US SUPREME COURT DECISIONS

1. Assuming that a shipper's claim for moneys collected from him by a railroad through excessive charges might be entitled to preferential chanrobles.com-red

Page 274 U. S. 305

payment from receivers of the railroad, subsequently appointed, if the moneys were traced into their hands, they are not so traced by showing that, for years which elapsed between the time of the overcharges and the transfer of the railroad property from the receivership to a new company, the old company and the receivers had at all times, in banks on which checks for current expenses were drawn, an aggregate working balance largely exceeding the claim. P. 274 U. S. 309.

2. The equitable doctrine giving preferential payment out of operating income accruing during a railroad receivership to debts previously incurred by the railroad corporation for labor, supplies, etc., does not apply to liabilities for excess charges illegally exacted of a shipper which accrued many years before the receivership began. P. 274 U. S. 310.

3. A claim to recover excess transportation charges which arose many years before the property of the railroad making them went into the hands of receivers and passed to a new company cannot be allowed preferential payment on the ground of public policy. P. 274 U. S. 311.

4. A provision in a decree foreclosing a railway mortgage which exempted the purchaser from paying claims not already presented in accordance with orders theretofore made, excepting claims which might "arise" after entry of the decree, is to be construed as employing the term "arise" in the sense of "accrue," and a claim for overcharges against the mortgagor railroad arose in that sense at least as early as the time when the claimant obtained his reparation order from the Interstate Commerce Commission, and not when judgment was recovered upon the order. P. 274 U. S. 312.

5. An unsecured creditor of an insolvent railroad has no standing to attack a reorganization plan upon the ground that he was not offered an opportunity to participate, when his exclusion was due to his own failure to file his claim in the foreclosure suit within the time limited by an order. P. 274 U. S. 313.

6. In this connection, it is immaterial that the excluded creditor had no actual knowledge of the order limiting time for filing claims, notice by publication being legally sufficient; nor did the fact that his claim was being contested in other litigation prevent him from filing it on time. P. 274 U. S. 313.

7. Where an unsecured creditor of a railroad prosecuted his claim diligently in an independent suit before and after the railroad passed into a receivership and was sold to a new company pursuant to a plan of reorganization, during which period his suit was chanrobles.com-red

Page 274 U. S. 306

resisted by the railroad, the receivers, and counsel for the new company, successively, and where, having recovered judgment after the sale, he appeared at the hearing on the order to. confirm the sale and gave notice to the old company, the receivers, the reorganization committee, and the new company of his claim and that the judgment would be a charge on the property in the hands of the purchaser, notwithstanding which the new company continued defending his suit and the new securities were issued, held that the creditor was not guilty of laches; that his failure to file his claim within the time limited in the foreclosure case, and thus conform to the terms of the reorganization plan, did not bar him from participating in its benefits with the other unsecured creditors, if that were still equitably possible, and that such relief might be had as well upon an intervening petition as upon an original bill. P. 274 U. S. 314.

14 F.2d 284 reversed in part, affirmed in part.

Certiorari (273 U.S. 680) to a decree of the circuit court of appeals which reversed a decree of the district court dismissing an intervening petition in a railroad foreclosure suit. chanrobles.com-red

Page 274 U. S. 307