Tirrell v. Freeman

Field, J. The plaintiff, having proved his debt, signed the resolution of composition of the defendants, (who were bankrupt [300] debtors, under a petition filed on or about February 10,1876,) in consideration of an oral promise by the debtors that they would pay the plaintiff his debt in full, by giving him four promissory notes therefor, and would pay a further sum in money. The resolution was confirmed by the signatures of the debtors, and the requisite number of creditors, including the. plaintiff, and it was ordered to be recorded by the court, whereby the debtors were discharged from their debts. Subsequently, on December 1, 1876, the debtors gave the plaintiff a written agreement to give the notes, and “ thereafter, on or about January 1, 1878, for the same consideration, gave the plaintiff, among other things, the five notes declared on, in lieu of the four notes so agreed to be given aforesaid.” On October 17,1876, the defendants filed a second petition in bankruptcy, and were adjudged bankrupt debtors thereon, and obtained their discharge; but the plaintiff, under this bankruptcy, did not prove his claim, nor was he “ mentioned as a creditor in the schedules filed therein.” It is conceded by the plaintiff that the oral promise was void, not only because it was not in writing, but also because it was illegal, and made in fraud of creditors and the laws relating to bankruptcy. Gen. Sts. c. 105, § 3. Pub. Sts. c. 78, § 3. U. S. Rev. Sts. § 5131. Blasdel v. Fowle, 120 Mass. 447. Dexter v. Snow, 12 Cush. 594. See also Cobb v. Tirrell, 137 Mass. 143. The contention of the plaintiff appears to be, that, as there was no new promise sufficient in form to revive the old debt, before the written agreement of December 1, 1876,—which was after the second bankruptcy, — that agreement must be regarded as voluntarily given; that the old debt, although discharged in bankruptcy, was a sufficient consideration; that the effect of the composition in the first bankruptcy cannot be impeached in this suit; Farwell v. Raddin, 129 Mass. 7; that the plaintiff was not a creditor under the second bankruptcy; that the giving of the written agreement was not in fraud of the creditors under the second bankruptcy, as the debts discharged by the first bankruptcy were not provable under the second; that, if the discharge in the first bankruptcy could have been held invalid in the second bankruptcy, the discharge in the second bankruptcy discharged the debts of the creditors in the first [301] bankruptcy; and that the plaintiff has not aided the defendants in obtaining this discharge. We are unable to see that the second bankruptcy has anything to do with the case. It is true, that the plaintiff did not aid the defendants to obtain a discharge in the second bankruptcy, and the agreement was not given in consideration of anything done, or for the purpose of affecting any proceedings, in the second bankruptcy. If the composition in the first bankruptcy had been seasonably set aside, and the debtors had not obtained their discharge therein, creditors under the first bankruptcy could have proved the remainder of their debt under the second bankruptcy; but the composition has not been set aside, and it may perhaps be assumed that the defendants have been effectually discharged of their debts under both proceedings in bankruptcy. It cannot, however, be assumed that the defendants would have obtained their discharge in the second bankruptcy, if they had not also obtained it in the first, and the proceedings in the first bankruptcy cannot be treated as of no effect, or as immaterial. The defendants could not have been compelled to give a written promise in accordance with their oral promise; but they have given such a written promise, and the question comes to this, whether, if a bankrupt debtor orally promises to pay a creditor’s debt in full if the creditor will sign an assent to his discharge and enable him to obtain it, and the debtor, after having thus obtained his discharge, gives, in execution of his oral promise, a written promise to pay the debt, the written promise is tainted with the original fraud. Of this we have no doubt. The purpose is to carry the original fraudulent agreement into effect. Blasdel v. Fowle, ubi supra. The judgment must be reversed, and the demurrer overruled. So ordered.