Bernheimer v. Charak

Knowlton, J. Unless affected by some statute which applies directly to bonds like that in suit, it is clear that the liability of the defendants as sureties is not changed by the insolvency and the discharge of the principal in the bond. Pub. Sts. c. 157, § 85. Gass v. Smith, 6 Gray, 112. New England Steam & Gas Pipe Co. v. Parker, 10 Gray, 333. Cutter v. Evans, 115 Mass. 27. In Tapley v. Goodsell, 122 Mass. 176, 182, Chief Justice Gray said of a similar bond: “ The bond is not affected by contingencies which might have discharged the attachment, if no bond had been given. Neither death nor bankruptcy of the principal discharges the surety from his obligation to satisfy a judgment lawfully rendered against the principal or his representatives ; but such judgment, in the absence of fraud or collusion, is conclusive against the surety.” The defendants rely upon the St. of 1889, c. 470. Prior statutes of the same series are the St. 1884, c. 236, St. 1888, c. 405, and St. 1889, c. 406. The first of these provided for a composition by a debtor with his creditors in the Court of Insolvency, and for the granting of a discharge to the debtor, but it contained no express provision in regard to bonds given to dissolve attachments. St. 1888, c. 405, provides that an obligee in a bond given to dissolve an attachment may have a special judgment against the surety on the bond in cases where the principal is discharged by proceedings for composition, so that no judgment can be obtained against him in the original action. This expressly extends section 23 of the Pub. Sts. c. 171, to such cases, if it did not apply to them before. 181 The legislation up to this point contained no provision for the dissolution of the attachment by proceedings for a composition in insolvency, for however short a time the attachment might have been in existence, but left security of that kind in full force after the debtor had obtained his discharge. To give the debtor relief in such cases, and to compel creditors who had attached property just before the proceedings in insolvency to share equally with the others when a composition is made, the St. of 1889, c. 406 was passed, which declares that the granting of a discharge shall dissolve such attachments made not more than four months prior to the time of giving notice by the register of the proposal for the composition. Apparently by an oversight, this statute failed to include cases where the attachment had been made a short time before the commencement of the insolvency proceedings and dissolved by giving a bond. Accordingly, in the same year chapter 470 was enacted, making a similar provision for cases of this latter kind. The defendants contend that it applies to cases in which final judgment is obtained in the original action before the com-men cement of the insolvency proceedings; but we are of opinion that it does not. When an attachment is not dissolved by giving a bond, a levy may be made immediately after obtaining judgment and execution, so that the creditor’s rights to his security may be fixed beyond the possibility of disturbance by proceedings in insolvency. We are of opinion that this statute is intended to give to a creditor who has obtained a judgment before the proceedings in insolvency the same right to hold his security under a bond to dissolve an attachment as he would have if no bond had been given and he had chosen to make a levy upon the attached property immediately after the judgment. The right which the statute gives to the debtor is, in express terms, to have the action in which the attachment was made continued to await the result of the insolvency proceedings, and, if the debtor is discharged, to have the discharge operate as a release of the sureties on the bond, when the claim on which the attachment was made is one that would have been discharged if proved in the insolvency proceedings. The statute, in the operation described, can apply only to attachments in suits pending at the time of the commencement of proceedings 182 in insolvency. If the action has gone to a judgment before the proceedings are begun, the right of the creditor to proceed against the sureties if payment is not made according to the terms of the bond is fixed, just as his right to the security of attached property would be fixed if he took out execution and made a levy immediately after the judgment. Judgment affirmed.