Case Name: In re MONTEVALLO MINING CO. LEWIS v. ROBERTS
Court: United States Court of Appeals for the Fifth Circuit
Jurisdiction: United States
Decision Date: 1923-11-20
Citations: 294 F. 171
Docket Number: No. 4174
Parties: In re MONTEVALLO MINING CO. LEWIS v. ROBERTS.
Judges: Before WALKER and BRYAN, Circuit Judges, and CALL, District Judge.
Reporter: Federal Reporter
Volume: 294
Pages: 171–176

Head Matter:
In re MONTEVALLO MINING CO. LEWIS v. ROBERTS.
(Circuit Court of Appeals, Fifth Circuit.
November 20, 1923.)
No. 4174.
1. Bankruptcy <@=^41 — Solvent debtor may file voluntary petition in bankruptcy.
A solvent debtor may file voluntary petition in bankruptcy.
2. Bankruptcy <@=>199 — -Judgment lien, obtained within four months prior to filing of involuntary petition, not discharged unless bankrupt was insolvent.
A judgment lien, though obtained within four months prior to the filing of an involuntary petition in bankruptcy, is not discharged unless the bankrupt was insolvent under Bankruptcy Act, § 67f (Comp. St. § 9651).
3. Bankruptcy <§=>320 — Unliquidated tort claim not provable*under statute relating to "unliquidated claims.”
Unliquidated tort claims are not provable in bankruptcy, notwithstanding Bankruptcy Act, § 63b (Comp. St. § 9647), making “unliquidated claims” provable; such statute being inapplicable to tort claims.
[Ed. Note. — For other definitions, see Words and Phrases, First and Second Series, Unliquidated Claim.]
4. Bankruptcy <§=>315(1)- — Judgment rendered in tort action not provable in bankruptcy; “debt.”
Under Bankruptcy Act, § 1 (11), being Comp. St. § 9585, defining “debt” as any debt, demand, or claim provable in bankruptcy, section C3a (1), (4), (f>), and 63b (section 9647), enumerating as provable debts those having fixed liability evidenced by a “judgment” or written instrument absolutely owing at the time of the filing of the petition, those founded on contract and on provable debts reduced to judgments after filing of petition, but before the consideration of bankrupt’s application for discharge, and unliquidated claims against the bankrupt, which may be liquidated in such manner as the court may direct, a judgment x'endered against the bankrupt in a tort action is not provable; section 63 being inapplicable to tort claims, notwithstanding section 17, as amended in 1903 (section 9601), providing that all “provable” debts with certain exceptions are discharged on discharge of bankrupt.
[Ed. Note. — For other definitions, see Words and Phrases, First and Second Series, Debt.] 1
Walker, Circuit Judge, dissenting.
Appeal from the District Court of the United States for the Northern District of Alabama; William I. Grubb, Judge.
In the matter of the Montevallo Mining Company, bankrupt. From an order confirming order of referee, rejecting claim of Henry Lewis,, opposed by David Roberts, Jr., as trustee in bankruptcy, the claimant appeals.
Affirmed.
Hugo L. Black and E. Crampton Harris, both of Birmingham, Ala., for appellant.
W. H. Sadler, Jr., of Birmingham, Ala. (Nesbit & Sadler, of Birmingham, Ala., on the brief), for appellee.
Before WALKER and BRYAN, Circuit Judges, and CALL, District Judge.
Certiorari granted 44 Sup. Ct. 335, 68 L. Ed. —.

Opinion:
BRYAN, Circuit Judge.
The appellant recovered a judgment, for personal injuries sustained by him, against the Montevallo Mining Com pany. His complaint charges simple negligence only; it contains no allegation of willful or malicious injury. Within four months from the recovery of the judgment, the mining company, upon its voluntary petition, was adjudicated a bankrupt.
It does not appear from the record before us that the bankrupt was insolvent at the date of the judgment. A solvent debtor may file his voluntary petition in bankruptcy. 1 Collier (13th Ed.) 195. A judgment lien, though obtained within four months prior to the filing of even an involuntary petition against the bankrupt, is not discharged, unless the bankrupt was insolvent. Bankruptcy Act, § 67f (Comp. St. § 9651). .It may therefore be that the appellant has a valid judgment lien upon the bankrupt's estate; but that question is not now presented. •
Appellant's judgment is for a pure tort, which neither constituted a breach of contract nor resulted in the enrichment of the tort-feasor. The District Judge confirmed an order of the referee rejecting appellant's judgment, upon the ground that it was not a provable claim.
The sole question raised by this appeal is whether, this judgment is a provable claim in bankruptcy.
Section 63a of the Bankruptcy Act (Comp. St. § 9647) provides:
"Debts WHoh may be Proved,. — a Debts of tlie bankrupt may be proved and allowed against bis estate wbicb are (1) a, fixed liability, as evidenced by a judgment or an instrument in writing, absolutely owing at tbe time of tbe filing of tbe petition against bim; (4) founded upon an open account, or upon a .contract express or implied; and (5) founded upon provable debts reduced to judgments after tbe filing of tbe petition and before tbe consideration of the bankrupt's application for a discharge," etc.
Section 63b is as follows:
"Unliquidated claims against tbe bankrupt may, pursuant to application to tbe court, be liquidated in sucb manner as it shall direct, and may thereafter be proved and allowed against bis estate."
It is provided in section 1 (11), being Comp. St. § 9585, under the heading "Definitions," that " 'debt' shall include any debt, demand, or claim provable in bankruptcy."
It is settled that an unliquidated tort claim is not provable in bankruptcy, and that clause (b) of section 63 adds nothing to the class of debts which may be proved under clause (a) of the same section. Dunbar v. Dunbar, 190 U. S. 340, 23 Sup. Ct. 757, 47 L. Ed. 1084; Schall v. Camors, 251 U. S. 239, 40 Sup. Ct. 135, 64 L. Ed. 247. In the case last cited it is said (251 U. S. 251, 40 Sup. Ct. 137, 64 L. Ed. 247):
"Evidently tbe words of tbe section [63] were carefully chosen; and tbe express mention of contractual obligations naturally excludes those arising from a mere tort. Since claims founded upon an open account or upon a contract 'express or implied often require to be liquidated, some provision for procedure evidently was called for; clause (b) fulfills this function, and would have to receive a strained interpretation in order that it should include claims arising purely ex delicto. Sucb claims might easily have been mentioned if intended to be included. Upon every consideration, we are clear that claims based upon a mere tort are not provable."
Only debts are provable. If they have become a fixed liability, they are provided for in section 63a (1); if they are unliquidated, they are provided for in section 63a (4), (5), and 63b.
In Wetmore v. Markoe, 196 U. S. 68, 72, 25 Sup. Ct. 172, 173, 49 L. Ed. 390, 2 Ann. Cas. 265, it is said:
"While this section enumerates under separate paragraphs the kind and character of claims to he proved and allowed in bankruptcy, the classification is only a means of describing 'debts' o'£ the bankrupt which may be proved and allowed against his estate."
The mere fact that an unprovable tort claim is evidenced by a judgment does not, in our opinion, convert it into a provable claim. In Boynton v. Ball, 121 U. S. 457, 465, 466, 7 Sup. Ct. 981, 983, 30 L. Ed. 985, it is said;
"The argument is that the judgment now existing against Boynton is not the debt that existed at the time bankruptcy proceedings were initiated; that by the change of the character of the debt from an ordinary claim ox-obligation to a judgment of a court of record it ceased to be the same debt and became a new and different debt as of the date of the judgment. Some authorities are cited for this general proposition of a change of the character of the debt by merger into the judgment, and some authorities are also cited by counsel for plaintiff in error to the contrary. See Judge Blatchford, In re Brown, 5 Benedict, 1; In re Rosey, 6 Benedict, 507.
"But this court, to which this precise question is now presented for the first time, is clearly of opinion that the debt on which this judgment was rendered is the same debt that it was before; that;, notwithstanding the change in its form from that of a simple contract debt, or unliquidated claim, or whatever its character may have been, by merger into a judgment of a court of record, it still remains the same debt on which the action was brought in the state court and the existence of which was provable in bankruptcy."
In Wisconsin v. Pelican Insurance Co., 127 U. S. 265, 292, 293, 8 Sup. Ct. 1370, 1375, 32 L. Ed. 239, it is said:
"The essential nature and real foundation of a cause of action are not changed by recovering judgment upon it; and the technical rules, which regard the original claim as merged in the judgment, and the judgment as implying a promise by the defendant to pay It, do not preclude a coui-t, to which a judgment is presented for affirmative action (while it cannot go behind the judgment for the purpose of examining into the validity of the claim), from ascertaining whether the claim is really one of such a nature that the court is authorized to enforce it."
To the same effect is Wetmore v. Markoe, supra, in which the Supreme Court quoted with approval from Barclay v. Barclay, 184 Ill. 375, 56 N. E. 636, 51 L. R. A. 351, the following:
"Liability to pay alimony is not founded upon a contract, but is a penalty imposed for a failure to perform a duty."
The same statement is equally applicable to a liability for negligence. It is true that the case óf Wetmore v. Markoe arose out of a decree for alimony, from which fact it is argued that a judgment was not involved; but no right to modify or amend the decree was reserved, and it was treated as a judgment by the Supreme Court.
Section 63a (1) does not authorize judgments to be proved. A judgment is considered merely as evidence of a fixed liability, and as s.uch enjoys no higher standing than an instrument in writing. If a judg ment is a debt, and therefore provable, it is wholly immaterial whether it is founded -upon- a contract, tort, penalty, or other liability.
It is to be conceded that there is a lack of entire harmony between section 63, which provides what debts are provable, and section 17 (Comp. .St. § 9601), which provides what debts are dischargeable. Of course, every debt that is dischargeable is provable. But the debts which are dischargeable are not enumerated. The provision of section 17 is that a discharge shall release a bankrupt from all his provable debts, except such as are specifically enumerated. It is true that liabilities for alimony, for willful and malicious injuries, and other torts, are included by this section 17 within the list of provable debts which are not discharged. The inconsistency is dealt with in Wetmore v. Markoe and in Schall v. Camors, supra, and in each of these cases it is held that the amendment of 1903 to section 17 should not be given the effect of enlarging the class of provable claims. It must be equally true that the section as a whole should receive a like construction.
There are cases to the contrary. They proceed upon the theory that a judgment is a debt, and therefore provable. Conspicuous among them are In re New York Tunnel Co., 159 Fed. 688, 86 C. C. A. 556, decided by the Circuit Court of Appeals for the Second Circuit, and Moore v. Douglas, 230 Fed. 399, 144 C. C. A. 541, decided by the Circuit Court of Appeals for the Ninth Circuit. But we think the decisions of the Supreme Court above cited lead to the conclusion that pure tort claims, though reduced to judgment prior to adjudication, are not provable in bankruptcy proceedings.
The order appealed from is affirmed.
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