Steene v. Aylesworth

Williams, Ch. J. 1. The bankrupt law makes the certificate conclusive evidence of the discharge of the bankrupt, unless impeached for some fraud or willful concealment of his property. Here the fact that this property was not in the schedule, was claimed as sufficient evidence of fraud or willful concealment, so as to destroy the effect of the certificate. Surely, some other evidence was necessary to show a fraud, to vacate so solemn an instrument. In addition to this, another guard is thrown around this certificate, viz. prior reasonable notice in writing, specifying the fraud or concealment. It is not pretended this has been given ; but in answer to this, it is said, they had no opportunity to give such notice. This would be an argument to prove, that cases of this kind, are not the cases in which the doings of another court in granting such certificates, are to be tried. It is enough for this case, that the law requires notice in writing ; and that that notice has not been given. It is not therefore necessary for us to determine whether a certificate of discharge could, in this collateral manner, be attacked; which we certainly very much doubt. In the transfer of the personal property, Peckham covenants to warrant and defend the property; and on this ground, it is said, he is interested. But there is here no attack upon the title to this property. The assigneee, by bringing a suit for its value, affirms the title in the defendant. Nor does it appear, that lie was called to contradict any fact stated in his deed. But it is said, that Peckham had an interest in the surplus of this estate, that is, what remained after paying his debts ; and as it may so happen, that there may be a surplus, the law considers him interested, unless he gives a release. Of this there is no doubt; and had the judge understood at the trial, that this objection was made, he would have so ruled ; and on this point the question is, not what is the law, but what were the facts — was any such claim made below ? The rule of the court is, that on a motion for a new trial, the precise point made by the party, and the precise opinion [251] expressed by the court, shall appear upon the motion ; and in every writ of error there shall be a special assignment of error. 6 Conn. R. 327. Now, what was the precise point made below ? That the party was interested in the event of the suit, first, as having given the covenants in the deed ; and secondly, being the bankrupt under whom the plaintiff claimed. To meet the latter objection, the plaintiff offered the certificate. The defendant says, that is not sufficient to remove the objections to it as void. They go to the court with that precise question; and that question is decided by the court. It does not appear that it was intimated by the court, or thought of by the parties, that there could be any other interest in the bankrupt. Certain it is, that the court below never did intend to decide the question now put to this court; and it would be in direct violation of the spirit, if not the letter of the rule, that a party, under a general allegation of interest in a witness, should specify particular grounds of interest, and omit others, and then claim that those omitted were in fact included in the general objection. This would be, in effect, to keep back a part of the objection, that it might escape observation, and yet lay the foundation for future litigation. The object of the rule was, that the party should make a full and fair disclosure of his objections so as to give the opposite party an opportunity to obviate it, if he could, or to withdraw the evidence. In this case, the whole course of proceeding was adapted, we trust not intended, to conceal this objection. For no one can believe, for one moment, that the prospect of a surplus from a bankrupt estate, would have been such as to have prevented a release, had this objection been interposed. We think too, that this point is in effect settled, in the case of Picket v. Allen, 10 Conn. R. 146. There the claim was, that a collector’s warrant was void, because it was not properly directed, and because the power under it had expired. When the case came to the superior court, it was claimed, that the warrant was void, for another reason, that no rate-bill was annexed. The court said, that this objection was fatal, if taken below; but it was admitted without objection; and the court were required, on other grounds, to charge the jury, that it was void, but. were not required to express any opinion on this point. It was, therefore, not a point in judgment. [252] That was a writ of error; but surely we should have more discretion in an application for a new trial. We may well say, that the defendant had waived any such objection, when it had not been alluded to. If it be said, that the general objection that Peckham was interested in the event of the suit, included it; it might with as much force have been said in that case, that a general objection that the warrant was void, included every cause which would render it so. 2. Phillips was offered as a witness, and objected to, because he was a creditor. No proof of the fact was offered to show that he was a creditor, except that in the schedule of debts presented by the bankrupt, he is named as such ; and we are called upon to grant a new trial, because the court did not hold this fact as conclusive evidence that he was interested ; for unless it was conclusive, we cannot grant a new tria!, because it did not convince the court. Take the fact most strongly for the objector, as the admission of a person interested, it is nothing more than that the bankrupt acknowledged there was, when he made his schedule, a note or outstanding claim in favour of Phillips against him. Whether r it was due to him, at this time; or whether it had been assigned to some other person, was left in doubt. But even if the court had, erred in admitting Phillips as a witness, after he had been admitted and testified that he was not then a creditor, but that he had assigned all his interest in the debt, it would be a perversion of every principle, upon this state of facts, to grant a new trial; because it is apparent, upon the whole testimony, that Phillips had no interest whatever. The testimony, taken together, shows only, that he once had an interest, but that before the trial, it was removed. 3. It has been claimed with much pertinacity, that if the sale by Peckham, to the defendant, was bona fide, this suit cannot be sustained, by the assignees of Peckham; and cases have been referred to, to show that the creditors ought to bring the suit. It is true, that after great diversity of opinion among the judges, it is now settled, that where a promise is made to one man for the benefit of another, the latter may sustain a suit upon that promise. Pigott v. Thompson, 3 B. & P. 149, and note. But it does not follow from this, that the promisee himself could not sustain a suit. On the contrary, it is ex [253] pressly asserted, in many of the cases, that the suit rnay be maintained, by the promisee, or the person for whose benefit-it is made. Bell v. Chaplain, Hard. 321. Dutton v. Poole, 1 Vent. 318. S. C. Sir T. Ray, 302, S. C. 2 Lev. 210. 3 Keble 815. It is recognized as law, by Ch. B. Corny ns, which is of itself authority; (1 Com. Dig. tit. Action on the case upon Assumpsit. E. a.;) by Chilly ; (1 Chitt. Pl. 5.) and by Bayley, J., in a modern case. Garrett & al. v. Handley, 4 R. & Cres. 684. (10 E. C. L. 439.) There cannot, therefore, be a doubt but that Peckham might have sustained a suit, had it not been for his bankruptcy. The only question, therefore, on this part of the case, is one which has not been alluded to, at the bar — whether the assignee of Peckham stands in his place, and can sustain his suit, if Peckham could have done it. By the 2nd section of the bankrupt act, all the property and right of property, of every name and nature, with a trifling exception, vests in the assignee, with power to sue for and defend the same. It is true, that it has been holden, that where a bankrupt is a mere trustee, the property does not pass to the assignee, and the bankrupt can maintain a suit in his own name. Winch v. Keeley, 1 Term R. 619. But it has also been hol-den, that wherever the bankrupt has a beneficial interest, that interest is a subject of assignment, and, by our law, vests in the assignee. Smith v. Coffin, 2 H. Bla. 461, Barstow v. Adams, 2 Day 70-97. That the bankrupt here had a beneficial interest in the property thus sold, and that it becomes important to the as-signee in settling the estate, is apparent: for, unless the defendant applies the properly in his hands to the payment of debts according to his contract, there remains so much more debts to be proved under the commission. We think, therefore, that the assignee k the proper person to bring the suit; and whether the creditors could sustain a suit or not, in point of law, the practical difficulties would be almost insuperable. And in this way, entire justice could be done, upon principles strictly legal. 4. Another question was made at the bar, not within the motion, about which testimony has been heard, relative to the exclusion, by the court, of evidence on a question put to the witness Peckham, upon his cross-examination. [254] It is extremely difficult to ascertain the exact state of the case, by the testimony, when the question was put. But without attempting to state it exactly, it is enough to say, that upon the cross-examination much must be left to the discretion of the judge ; and we are not satisfied, that any error has occurred, which ought to lay a foundation for further litigation in this case. In this opinion the other Judges concurred. New trial not to be granted.