In the Matter of Toula Freeman, AKA Toula Freeman Raasch, Toula Wig & Toula Enterprises, Bankrupt. Alfred Freeman v. George Ritner

Before MERRILL and HUFSTEDLER, Circuit Judges, and KELLEHER, District Judge.

In April, 1966, the bankrupt and her husband agreed that the latter should have, as a part of his share of their property in a divorce settlement, all of any federal income tax refund due to the couple as husband and wife or to either of them. Three-and-one-half years later, in August, 1969, a refund check in the sum of $10,301.47 was issued by the Government. By that time proceedings involving bankruptcy of the wife were pending and the check was taken over by the trustee. The referee ruled that the trustee had a qne-half interest in the refund. The husband sought review of that holding and the District Court reversed. This appeal was then taken by the trustee. We affirm.

It is conceded that the assignment by the bankrupt to her husband in 1966 was not in accordance with the Assignment of Claims Act, 31 U.S.C. § 203 . Failure to comply with the Assignment of Claims Act renders the assignment null and void so far as the United States is concerned. However, it does not render the assignment void as between the parties. In Martin v. National Surety Co., 300 U.S. 588 , 57 S.Ct. 531 , 81 L.Ed. 822…