Imlay v. Carpentier

Cope, J. delivered the opinion of the Court—Baldwin, J. concurring.

This is an action to set aside a judgment and execution. The complaint was demurred to, and the appeal is from an order sustaining the demurrer and dismissing the complaint. The action is based upon the following facts: The defendant, Carpentier, in the month of January, 1858, commenced a suit against the plaintiff, upon a promissory note, executed on the 4th of May, 1857, and recovered a judgment by default, for the amount of such note, and the costs of the suit. During the pendency of this suit, and about ten days anterior to the judgment, the plaintiff instituted proceedings in insolvency, in pursuance of the provisions of the Act of May 4th, 1852, for the relief of insolvent debtors and protection of creditors, and was afterward duly released and discharged from all his debts and liabilities, including his said debt to the defendant, Carpentier. An execution was subsequently issued upon the judgment, and levied upon the property of the plaintiff.

We agree with the Court below, that the complaint does not disclose sufficient equity to entitle the plaintiff to maintain this action, but as that Court based its decision upon the general ground of a want of equity, and as we think the plaintiff entitled to relief in some form, it is proper for us to examine the whole subject, without reference to any specific objection to the complaint, and to indicate what we deem to be the correct practice in such cases.

The question to be first disposed of, relates to the effect upon this judgment of the discharge of the plaintiff as an insolvent debtor. The statute limits the discharge to such debts and liabilities as were owing at the time of the application, and named in the schedule attached to the petition; and it is contended that this judgment is not within the operation of the discharge, for the reason that it did not exist at the time of the application, notwithstanding the debt upon which it was recovered was specially set forth in the schedule, and included in the discharge. This provision of our statute is not peculiar, and the authorities upon the question involved in the proposition contended for, are numerous and pointed.

In England, such debts only are affected by a discharge in [175]bankruptcy, as were due and owing at the date of the commission. It is, however, the settled doctrine of the English Courts, that a judgment recovered against a bankrupt after the issuance of the commission, and before he obtains his discharge, upon a pre-existing indebtedness, occupies the exact position of the original debt, and is equally within the purview and operation of the discharge. Blandford v. Foote, (1 Cowp. 138,) is a case in point. The defendant had been arrested in a suit upon a judgment recovered against him after he had committed an act of bankruptcy, and a commission had issued. An order was made requiring the plaintiffs to show cause why he should not be discharged under the provisions of the Bankrupt Act. Mr. Mansfield, who appeared for the plaintiffs, insisted “ that the judgment upon which the defendant had been taken—being subsequent to the commission sued out—the defendant was not within the favor of the statute, which expressly relates to any debt or debts due, or contracted, before such commission issued, and to such debts only.” Mr. Baldwin, contra, contended that “ the defendant ought to be discharged; though the judgment was signed after the commission issued, yet the cause of action was antecedent to the commission, and therefore within the intention of the statute.” Lord Mansfield, in ordering the discharge of the defendant, said: “ The only doubt that can arise in this case is with respect to the interest and costs accrued since the bankruptcy; but I think they stand upon the same foundation as the original debt which was clearly due before the bankruptcy, and therefore, equally within the benefit of the statute.” Mr. Justice Willes was of the same opinion, and referred to a similar case, which was decided in the same way, with the concurrence of the whole Court.