United States v. Guaranty Trust Co., 280 U.S. 478 (1930)

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United States v. Guaranty Trust Co.

No. 402

Argued January 7, 1930
Decided February 24, 1930
280 U.S. 478

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

Syllabus

1. In providing by Title II of the Transportation Act (1) for the funding of indebtedness of railroad carriers to the United States incurred for additions and betterments made during federal control and properly chargeable to capital account; (2) for the evidencing by notes of other then existing indebtedness of the carriers to the United States; (3) for advances to carriers by the Secretary of the Treasury, upon certification by the Interstate Commerce Commission, on account of the guaranty of operating income for the six months following federal control, and for repayment by carriers of amounts advanced in excess of the guaranty, and (4) for loans to carriers, to meet their maturing indebtedness or to provide equipment, etc., for the purpose of enabling them properly to serve the public during the transition period immediately following federal control, Congress intended to exclude the indebtedness so arising from the scope of Rev.Stats. § 3466, which confers priority on debts owed the United States by insolvents. P. 484.

2. This conclusion follows from the general purpose of Title II to rehabilitate railroad credit and preserve the existing transportation system, and from the specific means it provides to insure repayment, other than the priority provision of § 3466. Id.

33 F.2d 533 affirmed.

Certiorari, post, p. 546, to review a decree of the circuit court of appeals which affirmed a decree of the district court denying priority of payment to claims of the United States against the receiver of an insolvent railroad.