Perry v. Commerce Loan Company

RESPONDENT: Commerce Loan Company
LOCATION: Where Penn was killed

DECIDED BY: Warren Court (1965-1967)
LOWER COURT: United States Court of Appeals for the Sixth Circuit

CITATION: 383 US 392 (1966)
ARGUED: Jan 26, 1966
DECIDED: Mar 07, 1966

Facts of the case


Media for Perry v. Commerce Loan Company

Audio Transcription for Oral Argument - January 26, 1966 in Perry v. Commerce Loan Company

Earl Warren:

Number 694, Perry versus Commercial Loan Company -- Commerce Loan Company.

Mr. Harris. Oh, we'll wait just a moment until counsel is ready.

Now, Mr. Harris you may proceed with your argument.

Robert J. Harris:

Mr. Chief Justice and members of the Court.

This matter known as In re Perry comes for this Court to review the judgment of the Circuit Court of Appeals of the Sixth Circuit which judgment was entered on the 25th of January, 1965.

Writ of certiorari was filed here and granted on October 25, 1965.

If it please the Court, there's really no -- there's no question involved here except one very simple claim.

The issues can be resolved to one issue.

Can a wage earner be permitted to file a Chapter XIII proceeding wherein he asks for an extension of time to pay his bills in full, when he has received a prior discharge in straight bankruptcy within six years of filing the extension plan under the Chapter XIII?

Now it's important to the issue to distinguish between a composition and an extension and I mean a wage earner plan by way of composition or wage earner plan by way of extension because provision is made for both proceedings under the Chapter XIII Act, but whether this is a -- for the fact that this is an extension plan, is of primary importance, the decision of this case.

Composition of course is where the debtor would say, “I can't pay my debts in full.

I propose to pay so much on a dollar -- 50 cents, 75 cents on a dollar.

The creditors will go along with me and consent to it, then within the time limits of a Chapter XIII Act of three years.

I could pay off 50 to 75 cents on a dollar,” that's a composition.

He has been paying his debts in full.

An extension plan is where the debtor says to the court, “I want to pay my bills in full, a 100%, I want to pay my secured creditors a 100%, my unsecured creditors a 100%, all I want is time.

I want a three-year period or less in some cases to pay my bills in full.

I want the protection of the court, stay suits against me and garnishments, so that I hold my job and pay my debts,” that's what an extension plan is.

Now that's what Perry filed in the District Court for the Eastern District of Kentucky.

He filed a wage earner plan in which he said, “I owe about $1,400 and I want to pay them -- my debts in full both secured and unsecured creditors.

I make so much money a month and I have to pay my rent, food, utilities, and transportation, and etcetera.

I have $60 left and this $60 a month was taken out of my wages or will pay my debts in less than the three-year period, in fact about 28 months.”

And he asked the court, the referee in bankruptcy to confirm the plan.

But a motion was filed by one of the secured creditors that had a mortgage on certain furniture, it was listed in the plan, it would have been paid in full.

The Commerce Loan objected to confirmation, filed a motion to dismiss and deny confirmation.

The referee sustained the motion, denied confirmation.

The matter was taken to the district judge.

The referee's opinion was affirmed subsequently it was taken to U.S. Circuit Court for the Sixth District and was affirmed, and we're here on this matter today.

Byron R. White:

And what was the -- what was the prior bankruptcy?

Robert J. Harris:

The prior bankruptcy was a straight bankruptcy filed about four and a half years prior to the wage earner petition.