255 F. 478 | 2d Cir. | 1918
(after stating the facts as above).
Being thus rightfully possessed of the cause, the court also enjoyed that power of amendment which is incidental to all judicial administration and vital to the ends of justice. Bank v. Sherman, 101 U. S. 406, 25 L. Ed. 866. We are not permitted by this petition to inquire into the sufficiency of the Exchange Bank’s first pleading. It was evidently regarded by the District Judge as “too vague and general,” and therefore amendment was required. This is common practice.
The amendments made and permitted to stand were no more than a restatement, descending into unnecessary particulars of the original petition, and we hold that such amendment was properly permitted.
It was assumed below that this was an act of bankruptcy not set forth in the original petition and only charged in and hy an amendment made more than four months after its commission. Whether such an act, occurring more than four months before amendment, could be introduced into a pending proceeding, was thought an “interesting question” by Racombe, J., in the Riggs Case, supra. This court answered it in the negative (In re Haff, 136 Fed. 80, 68 C. C. A. 646), the matter not having been covered by In re Sears, 117 Fed. 294, 54 C. C. A. 532, which was correctly explained and limited in application by Gleason v. Smith, 145 Fed. 897, 76 C. C. A. 427. The general rule as stated in the Half Case has been approved, especially in the Ninth circuit (Walker v. Woodside, 164 Fed. 685, 90 C. C. A. 644), and in the Seventh (In re Brown Commercial Car Co., 227 Fed. 390, 142 C. C. A. 83). Our own decision (In re Condon, 209 Fed. 801, 126 C. C. A. 524) is (in this respect) but a reassertion of the Haff Case.
This rule rests in theory upon the reasoning of Justice Nelson in Re Craft, 6 Blatchf. 177, Fed. Cas. No. 3,317, where it was pointed out that “to allow a substantial amendment — that is, one going to the whole foundation of the proceeding nunc pro tunc — -would be a direct violation” of a limitation “obviously for the benefit of the debtor,” namely, the requirement that proceedings must be brought within a limited time after the act of bankruptcy is committed; i. e., under the present statute, four months.
If. therefore, the creditors’ allegations in respect of the proceeds of the 830,000 mortgage are to be regarded as stating an act of bankruptcy committed and complete more than four months, before amended petition filed, the order complained of was right. But the allegations stricken out are to the effect that the concealment complained of not only occurred within four months of original petition, but liad continued down to the date of amendment.
The concealment of property made an act of bankruptcy by section 3 may be a continuing concealment and the four months period may run from the date of discovery. Citizens’ Bank v. De Pauw Co., 105 Fed. 926, 45 C. C. A. 130. It was, we think, clearly the intent of the pleader to allege a continuing concealment, not discovered until within four months of amendment. The language is vague, and if the District Judge had required a further amendment, setting forth the circumstances of concealment and discovery with greater particularity, we should have regarded such an order as the exercise of reasonable discretion and therefore not reviewable. In re Rosenblatt, supra. But
We are of opinion that all the facts shown in evidence inevitably point to the conclusion that Havens had departed from Olean a few days before this petition in bankruptcy was filed, and thereafter practically secreted himself. Against such evidence Havens’ statement of a conclusion that he had been “since October, 1917, a citizen and resident of the state of Missouri,” is no more than an effort to deny the logical result of the facts shown against him.
As, however, he may hereafter find it advisable to show himself within the Western district of New York, as he did in April last, we shall consider whether an alleged bankrupt, while attending the trial of an involuntary petition against him, is privileged from examination under section 21a; for, if this be true, he must also be privileged from performing any other duty laid upon him by the act and usually enforced by a court order.
It is argued under section 7 of the act (Comp. St. § 9591) that Havens could not be required to attend'for examination at Buffalo, because it was more than 150 miles distant from his home or principal place of business. Assuming that both his personal and business homes were most remote from Buffalo, we think the section referred to has no application,, because he had already come there. Inasmuch as he refused to obey the order at all, the question whether (assuming a remote residence) he could have been compelled to continue in attendance without having his expenses paid is a question not before us.
It is true that one going to a town or place in order to attend a trial is secure from service of process eundo morando redeundo, even though he be a party. Hale v. Wharton (C. C.) 73 Fed. 739. But a party who is attending the trial of his cause is assuredly subject to the orders of the trial court in respect of the matter under adjudication. What the District Court had jurisdiction over was the question whether Havens was a bankrupt, and the examination directed, since it must relate to the “acts, conduct or property” of the alleged bankrupt himself, was a most important part of that investigation. The argument for immunity really assumes that any bankrupt who chooses to remove himself from the territorial jurisdiction of adjudication is by the fact of removal entitled to all the privileges of a stranger; indeed, rather more, in that he can attend the bankruptcy court for such purposes as he pleases, and decline to attend when he does not please.
But the duties of a bankrupt are laid down by the statute, and so are his privileges. Section 9 (Comp. St. § 9593). The order complained of exceeded the statute. If the bankrupt removes into another district, ancillary proceedings are open to his creditors. Babbitt v. Dutcher, 216 U. S. 102, 30 Sup. Ct. 372, 54 L. Ed. 402, 17 Ann. Cas.