United States v. Nazzaro

• Decision Date: 14 March 1946
• Citation: 65 F. Supp. 456
• Parties: UNITED STATES v. NAZZARO et al.
• Court: U.S. District Court — Southern District of New York

65 F. Supp. 456

UNITED STATES v. NAZZARO et al.

District Court, S. D. New York.

March 14, 1946.

John F. X. McGohey, by Frederick J. Waters, both of New York City, for the United States.

Moses Polakoff, of New York City, for defendant.

BONDY, District Judge.

This is a motion by the defendants to dismiss an indictment on the ground that, as appears on its face, the prosecution of the offenses charged therein is barred by the statute of limitations.

The second count of the indictment charging conspiracy to conceal assets from the trustee of an estate in bankruptcy was dismissed upon consent of the United States Attorney.

The first count charges the defendants with the offense of fraudulently concealing assets belonging to the estate in bankruptcy of Rona Dyeing & Finishing Company, Inc. in violation of Sec. 29, sub. b of the Bankruptcy Act, 11 U.S.C.A. § 52, sub. b.

It alleges that on March 16, 1939 the company, upon its petition, was adjudicated a bankrupt, that on April 7, 1939 a trustee was appointed for the estate and that, from March 1, 1938 (sic) to the date of the filing of the indictment, the defendants fraudulently concealed from such trustee assets belonging to the estate. The indictment was filed on August 3, 1945.

Section 29, sub. d, of the Act, 11 U.S.C.A. § 52, sub. d, provides:

"d. A person shall not be prosecuted for any offense arising under this title unless the indictment is found or the information is filed in court within three years after the commission of the offense: Provided, That the offense of concealment of assets of a bankrupt shall be deemed to be a continuing offense until the bankrupt shall have been finally discharged, and the period of limitations herein provided shall not begin to run until such final discharge."

Section 14, sub. a, of the Act, as amended, 11 U.S.C.A. § 32, sub. a, provides:

"a. The adjudication of any person, except a corporation, shall operate as an application for a discharge: Provided, That the bankrupt may, before the hearing on such application, waive by writing, filed with the court, his right to a discharge. A corporation may, within six months after its adjudication, file an application for a discharge in the court in which the proceedings are pending."

The bankrupt corporation never applied for a discharge and its time to do so expired six months after the date of adjudication, or September 16, 1939.

The defendants contend that, if Section 29, sub. d, is literally construed, they...