Court Opinion

ID: 6580190
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:37:40.173706+00
Date Added: 2024-06-11T15:57:14.931416
License: Public Domain

Carpenter, J.
This record presents two questions.
1. Was the receipt given by the plaintiff obtained by fraud ?
The committee finds that it was not obtained by fraud unless fraud is to be inferred from the facts stated. It will be observed that this was not a compromise with all the creditors, nor was there any agreement that all the creditors should release the defendant on the same terms in order to make the receipt binding upon the plaintiff. There was no fraud or misrepresentation in respect to the value of his assets: on the contrary it distinctly appears that the plaintiff received his full share of those assets. It is found that the defendant agreed verbally that lie would settle with all his creditors by paying them forty per cent, of their respective claims, and endeavor to procure their consent to such a settlement, which agreement was not kept. A breach of this promise does not in itself constitute a fraud.
It is further found that the defendant, when he made this agreement, intended to pay some of his creditors in full, should he thereafter bo able to do so; and that many of the creditors with whom .he made no arrangement to pay forty *166per cent, were his relatives, whom lie owed for money lent to him; that lie intended to carry out such arrangement with such creditors as had sold him goods, but not as to the others, some of whom he has since paid in full, and to others lie has paid nothing, but intends to pay them in full. All this may be evidence tending to prove fraud, but it is not itself fraud. From the whole case it is apparent that the plaintiff was satisfied to receive his fair proportion of the defendant’s property. Hence he did not require a technical composition, and did not make the validity of the receipt to depend upon the other creditors settling with and discharging the defendant upon the same terms.
The promise to settle with the other creditors, and the expectation that the defendant would do so, do not seem to have induced the action of the plaintiff; and there is no evidence that he relied upon such promise and expectation. If he did not the secret intention to favor a portion of his creditors is immaterial. At least upon the facts as they appear the law does not pronounce the transaction a fraudulent one.
2. The plaintiff objects, in the second place, that the receipt is inoperative, for the reason that it was given for a part of his demand only and can not be a discharge of the whole. In support of this claim Warren v. Skinner, 20 Conn., 559, and cases there cited, are relied upon. This case differs from that and falls within an exception to the rule which is there recognized. In this case a note indorsed by a third person was taken for a part of his demand, in consideration of which he relinquished the balance. The additional security which he received by the indorsement was a sufficient legal consideration for the discharge.
Whether a receipt in full should have the same legal effect as a release under seal is a question we need not consider.
We are satisfied that there should be no new trial.
In this opinion Park, C. J., and Pardee and Loomis, Js., concurred. Foster, J., was of opinion that there was some taint of fraud in the transaction and that the promise of the defendant had not been faithfully performed but concurred in the other views expressed in the opinion.