The record-union., 1898-06-04
A new LAW POINT DECIDED.
HAS NEVER BEEN PASSED ON
By THE SUPREME COURT.
A Statute T1at Seems to Vest No
Discretion in the Court as to
Allowing Attorneys Fees.


mercial men:
In the Superior Court of the State OF
California, in and for the County OF
Sacramento-In the matter OF John
X. Sweeney, in insolvency.
On April II, 1898, a creditors petition
in involuntary insolvency was filed
herein against said John r. sweeney
and Alice Sweeney, his wife. The re-
spondents had, prior to said date, been
engaged in conducting merchandising
business at Twelfth and d streets in
the city of Sacramento. They appeared
in this behalf and moved to strike out
certain portions of the petition, which
motion was granted by the court, with
leave to the creditors to amend their
pleadings. On April 26, 1898, an amend
ed petition was filed against John R.
Sweeney alone. Thereafter a separate
motion was made by each Of the re-
SpondentS for a dismissal of the pro-
ceedings against them and for an order
of the court allowing each of them costs
and counsel fees. These motions are
made on the ground that the proceeding
against John r. Sweeney, as it appears
in the amended petition, is a new, dis
tinct and different proceeding from that
which was prosecuted against the hus-
band and wife jointly.
The first petition contained an aver
ment that John r. Sweeney had. short
ly prior to the filing of said petition
and for the purpose Of confusing his
business affairs and casting a cloud
upon the title to his property and de-
frauding his creditors, made a pretend
ed transfer of his property to his Wife;
that said Alice had full knowledge of
the insolvent condition of her husband,
and for the purpose of aiding him in
his fraudulent design upon his credl-
tors, had herself promised to pay GER
tain of the creditors of said John X.
Sweeney Prior to the filing of the
amended petition both of said respond
ents were examined in this court touch
ing their transactions with the property
of said business above referred to. This
examination disclosed that John X.
Sweeney had, several months prior TO
the filing of the original petition here
in and while in poor health made bill
of sale of said business to his wife. The
latter however, disclaimed any inter-
est in said property hereunder, though
she did join with her husband in the
execution of a bill of sale of said busi-
ness made Immediately prior to the I'LL
ing of the original petition herein to j.
B. Frees. 1t also appeared that the
wife managed and conducted the bust
ness during the sickness of her husband
and personally received and disbursed
all of the money obtained from Frees on
account of the sale of said business.
The question presented by the mo-
tions of the respondents is whether or
not the petitioning creditors, by omit
ting Alice Sweeney from the amended
petition have so far changed the pro-
ceedings as to constitute it a new and
Independent Ietition. 1t is we'll settled
in this State that proceedings in in
solvency are purely statutory, and
courts exercising jurisdiction therein
are limited by the statute.
marble Co. vs. Superior Court, ~
Cal. 519)
The Insolvent Act itself. however,
contains the following provision: The
petitioners may, from time to time,
amend and correct the petition, so that
the same shall conform to the facts, by
leave of the court before which the pro-
ceedings are pending, such amendment
or amendments to relate back and be
received as if embraced in the original
petition
(Section g. Insolvent Act of 1900
1t will be noted that this provision
of the statute in no way limits the Pc
titioners to any particular KIND OF
amendment and contains no Inhibition
against such an amendment as has been
made by the petitioners in the case at
bar The statute confers upon the cred
itors a general authority and power TO
make amendments to the petition, and,
in the opinion of the court, authorizes
the amendment which the respondents
inveigh against by their said motions.
The respondent, Alice Sweeney, is en-
titled to an order dismissing the pro-
ceeding against her in view Of her dis
claimer and the amended petition filed
herein.
She also asks the court to make an
order allowing her costs herein, to-
gether with a reasonable attorney
fee Section 8 of the Insolvent Act of
1895 provides, among other things, that
the creditors shall accompany their Pc
tition with bond in the penal sum
of at least five hundred dollars, con
ditioned that if the debtor should not
be declared an insolvent the petitioner
will pay all costs and damages, includ-
ing a reasonable attorneys fee, that
the DEBTOR may ps iSe'|Ci "
the filing of said petition" As herein-
before stated the examination or the
respondents disclosed such a state or
facts as would likely justify reason
able person in including the respondent.
Alice Sweeney, in said petition The
statute however. seems to vest no dis
cretion in the court as to whether or
not an attorneys fee shall be allowed
on the dismissal of a petition, such as
has been filed in this case. On the
contrary it seems to make it the plain
duty of the court, where the respondent
mas not been declared insolvent. to
compel a payment by the petitioning
creditors of respondents costs and a
reasonable sum for fees of counsel.
II follows from the foregoing views
that the motion of John r. Sweeney
for the dismissal of the petition against
him must be denied, and the motion
of the respondent, Alice Sweeney, for
the dismissal of the petition against her
Is granted with permission to file with
in five days a verified statement of her
costs and on the settlement of such
cost bill an order will be made cover
ing counsel fees.
JOSEPH w. HUGHES, Judge.
Dated June 3, 1898.
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