In re Feuer, 146.

• Decision Date: 02 February 1925
• Docket Number: No. 146.,146.
• Parties: In re FEUER. Petition of GUARANTY CO. OF MARYLAND.
• Court: U.S. Court of Appeals — Second Circuit

4 F.2d 892 (1925)

In re FEUER Petition of GUARANTY CO. OF MARYLAND.

No. 146.

Circuit Court of Appeals, Second Circuit.

February 2, 1925.

Shapiro & Witte, of New York City, and Shapiro, Shapiro, Goldstein & Brody, of Bridgeport, Conn. (Samuel Witte, of New York City, of counsel), for petitioner.

Slade, Slade & Slade, of New Haven, Conn. (Benjamin Slade, of New Haven, Conn., of counsel), for respondent.

Before ROGERS, MANTON, and HAND, Circuit Judges.

HAND, Circuit Judge.

On November 23, 1923, Feuer, the bankrupt, filed a voluntary petition and was adjudicated on the same day. In his schedules appeared the name of the petitioner as a creditor in the sum of $122,050.43. On April 28, 1924, Feuer filed his petition for a discharge, to which the petitioner filed specifications of objection. On May 8, 1924, Feuer in turn filed exceptions to the specifications, which were referred to a master, who reported back overruling the exceptions. On July 15, 1924, the District Judge overruled the master, dismissed the objections, and directed the bankrupt to be discharged. The case comes up, therefore, solely upon the sufficiency of the specifications of objection upon their face.

The first specification was for the commission of an offense punishable by imprisonment under the Bankruptcy Act, in that the bankrupt knowingly concealed from his trustee certain property and assets belonging to his estate as follows: "A certain claim in the sum of $15,000, held by him against the National Grain Corporation for money loaned." The second specification was in that the bankrupt had knowingly made false oath and rendered a false account as follows: That at his examination before the referee at one time he had sworn that the National Grain Corporation was indebted to him for about $15,000, while at another before the same referee he had sworn that he did not know the amount of the indebtedness; finally, that he had omitted all reference in his schedules of bankruptcy to the said indebtedness. The third specification read as follows: "With intent to conceal his true financial condition he has failed to keep books of account or records, and has destroyed or concealed books of account or records from which such financial condition can be ascertained."

The point argued by the respondent, on which he chiefly prevailed, did not, however, concern the substance of the specifications but their inducement. Therein the objecting creditor described itself as a creditor, and not as a "party in interest," as prescribed in section 14b of the Bankruptcy Act (Comp. St. § 9598), and official form No. 58. The argument is that a creditor whose debt is not dischargeable may not oppose the discharge, because he cannot have any interest in its denial. The point has been differently ruled in a number of decisions, and was specifically left open by us in our decision in Re Russell, 176 F. 253, 259, 100 C. C. A. 77. In re Chandler, 138 F. 637, 71 C. C. A. 87 (C. C. A. 7), and In re Servis, 140 F. 222 (D. C.), each squarely held that, since a creditor simpliciter might be one whose claim was not dischargeable, he was not necessarily a "party in interest" quoad the discharge. Even if the bankrupt were discharged, it would not affect him. We passed close beside the point, but did not decide it, in Re Menzin, 238 F. 773, 151 C. C. A. 623. Several decisions of the District Courts have held otherwise. In re Armstrong, 248 F. 292; In re Reed, 191 F. 920; In re Lewis, 163 F. 137 (obiter); In re Menzin (D. C.) 233 F. 333 (the point in question not being reversed in Re Menzin, supra). And Remington, § 3207, is decidedly of their opinion.

We think that any creditor is a "party in interest," and that the phrase of section 14b and form 58 is more general than that chosen by the respondent at bar. While it is of course true that a creditor whose debt is not dischargeable has nothing to fear from a discharge, provided he can make good the exclusion of his debt under section 17 (Comp. St. § 9601), yet he may have an interest to avoid that issue, if he can. We see no reason to prevent his opposing the discharge on any statutory ground, and ab initio depriving the...