Court Opinion

ID: 5470373
Source: CourtListenerOpinion
Date Created: 2022-01-09 20:36:01.023488+00
Date Added: 2024-06-11T08:33:17.210445
License: Public Domain

Blatchford, J.
T. H. & T. W. Conkling have proved a claim against the bankrupts for $1,101.64, and interest from May 1st, 18-73, “ being a balance for rent of premises ” let to the bankrupts by T. H. & T. W. Conkling, by a lease bear*40ing date February 17 th, 1871, and expiring May 1st, 1873. The rent claimed in the proof is for the four months from January'1st, 1873, to May 1st, 1873, at the rate of $291.66 per month, less. a credit of sixty-five dollars as paid. The assignee of the bankrupts has filed with the register an objection to such claim and proof of debt, on the ground that the alleged debt or claim is not provable against the said estate under the bankruptcy act, “for the reason that the said debt or claim, or any part thereof, did not exist at the time of the filing of the petition for the adjudication of bankruptcy herein, to wit, the 28th day of December, 1872.” The register has taken testimony in the premises, not under an order made by him in pursuance of .General Order JSTo. 34, on a petition to him for the re-examination of the claim, but apparently by the consent of the parties.
Thereupon the register has certified to the court, under section 4 of the act, the question or issue, as to whether the claim should he allowed. He also has certified the testimony and the proof of claim. The lease forms a part of the testimony.
The petition in bankruptcy was filed on the 28th of December, 1872. The rent under the lease was fully paid up to the 1st of January, 1873, before the petition in bankruptcy was filed. The rent reserved hy the lease was payable monthly, on the first day of each month, at the rate of $3,500 per year. The lease was for two years from the first of May, 1871. The first rent became payable on the 1st of June, 1871. The rent for the month from January 1st, 1873, to February 1st, 1873, did not become payable till February 1st, 1873. The ‘adjudication of bankruptcy was made before February 1st, 1873.
The nineteenth section of the act provides that all debts due and payable from the bankrupt at the time of the adjudication of bankruptcy, and all debts then existing but not payable until a future day, a rebate of interest.being made where no interest is payable by the terms of contract, may be proved *41against the estate of the bankrupt. * * * Where the bankrupt is liable to pay rent or other debt falling due at fixed and stated periods, the creditor may prove for a proportionate part thereof up to the time of the bankruptcy, as if the same grew due from day to day, and not at such fixed and stated periods. If any bankrupt shall be liable for unliquidated damages arising out of any contract or promise, * * the court may cause such damages to be assessed in such mode as it may deem best, and the same so assessed may be proved against the estate.
It is contended for the lessors, that this claim for rent was, under the nineteenth section, a debt existing at the time of the adjudication of bankruptcy, but not payable until a future day, and that, therefore, it may, by the terms of that section, be proved against the estate. The case is sought to be likened to that where an article is purchased to be paid for in installments, at fixed periods, and only part of the installments are paid before an adjudication of bankruptcy, in which case, it is contended, the vendor can prove his debt for the remaining installments, a rebate of interest being made if no interest is payable by the terms of the contract. This might be so if there were not a special provision for the case of rent falling due at fixed and stated periods. And there seems to be a reason for such special provision in regard to rent, in the fact that where an article is purchased the consideration is or is assumed to be executed, while in the case of rent, the consideration is asssumed to be not executed but executory, the use and occupation being m futuro. But, whatever the terms of payment of rent may be, the creditor may prove for a proportionate part thereof up to the time of the bankruptcy, as if the same grew due from day to day, and not at the periods fixed by the contract of letting. The provision in regard to rent not yet due, and to proving for a proportionate part of it, with the further provision that no other than the specified debts shall be proved, makes it entirely plain that this debt, as proved, cannot be allowed. *42Whatever is not provable will not be discharged. The provisions in regard to what debts may be proved are arbitrary, but such provisions do not affect the existence or validity of such debts as are not provable, nor does a discharge release them. If the debt is provable it comes in for a dividend, and can unless it is an accepted debt be discharged. If it is not provable, it does not come in for a dividend, but it will not be discharged.
The words “ the time of the bankruptcy,” mean the time when the petition was filed, to which time the adjudication relates. The rent to that time has been paid. The objection of the assignee to the proof of debt, as made, is sustained and the claim set forth in the proof of debt is disallowed.