Rudge v. Rundle

Ingraham, P. J.

Two of the defendants were discharged in bankruptcy on 19th December, 1868. A judgment in this action was recovered on 11th June, 1869. Between December, 1868, and June, 1869, no application or attempt was made to set up the discharge, and the plaintiff was allowed to obtain judgment, without objection on this ground.

Whatever view might be taken of the question, whether the cause of action was one of a fiduciary character or otherwise, is not very material to the decision of this appeal. Under our practice and the provisions of the Code, a person acting as a factor has been charged with the liabilities arising from transactions of a fiduciary nature. I see nothing in the bankrupt act sufficient to warrant us in holding otherwise in the present case. The defendant received the money for a special purpose and applied it to his own use, without any authority so to do.

But, independent of that question, the defendants have no right to have this motion granted. After the discharge was obtained, six months elapsed before judgment was entered. During that time, he should have applied for leave to set up the discharge in a supplemental answer. Having omitted so to do, he loses the benefit of the discharge.

It has been the uniform course of decision, both in regard to insolvent and bankrupt discharges, that the debtor must plead his discharge when he has the opportunity; and if he omits to plead his discharge, the court will not relieve him on motion. Cross v. Hobson, 2 Cai. 102; Mechanics’ Bank v. Hazard, 9 Johns. 392; Stewart v. Green, 11 Paige 535; Alcott v. Avery, 1 Barb. Ch. 347; Cost v. Riley, 18 Johns. 54; Desobry v. Morange, id. 336.

The reason for this rule is obvious. The validity of a discharge should not be tried on affidavit, and if the defendant will not set up by way of answer, they must abide by the result. The order must be affirmed.

Ranchee, J., concurred.

Order affirmed.