Opinion
F. Joseph Thomas, of Meadville, Pa., for trustee.
Herbert A. Mook, of Meadville, Pa., for bankrupt.
Premo J. Columbus, Asst. U.S. Atty., of Pittsburgh, Pa., for United States Department of Agriculture.
GIBSON, District Judge.
The United States Department of Agriculture, Farm Security Administration, has caused the Order of Distribution of the Referee to be certified for review.
The Department was the holder of liens against the property of the Bankrupt which aggregated an amount greater than the amount of the property as shown by the Bankrupt's Schedules. Based upon this fact, the Department claims that the property should have been disclaimed by the Trustee in Bankruptcy, but, that action not having been taken and sale made, nothing can be deducted from the purchase price except the expenses of sale. In other words, the cost of maintaining the property prior to sale and administrative expenses must be subordinate to the claim of the Department.
From the record it appears that the Department was benefitted by the bankruptcy proceeding. When it was instituted the property in question was under a levy of the State Court, with loss imminent to all concerned. Whether a bankruptcy court shall sell property in a situation such as existed in the present matter, is a question of discretion. In the instant matter it was no abuse of that discretion to preserve the property which was threatened, and to sell it under proper conditions. This being so, the order of the Referee will be sustained and the exceptions thereto dismissed.