Court Opinion

ID: 6684348
Source: CourtListenerOpinion
Date Created: 2022-07-20 21:31:38.82464+00
Date Added: 2024-06-11T16:00:55.398980
License: Public Domain

HaMiltoN, Judge,
delivered tbe following opinion:
Tbe demurrer to tbe amended petition is ratber general in its nature. Inasmuch, however, as one ground will have to be sustained, and an amendment will have to be filed, it may be as well to pass upon both aspects of the case.
1. It is permissible for an agent to verify a petition in bankruptcy, but in such case tbe agent must set out bis authority. Tbe form prescribed by tbe supreme court, Bankruptcy Forms No. 6, gives many particulars which are not found in tbe verification of tbe petition at bar, and also a separate affidavit showing tbe sources of tbe agent’s information as to tbe facts set up and why tbe verification is not made by tbe petitioners in person. It must be held, therefore, that tbe verification is not shown to be properly made by an agent.
2. Tbe general rule as to judicial verifications is that they must allege knowledge of tbe facts set out, unless averred to be on information. Merely stating a fact as true to tbe best of one’s information may mean nothing at all. It would be *160possible for a person having practically no knowledge or information to sign such an affidavit. Moreover, the form of verification prepared by the supreme court, in Form No. 5, is that the three petitioners “do hereby make solemn oath that the ■statements contained in the foregoing petition subscribed by them are true.” The affidavit in question is that “the statement of facts contained in the foregoing petition is time according to the best of their knowledge, information, and belief.” It would not seem that this comes up to the standard required by the prescribed form, or up to that required by the general rule as to affidavits in legal proceedings.
3. The petition sets out that the alleged bankrupt is insolvent, and within four months next preceding “committed an act ■of bankruptcy in that she did convey and transfer all of her known property beyond the reach of her creditors with the intent to hinder, delay, or defraud them.” And then follows a list of conveyances, giving date, consideration, and description ■of the respective pieces of property. The petition further alleges that this amounted to “committing the first act of bankruptcy” described in § 3 of the bankruptcy act.
The general rule is that a mere allegation of fraud following the words of the statute is insufficient. Fraud is a conclusion of law, and pleadings must set out facts rather than such conclusions. The petition in question does not allege any particulars which might indicate fraud except the general .allegation that the alleged bankrupt is insolvent; non consiat that she was solvent at the time of making the different conveyances set out. The rule is that, while creditors are not, from the nature of the case, held to know all the particulars of the fraud, they must set out what they do know, must make a *161full disclosure, or it will be beld that they have not pleaded a case proper for the intervention of a court of bankruptcy. If there is to be a presumption in the matter, it must be, as in all other cases, in favor of the defendant. The rule as to such allegations is discussed in the following cases from Federal courts in different parts of the Union: Re Hark, 135 Fed. 603; Re Nelson, 98 Fed. 77; Re Vastbinder, 126 Fed. 418; Re Mero, 128 Fed. 630; Re Blumberg, 133 Fed. 845; Re Simonson, 92 Fed. 904.
It follows that the demurrer is sustained, and ten days will be allowed for amendment as the petitioners may be advised.