Referee in Bankruptcy
Encyclopedia
A Referee in Bankruptcy or Bankruptcy Referee is a federal official with quasi-judicial powers, appointed by a United States district court
to administer bankruptcy
proceedings. The office was first created by the Bankruptcy Act of 1898
, and was substantially altered by the Bankruptcy Reform Act of 1978, which created separate United States bankruptcy court
s with permanently assigned judge
s.
All three earlier, short-lived acts providing for bankruptcy jurisdiction in the federal courts had made provision for the appointment of officers to assist in the administration of bankruptcy cases. The act of 1800 (2 Stat. 19, repealed in 1803) authorized district judges to appoint commissioners with various powers to declare a person a bankrupt, to take possession of a bankrupt's estate, and to assign the bankrupt's property. The next bankruptcy act, in 1841 (5 Stat. 440, repealed in 1843), provided for the appointment of commissioners to receive proof of debts and carry out other administrative duties related to bankruptcy cases. The act (14 Stat. 517) that governed federal bankruptcy from 1867 to 1878 instructed district judges to appoint registers in bankruptcy, who would be nominated by the Chief Justice and assist the judges in a wide range of tasks related to bankruptcy proceedings.
Bankruptcy referees appointed under the act of 1898 performed a wide range of judicial and administrative functions during the early part of the twentieth century, including the following: the consideration and adjudication of bankruptcy petitions submitted to the district courts; the examination of property schedules and lists of creditors filed by bankrupts; the administering of oaths and depositions to witnesses in bankruptcy proceedings; the maintenance of the records in such proceedings and the transmission of such records to the clerk of court; and the distribution of the property of bankrupts in cases where the district court judge was absent. Referees' decisions on substantive matters were subject to review by the district court.
Such duties made each referee a combination of special master and estate administrator until the late 1930s, when Congress transferred many of their administrative functions to bankruptcy trustees or clerks of court and increased the referees' judicial functions. The Chandler Act of 1938 (52 Stat. 840) granted referees the authority to adjudicate petitions referred to them, to administer oaths and examine witnesses, and to act for the judge in certain instances.
In 1946 Congress provided a fixed salary for referees, increased their tenure from two to six years, and limited the circumstances under which they could be removed from office to incompetence, misconduct, or neglect of duty. In 1973 the Supreme Court acknowledged the increasingly judicial nature of the referees' work when it prescribed a set of bankruptcy rules that employed the term "bankruptcy judge" interchangeably with "referee". In the Bankruptcy Reform Act of 1978 (92 Stat. 2657) Congress abolished the office of bankruptcy referee and established bankruptcy judgeships to serve separate bankruptcy courts in each judicial district. While these judges assumed the referees' judicial duties, the remaining administrative functions in most districts were transferred to trustees whose offices were placed under the supervision of the Department of Justice.
United States district court
The United States district courts are the general trial courts of the United States federal court system. Both civil and criminal cases are filed in the district court, which is a court of law, equity, and admiralty. There is a United States bankruptcy court associated with each United States...
to administer bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
proceedings. The office was first created by the Bankruptcy Act of 1898
Bankruptcy Act of 1898
The Bankruptcy Act of 1898 was the first United States Act of Congress involving Bankruptcy that gave companies an option of being protected from creditors...
, and was substantially altered by the Bankruptcy Reform Act of 1978, which created separate United States bankruptcy court
United States bankruptcy court
United States bankruptcy courts are courts created under Article I of the United States Constitution. They function as units of the district courts and have subject-matter jurisdiction over bankruptcy cases. The federal district courts have original and exclusive jurisdiction over all cases arising...
s with permanently assigned judge
Judge
A judge is a person who presides over court proceedings, either alone or as part of a panel of judges. The powers, functions, method of appointment, discipline, and training of judges vary widely across different jurisdictions. The judge is supposed to conduct the trial impartially and in an open...
s.
History
The Bankruptcy Act of 1898 (30 Stat. 544) established the position of bankruptcy referee "to assist in expeditiously transacting the bankruptcy business". The act specified that referees were to be appointed by the district court for a term of two years, although they could be removed from office or have their jurisdiction over a particular case revoked at any time. The courts could appoint the referees in such numbers "as may be necessary". The fees paid by petitioners in bankruptcy proceedings were used to compensate the referees.All three earlier, short-lived acts providing for bankruptcy jurisdiction in the federal courts had made provision for the appointment of officers to assist in the administration of bankruptcy cases. The act of 1800 (2 Stat. 19, repealed in 1803) authorized district judges to appoint commissioners with various powers to declare a person a bankrupt, to take possession of a bankrupt's estate, and to assign the bankrupt's property. The next bankruptcy act, in 1841 (5 Stat. 440, repealed in 1843), provided for the appointment of commissioners to receive proof of debts and carry out other administrative duties related to bankruptcy cases. The act (14 Stat. 517) that governed federal bankruptcy from 1867 to 1878 instructed district judges to appoint registers in bankruptcy, who would be nominated by the Chief Justice and assist the judges in a wide range of tasks related to bankruptcy proceedings.
Bankruptcy referees appointed under the act of 1898 performed a wide range of judicial and administrative functions during the early part of the twentieth century, including the following: the consideration and adjudication of bankruptcy petitions submitted to the district courts; the examination of property schedules and lists of creditors filed by bankrupts; the administering of oaths and depositions to witnesses in bankruptcy proceedings; the maintenance of the records in such proceedings and the transmission of such records to the clerk of court; and the distribution of the property of bankrupts in cases where the district court judge was absent. Referees' decisions on substantive matters were subject to review by the district court.
Such duties made each referee a combination of special master and estate administrator until the late 1930s, when Congress transferred many of their administrative functions to bankruptcy trustees or clerks of court and increased the referees' judicial functions. The Chandler Act of 1938 (52 Stat. 840) granted referees the authority to adjudicate petitions referred to them, to administer oaths and examine witnesses, and to act for the judge in certain instances.
In 1946 Congress provided a fixed salary for referees, increased their tenure from two to six years, and limited the circumstances under which they could be removed from office to incompetence, misconduct, or neglect of duty. In 1973 the Supreme Court acknowledged the increasingly judicial nature of the referees' work when it prescribed a set of bankruptcy rules that employed the term "bankruptcy judge" interchangeably with "referee". In the Bankruptcy Reform Act of 1978 (92 Stat. 2657) Congress abolished the office of bankruptcy referee and established bankruptcy judgeships to serve separate bankruptcy courts in each judicial district. While these judges assumed the referees' judicial duties, the remaining administrative functions in most districts were transferred to trustees whose offices were placed under the supervision of the Department of Justice.
Further Reading
- Prudence Carter Beatty and Andrew DeNatale, "From Referee in Bankruptcy to Bankruptcy Judge: A Century of Change in the Second Circuit", in The Development of Bankruptcy and Reorganization Law in the Courts of the Second Circuit of the United States (New York: Matthew Bender & Company, 1995).
Attribution
- Material on this page was copied from the website of the Federal Judicial CenterFederal Judicial CenterThe Federal Judicial Center is the education and research agency of the United States federal courts. It was established by an Act of Congress in 1967, at the recommendation of the Judicial Conference of the United States....
, an agency of the United States whose works are in the public domainPublic domainWorks are in the public domain if the intellectual property rights have expired, if the intellectual property rights are forfeited, or if they are not covered by intellectual property rights at all...
. The original is available here.