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Cramer v. -

3 N.Y. Super. Ct. 700 1 Sandf. 700 Court N.Y. Super. Ct. Decision date 1851-01-18 English

Delivered by Saitofokd, J.

Contents

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p. 700
Cramer v. —.

Headnote

The court will not try the validity of an insolvent's discharge on affidavits.
But where the creditor has issued and levied an execution* and on a motion to set it aside, ho presents facts showing presumptively, that the discharge may be success» fully assailed, the levy will be retained, and an issue directed to be tried in the original suit; to test its validity.
in lieu of retaining the levy, the defendant may give security, or bring the amount of the execution and sheriiPs lees into court.
Form of the order in such cases, and of the issues directed to be tried.
Jan. 15;
Jan. 18, 1851.
Motion to set aside an execution.
The suit was commenced on the 22d of June, 1847, on anote for $800, at three months, made by the defendant, payable to and indorsed by one Allerton, dated August 7, 1846. The declaration, with a copy of the note, was served on the defendant personally. He appeared by an attorney, and filed a plea setting up that the note was usurious in the hands of the plaintiff, with an affidavit of merits. An inquest was taken and judgment perfected December 19, 1848. An execution was returned unsatisfied in February following. An alias execution was issued in November, 1850, and levied on personal property of the defendant.
The motion was founded upon a discharge of the defendant from bis debts, on the petition of himself and two thirds of his creditors, granted by Judge Ingraham of the New York Common Pleas, dated .January 80, 1849.
In answer to the discharge, it was shown that the plaintiff for over thirty years past has resided in Saratoga County, more than one hundred and fifty miles from the city of New York, where the creditors were ordered by the judge to show cause against the discharge ; that the order to show cause and its publication were for six weeks only, instead of ten weeks as required by law in such a case; that the plaintiff was not mentioned in the petition or affidavits presented to the judge, as a creditor or otherwise; that neither lie nor his attorney received any notice
p. 701
or had any information of the proceeding; that the assignment of the insolvent was attested by only one witness, and was not certified by the county clerk; and various other objections and defects in the proceedings were insisted upon. On the grounds thus taken, the plaintiff claimed that the discharge was utterly void, and should be disregarded.
The defendant showed that the note on which the judgment was recovered, was indorsed by Allerton to E. Curtis ; and in his schedule of creditors he described Curtis as a creditor for $1000, on a note made by Allerton and indorsed by the defendant. It did not appear that Curtis ever had any note against the defendant, other than the one sued by the plaintiff, which was transferred by Curtis to him in the spring of 1847.
W. 0. Russell, for the defendant,
insisted that the court would not try the question of the validity of the discharge on affidavits, but would require the plaintiff to contest it by a suit on the judgment. He cited 5 Hill, 245 ; 9 Wend. 431 ; 1 Cowen, 50, 228; 20 John. 21 ; 9 ibid. 259; 1 Caines, 249.
8. Sanxay and T G. Taleott, for the plaintiff,
cited 2 Rev. Stat. 16, 23, § 1, 5, 8 to 12, 29, 35; 1 Rev. Laws, 464, § 8 ; Laws of 1847, ch. 366, page 470 ; 3 Barb. Sup. C. R. 185; 1 Wend. 90 , 156 ; 15 John. 183 .

(after advising with the Chief Justice,) — said, the court will not try the validity of an insolvent’s discharge upon affidavits. But it does not follow that the execution must necessarily he set aside and the plaintiff subjected to the alleged probability of thereby losing his debt, although he shall succeed in overturning the discharge, and which is now secured by the levy. The proper rule to be adopted, is to retain the levy and direct a reference or an issue to test the validity of the discharge, whenever it is made presumptively to appear that the discharge may be successfully assailed. This conforms to the practice long since established, in respect of judgments by confession, which defendants seek to set aside on the ground of fraud, imposition, usury, or the like.

p. 702
In this case, without reference to numerous other points made against the discharge, there are two which furnish a strong presumption that it cannot be maintained. One is the defect in the publication of the notice of the order to show cause ; the other is the omission of the plaintiff in the insolvent’s account of his creditors. The plaintiff is certainly entitled, as the case now appears, to retain the security he has obtained, until he can have the opportunity of bringing these objections to the test of a regular judicial examination.

An order must be entered to the following effect, viz. The motion will be denied, on the plaintiff’s serving issues to try the validity of the discharge, within ten days. If served, the defendant may bring into court the amount of the execution and sheriff’s fees ; or he may give a bond for the same, with sureties, to be approved by the clerk on notice; and on his doing either, the levy is to be set aside. The issues served, are to be tried in this suit, by the court and a jury, (unless a jury trial be waived,) and they are to present two questions: 1. Had the officer who granted the discharge to the defendant, jurisdiction or authority for that purpose when it was granted % 2. Was the defendant guilty of any fraud in the matter, contrary to the true intent of the article of the revised statutes relative to the discharge of debtors from their debts on the application of such debtors and their creditors, or of any act or omission specified in the thirty-fifth section of that article. The plaintiff is to serve with such issues, a specification of the grounds relied upon in support of each; the defendant may propose amendments to the same ; and if the parties disagree, the issues and specifications are to be settled by one of the justices of the court.

The costs of this motion, of the issues, and the trial and subsequent proceedings thereon, to be disposed of by the court hereafter, on motion of either party.

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