In re Marsh

Britt, C. April 22, 1893, Marsh filed in the superior court a petition in insolvency under the Insolvent Act of 1880. In the accompanying schedules his debts were estimated at $2,318, including the sum of $2,200 on a promissory note to one J. A. Bell, for which note it was stated there was no consideration. A formal adjudication of insolvency was entered, and, after the .expiration of three months following, Marsh applied for a discharge from his debts. Said Bell contested the application, and, on July 14, 1894, after trial of the contest, the court rendered judgment declaring [232]that, on said April 22, 1893, Marsh did not owe debts amounting to three hundred dollars, and was not entitled to be discharged, or to receive the benefits of the act. Afterward, on October 9, 1894, Marsh began the present proceeding by filing a new petition in insolvency, showing liabilities amounting to $3,104; thereupon he was adjudged insolvent, and on January 11, 1895, he again made application to be discharged from his debts. Bell again contested his right to the same; this time on the ground that in the proceeding first instituted, Marsh , had had the benefit of the Insolvent Act within the meaning of the provision of section 49 thereof—that no discharge shall be granted if the debtor has received the benefits of any acts of insolvency within three years next preceding his application for discharge. The court made findings sustaining this view, and gave judgment denying the discharge, and subsequently denied a motion for new trial.

At first blush it seems odd that if a debtor’s discharge in insolvency is denied on the ground that he was not, when he filed his petition,'entitled to receive the benefits of the act, yet in a subsequent proceeding his discharge may be again defeated because in the first he had enjoyed such benefits. And this impression is not effaced on fuller consideration of the facts here. Under the act of 1880 (section 2), no one whose debts did not exceed the sum of three hundred dollars could invoke the action of the court for his relief. Marsh’s first petition was, therefore, self-destructive. (See Friedlander v. Loucks, 34 Cal. 24; In re Fowler, 1 Low. 162.) To say that there was no consideration for his promissory note to Bell, was to say that it was no valid contract, and hence, no debt. The court had no jurisdiction to entertain his petition, and he, of course, could receive no legal benefits from proceedings based thereon. In this, the case differs wholly from In re Smith, 68 Cal. 203, relied on by respondent; no question existed there as to any jurisdictional infirmity in the prior proceedings taken by the insolvent.