Lawrence v. Wischnowsky

100 N.E.2d 816, 344 Ill. App. 346
CourtAppellate Court of Illinois
DecidedOctober 2, 1951
DocketGen. 10,502
StatusPublished
Cited by5 cases

This text of 100 N.E.2d 816 (Lawrence v. Wischnowsky) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lawrence v. Wischnowsky, 100 N.E.2d 816, 344 Ill. App. 346 (Ill. Ct. App. 1951).

Opinion

Mr. Justice Anderson

delivered the opinion of the court.

This is an appeal from an order of the county court of Kankakee county, recalling on motion of Howard Wisehnowsky, defendant-appellee herein, that court’s execution on a judgment rendered on January 7, 1944, in favor of plaintiff-appellant E. W. Lawrence staying all further proceedings thereon.

On September 14,1942, the appellant sold some hogs to the appellee. In payment therefor Wisehnowsky delivered to Lawrence a conditional sales note for $696, due March 14, 1943. The note provided the title to the hogs remain in the payee until payment was made, and the note also included a warrant of attorney to confess judgment at any time after its date. The note was not paid when due, and some time in 1943 Wisehnowsky sold the hogs without accounting to Lawrence for the proceeds.

On January 7, 1944, a judgment was entered by confession in the county court of Kankakee county in favor of Lawrence and against Wisehnowsky for the sum of $845.56.

On June 20, 1944, Wisehnowsky was adjudicated a voluntary bankrupt in the United States District Court for the Eastern District of Illinois. The judgment of Lawrence was listed in the schedule as an unsecured claim. On objection of appellee’s discharge in the said United States court, the referee found that the hogs had been sold without accounting to Lawrence. The referee held that the appellee’s discharge was not barred, and it was granted to him, and he further refused to decide whether the debt was dischargeable, and held this question was reserved for the state courts in a proper proceedings.

On January 7, 1944, Lawrence filed in the county court of Kankakee county where the judgment was taken, an affidavit for garnishment alleging among other things that Sanderson and Porter were indebted to Wischnowsky. Sanderson and Porter, the garnishee, filed an answer admitting certain indebtedness, and on August 30, 1945, a judgment was entered that appellee for use of appellant have judgment against the garnishee for the amount of $82.50. On December 13, 1950, appellant sued out a pluries execution on his judgment for the amount of the unpaid balance there. The execution was delivered to the sheriff of Kankakee county to levy on certain real estate of the appellee, and it was advertised for sale. December 19, 1950, appellee filed his motion in the county court to recall the execution on the ground that his discharge of bankruptcy discharged the debt. Appellant contended in the county court, as he does here, that the underlying judgment was a liability for willful conversion of property, hence not dischargeable in bankruptcy. He further contended in the county court, and contends here, that the garnishment judgment above referred to was res adjudicata, in effect contending that the fact that appellee did not raise the question or plead his discharge in bankruptcy was in fact an admission and adjudication that it was not dischargeable. Wischnowsky was called by Lawrence as an adverse witness in the trial held in the county court. Wischnowsky testified that he had sold the hogs and paid the proceeds to Lawrence. He further was asked why he listed the debt as a debt in bankruptcy if he had paid it. He said he did not wish to answer that. E. W. Lawrence also testified that he sold half of those hogs to Howard Wischnowsky for which the note was given, and he retained title to the hogs by the conditional sales note; that Wischnowsky sold the hogs, and had not paid him the proceeds of the sale or any part thereof. The court permitted E. W. Lawrence and Howard Wischnowsky to testify as above mentioned, but reserved ruling as to its competency. The court later sustained the objections as to the competency of the testimony of E. W. Lawrence and Howard Wischnowsky, and ordered that the execution he recalled.

The facts disclosed by the record are that Lawrence, the appellant, had sold Wischnowsky, the appellee, the hogs in question and taken an ordinary note in pay-ment thereof. Lawrence, in addition to having the note, reserved title in the hogs by a conditional sales agreement. That is he not only had the security of the maker of the note but he had additional security, the hogs. The note was an ordinary judgment note form, and provided that payee might take judgment on it by confession at any time thereafter. The hogs were sold by Wischnowsky, apparently without the consent of Lawrence, and the proceeds of the sale were converted to his own use, and were not applied on the note. After the date of the sale as above disclosed, Lawrence took judgment on his note. Wischnowsky went into bankruptcy thereafter and was discharged on the 8th day of December, 1944, the discharge being defendant’s exhibit two, stating that the bankrupt was discharged from all his debts except such debts as are by said act excepted from the operation of the discharge in bankruptcy. There is no question but such discharge was properly given to the bankrupt by the United States court. (U. S. C. A. Title 11, Sec. 103 (1) of the Bankruptcy Act.)

It is settled law that the discharge in bankruptcy is prima facie bar to a claim sued upon, and the burden of proof is upon the person attacking it to show that the debt sued on is not within the terms of the bankrupt’s discharge. (VanNorman v. Young, 228 Ill. 425; Vandervoort v. Flaherty, 257 Ill. App. 480.)

So in this case the bankrupt court was right in awarding Wischnowsky his discharge, and the question of whether certain debts made by the bankrupt were dischargeable in suits thereinafter brought against him was a question for the court where he was sued to determine under the provisions of section 17 of the Bankruptcy Act (11 U. S. C. A. Par. 35, 3 F. C. A. Title 11, Par. 35).

These questions are not important here. The question presented here is whether the nondischargeable character of the original obligation for which a note or other commercial paper has been given may be shown even after the recovery of a judgment on the note, which judgment disclosed nothing to show that the debt is not dischargeable. This question is discussed in an interesting note on the subject in 170 A. L. R 368. The notewriter says, on page 374: “By the great weight of authority, although the nondischargeable character of the original obligation for which a note or other commercial paper has been given may be shown even after the recovery of a judgment on the note if the record of the judgment or of the proceedings in which it was obtained discloses such character, it may not be shown if all that the record shows is that the action was upon a note and does not disclose the nondischargeable character of the original obligation.”

Under this view of the law the nondischargeable character of the original obligation may be shown only by what appears on the judgment record or the record of the proceedings culminating in the judgment; so that, if nothing appears on that record showing that the original obligation was of a character excepted from the operation of the discharge in bankruptcy, the judgment will be discharged; and, conversely, if that record discloses the nondischargeable character of the original obligation, the judgment will not be discharged.

The note cites many authorities including the United States courts, Indiana, Michigan, New York, Texas, and Vermont, to support the rule as above stated. There is a minority rule which we do not follow.

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100 N.E.2d 816, 344 Ill. App. 346, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lawrence-v-wischnowsky-illappct-1951.