Morrison v. Woolson

23 N.H. 11
CourtSuperior Court of New Hampshire
DecidedJuly 15, 1851
StatusPublished

This text of 23 N.H. 11 (Morrison v. Woolson) is published on Counsel Stack Legal Research, covering Superior Court of New Hampshire primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Morrison v. Woolson, 23 N.H. 11 (N.H. Super. Ct. 1851).

Opinion

Perley, J.

Are the defendant’s pleas of his discharge in bankruptcy sufficient ?

It is objected to them both, that they do not allege the plaintiffs’ demands to have been provable under the commission. They allege that the demands in suit were debts due and owing when the petition was filed, and that it was decreed by the district court that the defendant should be discharged from all debts that he owed at the time when he presented his petition.

All debts due when the petition was presented, were by the bankrupt act provable under the commission. To this there would seem to be no exception. Certain other daubs were also provable; but all debts due at the time of filing the petition are made provable under the commission. Whether the demands were provable is a legal conclusion to be drawn from the facts stated. The plea states those facts, and that is sufficient. [18]*18To aver a more legal inference is unnecessary and idle. . Tins precise point was decided in Harrington v. M’Naughten, 20 Vermont Rep., 293.

In Sackett v. Andross, cited for the plaintiff, the court say, “ The discharge, as set out in the plea, is restricted to debts provable under the said act. There is no averment in the plea that the debt due to the plaintiff was provable under the bankrupt act, and without such averment the discharge does not appear to be a bar to the action.” The plea in that case was therefore clearly bad, for it neither stated the legal conclusion that the debt was provable under the commission, nor the facts from which, the court could draw that conclusion.

The plaintiff also contends that the pleas are bad, because they do not confess the causes of action stated in the count to which they are pleaded. The pleas allege that the “ said several supposed causes of action, if any there were, were debts due,” &e. In pleadings at law, all facts sufficiently alleged, and not denied by the pleadings of the adverse party, are taken to be admitted and confessed. Where a special plea, professing to introduce new matter by way of avoidance, in substance denies the cause of action stated in the declaration, and puts in issue the fact that the cause of action existed as the plaintiff has alleged, the plea is bad, because it does not confess the cause of action, and amounts to the general issue. 1 Chitty’s Pl., 509.

But no direct and formal admission of the cause of action is required; it is enough that it is not denied; for, not being denied, it is in law admitted. Where the nature of the defence pleaded is not such as to require that the cause of action should be material in the plea, no mention of it is necessary ; as where the defendant pleads in bar that the plaintiff is an alien enemy. 2 Chitty’s Pl., 425.

The cause of action upon principle, and according to the precedents, is well enough confessed in these pleas. In this respect they appear to agree exactly with a form for a plea of discharge in bankruptcy given in 1 Saund. Pl. and Ev., 252.

It is suggested in argument that the the plea to the first and .second counts is bad, because it shews that the decree in bank[19]*19ruptcy undertook to discharge the defendant from his liabilities as partner without, at the same time, discharging him from his individual debts. If we were to understand the statement of the plea as descriptive of the certificate of discharge, so that it appeared on the face of the plea that the decree of discharge was limited to the debts which the defendant owed as partner, and left him liable in his individual capacity, this part of the case would present a question of some difficulty, which the court have not found themselves called upon to decide.

The ground of objection, as we understand it, is this: When a partner in trade petitioned as such for the benefit of the bankrupt act, if his petition was entertained, and he was declared a bankrupt, the act required that all the partners should also be declared bankrupts; that the property of the firm and of each partner would in such case be assigned and administered in 'bankruptcy ; that, in short, the effect of the proceeding would be the same as if each partner had petitioned in his partnership and also in his individual capacity; that if any partner was entitled to be discharged from the debts of the firm, he would consequently and necessarily be also entitled to a discharge from his private liabilities; that his individual property, as well as the funds of the partnership, being assigned and administered in bankruptcy, the court could not decree him a discharge limited in effect to the partnership debts, as the discharge of them would necessarily involve his right to be discharged from the other.

It is to be observed that the law gave each partner the right to petition as such for the benefit of the act. There is nothing in the act which required him, in the same petition, to ask for a discharge from his individual debts. He could not be dischai’ged upon his original petition for the benefit of the act, without a further application to the court. He was obliged to file, in a subsequent stage of the proceedings, a separate petition for that purpose. Could he not, in this petition for a discharge, follow the prayer of his original petition, and ask to be discharged from the debts of the firm, without at the same time praying for a discharge from his individual liabilities ? Even if he were entitled under the law and the facts of his case to be discharged [20]*20from both classes of Ms debts, was he compelled to take a discharge from both classes, when he was willing and desirous to remain liable for one of them ? We discover notMng in the terms of the act, and it would perhaps be difficult to find anything in general principles, which should prevent the petitiomng bankrupt from waiving the whole or any part of the advantage given him by provisions of law introduced for his own benefit. Cases would be very likely to occur, where an honest and Mghminded man might find Mmself hopelessly involved in the liabilities of an extensive partnership, and feel compeled to claim the protection of our insolvent law against them, but would be wiling and desirous to remain fiable for Ms private debts. Why should such a debtor be compeled to take more than he asked and more than he needed ?

Nor is it by any means clear that a partner might not be entitled to his discharge from one class of his debts and not upon the other class.

The creditors of the firm might assent to his discharge, and Ms private creditors might successfully resist; and vice versa.

He might have been guilty of a fraud against his individual creditors, wMch would not be available to the creditors of the firm. For instance, suppose that in contemplation of bankruptcy, in concert with Ms partners and with the creditors of the firm, he had without consideration conveyed Ms private property to the firm, in order that the dividends to the creditors of the firm might be increased and the dividends to his own creditors diminished. This would be a manifest fraud on Ms individual creditors, which would furnish them with ground to resist his application for a discharge from their claims. But how could the creditors of the firm insist on a fraud, in wMch they had themselves concurred, and which was achieved for their benefit ?

Then again the other partner might die, pending the petition; and we do not see how a discharge could be decreed to the deceased partner; yet his death would not prevent the partnership funds from being administered in

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Cite This Page — Counsel Stack

Bluebook (online)
23 N.H. 11, Counsel Stack Legal Research, https://law.counselstack.com/opinion/morrison-v-woolson-nhsuperct-1851.