Adams's Appeal , 1882 Pa. LEXIS 283 ( 1882 )

Mr. Justice Sterrett

delivered the opinion of the court, December 11th 1882.

The question in this case is whether, upon the facts disclosed by the record, the judgment against appellant should have'been opened for the purpose of enabling him to plead his discharge in bankruptcy as a defence to the debt secured by the bond on which the judgment was confessed in January 1879.

The bond was given by appellant in 1868, two years before he was adjudged bankrupt, for a debt that was clearly provable against his estate; and hence his subsequent discharge, as a bankrupt, in 1871, operated as a release of the debt evidenced by the bond. The Act of Congress expressly provides that a discharge in bankruptcy, subject to certain exceptions therein specified, shall release the bankrupt from all debts, claims, liabilities and demands which were or might have been proved against his estate in bankruptcy: R. S. sec. 5119. In the absence of proof sufficient to avoid its effect, the certificate of discharge given in evidence by appellant, coupled with the fact that the debt in question was provable against his estate, was quite sufficient to sustain a strictly legal defence to the bond in suit; and it appears to us that no sufficient reason was shown for refusing permission to present that defence in the only way that it could be interposed. In cases like the present, a discharge in bankrupcy is wholly unavailable unless the judgment is opened and the defendant permitted to plead the discharge in bar of the debt which has been merged in the judgment: Wise’s Appeal, 39 Leg. Int. 298.

As has already been observed, the judgment against appellant was not confessed until 1879, eight years after his discharge was granted. Shortly thereafter, he sought relief by asking that the judgment, as to himself, be marked satisfied. To the refusal of the. court to make the order prayed for, a writ of error was. taken to this court; and, in disposing of it, we held that he had mistaken his remedy; that he should have moved the court below to open the judgment and thus permit him to plead his discharge in bankruptcy. He then petitioned the court for such an order as he should have applied for in the first place, but it was refused on the ground — as the court below held — of. “inexcusable negligence and laches in instituting and pursuing the remedy he now claims.” In this we think there was error. There was certainly no unreasonable delay in seeking relief. For aught that appears, the first application was made as soon as appellant ascertained judgment had been confessed by warrant of attorney; but, in that, he mistook his remedy, as he was afterwards informed by the decision of this court. He then promptly petitioned for the proper order; and, in view of all. the circumstances, we think it should have been granted. The delay, which the court below regarded as inexcusable, was not intentional. It manifestly resulted from a misconception of the appropriate .remedy, and should not be visited with the consequences which might result from a refusal to permit the case to be tried on its merits.

A discharge in bankruptcy may be regarded as an easy mode of cancelling honest obligations, but with that consideration we have nothing to do. If fairly and legally procured, such a discharge is equivalent to payment of all debts provable against the bankrupt’s estate, and his right to plead it in bar of the same should not be denied without reasons more cogent than those presented in this case.

The order of court discharging the rule to show cause why the judgment should not bo opened and defendant let into a defence, etc., is reversed, and the rule is now made absolute.