In re Stickney

23 F. Cas. 77 | U.S. Circuit Court for the District of Eastern Missouri | 1878

DILLON, Circuit Judge

(orally). I am prepared to decide the Case of Stiekney, before me on appeal from an order of the district court refusing to grant Mr. Stiekney a discharge in bankruptcy.

It seems that for some years Merrick & Stiekney were partners in this city. The record is a little meagre, but I gather from it this state of affairs: Merrick & Stiekney were connected largely with a corporation formed under the statutes of the state, known as the St. Louis Stoneware Company, engaged in the business of manufacturing and selling stoneware; and they were the largest stockholders. Both bankrupts were officers — one president, and the other, I believe, secretary — of the corporation; and they were the largest, but not the only, stockholders. The corporation is not in bankruptcy, Merrick & Stiekney being the bankrupts. Mr. Merrick is now' dead. The district court refused Mr. Stiekney a discharge solely on the ground that he was a tradesman, and had failed to keep proper books of* account.

There were other objections to the discharge contained in the specifications, based on the ground of fraud. They were overruled as not being sustained, and no appeal was taken therefrom. But the fifth specification was to the effect that Merrick & Stiek-ney did not keep proper books of account. The provision of the bankrupt act is that if any merchant or tradesman has not, since March 2, 1807 — the date of the passage of the bankrupt act [14 Stat. 517]—kept proper books of account,' it is sufficient ground of objection to his discharge. It makes no difference, under the bankrupt act, whether or not the failure to keep proper books is through inadvertence, negligence, or fraud; it is sufficient ground for refusing his discharge, provided the bankrupt is a merchant or tradesman.

From what counsel stated on the argument, the chief emphasis and stress in the court below was upon the question whether the books that were actually kept were proper books. I have not those books before me, and if the case turned on them I would be obliged to hold that there w'as not sufficient certainty that the books were proper books to justify a reversal of the decision of the district court. Accordingly, the case turns on the question whether, under the circumstances, these bankrupts were merchants or tradesmen within the meaning of the bankrupt act. Now, all that the record discloses in this behalf is this: These men were large stockholders, and were main officers, in a corporation formed for the purpose of carrying on the business of manufacturing and selling stoneware. Now’, I conceive that whether or not that corporation kept proper books is perfectly immaterial here, and it has not been attempted to show that it did not keep proper books of account — and, indeed, it was stated by one of the witnesses that it did. No contest was made on that ground. Now, then, were these men tradesmen or merchants? It appears that, as to their business outside of their connection w'ith this corporation, they ow'ned a farm in St. Charles county, and carried on business in connection with that farm, and sustained heavy losses; and it also appears that they were in the habit of borrowing money. It seems w'lien they failed they owed between $200,000 and $300,000, mostly evidenced by promissory notes, and some certificates of deposit; but it did not appear that they carried on any business of merchandising, or held them selves out to the community in that capacity; and the authorities that were read here on the argument show, to my mind, quite conclusively, that, having imported this word “tradesman” from the English bankrupt act, it means — and has been so held by Judge Lowell, of Massachusetts (In re Cote, supra) — that the word “tradesman,” as here used in the bankrupt act, has a very limited signification. It says, “if any merchant or tradesman fails to keep proper books of account.” Now, the English authorities hold that a man who owned land, or a man who rented land and has held it for a term of years, and carried on the business of brick-making as a means of realizing the' profits to be derived from his land, is not a “tradesman,” and they have said that the word “tradesman,” as used in the bankrupt act, refers to smaller merchants or tradesmen, or a shopkeeper. And this was the meaning put upon it by the decision of Judge Lowell; it means a smaller class- of merchants.

I think that, in the present condition of the law, it is very clear that Merrick & Stick-ney, so far as shown by this record, were not tradesmen. For this reason I will reverse the decision of the district court and order a discharge. Ordered accordingly.