City of Lincoln v. Ricketts, 297 U.S. 373 (1936)

Text

---

U.S. Supreme Court CITY OF LINCOLN, NEB. v. RICKETTS, 297 U.S. 373 (1936)

[Page 297 U.S. 373, 377]

ment of section 1a(6), the scope of the term 'corporations' was extended so as to include 'joint stock companies, unincorporated companies and associations.' Id. In view of the explicit inclusion of 'corporations' in the amendment of section 64b(7) and the evident intention shown by the context not to restrict the meaning of the term 'corporations,' the reasoning of the opinion in Davis v. Pringle cannot be regarded as apposite to the present case.

We conclude that a municipal corporation is a 'corporation' and hence a 'person' entitled to the priority accorded by section 64b(7).

There is a further question, which is one of state law. The preference under section 64b(7) is only in the case of 'debts owing to any person who by the laws of the States or the United States is entitled to priority.' The further question then is whether the City of Lincoln is entitled to priority under the law of Nebraska. The Circuit Court of Appeals did not determine that question. The court cited its decision as to the status of the City and County of Denver under the laws of Colorado ( City and County of Denver v. Stenger (C.C.A.) 295 F. 809; compare U.S. Fidelity & Guaranty Co. v. McFerson, 78 Colo. 338, 241 P. 728), and apparently assuming, without deciding, that the law of Nebraska accorded priority to the City of Lincoln, the court proceeded to base its decision in the instant case upon the inapplicability of section 64b(7) to a municipal corporation. The law of Nebraska was not discussed.

As we hold that the construction placed upon the Bankruptcy Act was erroneous, the cause will be returned to the Circuit Court of Appeals for the determination of the remaining issue as to local law.

The decree of the Circuit Court of Appeals is reversed, and the cause is remanded to that court for further proceedings in conformity with this opinion.

It is so ordered.

---