires to secure the administration of a debtor's estate in bankruptcy may properly solicit other creditors to join him in filing a petition. In re Kootenal Motor Co., 41 F.2d 403 (D.Idaho 1930); In re Smith, 176 Fed. 426, 435 (N.D.N.Y. 1910). After a reasonable opportunity has been afforded for other creditors to join in an involuntary petition, the hearing on the petition should be held without further delay. The last sentence of § 59d is omitted from the rule as unnecessary.

Rule 105. Partnership Bankruptcy. (a) Voluntary Petition.

A voluntary petition may be filed by all the general partners on behalf of the partnership.

(b) Partner's Petition Against Partnership.

A petition may be filed by fewer than all the general partners to have a partnership adjudged bankrupt under § 5b of the Act. An original and 2 copies of the petition shall be filed under this subdivision, but if more than one general partner does not join in the petition, an additional copy for each such partner shall be filed. The petition for adjudication of the partnership may be contested by any general partner (or alleged general partner) who is not a petitioner.

(c) Involuntary Petition by Creditors.

An involuntary petition may be filed by creditors against a partnership. Within 5 days after the filing, the petitioning creditors shall cause a copy of the petition to be sent by certified mail to the last known address of or to be delivered to, each general partner who has not been served.

(d) Petition When All General Partners Are Adjudicated.

If all the general partners of a partnership are adjudged bankrupt, any party in interest may file a petition in any court in which a partner's bankruptcy case is pending to have the partnership adjudged bankrupt.

NOTES OF ADVISORY COMMITTEE ON RULES This rule is derived from subdivisions a, b, and 1 of § 5 of the Act and authorizes 4 types of petitions to have a

partnership adjudged bankrupt. The joint petitions authorized by § 5 of the Act are abolished by this rule. The statutory provisions for this kind of petition have caused confusion as to the filing fees chargeable and the manner of preparing schedules and statements of affairs. The advantages of joint administration of partnership and partners' estate where that is feasible are obtainable under Rule 117. Subdivision (d) is an elaboration of the first sentence of § 51 of the Act. See Kennedy, A New Deal for Partnership Bankruptcy, 60 Col. L. Rev. 610, 646-49 (1960). The duty to prepare and file schedules and the statement of affairs for the partnership adjudicated on a petition filed under this rule rests on the general partners See Rule 108 (c).

Rule 106. Caption of Petition.

The caption of every petition shall comply with Rule 904(b). In addition the title of the case as set forth in the caption shall include the name of the bankrupt and all other names used by him within 6 years before the filing of the petition. If the petition is not filed by the bankrupt, the petitioners shall include such other names according to their best information.

NOTES OF ADVISORY COMMITTEE ON RULES

The second and third sentences of this rule adopt a feature found in some local rules. See, e.g., N.D. Ill. Bankr R. 5(B) (2); S.D. & ED. N.Y. Bankr. R. 1(b). Additional names of the bankrupt are also required to appear in the caption of each notice to creditors. See Rule 203 (1).

Rule 107. Filing Fees.

(a) General Requirement.

Except as otherwise provided in subdivision (b), every petition shall be accompanied by the prescribed filing fees.

(b) Payment of Filing Fees in Installments.

(1) Application for Permission to Pay Filing Fees in Installments. A voluntary petition shall be accepted for filing by the clerk of the district court if accompanied by an application signed by the petitioner for permission to pay the filing fees in installments. The application shall state that the applicant is unable to pay the filing fees except in installments, the proposed terms of such installment payments, and that the applicant has paid no money and transferred no property to his attorney for services in connection with the case. The application shall be filed in duplicate, one copy for the clerk and one for the bankruptcy judge.

(2) Action on Application. At or prior to the first meeting of creditors, the court after a hearing may make an order permitting the payment of the filing fees in installments to the clerk of the district court, and fixing the number of installments and the amount and date of payment of each installment. The number of installments permitted shall not exceed 4, and the final installment shall be payable not later than 4 months after the filing of the petition. For cause shown, however, the court may extend the time for payment of any installment to a date not later than 6 months after the date of filing of the petition.

(3) Postponement of Attorney's Fees. Filing fees must be paid in full before the bankrupt may pay his attorney for services in connection with the case.

NOTES OF ADVISORY COMMITTEE ON RULES Subdivision (a). Filing fees for bankruptcy cases are prescribed by §§ 40c(1), 48c, and 52a of the Act. Additional fees and charges may be prescribed in accordance with