206 F. 858 | D.N.M. | 1913
This is an involuntary proceeding in bankruptcy, brought by a single petitioner, alleging a claim of more than $500, and that the total number of the creditors of the alleged bankrupt is less than 12. It is stipulated that the petitioner is related to the defendant within the third degree of affinity by reason of defendant having married his sister. The case is now presented upon a motion to dismiss, upon the ground that an invóluntary petition may not be prosecuted by such a relative as the sole petitioner.
This contention is urged upon the terms of section 59e of the Bankruptcy Act, which is as follows :
“In computing the number of creditors of a bankrupt for the purpose of determining how many creditors must join in the petition, such creditors as were employed by him at the time of the filing of the petition or are related to him by consanguinity or affinity within the third degree, as determined by the common law, and have not joined in the petition, shall not be counted.”
The argument is that as, in computing the number of creditors for the purpose of determining how many must bring tlie petition, relatives within the third degree who have not joined in the petition may not be counted, therefore such a relative may not, by himself, bring such a petition. This insistence in our opinion is untenable in a proper view of section 59. The latter section, in its subsection “b,” provides that “three or more creditors who have provable claims against any person” aggregating $500 or more, or, if all of the creditors be less than 12 in number, then “one of such creditors” whose claim equals $500, may file an involuntary petition. Thus possession of a provable claim is the general test of the right to file. Since the claim here asserted is upon promissory notes, and since no reason is suggested why such do not constitute valid obligations between brothers-in-law. the petitioner here is the .holder of a provable claim, and thus within the general terms of the statute, and, unless there be something further in the .statute operating against him, is entitled to prosecute this proceeding.
Do the further provisions of section 59 have any such effect? Subsection “d” provides tliáí in a proceeding by less than 3 creditors, coupled with the necessary allegation that there are altogether less than 12,
But where the relative appears, not in aid of a defense and as a weapon to defeat, but as an adverse mover and as a beneficiary of the' law, the reason for the rule entirely fails, and with it the rule. The difference in the relative’s status when used to frustrate the act and when proceeding under it is illustrated by the prohibition, contained in subsection “e”. The terms of that section, to the effect that he may not be counted, apply only when he has not joined in the petition. When he has joined, he may be counted; for then there exists no reason to fear that his relationship is operating to effect a fraud. Equally, indeed more strongly, is this the case where, as here, he brings the petition himself; indeed, brings it as the sole petitioner. This seems never to have been questioned in the courts. In re Novak (D. C.) 101 Fed. 800, decides, it is true, that a wife may bring the proceeding; but the case does not discuss, nor indeed apparently consider, section 59, and may, perhaps, have proceeded upon the theory that husband and wife are not related by affinity (State v. Wall, 41 Fla. 463, 26 South. 1020, 49 L. R. A. 548, 79 Am. St. Rep. 195, 205), andl that section 59 was thus not involved. No other decision, even apparently dealing with the matter, has) been found by counsel, and this for the reason, doubtless, that it has never heretofore been deemed one for controversy. The bankruptcy text-writers — -Remington, § 215; Collier, page 779— express the view that members of the petitioner’s family may be petitioning creditors. So, in our judgment, does the spirit and letter of the statute.
The motion to dismiss will accordingly be denied.
