Having been adjudged bankrupt John Willoughby applied for a discharge. Allen R. Jamison, a creditor, filed objections. The matter was referred to a special master, who, аfter hearing, recommended that the petition for discharge be denied. Exceptions to the master’s report were overruled and the report was confirmed. Thе bankrupt appeals.
Only one specification of objection to the discharge is presented for consideration on this appeal. The others were dismissed. The objection sustained was in substance that the bankrupt upon general examination before the referee at the first meeting of his creditors gave false testimony under oath in respect to the source from which his wife obtained funds with which she purchased a farm.
The master found, and it is not disputed, that at the first meeting of his creditors the bankrupt tеstified that his wife owned a farm of about 520 acres purchased at a cost of approximately $12,000 with money inherited by her from her mother’s estate. The title stood in the jоint names of the bankrupt and his wife, but it in fact belonged to her and was purchased with her money. The bankrupt wilfully and falsely testified that the purchase money was inherited from her mother when in truth she had received it from her friend Julia E. Taylor.
The master found, also, that the false testimony did not hurt the objecting creditor nor interfere with the orderly administration of the bankrupt’s estate. The recommendation to deny a discharge was based upon the conclusion that the false answer was made with respect to a matter material to an issue in the bankruptcy proceeding.
The exception to the master’s report is based upon the contention that the false statement was not mаterial for the reason that it did not relate to the bankrupt’s estate nor to any act or fact affecting the estate.
The general rule is that when an application for discharge is made by a bankrupt in the district court, the judge of that court is, by the terms of the statute, bound to grant it, unless upon investigation it appears that the bankrupt has committed one of the six offenses specified in the bankruptcy act. Bluthenthal v. Jones,
The particular offense charged here is defined in the Bankruptcy Act. Section 32(b) (1), 11 U.S.C.A. (Act of July 1, 1898, c. 541, § 14, 30 Stat. 550; Act of June 25, 1910, c. 412, § 6, 36 Stat. 839), provides that when a bankrupt files an application for discharge “The judge shall hear the application * * * and discharge the applicant unless he has (1) committed an offense punishable by imprisonment as herein provided.” Section 52(b), 11 U.S.C.A. (Act of July 1, 1898, c. 541, § 29, 30 Stat. 554), provides that “A person shall be punished, by imprisonment for a period not to exceed two years, upon conviction of the offense of having knowingly and fraudulently * * * (2) made a false oath or account in, or in relation to, any proceeding in bankruptcy.”
The false oath to justify a denial of a discharge must be “knowingly and fraudulently” made, that is, it “must contain all the elements involved in perjury at common law, namely, an intentional untruth in a matter material to an issue which is itself material.” Troeder v. Lorsch, 1 Cir.,
Thе substance of the false oath is that the bankrupt’s wife obtained the purchase money for her farm from her mother’s estate when in fact she obtained it from Julia E. Taylor. Was this a material fact?
What facts are material to any inquiry must be determined by the nature of the right or liability asserted. I Chamberlayne, Modern Law of Evidence, § 16. Facts essential to support a judgment are material to the issue. 22 C.J. 164; American Process Co. v. Pensauken Brick Co.,
The issuеs upon the examination of a bankrupt at the first meeting of his creditors are not defined in pleadings. The scope and nature of the inquiry are found only in the statute. Section 7 of the Bankruptcy Act, 11 U.S.C.A. § 25, provides that “The bankrupt shall * * * when present at the first meeting of his creditors, and at such other times as the court shall order, submit to an examinatiоn concerning the conducting of his business, the cause of his bankruptcy, his dealings with his creditors and other persons, the amount, kind, and whereabouts of his property, and, in addition, аll matters which may affect the administration and settlement of his estate.
The objects of the inquiry are obviously to determine the property belonging to the estate in whiсh creditors are interested and to aid the court in its administration and settlement. It is said in VII Remington on Bankruptcy, § 3289, p. 512, 4th ed., citing authorities, that “Mere false swearing, unless concеrning matters that would naturally be material to the discovery of assets, the history of the bankrupt’s business doings and relations, the' existence and disposition of his property and dеbts, etc., would not be sufficient to bar a discharge.”
The master in this instance found “that the false testimony of the bankrupt in regard to the source of the fund did not hurt the objector, nor interfere with the orderly administration of the bankrupt’s estate”; but he concluded that it was material nevertheless. It is true that in a proper case the materiality of the false oath is not dependent upon injury to creditors. In re Goldman, 2 Cir.,
Further, the evidence does not sustain the charge that the falsehood with referencе to the source from which his wife obtained her money was “fraudulently” made. The burden was upon the objecting creditor to prove not only that the false testimony was knowingly made, but that it constituted an “offense punishable by imprisonment” Section 32(b) (1), 11 U.S.C.A.; In re Opava, D.C.Iowa,
Upon the record before him the master should have found that the first specification of objection was not sustained. The proof does not warrant the refusal of a discharge.
*825 The order denying the application for discharge of the bankrupt is reversed and the court is instructed to grant a discharge.