DISCHARGE IN BANKRUPTCY—WHAT WILL PREVENT.
Under the amendment to the National Bankruptcy Law as amended in February, 1903, the rules relating to discharge of bankrupts, are somewhat changed. Many parties are interested ofttimes in preventing the discharge of a bankrupt for no other reason than that they are creditors who believe that the bankrupt has not been honest in his dealings and irrespective of motives of personal enmity feel that the welfare of the business community is served by preventing the bankrupt from being discharged and re-entering into business. Probably the act that will prevent a discharge that most often appeals to the creditor is that the bankrupt obtained goods on a false statement in writing. This, if shown, will prevent the discharge, the law reading in this respect, as follows: “Obtained property on credit from any person upon materially false statement in writing made to such person for the purpose of obtaining such property on credit.” It is obvious that the party who urges this objection must be the one who has been injured thereby.
Other debts not dischargeable in bankruptcy are taxes levied by the United States, the State, county, district or municipality in which bankrupt resides, and others of no practical interest to merchants. In addition to the above are those debts which have not been duly scheduled by the bankrupt in the proceeding in time for proof and allowance, with the name of the creditor if known to the bankrupt, unless such creditor had notice or actual knowledge of the proceedings in bankruptcy; or were created by his fraud, embezzlement, misappropriation, or defalcation, while acting as an officer or in any fiduciary capacity.
Opinion No. 97.
SALES—OF AN INDEFINITE QUANTITY.
A purchaser of a quantity of merchandise ordered by letter two hundred to three hundred tons of a certain article to be delivered within the following six months as wanted. The vendor duly acknowledged receipt of the order and accepted same, stating that they would deliver a certain quantity in the immediate future and balance as ordered within the following six months. Thereafter, the vendor delivered a certain portion of the merchandise for which it was paid with the exception of one installment, which the vendee refused to pay for alleging that the vendor had refused to deliver further installments. The purchaser sued the vendor for damages for breach of contract in failing to deliver the balance of the contract. The Court held that by the terms of the order the vendor could not insist on the purchaser taking more than the two hundred tons but the purchaser on his part could insist within the six months period upon the vendor delivering the remaining hundred tons, it appearing that two hundred tons had been already delivered. In fact, it was an option which the vendee could enforce but not the vendor.
The above is a brief outline of an action decided in the Appellate Court in New York and applies as well to an executory sale of lumber, many similar orders being placed among lumbermen.
Opinion No. 98.
LIABILITY OF BANK FOR FAILURE TO GIVE NOTICE OF PROTEST TO ENDORSER UPON NOTE RECEIVED FOR COLLECTION.
That it is the legal obligation of a bank, which receives a note for collection to use all diligence to give notice of its dishonor to all endorsers is set forth in a decision of the Appellate Division of the New York Supreme Court (Howard vs. Bank of Metropolis, 95 App. Div. 342).