In re Frazzetta
| Decision Date | 01 August 1932 |
| Docket Number | No. 17587.,17587. |
| Citation | 1 F. Supp. 122 |
| Parties | In re FRAZZETTA. |
| Court | U.S. District Court — Western District of New York |
Paul Muscarella, of Rochester, N. Y., for the motion.
Wynkoop & Toan, of Rochester, N. Y., opposed.
This is the return of an order to show cause why a garnishment against the bankrupt's wages should not be vacated. The application is opposed by one Fichera, who maintains that his judgment obtained in the state court is one which is not dischargeable in bankruptcy. It appears that Fichera, the bankrupt, Frazzetta, and Rivoli were copartners engaged in the real estate business. An agreement was drawn up by the three partners which provided that the partnership should be dissolved, and that Frazzetta should have power to perform all the uncompleted work of the firm, and that he should faithfully account for all sums collected on behalf of the partnership. By the terms of the agreement, Frazzetta was to keep the partnership money in a separate account and not mingle it with his own. Frazzetta failed to account for any of the sums collected, and Fichera brought an action in the state court for an accounting. The defendant defaulted, and a referee was appointed to take testimony and compute the amount due. The referee found that the defendant was indebted to Fichera in the amount of $2,284.59 which Frazzetta is charged with having received in a fiduciary capacity. Subsequently Frazzetta filed a petition in bankruptcy.
It is the judgment creditors' contention that this sum is not dischargeable in bankruptcy on the grounds: (1) That this is a debt created by fraud, embezzlement, misappropriations, or defalcations while acting as an officer or in any fiduciary capacity; (2) that it is a willful and malicious injury to person or property of another.
1. It has long been settled that the term "fiduciary capacity" relates to technical or express trusts, and does not include trusts implied by law from contract or agency or bailment. Noble v. Hammond, 129 U. S. 65, 9 S. Ct. 235, 32 L. Ed. 621; Upshur v. Briscoe, 138 U. S. 365, 11 S. Ct. 313, 34 L. Ed. 931; Matter of Burchfield (D. C.) 31 F.(2d) 118. Also the act applies only to a debt created by a person who was already a fiduciary, independently of the particular transaction out of which the debt arose. Crawford v. Burke, 195 U. S. 176, 25 S. Ct. 9, 49 L. Ed. 147.
The fact that Frazzetta was the partner of Fichera does not bring him within the definition "fiduciary capacity" as is contemplated by section 17 of the Bankruptcy Act (11 USCA § 35). See Inge v. Stillwell, 88 Kan. 33, 127 P. 527, 42 L. R. A. (N. S.) 1093; Gee v. Gee, 84 Minn. 387, 87 N. W. 1116; Karger v. Orth, 116 Minn. 124,...
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Fooshe v. Sunshine
...Prescott nor the receiver consented to or ratified the misappropriation. It was willful and malicious, as expressly found.' In re Frazzetta, D.C., 1 F.Supp. 122, the District Court in New York held a bankruptcy discharge unavailing to a partner who had converted partnership funds following ......
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Short, In re
...Act). Specifically, he contends that a partner is not a fiduciary within the meaning of the Bankruptcy Act. See In re Frazzetta, 1 F.Supp. 122 (W.D.N.Y.1932). Short's arguments are not persuasive and fail to address current law. Because the broad general definition of fiduciary--a relations......
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In re Perrin, Bankruptcy No. 79 B 1089.
...between partners does not create a "fiduciary capacity" as required under § 17(a)(4) of the Bankruptcy Act, citing In re Frazzetta, 1 F.Supp. 122 (W.D.N.Y.1932); Gee v. Gee, 84 Minn. 384, 87 N.W. 1116 (1901) and the language expressing this proposition in 1A Collier on Bankruptcy, ¶ 17.24, ......
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In re Haddad, Bankruptcy No. 80-00343
...his own name and used the money at his own discretion. Under Section 523(a)(6), Caroline contends that on the basis of In re Frazzetta, D.C.N.Y., 1 F.Supp. 122 (1932), Tom's deposit of the insurance proceeds of G.H.P. in his own name was willful and malicious injury to the property of Abe's......