In the Matter of Shakesteers Coffee Shops, a Partnership Composed of Milton Kaffen John M. England, Trustee v. United States of America

MARY ANNE RICHEY, District Judge:

The United States, the California Department of Benefit Payments, and the California Board of Equalization have appealed from the district court’s decision that funds deposited in a special tax account pursuant to an arrangement proceeding under Chapter XI of the Bankruptcy Act (11 U.S.C. § 701 et seq.) should be considered a general asset of the bankrupt’s estate and subject to costs and expenses of administration. Appellants contend that a trust fund in their favor was created by the arrangement court’s order. In light of United States v. Randall, 401 U.S.…