136 F. 262 | E.D.N.Y | 1905
On April 27, 1900, Otto Kaufman filed a petition in this court, wherein he prayed “that he may be adjudged by the court to be a bankrupt,” and on such date he was duly adjudicat
“I pray that I may be decreed by the court to have a full discharge from all debts provable against my estate under the bankruptcy acts, except such debts as are excepted by law from such discharge, and that I may have discharge not only from all individual debts provable against my estate, but also of debts incurred by me as partner with Simon Hirsh, in so far as I am liable on the said partnership debts.”
And that his petition for discharge, verified April 21, 1901, be amended by adding thereto the following:
“Your petitioner seeks a discharge from all debts which may be provable against his estate, consisting not only of individual, but debts contracted as a member of the firm composed of himself and Simon Hirsh, and doing business under the name of City Metal Works, except such debts as are excepted by law from a discharge.”
And that the order permitting the said amendment allow the same as of the original date of such several petitions.
The history above given shows that the bankrupt, as an individual, petitioned this court to be adjudicated a bankrupt, and to be discharged as such; that he was discharged as such individual, although he scheduled all his firm indebtedness. Although the schedules do not show that he scheduled any property of the firm, if such there were, he now asks that the record be amended so as to discharge him, as an individual, from any liability on account of the debts of the firm. It will be observed that he does not ask that the firm be discharged from any liability, or. that he be relieved, on proper action taken by the firm, an assignee, receiver, or trustee thereof, from any liability for assets of the firm which he may have. The judgment obtained against him was a personal judgment against himself and his partner on account of the indebtedness contracted by him and'his partner in the course of partnership business. Both the indebtedness and the judgment subjected to its payment the assets of the firm, and the individual property of each debtor against whom the judgment was recovered. Therefore Kaufman was a judgment debtor, first, as a partner of the firm; second, as an individual. The petition in bankruptcy was not for the purpose of procuring the administration of the assets of the firm, as a distinct entity, nor for the purpose of procuring the discharge of the firm as such; but it was for the purpose of administering the personal assets of a person, who was a partner, and for the discharge of such person from all debts against him as an individual, however such debts were created. He tendered his personal assets not only to his individual creditors, but to his several partnership creditors, and underwent searching examination for the purpose of determining whether he, as an individual, had had or retained in his possession any property belonging to himself individually or to the partnership which should be applied to the payment of any class of debts. It was found that he had no personal assets, and that he had no partnership assets, nor were there any for which, as an individual, he was accountable. Chapter 3, § 5, subd. “g,” of the bankruptcy law (Act July 1, 1898, c. 541, 30 Stat. 548 [U. S. Comp. St. 1901, p. 3424]), provides, “The court may permit the proof of the claim of the partnership estate against the in
“From all debts provable against my individual estate under tbe bankruptcy acts, except such debts as are excepted by law from such discharge, and that 1 may have discharge not only from all individual debts provable against my individual estate, but also from all debts incurred by me as partner with Simon Hirsh, in so far as I individually am liable on the said partnership debts.”
And that the petition for discharge be amended so as to provide:
“Xour petitioner seeks a discharge from all debts which may be provable against his individual estate, consisting not only of individual debts, but also debts contracted as a member of the firm composed of myself and Simon Hirsh, and doing business under the name of City Metal Works, except such debts as are excepted by law from a discharge.”
Thereupon the discharge would operate only for the protection of his individual estate, and could not be invoked as against the partnership of which he was a member. The order of discharge would provide for his discharge, as an individual, from any individual responsibility growing out of the partnership liability. This is not an application to set aside the discharge for the purpose of inserting a creditor in the schedules, as appeared in Re Hawk, 114 Fed. 916, 52 C. C. A. 536. It is not an application for the purpose of bringing in the partnership, and having it adjudicated a bankrupt, and its affairs administered, as was attempted in the Matter of Mercur, 8 Am. Bankr. R. 275, 116 Fed. 655, affirmed in 122 Fed. 384, 58 C. C. A. 472, 10 Am. Bankr. R. 505. The amendment cuts off no rights of Phelps, Dodge & Co. — for instance, the right to prove their claim. They had full opportunity to .prove such claim against the bankrupt as an individual, which they neglected to do; and, although the time for proving the claim is now past, yet the fault is with the creditors who ignored their opportunity to reach the personal assets of the individual, if they so desired.
As already stated, the fact that a year has passed is not injurious to the creditors opposing this motion, inasmuch as they had ample opportunity to prove their claim, and nothing in the amendment affects it. In this the case is distinguishable from In re Hawk, supra. Therefore the present motion is granted, so far as to permit the amendments to the extent above stated, but not for the purpose of allowing the discharge of the firm.