98 F. 414 | 2d Cir. | 1899
We have no doubt of the power of the court below to make the order lining the petitioner for refusal to produce the books of the corporation (in bis custody as its president) for examination before the referee in bankruptcy, nor that the order was a reasonable exercise of judicial discretion. The provisions of tlie bankruptcy act authorizing the examination of third persons as witnesses, and compelling the production of books and documents upon such examinations, are intended to enable creditors to discover transactions which may affect the right of the bankrupt to obtain a discharge, and to enable the trustee to ascertain whether any assets exist which should be collected and applied towards the payment of the bankrupt’s debts. It is the duty of the bankruptcy court to see that such examinations are not permitted to transcend tlie limit of a legitimate investigation for these purposes; but of necessity this is a duty which involves the exercise of wide discretion, and which should not be interfered with by any appellate court except when it has been manifestly abused. It is not a valid objection to the production of the books of a corporation that their inspection may disclose concealed assets, or supply evidence to enable the trustee to maintain a civil action to recover the value, in the present case the bankrupts were the officers and directors of tlie corporation whose hooks were sought to be examined, their wives were the stockholders, and substantially the only capital originally contributed or subsequently employed in its business consisted of
The order is affirmed.
