Davenport v. His Creditors

Ross, J.: More care on the part of counsel in regard to references made in briefs would save the Court much time and labor. In this case, the counsel for both sides refer to the Insolvency Act of 1876, as the one under which the proceedings were had, and, by number, to sections not found in that Act at all. The Act of 1876 has nothing to do with the case. The proceedings were had under the Act of May 4,1852. Davenport filed in one of the late County Courts a petition praying to be adjudged an insolvent. Accompanying the petition was a schedule, in which Van Winkle was named as one of his creditors. Van Winkle’s claim against Davenport was [31] based on some partnership transactions between the parties. Within ten days after the appointment of an assignee of the insolvent’s estate, Van Winkle filed in writing his opposition to the discharge of the insolvent, and an application for the revocation of the appointment of the assignee, on the ground of fraud alleged to have been committed by Davenport. In his opposition, Van Winkle charged distinct acts constituting the alleged fraud on the part of Davenport, consisting, among other things, of the alleged fraudulent receipt and appropriation of a considerable portion of opponent’s funds; and further charged that in an action between the parties in one of the then District Courts of the State, an account had been stated of the partnership affairs, by which it had been ascertained and found that there was a large indebtedness due from Davenport to opponent, for which judgment was entered. Davenport filed an answer, by which he put in issue the averments of fact contained in the opposition of Van Winkle. The judgment entered against Davenport in favor of Van Winkle was afterwards set aside by the Court in which it was entered, on the ground “that no notice was given ” to Davenport’s attorney, and subsequently Davenport moved in the insolvency Court to dismiss Van Winkle’s application for the revocation of the appointment of the assignee and his opposition to the discharge of the insolvent, on the ground that he, Van Winkle, had “no status in Court on which to make such opposition.” That motion was granted, and an order of discharge was subsequently entered. The idea of the party making the motion, and of the Court in granting it, seems to have been that Van Winkle ceased to be a creditor of Davenport when the judgment entered in the District Court was set aside. But that was not at all so. If the facts stated in Van Winkle’s opposition were true, he was a creditor; for in that it was distinctly charged that Davenport was indebted to him in the sum of seventeen thousand two hundred and eighty-one dollars, received by him in a fiduciary capacity. Besides, in the schedule filed by the petitioner himself, Van Winkle is named as one of his creditors. Issues having been raised upon the question of fraud on the part of the insolvent, it became the duty of the [32] Court, by virtue of Section 20 of the Act of May 4, 1852, to summon a jury for the purpose of deciding on that accusation. Judgment and order reversed, and cause remanded for further proceedings in accordance with the views here expressed. McKinstry and McKee, JJ., concurred.