Opinion
June Term, 1903.
James R. Baumes, for the appellants.
Wordsworth B. Matterson, for the respondent.
The facts concerning this somewhat unusual litigation are quite fully stated in an opinion of Mr. Justice HOUGHTON, handed down at this term of court, with a decision affirming a judgment overruling a demurrer by the defendant Clark, as trustee, to the complaint and supplemental complaint in this action, and need not be here repeated. ( 85 App. Div. 224.)
After the court had affirmed an order denying the motion of these appellants for leave to serve a supplemental answer alleging their discharge in bankruptcy (see 72 App. Div. 290) they served a supplemental answer containing a provision alleging such discharge. From an order striking out such provision this appeal is taken.
The claim sued upon was an unliquidated claim. After the plaintiff had procured judgment upon it his judgment was reversed by the Court of Appeals and a new trial granted. Thereafter the defendants filed a petition in bankruptcy.
The Bankruptcy Act of 1898 provides in subdivision b of section 63 (30 U.S. Stat. at Large, 563) that "unliquidated claims against the bankrupt may, pursuant to application to the court, be liquidated in such manner as it shall direct, and may thereafter be proved and allowed against his estate."
Upon an application to the bankruptcy court under that section by the plaintiff an order was made permitting him to proceed in the State court to liquidate his claim against the estate of the bankrupts and directing that Clark, the trustee in bankruptcy of the estate of the defendants, be brought in as a party defendant in the action. The plaintiff's action is, therefore, continued for the purpose only of "liquidating" or ascertaining the amount of his claim against the defendants.
This being the situation, all that there is to try in the action is what amount, if anything, did the defendants owe to the plaintiff before their discharge in bankruptcy upon the claim sued upon, and the only purpose of determining this is that it may be ascertained how much the trustee in bankruptcy may lawfully allow to the plaintiff in the distribution of the assets of the bankrupts.
The fact of bankruptcy is entirely immaterial in determining these questions, and the order striking out of the supplemental answer the allegation of defendants' discharge in bankruptcy was proper and should be affirmed, with ten dollars costs and disbursements.
All concurred.
Order affirmed, with ten dollars costs and disbursements.