This case is here upon certificate from the circuit court of appeals for the sixth circuit.
From the statement in the certificate preceding the question asked of this court, it appears that Loving, trustee in bankruptcy of the Starks-Ullman Saddlery Company, filed a petition in the circuit court of appeals to revise in matter of law an order of the district court adjudging that the American-German National Bank of Paducah, Kentucky, had a lien under the statutes of Kentucky upon the property and effects of the bankrupt, in the sum of $10,125, and interest. The facts are stated as follows:
'On December 4, 1908, after the Saddlery Company had been adjudged a bankrupt, and the cause had been referred to the referee in bankruptcy, the bank filed before the referee its proof of claim, verified by its cashier, in which it alleged that the bankrupt was indebted to it in the sum of $11,125, evidenced by two notes, one for $2,000, dated April 20, 1908, and due four months after date, and the other for $8,000, dated July 25, 1908, and due two months after date, each of which provided for a reasonable attorneys' fee, and executed by the bankrupt for unmanufactured leather sold to it for use in carrying on its manufacturing business. After setting forth the nature of this indebtedness, the proof of claim concluded as follows: 'Deponent says that . . . by and under the provision of §§ 2487-2490 of the Kentucky statutes, the claimant has a lien upon all the property and effects of the bankrupt involved in its business, and upon all the accessories connected therewith, used in its business, to secure the payment of its said indebtedness; and deponent now asserts its claim and lien upon all such property and effects, to secure the payment of its said debt, including interest upon the notes from maturity thereof, and an attorneys' fee, as provided in said notes, of 10 per cent for the collection thereof by legal process.'
"Wherefore, the affiant prays that the claimant's debt be allowed as a lien claim against the assets of this bankrupt estate, and for all other proper and equitable relief.'
'The trustee in bankruptcy thereupon filed exceptions to the allowance of this claim in so far as it was made for any sum in excess of $10,000 at the time of the adjudication of bankruptcy, for various reasons set out in the exceptions, and also further objected and excepted to the allowance of any part of the said claim as a lien in favor of the bank against the estate of the bankrupt, for various reasons set forth in the exceptions. These exceptions of the trustee concluded as follows:
"Wherefore, he prays that said claim be disallowed as a lien against the property of the aforesaid bankrupt, and that it be allowed as a general claim only for the sum of two thousand ($2,000) dollars, with interest from August 20, 1908, and for eight thousand ($8,000) dollars, with interest from September 25, 1908."
The referee, having heard the case upon an agreed statement of facts, ordered that the exceptions of the trustee be overruled, and the claim of the bank was established and allowed as a lien against the estate of the bankrupt. The trustee in bankruptcy thereupon filed his petition for review of the order of the referee in the district court. The district court affirmed the order of the referee, and adjudged the claim to be in the amount found, with a lien for the security thereof, as reported by the referee. More than ten days thereafter, on June 30, 1909, the trustee in bankruptcy filed his petition for the revision of the order of the district court in the circuit court of appeals, his petition reciting:
'That said order was erroneous in matter of law, in that it adjudged a dismissal of your petitioner's petition, and in that it adjudged that the American-German National Bank of Paducah had any lien upon any of the property or effects of the aforesaid bankrupt by virtue of the statutes of the state of Kentucky in such cases made and provided, or by virtue of any law or contract.
'Wherefore your petitioner, feeling aggrieved because of such order, asks that the same may be revised in matter of law by this honorable court of appeals of the United States for the sixth circuit, as provided in § 24b of the bankruptcy law of 1898 [30 Stat. at L. 553, chap. 541, U.S.C.omp. Stat. 1901, p. 3432] and the rules and practice in such cases provided.'