In re Good

Hayne, C. — H. C. Good and James Roney were partners, “ carrying on a grocery and bar business at Vallejo in a small way,” for about four years. On the third day [400]of July, 1886, they filed a petition in the superior court of Solano County, asking to be adjudged insolvents, and in February, 1887, Good applied to the court for a discharge from his debts. This application was opposed by some of the creditors, on the ground that the firm of Good & Roney had not kept proper books of account-, and it was specified that they did not enter in their books “ an indebtedness of said firm to John Good, amounting to about seven thousand five hundred dollars, and did not enter in said books an indebtedness of said firm to Walter C. Good, amounting to about two thousand five hundred dollars, and thereby falsely made it appear by said books that said firm was indebted in a less sum, to wit, ten thousand dollars less, than said firm actually owed, and thereby falsely made it appear by said books that said firm was "solvent, and that the indebtedness of said firm did not exceed its assets, whereas said firm was wholly insolvent, and its actual indebtedness largely exceeded the value of its assets.”

Good filed an answer to the objections made to his discharge, and, admitting that the indebtedness of seven thousand five hundred dollars to John Good, his father, and two thousand five hundred dollars to Walter 0. Good, his brother, was not entered in the books of the firm, averred that the books -were not kept by himself, but by James Roney, and that neither of the partners was -an expert book-keeper, and that they did not consider it necessary to enter those items; that the items were for moneys loaned to the firm to enable the partners to commence and continue their business, and constituted their capital stock, and that promissory notes therefor had been given. He also averred that the omissions were made in good faith, and without any intention to deceive or defraud any one, or to make the firm appear solvent when it was insolvent, and that no creditor of the firm was injured or defrauded thereby; that the books correctly set forth the mercantile transactions [401]of the firm, and did not purport to show its indebtedness for money borrowed and for which notes had been given, and therefore did not falsely or at all make it appear that the firm was indebted in a less sum than it actually owed, or falsely or at all make it appear that the firm was solvent, or that its indebtedness did not exceed its assets.