Court Opinion

ID: 3516709
Source: CourtListenerOpinion
Date Created: 2016-07-05 22:28:05.775994+00
Date Added: 2024-06-11T14:19:15.599358
License: Public Domain

* Headnotes 1. Pleading, 31 Cyc., p. 773; 2. Bankruptcy, 7 C.J., Section 732; Bills and Notes, 8 C.J., Section 1300 (Anno.); 3. Appeal and Error, 4 C.J., Section 3240.
The appellees, Magee, Gibson  Magee, a law partnership, sued the appellant, Mrs. Berry, on a promissory note for three hundred sixty-one dollars and twenty-five cents, dated November 5, 1923, and payable sixty days after date.
The appellant, Mrs. Berry, filed a plea to the declaration in which she alleged that she filed a petition in voluntary bankruptcy on November 6, 1923, and was in due course adjudged a bankrupt; that the promissory note was an outstanding obligation and a provable claim against her estate in bankruptcy; that this note was given in the usual course of business, for services rendered by this law firm for the filing of her petition in bankruptcy and for obtaining her final discharge; that the law firm had full knowledge of the bankruptcy proceedings and every transaction pertaining thereto; that in December, 1924, when she was granted a discharge in bankruptcy, the appellees were present, and presented her petition for the discharge, and had actual knowledge of everything pertaining to the bankruptcy proceedings; and that they knew their claim was then a provable one against her estate.
The appellees (plaintiffs below) filed a replication to this plea of the defendant (appellant), in which they admitted that Mrs. Berry filed a petition in bankruptcy, of which they had actual knowledge, and obtained a discharge after the note was given, and that they knew this note was a provable claim; and the plea admits also that the note was given for professional services to be rendered the defendant in the bankruptcy proceedings; but appellees aver that, by agreement between them and Mrs. Berry, the note was not to be filed as a claim against her estate in bankruptcy, that she agreed at the time the *Page 313 
note was given, which was before the petition in bankruptcy had been filed, and also agreed since and after the petition was filed, that said indebtedness was not to be proved in the bankruptcy proceedings, but that she promised to pay the note independently of the bankruptcy proceedings, which agreement was known to the referee in bankruptcy at the time the petition was filed.
The replication "concluded to the country" instead of that appellees were "ready to verify." This amounted to joinder of issue, though made erroneously by appellees; section 808, Code 1906 (section 596, Hemingway's Code), curing the trouble after judgment.
So it will be observed that the replication confesses the holders of the note were the attorneys in the bankruptcy proceedings and consequently had actual knowledge thereof, and that the note was executed before the petition for bankruptcy was filed, and was for services as attorneys in the proceedings, and that the claim was a provable one in the bankruptcy proceedings. But the pleader alleges, by way of avoidance of the confession, that the note was not provable against the bankrupt, because there was an agreement with the maker not to do so, and that the bankrupt, appellant, promised to pay the note after the petition was filed in the bankruptcy proceedings.
On the trial of the case, Mr. Gibson, one of the members of the appellee law firm, was the only witness testifying in the case, and his testimony, in short, was only to the effect that the note was executed by Mrs. Berry and was due and unpaid, and that it was given to them as an attorney's fee in the bankruptcy proceedings.
At the conclusion of this testimony, the court, at the request of appellees, instructed the jury peremptorily to render a verdict in favor of plaintiff for the amount of the note and interest; and, from this action of the lower court, Mrs. Berry prosecutes this appeal.
Reversal of the judgment is urged upon the ground that the plaintiff below failed to prove that the defendant, *Page 314 
Mrs. Berry, agreed to pay the note after the petition in bankruptcy was filed, and that therefore she was discharged from the claim because it was not proved against her in the bankruptcy proceedings.
The appellees oppose this contention of the appellant on the theory that the pleadings set up the fact that Mrs. Berry agreed the note should not be proved against her estate as a bankrupt, and that she agreed after the petition in bankruptcy had been filed that she would pay the note, and that therefore the subsequent agreement after the bankruptcy proceedings were instituted was a valid obligation resting for a consideration upon the old one given before the petition was filed.
As we understand the pleadings in the case, the controversy is narrowed down to one point, and that is whether or not the burden was upon the appellees, plaintiffs below, to show by testimony that Mrs. Berry agreed to pay the note after the petition in bankruptcy was filed; or whether it was incumbent upon Mrs. Berry to plead and prove the fact that she gave the note before the petition was filed, and that she did not subsequently (that is, subsequent to the filing of the petition) agree to pay the amount of the note.
It is our judgment that the replication of appellees sets up an affirmative matter, namely, that the promise to pay the note by Mrs. Berry was made by her after the filing of the petition in the bankruptcy proceedings, and we think therefore the burden was upon the appellees to prove the affirmative fact set up in the replication. The appellees failed to make this necessary proof, and consequently judgment should not have been rendered against the defendant below. The affirmative matter, set up in the replication, upon which issue was joined "by concluding to the country," should have been established by evidence on the part of appellees.
The law seems to be settled that, in a case as here presented, the note was a provable claim because it was given before the petition in bankruptcy was filed, and *Page 315 
that it would be barred unless proven against the estate of the bankrupt, where the holder of the note had actual knowledge of the bankruptcy proceedings. Of course there are exceptions to this rule, and one of them is that the claim against the bankrupt would not be discharged on failure to prove it, if the bankrupt agreed and promised to pay the amount of the note after the petition was filed or after the bankrupt was discharged. However, the burden is on the holder of the claim to show by evidence that it comes within the exception mentioned, and, where he fails to make the proof of this affirmative matter, he cannot recover because such claim is released by the failure to file it in the bankruptcy proceedings.
The judgment of the lower court must be reversed, and, as no request was made by the appellant for a directed verdict in the lower court, the case will be remanded for a new trial.
Reversed and remanded.