William O. Douglas

“ There is to be a forfeiture 'if the tenant shall be adjudged bankrupt or insolvent by any Court.' It is said that 'insolvent' is used interchangeably with 'bankrupt'. But it has long been held that a general assignment is an act of bankruptcy whether or not t e debtor is insolvent. West Co. v. Lea, 174 U.S. 590, 19 S.Ct. 836, 43 L.Ed. 1098. Thus it would seem that 'adjudged bankrupt' and 'adjudged insolvent' do not cover precisely the same ground. Moreover, insolvency in the equity sense has always meant an inability of the debtor to pay his debts as they mature. ”

“ Thereafter, respondent petitioned the bankruptcy court for an order adjudging that the term granted by the lease had terminated. The court granted the relief asked by the petition. The Circuit Court of Appeals affirmed. 2 Cir., 146 F.2d 594. The case is here on certiorari.
The bankruptcy court does not look with favor upon forfeiture clauses in leases. They are liberally construed in favor of the bankrupt lessee so as not to deprive the estate of property which may turn out to be a valuable asset. ”

“ X. By § 102 (11 U.S.C. § 502, 11 U.S.C.A. § 502) it provided that the provisions of Ch. VII (which includes § 70) should be applicable to proceedings under Ch. X 'insofar as they are not inconsistent or in conflict with the provisions' of that chapter. ”