Opinion
No. 144.
January 5, 1931.
Appeal from the District Court of the United States for the Southern District of New York.
In the matter of the bankruptcy of Matthew M. Marshall. From an order granting the bankrupt a discharge and an order dismissing creditor's specifications and confirming special master's report, James E. Hams, as executor of the last will and testament of John J. Hams, deceased, appeals.
Orders reversed, and discharge denied.
Reversed.
Matthew M. Marshall was adjudicated a bankrupt on his voluntary petition December 5, 1928. On October 9, 1929, he filed his application for discharge. On October 19, 1929, James E. Hams, executor of the estate of John J. Hams, a judgment creditor, filed specifications of objections to the discharge. They were twenty-four in number, and charged that the bankrupt knowingly and falsely made false oath to the schedules he filed with his petition, that he caused false claims to be presented, and that he knowingly and fraudulently gave false testimony on his examination in the bankruptcy proceedings.
For the purposes of this appeal, we may profitably confine our attention to one of the specifications of objection relating to the claim of John J. Healy, although others were supported by substantial proof. It is:
13. That said bankrupt knowingly and fraudulently made a false oath on his examination in his bankruptcy proceeding in testifying that a certain paper produced on said examination, as evidence of such indebtedness to said John J. Healy, and dated December 5, 1924, was prepared and given to said Healy on or about December 5, 1924.
At a creditor's meeting held January 14, 1929, Marshall was examined under oath. He was asked about the receipt for $5,000 he had given Healy; testified that he gave it to him when he borrowed the money, and that Healy must have had the paper ever since. On January 23, 1927, Marshall testified again. This time he was shown the paper dated December 5, 1924, concerning which the truth appears below, and testified, in response to a question, that "it was prepared at that date, December 5th." He did not remember where and did not remember whether he was in his office when he signed the receipt.
It was proved that the bankrupt had borrowed $5,000 of Healy in December, 1924, and an additional $700 of Healy in July, 1926; the evidence plainly showed that he had given Healy a receipt in December, 1924, for the $5,000 and a receipt dated July 30, 1926, for the $700; that Healy was an engineer on a ship and a friend of the bankrupt; that he kept both receipts in a tin box on board his ship, and on his last trip before Marshall filed his petition in bankruptcy looked for the $5,000 receipt and could not find it It never has been found.
Healy returned to New York with his ship on November 23, 1928. Marshall soon afterward telephoned him that he had gone into bankruptcy and that, if he (Healy) wanted to get his money, to put in his claim. Later in that month Marshall met Healy in Rector Street and gave him the receipt dated December 5, 1924, about which Marshall testified as already stated. That was the first time Healy ever saw that paper. Subsequently, Healy filed his proof of claim based in part on the postdated receipt Marshall had given him for that purpose and concerning which Marshall testified falsely.
Winifred Sullivan, of New York City, for appellant.
Whitbeck Griffin, of New York City, for appellee.
Before MANTON, L. HAND, and CHASE, Circuit Judges.
Section 14b of the Bankruptcy Act, as amended by Act May 27, 1926, § 6 (11 USCA § 32(b), provides among other things that a bankrupt shall be discharged unless he has committed an offense punishable by imprisonment as provided in the act. Section 29b of the act, as amended by Act May 27, 1926, § 11 (11 USCA § 52(b), makes it such an offense to make a false oath in or in relation to any proceeding in bankruptcy. Under section 14b, whenever an objector shows to the satisfaction of the court that there are reasonable grounds for believing that the bankrupt has committed any of the acts which would prevent his discharge, the burden is on the bankrupt to prove that he has not committed such acts.
In this case the bankrupt prepared and gave to Healy a new receipt in November, 1928. Within two months, and when the fact must have been fresh in his mind, he deliberately testified on two occasions that he had given that receipt of Healy in 1924. That a motive for such false swearing is not altogether plain is of no moment whatever. It is enough that the bankrupt intentionally testified falsely on a material matter on a material issue. In re Slocum (C.C.A.) 22 F.2d 282. That the receipt was a material matter in the proof of a claim itself a material issue is self-evident, and, for some reason best known to himself, the bankrupt, well knowing that his testimony was false, attempted to make it appear that the receipt produced was the original and not one that he had recently given Healy to use in the bankruptcy proceedings. As an appeal in bankruptcy brings up both questions of law and of fact for trial de novo, Schieber v. Hamre (C.C.A.) 10 F.2d 119, we can dispose of this case here.
Orders reversed, with costs to the appellant, and discharge denied.