Case ID: ny_12/html/0575-01.html
Source: Caselaw Access Project
Author: {"author": "Denio, J.,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Stanton and others against Ellis.
    By force of the statute (2 R. S., 38, § 19), a discharge granted on the application of an insolvent and two-thirds in amount of his creditors, is conclusive evidence of the statutory proceedings and facts therein recited, except those which were necessary to confer jurisdiction, upon the officer granting it.
    But the discharge is not conclusive evidence of the facts requisite to give the officer jurisdiction to entertain the proceedings, although they are therein stated to have been proved before him.
    To confer jurisdiction on the officer, the schedule of the insolvent’s creditors annexed to his petition should state the amount owing to each creditor therein named.
    And where the schedule was in blank as to the sum owing to one of the creditors therein named; Held, that this was a jurisdictional defect which rendered the discharge void, notwithstanding it recited that two-thirds in amount of the creditors united in the petition, and that it satisfactorily appeared to the officer that the insolvent had in all respects complied with the requirements of the statute.
    The ground upon which this case was decided by the supreme court {see 16 Barb., 319) doubted by Denio, J
    Action commenced in the supreme court in 1852, upon a judgment recovered in that court against the defendant on the 11th of February, 1843, for $601.12 in favor of George W. Stanton, George W. Stanton, Jr., and Charles Stanton. In 1845, Charles Stanton transferred his interest in the judgment to his co-plaintiffs therein. George W. Stanton died in 1849, and this action was in the name of his executors and George W. Stanton, jr. On the trial of the cause at the Jefferson county circuit, before Mr. Justice Pratt, without a jury, the plaintiffs proved the above facts and rested. The defendant then read in evidence a discharge, dated the 1st day of January," 1847, granted by George C. Sherman, Esq., judge of the court of common pleas of Jefferson county and of the degree of counselor, &c., under the statute “ of voluntary assignments made pursuant to the application of an insolvent and his creditors,” and which was recorded the 27th of the same month of January. The discharge recited that Ellis, the defendant, in conjunction with so many of his creditors residing in .the United States, who had debts in good faith against him amounting to at least two-thirds of all the debts owing by him to creditors residing within the United States, presented a petition to Judge Sherman, praying that he, Ellis, be discharged from his debts pursuant to the statute on complying with its provisions. It further recited that a day was appointed for the creditors of the insolvent to show cause why the prayer of the petition should not be granted; that notice of the same was duly published and given according to the statute ; and “ that it satisfactorily appeared to him” (the judge granting the discharge), that the insolvent had conformed in all respects to those matters and things required of him according to the true intent and meaning of said statute;” and after reciting that the insolvent had executed an assignment of his estate to trustees, pursuant to the statute, discharged him from his debts.
    The counsel for the plaintiffs, in reply, gave in evidence the papers upon which the discharge was granted. Among them was the schedule of the creditors of Ellis, the insolvent, annexed to" the petition for his discharge. In this schedule, George W. Stanton & Sons were named as his creditors, and the debt owing them was stated to be .for merchandise and in judgment in the supreme court, but no amount was stated; and the column, in which the amounts of the indebtedness to the several other creditors named in the inventory were placed opposite their respective names, was left in blank opposite the name of Stanton & Sons. It also appeared that the affidavit of the publication in one of the newspapers, of the notice to creditors to show cause, &c., was sworn to before a master in chancery.
    The counsel for the plaintiffs insisted that the discharge was void on various grounds; and the justice before whom the cause was tried so ruled, and ordered judgment in favor of the plaintiffs for the amount of the original judgment and costs. The counsel for the defendant excepted. The judgment ordered at the circuit was affirmed by the supreme court at a general term, in the 5th district. The case was decided in that court, upon the ground that the affidavit of publication sworn to before the master in chancery was not legal proof of its publication, he not being authorized to take affidavits to be used in the proceeding, as appears from a report offc the decision in 16 Burbour, 319. The defendant appealed to this court.
    
      J. W. Tamblin, for the appellant.
    
      B. B. Burt, for the respondents.
   Denio, J.,

delivered the opinion of the court.

The statute under which the insolvent proceedings were ..ad, which were in question in this case, declares the effect of a discharge to be as.follows: “ The original discharge, the reword thereof, and a transcript of such record, duly authenticated, shall be conclusive evidence of the proceedings and facts therein contained.” (2 R. S., 38, § 19.) Notwithstanding this, strong language, the constant course of adjudication has determined that the facts upon which the jurisdiction of the officer depends, may be inquired into by a party seeking to impeach the final order in .a collateral action; and if a defect is- ascertained the whole proceeding is declared void. (Barber v. Winslow, 12 Wend., 102; Van Alstyne v. Erwine, 1 Kern., 331, and cases cited; Morgan v. Dyer, 10 Johns., 161; Sackett v. Andross, 5 Hill, 327; Varnum v. Wheeler, 1 Denio, 331.) The recitals in a discharge are held to be prima-facie evidence only of jurisdictional facts. (Jenks v. Stebbins, 11 Johns., 224.) But these are subject to be disproved. The rule, therefore, is, that where the officer is shown to have acquired jurisdiction, the discharge reciting the performance of the subsequent statutory requirements is incontrovertible evidence that they have been performed as stated, but it is not in the power of the officer to create such evidence, unless he has in the first place acquired a right to proceed in the case, by the performance, by the party invoking his action, of the preliminary steps required by law to be taken as a condition to his entertaining the case. In applications by an insolvent and his creditors under the third article of the title of the Revised Statutes relating to non-resident, absconding, insolvent and ijnprisoned debtors (2 R. S., 16), the debtor is required to deliver to the officer with his petition a certain schedule containing an account of his creditors, in which is to be stated the sum owing to each creditor, and the nature of each debt or demand, whether arising on written security, on account, or otherwise.” (§ 5.) The petition is to be signed by two-thirds in amount of all his creditors residing within the United States. (§ 2.) In the papers delivered by the defendant when he applied to Judge Sherman, the schedule of his creditors contained the names of George W. Stanton & Sons as such creditors, and a statement that their debt was in judgment in' the supreme court, and that it was for goods, wares and merchandises; but it omitted to state the amount of the debt, the proper place in the column of amounts being, accidentally, I presume, left blank. Now although the discharge recites that it had been made to appear satisfactorily to the officer that the defendant had conformed in all respects to the requirements of the act, yet it was proved, by the production of the petition and schedule, that in the respect just mentioned there was a failure so to conform. It was impossible for the officer to know that two-thirds in amount of the defendant’s creditors had subscribed his petition; for the aggregate amount of all his debts could not be stated until it was known how much he owed to Messrs. Stanton & Son. This was a fatal defect in an important jurisdictional requirement, and the officer had no right to make any order upon the petition. If no mention had been made of this debt, the papers would have been regular on their face and the discharge would have been valid so far as that obligation is concerned, unless it had been shown that the suppression was with fraudulent motives. So, "if an incorrect amount had been inserted. (2 R. S., 81, § 35, subd. 4.) The difficulty in the case is that the schedule showed affirmatively that there was a creditor, the amount of whose debt was not stated It might be more or less; and if it reached a certain amount, the debts of the petitioxing creditors would not have amounted to two-thirds of all the petitioners’ debts, and it was utterly impossible for the officer to tell whether it did amount to such a sum or not. For this reason, without examining the point passed upon by the general term of the supreme court., I am of opinion that the judge, before whom the action was tried, decided correctly in rejecting the discharge as a defence. Cunningham v. Bucklin (8 Cow., 178) is not opposed to this. Judge Savage said: “There is no question, here as to jurisdiction. The commissioners had by statute jurisdiction of the subject matter. By the petition and oath of Shepherd he acquired jurisdiction of his person.” I think the court fell into a mistake in. supposing that taking up the case after a discontinuance did not raise a question of jurisdiction. But it is enough for my purpose that they admit, impliedly, that his license would not shield him unless he once acquired jurisdiction. I have some doubt about the point decided by the supreme court in this case. If jurisdiction was acquired by the original papers, I suspect that the recital in the discharge covers the want of notice.

The judgment should be affirmed

Judgment accordingly.