United States v. California

This is an appeal from an order of the District Court confirming an order of a referee in bankruptcy. The referee’s order was made after a hearing upon objections filed by the trustee in bankruptcy to certain claims against the bankrupt’s estate. The order recites that the adverse interests had notice and were represented at the hearing. Ten separate claims were affected by the order. As to eight claims the full amount was allowed; as to one partial payment was directed, and one was disallowed. The order established the respective priorities of the claims involved. A claim of Galen H. Welch, Collector of Internal Revenue, in the sum of $34,109.11 for income taxes 'due the United States was “allowed as a prior claim under the provisions of Section 64b, subsection 6 of the Bankruptcy Act of 1898 as amended [ 11 U.S.C.A. § 104 (b) (6)] * * * ” and the trustee was directed to pay to the Collector all sums remaining in his possession after the payment of the other eight claims as allowed. The remainder of the claims allowed were of two classes: “prior lien claims” for taxes, and “expenses of administration.” Of the claims designated “prior lien claims” several were filed by the State…