In re Hanna

• Decision Date: 16 February 1909
• Docket Number: 194.
• Parties: In re HANNA.
• Court: U.S. Court of Appeals — Second Circuit

168 F. 238

In re HANNA.

No. 194.

United States Court of Appeals, Second Circuit.

February 16, 1909

Kellogg Beckwith & Emery, for appellant.

James Schell & Elkus (Robert P. Levis, of counsel), for respondent.

Before LACOMBE, WARD, and NOYES, Circuit Judges.

WARD Circuit Judge.

This is an appeal from a judgment of the District Court reversing an order of a referee, acting as special master. July 23, 1907 John W. Hanna was adjudged a bankrupt on his own petition. November 19th he filed a petition for a discharge. December 16, 1907, on the return of the order to show cause, J. M Prendergast & Co., Hamilton Manufacturing Company, and Lawrence & Co., creditors objecting to the discharge, appeared by attorney. December 26, 1907, specifications of objections were filed by the same attorneys on behalf of Prendergast & Co., Hamilton Manufacturing Company, and Cocheco Manufacturing Company, signed only by Cocheco Manufacturing Company, by Lawrence & Co., Agents, and verified by a member of the firm of Lawrence & Co.

The matter was referred by the District Judge to one of the referees as special master, with power to pass on all exceptions to the specifications. January 9, 1908, it came on for hearing before the special master, when it transpired that Lawrence & Co. were not creditors, but only agents for the Cocheco Manufacturing Company, creditors. The special master permitted the specifications to be amended by adding the verification of the Hamilton Manufacturing Company. January 17, 1908, amended specifications, duly signed and verified by the Hamilton Manufacturing Company, were filed. The District Judge overruled the bankrupt's objections to the action of the special master, held that he had power to permit the amendment, and that he was guilty of no abuse of discretion in doing so. The special master, or certainly the District Judge, had the power to allow the amendment. The result is that the Hamilton Manufacturing Company appeared seasonably as an objecting creditor and duly signed and verified specifications of objection. The irregularities have caused no injury to the bankrupt, and we discover no reason for revising what has been done in the court below.

The only specification of objection relied on was that the bankrupt had failed to make entries in his books of account of loans and payments of money, with the specific intention of concealing his transactions. As to it the special master held that the bankrupt was entitled to his discharge because although he had failed to enter in his books of account a loan considerable in proportion to the amount of his assets, he did so, not for the purpose of defrauding his creditors, but for the purpose of concealing his real...