In re Schulman

• Citation: 177 F. 191
• Decision Date: 07 March 1910
• Docket Number: 38.
• Parties: In re SCHULMAN et al.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

177 F. 191

In re SCHULMAN et al.

No. 38.

United States Court of Appeals, Second Circuit.

March 7, 1910

Morris Myers, for appellant.

James Schell & Elkus (Abram I. Elkus, James N. Rosenberg, and Robert P. Levis, of counsel), for trustee.

Before LACOMBE, COXE, and WARD, Circuit Judges.

COXE Circuit Judge.

The questions of fact presented by this appeal are peculiarly within the province of the referee and District Judge. The law cannot be promptly and efficiently administered if the collection and division of the bankrupt's property is to be suspended and delayed pending appeals from the orders of the court and referee having in view the discovery of the bankrupt's property and the prevention of its fraudulent concealment and conversion. Unless convinced that manifest error has been committed, this court should refrain from meddling with the administration of the estate which can safely be intrusted to the officers of the bankruptcy court who are familiar with the local environment and the character and conduct of the parties.

In the case at bar we know nothing of the bankrupt, Schulman, except as he is portrayed in the printed record. The referee, on the contrary, had an opportunity to see and hear the bankrupt and observe his manner while testifying, which is an inestimable advantage in cases of this character. The testimony of a witness may sound plausible when read afterwards from a printed book and yet his conduct on the stand may have been such that no one who heard him testify believed that he was telling the truth.

The referee certifies that after having taken the oath the bankrupt refused to be examined according to law and deliberately withheld facts within his knowledge as to the disposition of the property of the bankrupt's firm. Again, he certifies that the bankrupt withheld from the trustee and the court, with the deliberate intention of concealing his condition, the true facts relating to the conduct of his business, his dealings with his creditors and the amount and whereabouts of his property. The referee says:

'The manner of the bankrupt, his recollection when he desired to exercise it convinced me as I watched him that where he desired to give the facts he could do so.'

Disingenuous and evasive as his testimony appears when read, it is obvious that the opportunity to 'watch' the bankrupt gave the referee a very marked advantage in determining whether he was acting honestly. His answers 'I don't remember,' and 'What do you mean?' so often given might in some instances have been the result of a defective memory or an honest inability to understand. An appellate court may be unable to detect, under such conditions, the false from the true, the honest from the fraudulent, but any intelligent person, after observing the witness for hours on the stand could not be deceived as to his purpose.

The testimony as it appears in the record evinces a deliberate...