In Re Lancaster, 38 F. Supp. 318 (W.D. Mo. 1941)

US District Court for the Western District of Missouri - 38 F. Supp. 318 (W.D. Mo. 1941)
March 21, 1941

38 F. Supp. 318 (1941)

In re LANCASTER.

No. 16369.

District Court, W. D. Missouri, W. D.

March 21, 1941.

Conger R. Smith, of Kansas City, Mo., for petitioner.

Harry B. Jenkins, of Kansas City, Mo., for creditor.

REEVES, District Judge.

The question for review is whether a proceeding under Chapter 13 of the Bankruptcy Act, 11 U.S.C.A. § 1001 et seq., referring to the general subject of wage earners' plans, should be expanded to relieve a surety or guarantor of a debtor from his liability.

Under the general bankruptcy law, and particularly by Section 34, Chapter 3, Title 11 U.S.C.A., it is provided as follows: "§ 34. Co-debtors of bankrupts. The liability of a person who is a co-debtor with, or guarantor or in any manner a surety *319 for, a bankrupt shall not be altered by the discharge of such bankrupt."

When the Congress enacted the statutes pertaining to wage earners' plans, Section 1002, Title 11, specifically provided as follows: "The provisions of chapters 1 to 7, inclusive, of this title shall, insofar as they are not inconsistent or in conflict with the provisions of this chapter, apply in proceedings under this chapter."

While there are limited exceptions in said Section 1002, yet Section 34, supra, is not one of them. It was clearly the intention of the Congress to make applicable to proceedings under said Chapter 13 the specific provisions of Section 34. Such section does not have to be construed. It simply states that the liability of a co-debtor, guarantor or surety for "a bankrupt shall not be altered by the discharge of such bankrupt."

The referee properly dissolved his injunction restraining the creditor from proceeding against the surety. His act in so doing is approved, and his order is confirmed.