Whitaker v. Chapman

By the Court — Johnson, J. Upon the facts found by the judge, at Special Term, the judgment is clearly right. The debt was created by the defendants while acting in a fiduciary character, and was in no way affected by their discharge in bankruptcy afterward. The discharge does not absolve any party from the enforcement of a debt of that character against him, by the express terms of the bankrupt act (section 33). It is claimed, on behalf of the defendants, that the property sold by them was received and sold upon an undertaking on their part, that they should guaranty to the plaintiff payment of the amount of sales less their commission. But this fact, if important in the case, is not found by the court, and the presumption is, that the finding was the other way, if such adverse finding is necessary to support the judgment, and the evidence in the case would warrant such finding. (Valentine v. Conner, 40 N. Y., 248.) Upon looking into the evidence, it is seen that the judge who tried the actio*' might well have found, that the property was sent by the plaintiffs to the defendants, to be sold by them upon commission in the ordinary manner, and that there was no agreement, express or implied, that defendants were to be [158] guarantors of credit sales, or otherwise. This being the case, the debt was clearly contracted while the defendants were acting in a fiduciary character, within the meaning of our Code, and according to numerous decisions under it in our own State. Under our present bankrupt act of 1867, the discharge does not extend to a debt created by the bankrupt “ while acting in any fiduciary character (section 33). In re James W. Seymour (6 Internal Revenue Record), 61, it was held by Blatchford, J., that if the debt was created while the debtor was acting in any fiduciary relation with the creditor, and in the business in which the relation was created, the bankrupt act would not affect it. In that case one Roswig had deposited with Seymour, who was a wholesale jeweler, jewels to be sold on a commission of five per cent for selling. The latter had sold the jewels and refused to pay over the proceeds. Action had been commenced against him, an order of arrest obtained, and the defendant arrested upon execution of the judgment for the proceeds of the sale less the commission. Pending the action, proceedings in bankruptcy had been instituted against Seymour, and he obtained a writ of habeas carpus to procure his discharge from the arrest under the execution. The learned judge held that proceedings and discharge in bankruptcy could not affect the case, as it was a debt contracted by the defendant while acting in a fiduciary character. It was held that the present bankrupt act had intentionally been made broader than the bankrupt act of 1841. By that act “ all persons owing debts, created in consequence of a defalcation as a public officer, or as executor, administrator, guardian or trustee, or while acting in any other fiduciary character,” were excluded from its benefits. But the Supreme Court of the United States, in Chapman v. Forsyth (2 How. U. S., 202), restricted the latter clause “ any other fiduciary character” “to trusts of the same class” with those previously mentioned, which were express trusts, and not those implied by law, and held that a factor was not within the act. This construction was given to that clause [159] upon the principle of the maxim nosoitur a sociis. In the present act no particular class of trusts is mentioned, and there is no such limitation. All debts are excluded which are contracted “ while acting in any fiduciary character.” And so it was held, in the ease before referred to, that a debt created by a factor was within the present bankrupt act. This is manifestly correct. The language of the act is general, and there is nothing in its provisions which can be construed to confine such debts to any particular class or kind of trusts. The defendants’ circular was properly received in evidence, ít was a paper delivered by the defendants to the plaintiff when they solicited his custom, and had an important hearing upon the terms and conditions upon which the property was sent, and the character in which the defendants purposed to act, and did act in the transaction. The bill of invoice and stencil plate delivered at the same time were evidence for the same purpose. The bill of sale was also properly received. It was the account rendered by the defendants, of the sales made by them, and the prices and amounts for which the property had been sold. The receipt of the freight agent on the delivery of the cheese at the railway depot, whether properly received in evidence or not, was wholly immaterial, and could by no possibility have prejudiced the defendants. The defendants admitted the receipt and sale by them of the cheese. If it was an error to receive it in evidence, it was altogether harmless and would afford no ground for the reversal of the judgment. The judgment must therefore be affirmed. This being an appeal from a judgment rendered by the presiding justice he does not sit in the case. Judgment affirmed.