In the Matter of Robert Miles Knox v. Kal W. Lines, Trustee

In May, 1969, Knox filed a yoluntary petition in Bankruptcy. The District Court adjudged Knox bankrupt and appointed Lines as trustee. As the trustee, Lines was required, by Bankruptcy Gen. Order 17, to prepare a complete inventory of Knox’s property and to report to the court which assets were exempt and thus set off to the bankrupt. In making this report, on June 23, 1969, Lines disallowed Knox’s claim for a homestead exemption on certain property.

Under General Order 17, Knox had “ten days after the filing of the report, unless further time [was] granted by the court”, to object to Lines’ report. The ten-day period expired on July 3d, but no objection was filed until the next court day, July 7th. At that time, Knox challenged the denial of the claimed homestead exemption.

On September 8, 1969, a hearing before the bankruptcy referee was held to consider Knox’s objection. During the hearing, Lines moved to dismiss the objection. He argued that his report became final on July 3d and that the objection, since it was not timely filed, should not be considered. The referee granted the motion to dismiss, the District Court affirmed the dismissal, and this appeal followed.

Knox…