FOLEY V. BLAIR & CO., INC., 414 U. S. 212 (1973)

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U.S. Supreme Court

Foley v. Blair & Co., Inc., 414 U.S. 212 (1973)

Foley v. Blair & Co., Inc.

No. 72-1154

Argued November 12, 1973

Decided December 5, 1973

414 U.S. 212


Respondent securities broker was adjudged an involuntary bankrupt for having committed the fifth act of bankruptcy under § 3a(5) of the Bankruptcy Act. This adjudication was reversed by the Court of Appeals, but subsequently the bankruptcy court, on a petition by the broker which had been filed shortly after the adjudication, confirmed the broker's proposed arrangement with creditors under Chapter XI of the Act.

Held: Where the issue of whether the confirmation of the Chapter XI arrangement renders the case moot because the petitioners no longer have a monetary stake in resolving whether the fifth act of bankruptcy had been committed, was briefed and argued before this Court, but, because of the sequence of events, was necessarily not treated in the Court of Appeals' opinion, the Court of Appeals should have the opportunity to consider such issue in the first instance, and, in doing so, it should consider the effect of § 64a(1) of the Act providing that "one reasonable attorney's fee" for services rendered to petitioning creditors in involuntary bankruptcy cases shall be treated as a priority debt.

471 F.2d 178, vacated and remanded.

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