Court Opinion

ID: 7192265
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:58:22.540892+00
Date Added: 2024-06-11T16:16:08.671883
License: Public Domain

The opinion of the Court was delivered by
Todd, J.
This is a suit on a promissory note for $1237. 44 and interest, executed by the defendants, payable to'the order of Payne, Denegre & Co. and by them indorsed.
The defense is that the defendants had been adjudicated bankrupts; that a meeting of their creditors had been held, and their creditors had voted in favor of a composition offered by them; that plaintiff had appeared and proved a claim held by him against the defendants, and had participated in said composition proceedings, by reason of which they claim their discharge from the debt.
There was judgment for plaintiff and the defendants have appealed.
The composition act of 1874, relating to proceedings in bankruptcy, prescribes the terms on which the bankrupt may make a composition with his creditors.
Among its other requirements it enacts :
“That the provisions of a composition accepted by such resolution in pursuance of this section, shall be binding on all the creditors whose names and addresses, and the amounts of the debts due to whom, are shown in the statement of the debtor, produced at the meeting at which the resolution shall have been passed, but shall not affect or prejudice the rights of any other creditors.”
We find in the statement submitted by the debtors in this case that plaintiff was not put down as a creditor for the claim in suit. It is true that a claim similar in amount, date, etc., was reported in the statement, and for this claim the names of Payne, Denegre & Co., the payees of the note sued on, were reported as the creditors.
The law required, as we have seen, that this statement must include the names of all creditors, with the amount of their claims, etc. A further provision required that where the creditor or creditors were unknown that such fact should be asserted in the statement.
A party claiming his discharge under this act, must bring himself *780clearly within its provisions; nothing must be left to inference or implication.
The plaintiff was not reported in the statement of the debtors as a creditor for this claim, although it is admitted that he was so reported for another claim. Nor was it a sufficient compliance with the law that Payne, Denegre & Co. were reported as creditors for a similar amount, date, etc.
It might be that there were two or more notes of the same tenor and amount executed by the defendants to the same payees. Besides, the note in question was negotiable in form; and thus its negotiation was contemplated at the time of its execution; and there was no reason to conclude that it still remained in the hands of the payees; and that they, the payees, were still creditors for this claim.
And again, the record shows that the defendants were cited in this case on the 14th March, 1876; at which time and by which means they were informed that plaintiff was the holder of the note. The amended answer of the defendants, filed on the 10th of April, 1876, refers to a meeting of their creditors, including the plaintiff, as having taken place. The composition act referred to gave the debtor the privilege of correcting his statement as to any error made in the original one, touching the claims therein reported; and here was an opportunity shown to have been offered the defendants to make this correction, and place plaintiffs name' on the statement for this debt, after they were informed by the citation that he was the creditor; and such correction was not made. Vol. 18 Stat. at Large, p. 183.
It made no difference that the plaintiff was present at the meeting of the creditors and opposed the proceeding for a composition, for it is distinctly admitted that he had been reported in the statement as a creditor, but a creditor for another claim.
We are of the opinion that creditors whose names and address, and the amount of whose debts are not placed on the statement of debts, are not bound by the composition proceedings; and in this we are supported by the highest authority.
Ex parte Matthews L. R. Ch. App., 307; Breslawer vs. Brown, 3. Appeal cases, 672.
And holding this opinion, we conclude that the defendants were not discharged by these proceedings, pleaded in their answer as a bar to this action.
The judgment of the lower court is, therefore, affirmed with costs.