IN RE BOYNTON.
a.lthough that was not the precise question in the case. "There can be no doubt," says Mr. Justice Miller, speaking for the whole court, "that the incorporeal right which Fenn, the bankrupt, had to this seat when he became bankrupt was property, and the sum realized by the assignees from its sale proves that it was valuable property. Nor do we think there ca,n be any reason to doubt that if he had made no such assignment it would have passed, subject to the rules ofthe stock board, to his assignee in bankruptcy," I am aware that In re Sutherland, 6 Biss. 526, Judge Blodgett seems to have come to a different conolusion. I have read the case with. care, hoping to find some provisions in the charter of the Chicago Board of Trade to distinguish it from the case under consideration. This I have been unable to do; but Hyde v. Woods, supra, is subsequent in date, and in questions of this sort it is my duty to follow the supreme court. The district court of the United States for the southern district of New York, in February, 1880, made an order requiring a bankrupt to vest the title to his seat in the New York Stock Exchange in the assignee in bankruptcy. I think the present application falls within the principle of that case, and I approve of the reasoning of Judge Choate in his opinion granting the order. In re Ketchum, 1 FED. REP. 840. Let an order be entered directing the bankrupt to transfer his membersh-ip in the New York Prod.uce Exchange to the assignee.
In re In re In re
JESSE BOYNTON. LYMAN BOYNTON.
BOYNTO:f BROTHERS.
(Disfrict Court, D. RhodlJ
February 7,1882.)
1.
BANll.RUPTCy-RESIDENT ALIENS.
Resident aliens may take the benefit of the hankrupt act. 2. SAME-INSUFFICIENT GROUNDS FOR WITHHOLDING DISCHARGE.
Omissions from the schedule or inventory which were unintentional, the rcsult of an oversight or mistake, aDd not wilful, should not bar a discharge. 3. SAME-PAYMEN'rS THROUGH INADVERTENCE.
Payments made to employes several days before filing the petition, through inadvertence or a mistaken sense of duty, should not deprive bankrupts of their discharge. So payment of attorneys' fees IS not. such a preference as will prevcnt a discharge.
218
FEDERAL REPORTER.
&. S.UlE-CONVEYANCES IN ABSENCE OF CONCEAL1ffiNT.
Oonveyancesof stocks made by bankrupt to his wife,long before bankruptcy. and in the absence of concealment, are no ground for withholding a discharge. 0. SAME-VIOLATION OF PROVfSIONS Oil' BANKRUPT ACT-EVIDENCE.
Where the estate of the bankrupts yields a large percentage of tile indebtedness, and where the only evidence adduced by the opposing creditors is the examination of the bankrupts bef'Ore the register, the court should be clearly satisfied, upon the proof submitted, of the violation of the bankrupt act before withholding a discharge.
In Bankruptcy. N. B. Bryant, for creditors. James M. Ripley, for bankrupts. COLT, D. J. In this ca.sespecifications are filed by sundry objecting creditors against the discharge of the bankrupts. It appears that the individual estltte of Jesse Boynton paid 91 per cent. ; that no debts were proved against the individual estate of Lyman Boynton; and that the firm of Boynton Bros., composed of Jesse and Lyman, paid 81 per cent. While the specifications in terms oppose the disoharge of both brothers, yet we learn from the statement of counsel that the objecting creditors desire mainly to resist the discharge of Jesse BoyntOn. The first specification, that the bankrupts are not citizens of the United States, and so not entitiedto the benefit of the bankrupt act. is not ,pressed, in view, probably, of the fact that they have resided in this country for more than 25 years, and that resident aliens may take the benefit of the act. Tile second specification charges wilful false swearing in the affidavit annexed to the schedule or inventory, in that a certain farm in Canada, and certain real estate in Boston, were knowingly omitted therefrom. The evidence of Jesse Boynton discloses that he and hiB brother had conveyed to them many years before a farm in Canada of some 75 acres, which he thinks might sell for $1,000. He states that he had not thonght of this property for years; and when questioned further as to whether the farm had not been within a few years on his books, in the form of assets, at a valuation of $2,600, he answers that he does not know; that he never ordered it put there, and if there, representing such an amount, it was the sum paid for it. In the absence of any testimony impeaching this statement, and believing that the court should not hastily presume fraud merely from the fact of such an omission, in a case where the payment of so large a percentage of indebtedness tends to show general good faith, v,e cannot but conclude that this omission was unintentional-an over·
.N .RE BOYNTON.
279
Hight or mistn.ke'-not a wilful act; therefore it should not bar a dis· charge. In rc Wyatt, 2 N. 'B. R. 288; In r6 Smith, 13 N. B. R. 256; In re McVey, 2 N. B. R. 257. The evidence does not support any. omission from the inventory of real estate in Boston. The latter part of this specification charges the omission of certain lands, stocks, and money of great value, but this general allegation is not established by proof. The third specification alleges fraudulent preferences in paying sundry creditors a few days before bankruptcy, when insolvent and in contemplation of bankruptcy, and among others J. C. Boynton, a son of one of the bankrupts. From the examination of the bankrupts before the register we find that $604 was paid as wages to workmen several days before the filing of the petition, the sum of $60 in three different amounts at different times to J. C. Boynton for services, the sum of $300 to their counsel, Thurston, Ripley & Co., and $90 to the clerk of the court. Some of these payments certainly were proper and regular, and so fnr as ,any of them may have been improper, there is nothing to show that they were made with any fraudulent intent, but rather through inadvertence or a mistaken sense of duty; consequently the bankrupts should, not be deprived of their discharge. In re Rosenfeld, 2 N. B. R. 117; In re Sidle, 2 N. B. R. 220; In re Locke, 1 Low. 293; In re Burgess, 3 N. B. R. 196. Payment of attorneys' fees is not such a preference as will prevent a dischargo. In re Sidle, 2 N. B. R. 221; Inre Uosenfeld, 2 N. B. R. 116. The fourth specification, that each of the bankrupts wilfully swore falsely in omitting large sums of money from their schedules, is an· other general allegation unsupported by pioof. The fifth and last specification contains another charge of similar character against Jesse Boynton in omitting from his inve.ptory $5,000 withdrawn from the firm; also other property, oomprising sundry shares of different stooks specifioally mentioned;' also horses ah.i carriages. Boynton admits that he drew from the firm from $10,000 to $12" {)OO during the year 1878, and prior to September 1st, for current family expenses. This may seem a large SUIn, bntthe testimony is that he did not expect to go into bankruptcy until within 10 days of the filing of· the petition, August 3i, 1878, and no proof is offered to show that the money was not actually spent as 'stated, or to establish fraud or concealment in any form. in re Rosenfeld, 2 N. B. R. 116. Jt also appears that .8haresof stock were transferred, to his
280
PEDERAL REPORTER.
wife five or six years before bankruptcy, and that he has borrowed money, giving the stock as collateral security. He swears that the transfers were made bona fide, and no proof is brought forward to contradict him. Such conveyances, made long before bankruptcy, and in the absence of concealment, are no gronnd for withholding a discharge. In re Murdock, 8 N. B.R.146; 1 Low. 862. There seems to have been nothing irregular in the sale of the other stocks mentioned, or in the disposition of the proceeds. The ownership of any horses is denied, but the 'bankrupt admits having an old carriage or two in the stable. This latter omission is hardly of such a serious character as to affect the discharge. Had these bankrupts intended to have defrauded their creditors it is more than probable that their estat& would have yielded a smaller percentage of their indebtedness, and when in addition to this we find that the only evidence brought forward by the opposing creditors is the examination of the bankrupts before the register, anJ that no witness is produced to show any facts tending to contradict them. The court should be clearly satisfied, upon the proof submitted, of the violation of the provisions of the bankrupt act set out in the specifications before withholding a discharge. In rt Burgess, 3 N. B. R. 196. Weare not so satisfied, and therefore a discharge is granted ill each case.
PLATT, Assignee, etc., v. MATTHEWS and others. (DistricC Gourt, S. D. New York.
January 30, 1882.)
L
BANKRUPTCy-TITLE OF ASSIGNEE-SUIT TO RECOVER INTEREST OF BANKRUJ"J' ON PROPERTY TRANSFERRED IN FRAUD.
The bankrupt act vests the assignee with the title to all property conveyed by the bankrupt in fraud of creditors; and he may proceed to recover the interest of the bankrupt in such property, whether any l.:reditQl W&i i.n II. pQsition to attack the transfer or not.
In Bankruptcy. Austin G. Fox, for plaintiff. Abbott Brothers, for defendants. WALLAOE, D. J. Separate demurrers are interposed by the de. fendants Matthews and wife, and the defendant Murchison, to the bill of complaint. The complainant is the assignee in bankruptcy of Ma.tthews, and the bill is framed with the object of reaching the illteresi