Atkinson v. Elmore
| Decision Date | 07 December 1903 |
| Citation | 77 S.W. 492,103 Mo.App. 403 |
| Parties | FRANK M. ATKINSON, Appellant, v. WILLIAM ELMORE et al., Respondents |
| Court | Kansas Court of Appeals |
Appeal from Buchanan Circuit Court.--Hon. W. K. James, Judge.
AFFIRMED.
Judgment affirmed.
Charles F. Strop and Kendall B. Randolph for appellant.
(1) A discharge in bankruptcy releases a "bankrupt from all of his provable debts, except such as . . . have not been duly scheduled in time for proof and allowance, with the name of the creditor, if known to the bankrupt, unless such creditor had notice or actual knowledge of the proceedings in bankruptcy." U. S. Bankruptcy Law 1898, chap. 3, sec 17. (2) The court will take the findings of fact when they have been made a part of the judgment--as the facts in the case, and determine whether or not the trial court has reached correct conclusions therefrom. Hill v Combs, 92 Mo.App. 250; Drug Co. v. Saunders, 70 Mo.App. 221. (3) To affect the principal, the knowledge possessed by the agent, or the notice to the agent, must have come to the agent during his agency, and not after or before. Anderson v. Vollmer, 83 Mo. 403; Richardson v Palmer, 24 Mo.App. 480; Wheeler v. Stock Yards & Ter. Co., 66 Mo.App. 260.
Beardsley, Gregory & Kirshner for respondents.
(1) Elmore and Cooper, in good faith, listed in their schedule the notes sued upon here and gave, in good faith, the name and address of their creditor according to their best knowledge. This discharges them from this indebtedness. It is not necessary to have actual service of legal notice on the creditor as in an ordinary action in personam. Bank v. Moyses, 186 U.S. 181 (22 S.Ct. 857); U. S. Bankruptcy Law, 1898, chap. 3, sec. 17; Fider v. Mannheim, 78 Minn. 309, 81 N.W. 2. (2) By their dealings all parties interested in the ownership of this debt while they used the name of S. Hegner, really held out Schneider as the one who was in all matters to stand instead of S. Hegner, and Schneider had actual knowledge of the pendency of the bankruptcy proceedings within two days after they were begun. (3) Schneider was in fact the agent of the holder of the debt. The trial court was authorized to so find from all of the evidence, as shown and set out in the findings of fact, and did so find. Mosby v. Commission Co., 91 Mo.App. l. c. 504; Hanbelt v. Mill Co., 77 Mo.App. l. c. 679; Sharp v. Knox, 84 Mo.App. l. c. 174; Gibson v. Zeibig, 24 Mo.App. l. c. 67; Greely v. Capen, 33 Mo.App. 301; Edward v. Thomas, 66 Mo. 482; Bank v. Life Ins. Co. , 145 Mo. 127; Bonner v. Lisenby, 86 Mo.App. 666; Bradstreet Co. v. Gill, 2 L. R. A. 405. (4) Knowledge of the agent, in this case, is the knowledge of the principal. In re Beerman, 112 F. 662; Howard v. Ins. Co., 52 Mo. l. c. 191; Trust Co. v. Ins. Co., 157 Mo. 97; Laundry Co. v. Ins. Co., 157 Mo. 97; Laundry Co. v. Ins. Co., 66 Mo.App. l. c. 209; Bank v. Hoebor, 88 Mo. l. c. 43.
This is an action whereby plaintiff seeks to recover from defendants Elmore and Cooper the balances due on three promissory notes. The defendants pleaded a discharge in bankruptcy by the federal court for the western district of Missouri. The trial was without a jury and judgment rendered for defendants, on a special finding of facts.
It appears from the findings of the trial court that defendants were the payees in a note given them by one Gillette for $ 2,586.98, secured by chattel mortgage on cattle. They sold the note to the German American Bank of St. Joseph, Missouri, and the bank, in turn, sold it to William and Henry Krug of the same city, who were brothers, one being a director and the other president of the bank. J. G. Schneider was vice-president and active manager of the bank. Defendants became much embarrassed financially and in 1899 their creditors, including the Krugs, gave them an extension by taking new notes payable in one, two and three years. The notes were executed to "S. Hegner," which was the maiden name of the daughter-in-law of one of the Krugs, her husband being connected in the bank with his father as an active director and vice-president thereof. Defendants however entered these new notes in their register as payable to the bank to whom they had sold the original note. In 1900 the defendants filed voluntary petitions in bankruptcy and scheduled the notes as payable to the bank. They were afterwards discharged.
Plaintiff is assignee of the notes in suit (though it appears merely to collect) and seeks to avoid the discharge of defendants on the ground that the Krugs had no notice of the bankruptcy proceedings. By section 17 of chapter 3 of the bankrupt law of 1898, a discharge releases the debts of the bankrupt "from all his provable debts . . . except such as have not been duly scheduled in time for proof and allowance, with the name of the creditor, if known to the bankrupt, unless such creditor had notice or actual knowledge of the proceedings in bankruptcy." In this case the defendants, as just stated, scheduled the bank as the creditor holding the notes in question. They were therefore not "duly scheduled" as required by the statute cited and the only question for decision is, did the Krugs, or either of them, have notice or actual knowledge of the proceeding in bankruptcy? Whatever notice or knowledge they had was such notice and knowledge as was brought home to Schneider, the manager of the bank and who defendants claim was the authorized agent of the Krugs. The trial court found that Schneider was their agent and plaintiff contends that such finding was not justified. It therefore becomes necessary to look into the connection which existed between Schneider and the Krugs.
After the note was purchased by the bank and before it was sold to the Krugs, Schneider made arrangements for the pasturage and care of the mortgaged cattle securing the note and advanced several hundred dollars of his individual money for that purpose. He thereby became interested in the mortgage. After the bank sold the note to the Krugs by indorsing it over to the daughter-in-law, Schneider wrote to defendants...
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