Court Opinion

ID: 3867088
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:00:59.141028+00
Date Added: 2024-06-11T13:31:49.632638
License: Public Domain

This is an action of debt on judgment, and the defendant pleads a discharge in bankruptcy granted in this Rhode Island District. The plaintiffs reply that although the plaintiffs' names were given as creditors in the list annexed to the petition in bankruptcy, their residence was not stated; nor was it stated that the residence was unknown to the petitioner, but he did state New York city as their residence, whereas they were residents of Glasgow, Scotland, and that no written or printed notice was served personally or by mail on the plaintiffs, nor did the plaintiffs know of the proceedings; to which replication the defendant demurs.
The plaintiffs claim that to give a court jurisdiction, the defendant or person affected must have actual or constructive notice, and that if the notice be prescribed by statute it must be strictly followed; and that otherwise the judgment will be void. And for the mode of notice in this case they refer to section 11 of the Bankrupt Act of 1867, which required publication in the newspapers, and serving written or printed notices by mail or personally; and to carry this out the petitioner is required to file a schedule of his creditors with their residences, if known, and if not known, the fact to be so stated.
If this were the only notice provided for in the act, it has not been complied with. But we have been referred by the defendant's counsel, Mr. Gardner, to authorities holding that the discharge cannot be impeached for any omission unaccompanied with fraud. But it does not seem necessary for us to express any opinion on that in the present case. It is contended by Mr. Jenckes, for the defendant, that the bankrupt act has two objects: first, the application of a bankrupt's property to the payment of his debts, which is the main object of the law; second, the discharge of the honest debtor; but this second object has no necessary connection with the first, and may not be applied for, or may be granted or refused, without at all affecting the validity of the proceedings, to effect the first object.
Sections 11-29 relate entirely to the distribution of the bankrupt's *Page 454 
property, and have nothing to do with his discharge; and the notice required by section 11 is for this purpose only, to enable creditors to prove their claims, and has no reference whatever to his discharge.
The court, having jurisdiction over the bankrupt's person and over his property, proceeds to apply it to payment of his debts. And it is important to consider that in this first part of the proceedings the notice is the same in case of voluntary and involuntary bankruptcy. But if the debtor chooses to apply for a discharge, he then becomes the moving party, even if the proceedings were originally commenced by creditors; and section 29 prescribes the notice to be then given, namely, by mail, to all who have proved their debts, and by publication also, to appear and oppose the discharge. And the order of court (Form No. 51), according to the rules prescribed by the Supreme Court of the United States under the authority given them by the act, is, that notice be published in newspapers "that all creditors who have proved their debts, and all others in interest, may appear at the said time and place, and show cause, if any they have,"c., c., and also for letters by mail to creditors whose residence is known.
We think this the sound view, and that the notice to be given in the matter now in question is the notice prescribed by section 29, and not the one provided for by section 11.
To give a court jurisdiction, either the property must be within its control, or the party must have his domicil, or be at least temporarily within its control. In case of real property, the lex rei sitae of course prevails. In regard to personal property, while there is some diversity of opinion as to the effect of a bankrupt's assignment upon foreign property, there is none, we believe, in English or American cases, as to the effect upon property situated within the jurisdiction.
In the present case, both parties lived in this country when the contract was made. Here was its place of performance, the real locus contractus. 4 Phillimore (2d ed.) § 1670, c.; Lawrence's Wheaton on International Law, pp. 178, 284, 290; Wharton's Conflict of Laws, §§ 523, 852a. And although the plaintiffs subsequently removed to a foreign country, they have sued that claim in the courts of this country and obtained a judgment *Page 455 
on it, in which of course their former claim is merged. And on that judgment the present suit is founded. And the plaintiffs by suing in one court subject themselves to the lex fori, and cannot deny here the legal effect of the discharge under our laws. Upon no other principle would a foreign plaintiff suing in our courts be bound by a judgment against him, which we believe has never been doubted. Penniman v. Meigs, 9 Johns. 325;Murray v. De Rotterham, 6 John. Ch. 52; In the matter ofZarega, 4 Law Reporter, p. 480 (A.D. 1842).
There being no dispute but that the notice required by section 29 was given, the demurrer must be overruled.
Demurrer overruled.