The New York herald., 1869-01-16
UNITED STATES CIRCUIT casaT-Ia BANKRUPTCY.
Decision Appeai-No Discharge Of Fraudn-
lent Dcbt-Thc Liabilities OF Factors.


lent Debt--Thc Liabilities OF Factors.
Before Judge Nelson.
Es The Matter or John ~. Eiu,bod, BdnkJuDk-
Judge Nelson has rendered the following decision in
this casc:The petition IN This seeks revision
OF q decision OF the District Judge Southern District
OF New York. refusing 10 discharge Nimba, the
bankrupt from arrest and also his Jail given thereon
He was adiudged a bankrupt on the 10Th May, 1868.
and the arrest was made on about the 9Th OF June
thereafter The action brought in the State Court
and the order OF arrest founded on aidavt set
ting forth that the 23d December. 1887, the plain
TN furnished q, ,25o pounds OF buchwheat
remit the proceeds less the commission. The nour
was sold or about the 10th February 1865. by the
agent who received therefor sos ~ over and above
tile commissions, but failed TO remit The proceeds,
or any part thereof. They were subsequently de-
manded OF him. but he refused TO pay, saying he had
no means OF payment and had applied The moneys
70 his own use, and he soon after applied ror the
benefit OF the bankrupt act and closed the coinns-
sion business. The application for the discharge
founded on The latter clause OF the twenty-sixth
section or the act which provides that mo bank
rlpt shall be liabe 70 arrest during the pendency
action. unless the same IL founded some
debt or claim from which his discharge In bank
ruptcy would not release him. Section thirty
three provides. That no debt created by
the. fraud or cmbel2lomeEt OF the bankrupt, or by
MS delalcaon as public officer. or while acting ia
any flduciary character shall lie discharged under
thia act.r The District Court held upon the case
above made that The debt was created by the deal-
cation Of the debtor while acting In niucisry CHAR
acier anu was one which woulI not be dschargedin ia
bankruptcy. ami hence refused 10 discharge the
petitioner from arrest. We nIe incbsi To concur In
TINS opinion. We tire more readily concur as the de-
cislon OF the question by the District Court In ts
operation and effect extends only 70 the matter of
arrest, and docs not eect the question ultimately TO
be determined, whether tho deut will or VIII not
be discharged In bankruptcy The simple ques-
ton here Is, nnder the twentysixth section,
whether the court WIN discharge the bankrupt
from arrest during the peDdency of the proceed
Ines, and nothing more; and ihis must depend
upon The case presented upon which ihe arrest
made IN the action IN the state Court And looking
al u az TINS presented seems to ns there IL great
dinlcuity in saying that The 1our not received
and held by the bankrupt Ia strictly Gduciary char.
actcr The article was placed IN his possession
simply 10 be sold and TO remit the proceeds over and
above the commission. The money not the
bangrupra wnen received on the SALE but waa the
money cf the owner or the fonr u was gross
breach OF trust TO apply 70 his own use. We have
looked at the Of Chapman vs.. Forsyth ct al u
How 2ol hut do not regard n n controlling the
IN hand. The provision In the present act is much
brosder than tiat the act Of isi Decision Of the
District Court afrmed.