101 Pa. Super. 142 | Pa. Super. Ct. | 1930
Argued December 10, 1930. We sustain the entry of judgment against this appellant, but for different reasons from those advanced by the learned court below.
The appellant on February 13, 1926 became surety on a bond to the Commonwealth, in the nature of a recognizance, in the sum of $750, conditioned that his son, William Hosey, the defendant in certain proceedings brought by his wife for the support of their minor daughter, Nancy Marie, and then pending in the Court of Quarter Sessions, comply with the order *144 of that court and pay the sum of ten dollars per week for the support of his said daughter, together with the costs of prosecution. William Hosey made no payment under said order after December 18, 1926, but no action was brought on the bond or demand made upon this appellant as surety, until the institution of this suit on April 2, 1929.
In the meantime the appellant, on May 16, 1927, filed his voluntary petition to be adjudicated a bankrupt, and on November 21, 1927 was discharged from all debts and claims made provable against his bankrupt estate which existed on May 16, 1927, the day the petition for adjudication was filed; excepting such debts as were by law excepted from the operation of a discharge in bankruptcy. The question raised by this appeal is whether the appellant was discharged from his obligation under said bond.
The learned court below held that he was not, basing its action on two grounds: (1) That the action being in the name of the Commonwealth for the penalty of a bond, forfeited for noncompliance with an order of court, it was not for a provable debt within the terms of the Bankruptcy Act and its supplements and amendments; (2) that as a debt due the State it was not impaired or discharged by the appellant's discharge in bankruptcy. We cannot agree with either of these positions, and shall discuss them in reverse order.
(1) Decisions under prior bankruptcy acts, having different provisions, such as Com. v. Hutchinson,
(2) The lower court interpreted section 57 j of the bankruptcy act to mean that debts owing a state as a penalty or forfeiture shall not be allowed or provable. We do not so understand it. The clause reads as follows: "Debts owing to the United States, a state, a county, a district, or a municipality as a penalty or forfeiture shall not be allowed, except for the amount of the pecuniary loss sustained by the act, transaction or proceeding out of which the penalty or forfeiture arose, with reasonable costs occasioned thereby and such interest as may have accrued thereon according to law." As we read this clause it does not mean that the debt of the state, etc., shall not *146
be provable but that the amount allowed shall not be measured by the penalty or forfeiture, but by the amount of the pecuniary loss sustained. Thus in People v. Jersawit,
We ground our action in sustaining the judgment on the proposition that in the circumstances above outlined the claim in suit was not a provable debt within the provisions of the bankrupt act, because it was not a fixed liability, absolutely owing, when *147 the appellant filed his petition to be adjudicated a bankrupt.
Section 17 refers to section 63 for the definition of what debts are provable: Schall v. Camors,
Under class (1) it is necessary that the claim be evidenced by a judgment or instrument in writing, which is here present, but it must be a fixed liability, absolutely owing at the time of the filing of the petition, and, in our opinion, this it was not. There was no debt or obligation, fixed and absolutely owing, by this appellant to either the Commonwealth or the use plaintiff. He did not absolutely bind himself or *148
agree to pay to the Commonwealth or to his son's wife or daughter, any fixed amount or weekly sum. Unlike an ordinary bond for the payment of money, any sum or sums advanced or paid by him on account of the weekly payment due by his son would not have been in discharge pro tanto of his liability, or a credit on the recognizance; Com. v. Grady McNally,
We have not ruled, as was held by the court below, that the penalty became foreited the instant there was a violation of the condition of the bond. What has been ruled by this court and by the Supreme Court is, that no formal forfeiture is necessary; that suit may be brought on the bond without a prior forfeiture: Com. v. Schmeltz,
There was no contract, express or implied, apart from the bond in suit, and hence it does not come within the fourth class of provable debts as defined in the 63d section of the Bankruptcy Act. The order on which it was based is not a contract, express or implied: Audubon v. Shufeldt, supra, p. 579; and the bond cannot be divorced from its terms which make it non-provable before forfeiture. See also In re Caponigri, supra.
While this disposes of appellant's contention, we are further of opinion that he failed to show that notice was given the Commonwealth that the obligation had been properly listed in his schedules as a debt; that his schedules on their face showed want *151
of due notice. The purpose of listing the bankrupt's debts is to afford the creditor an opportunity (1) to prove his claim, (2) to be heard as to the allowance of other claims, the election of a trustee, etc., and (3) to object to the bankrupt's discharge, if he has done anything to prevent it. Listing a debt as due to `The Commonwealth of Pennsylvania,' without more, — no official or department named, or address given to which notice is to be sent — amounts to no notice at all. See Miller v. Guasti,
We are obliged, however, to modify the judgment. The penalty of the bond is the limit of the surety's liability: Foster v. Passerieux, supra. This is a basic matter which cannot be overlooked or disregarded in this court: Sookiasian v. Swift,
The first three assignments of error are overruled. The fourth is sustained. The judgment as entered by the court is reduced from $892.50 to $750, with interest from April 2, 1929 to March 3, 1930, $38.13, or $788.13, as of date of March 3, 1930, and, as so modified or reduced, it is affirmed. *152