In re Jersey Island Packing Co.

152 F. 839, 1907 U.S. Dist. LEXIS 352

• Court: District Court, N.D. California
• Decided: March 15, 1907
• Docket: No. 4,821
• Status: Published

Opinion

DR, HAVEN, District Judge.

This is a petition to set aside and annul an order of this court made on the 23d day of February, A. D. 1906, confirming a composition offered by the bankrupt, and the discharge resulting therefrom, upon the alleged grounds of fraud in its procurement, and because the offer did not conform to the requirements of section 12, Bankr. Act July 1, 1898, c. 541, 30 Stat. 549 [U. S. Comp. St. 1901, p. 3426]. The petition was filed on February 21, 1907. The trustees named in the offer of composition and in the order confirming the same have appeared and moved to strike the petition from the files, as sham, irrelevant, and trifling, and upon other grounds stated in the notice of motion. They have also demurred to the petition upon the ground ‘that the said petition is barred by the provisions of section 13 of the acts of Congress relating to bankruptcy.” Section 13 of the Bankruptcy Act provides:

“The Judge may, upon the application of parties in interest filed at any time within six months after a composition has been confirmed, set the same aside and reinstate the case if it shall be made to appear upon a trial that fraud was practiced in the procuring of such composition, and that the knowledge thereof has come to the petitioners since the confirmation of such, composition.”

In view of this section, there does not seem to be any escape from the conclusion that the present petition was not filed within time, and that the demurrer thereto must be sustained for that reason. The fact that the petitioner also asks that the bankrupt’s discharge resulting by operation of law from the confirmation of the composition referred to may also be set aside and annulled does not bring this proceeding within section 15 of the bankruptcy act, which provides that a judge may, “upon the application of parties in interest who have not been guilty of undue laches, filed at any time within one year after a discharge shall have been granted, revoke jt, if upon a trial it shall be made to appear that it was obtained through the fraud of the bankrupt,” etc. This section does not apply in a case such as this, where the discharge of the bankrupt results by operation of law from the confirmation of the bankrupt’s offer of composition. So long as the order confirming the composition stands, it must have the effect given it by subdivision “c,” § 14, of the bankruptcy act, viz., the discharge of the bankrupt from his debts, “othqr than those agreed, to be paid by the terms of the composition and those not affected by a discharge,” and the order of confirmation can only be set aside within the time limited by section 13 of the bankruptcy act above quoted.

Having reached this conclusion upon the demurrer, it is unnecessary to consider the motion to strike the petition from the files.

The demurrer will be sustained, and the petition dismissed.