Federal Priority Statute Gives United States Nontax Priority in Chapter X Corporate Reorganizations-United States v. Anderson
In a proceeding under Chapter X of the Bankruptcy Act for the reorganization of an insolvent corporation, the United States claimed first priority for nontax debts under the federal priority statute, Revised Statutes § 3466. The trustee of the corporation contested the claim to priority on the ground that section 199 of Chapter X, which in effect provides the United States in Chapter X proceedings with priority only for tax and customs claims, is exclusive and therefore R.S. § 3466 does not apply. The district court denied the claim to priority. On appeal to the Court of Appeals for the Fifth Circuit, held, reversed, one judge dissenting. R.S. § 3466 is operative to give all debts due to the United States priority in a Chapter X corporate reorganization proceeding.