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Vol. I.]

IN RE KEELER.

(No. 9.

BANKRUPTCY. PRACTICE UNDER ACT OF JUNE 22, 1874, AS TO PE

TITION. - INSUFFICIENCY OF ADMISSION OF NUMBER AND AMOUNT OF CREDITORS.

IN RE KEELER.

In involuntary cases the petition must contain a proper allegation as to the requi

site number and amount of petitioning creditors. The admission of the debtor that the terms of the law have been complied with will not dispense with such allegation. There can be no adjudication except it be made and shown to be true to the satisfaction of the court.

BLATCHFORD, J. The petition in this case, which is one in involuntary bankruptcy by a single creditor, contains no allegation that the creditor constitutes one fourth, at least, in number of the creditors of the debtor, and that the aggregate of his debts, provable under the act, amounts to at least one third of the debts so provable. It was filed July 23d, 1874. It is accompanied by a separate paper, purporting to be signed by the debtor, and reading thus: “The said James R. Keeler does hereby admit, that the requisite number and amount of his creditors have joined in the petition herein, and does consent that proceedings shall be had under said petition, as a petition signed by the requisite number and amount of his creditors.” There is no authentication of the genuineness of the signature to this paper, nor is it verified by the oath of the signer. I have held, in the case of In re Scull, that the petition must contain the allegation which, as before said, this petition does not contain. The absence of such allegation, which, if in the petition, is verified by the oath to the petition, is not supplied by any admission by the debtor, much less by admission in form such as the one now presented, and not accompanied by any oath that the petitioning creditor does constitute the required number and amount of creditors. It is the allegation of the petition as to the number or amount of petitioning creditors, which, by the statute, the debtor may deny, by a statement in writing to that effect. The statute then says (Act of June 22d, 1874, § 12): “But if such debtor shall, on the filing of the petition, admit in writing that the requisite number and amount of creditors have petitioned, the court, if satisfied that the admission was made in good faith, shall so adjudge, which judgment shall be final, and the matter proceed without further steps on that subject.” The purport of this provision, in view of the context, is, that the admission is to be an admission of an allegation in the petition, which shows that the requisite number and amount of creditors have petitioned, and which allegation is before the court, verified by the oath to the petition. The court, even after such admission in writing, is to be satisfied that the admission was made in good faith, before it can adjudge that the requisite number and amount of creditors have petitioned. Certainly, it cannot be thus satisfied on the present papers: a petition without the allegation ; an admission not acknowledged or verified; no evidence of the authenticity of the signature of the debtor; no oath that the petitioning creditor constitutes the requisite number and amount of creditors; and an admission which states the legal conclusion, that the requisite number and amount of creditors have joined in the petition (without anything to show that the

Vol. I.]

BLAKE CRUSHER Co. v. WARD.

(No. 9.

debtor knows what such requisite number and amount of creditors is), instead of stating and admitting facts from which the court can draw such legal conclusion. The statute intends to exclude collusion, and not to permit a person to be adjudged an involuntary bankrupt unless the statute is strictly complied with. This is shown not only by such provision that the court must be satisfied that such admission of the debtor was made in good faith, but also by the provision of section 13 of the act of 1874, that the court must be satisfied that the requirement as to the number and amount of petitioning creditors has been complied with, or else must dismiss the proceeding.

I therefore cannot, on these papers, issue an order to show cause.

CIRCUIT COURT OF THE UNITED STATES. - EASTERN

DISTRICT OF MICHIGAN.

[JANUARY, 1874.]

PRACTICE IN UNITED STATES COURTS. — VERIFICATION. CONSTRUCTION OF EQUITY RULE 95. — ENTITLING OF AFFIDAVITS. NOTARY PUBLIC.

BLAKE CRUSHER CO. v. WARD.

Notaries public are officers before whom affidavits may be taken and bills and an

swers verified within the meaning of existing laws. Affidavits entitled as in a cause pending when no such cause was in existence can

not be read unless the entitling be rejected, which, if it render the affidavits mean

ingless in material particulars, will not be allowed. Practice in respect of verification, and construction of Equity Rule 95.

MOTION for a preliminary injunction on bill of complaint and accompanying affidavits, to restrain the defendants from an alleged infringement of a patent for a stone crusher. ,

The affidavits were made, some in Connecticut and some in Pennsylvania, and were all sworn to before notaries public. They were all made before this suit was commenced. They are, nevertheless, all entitled in a cause the same as is the entitling of this case, notwithstanding that no such cause was pending or in existence at the times the affidavits were made.

The bill was signed and the verification of the same was by an agent and director of the complainant corporation; and the verification appears also to have been made before a notary public of the State of Connecticut.

No answer has been put in nor counter affidavits filed, but at the hearing of the motion the defendants appeared by counsel and opposed the granting of the motion on the grounds, 1. That the verification of the bill and the affidavits were not entitled to be read and used because they were not taken before an officer authorized to take the same to be used in this court. 2. The affidavits are entitled in a cause which had no exist

Vol. I.)

BLAKE CRUSHER Co. v. WARD.

(No. 9.

ence when they were made. 3. That the verification of the bill is insufficient because it is upon information and belief only, and is otherwise defective.

Mr. A. Russell, for complainant.
Mr. H. B. Brown, for defendant.

LONGYEAR, J. First. As to the officers before whom the verification and affidavits were taken.

The act of Congress of July 29th, 1854 (10 Statutes, 315), provides, " That notaries public be and they are hereby authorized to take depositions, and do such other acts in relation to evidence to be used in the courts of the United States, in the same manner and with the same effect as commissioners to take acknowledgments of bail and affidavits may now lawfully take or do.” I think it safe to assume that taking of verifications to bills and answers, and of affidavits in support of or to oppose motions for injunction, are acts in relation to evidence" within the meaning of the above provision ; and, therefore, the verification and affidavits were properly taken before such officers.

By the previous act of September 16th, 1850 (9 Statutes, 458), the signature and official seal of the notary was recognized as sufficient evidence of his official character and the genuineness of his acts; and as the act of July 29th, 1854, was supplementary to the act of 1850, the same recognition must be extended to the signature and seal of the notary under that act. See, also, Goodyear v. Hulliben, 3 Fish. 251, 254. In the present case, the jurats to the verification of the bill, and to the affidavits, all have the signatures and official seals of the notaries, and are therefore sufficiently authenticated.

Second. As to the entitling of the affidavits as in a cause pending when no such suit was in existence at the time. By an unbroken current of decisions, some of which are cited below, in England and in this country, such affidavits are not entitled to be read or used for any purpose whatever. The test, and the main ground of their rejection is, that there being no such cause in existence at the time, the affiant could not be convicted of perjury if the affidavit is false. Rex v. Jones, 1 Str. 704; Rex v. Pierson, Arch. 313; Rex v. Harrison, C. T. R. 60; King v. Cole, C. T. R. 640; 1 Dan. Ch. Prac. 891; Humphrey v. Cande, 2 Con. 509 ; Haight v. Turner, 2 J. R. 370; Bronson v. Mitchell, 12 L. J. R. 460; Milliken v. Selye, 3 Denio 54; Hawley v. Donnelly, 8 Paige, 415.

In Bronson v. Mitchill, two of the judges thought the entitling might be rejected as surplusage, but the majority of the court decided otherwise and the affidavits were rejected. And in some of the English cases cited, the question of rejecting the entitling as surplusage was mooted, and it was held that, even if competent in any case, it could not be done in those cases, because it would render many material portions of the affidavits meaningless on account of references to "the said defendant," &c. That is precisely the case here. It results therefore that, with the entitling retained, the affidavits cannot be read ; with the entitling rejected, they are in many material portions meaningless. The affidavits must therefore be rejected. Third. As to the verification of the bill

. This is evidenced only by the jurat of the officer before whom the verification was made. The jurat is as follows:

Vol. I.)

BLAKE CRUSHER Co. v. WARD.

[No. 10.

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“United States of America, District of Connecticut.

"NEW HAVEN, 4th October, 1873. " Then personally appeared before me John A. Blake, agent and director of the orators in the foregoing bill of complaint, and made solemn oath that the same, and the allegations therein contained, are true, upon his knowledge, information, and belief. “ (Signed)

GEORGE SHERMAN, “ (Notarial Seal.]

Notary Public.Without this verification there is no proof of the allegations of the bill as to complainant's title to the patent in question, the novelty of the same, complainant's use and enjoyment, of the decisions of courts sustaining the same, all material to be proven on an application for a preliminary injunction. 2 Dan. Ch. Pr. 1644. The question of the validity of the verification is therefore important.

Equity rule ninety-five is as follows: “ That bills in equity may be verified by the agent or solicitor of the complainant:

“ First. When the party is at the time absent from the district.

“ Second. When the facts are within the personal knowledge of the agent or solicitor."

Aside from this rule (and it is doubtful if this rule can be applied to bills by corporations, as in this case), there is no rule or provision of law, by act of Congress or otherwise, prescribing the manner of verifying bills, or even requiring them to be verified at all, in any case. Beyond all doubt, however, the material allegations of injunction bills, especially in patent and copyright cases, upon which a preliminary injunction is moved, must be verified in some manner. In England, this appears to have been done by affidavit, subscribed and sworn to in the usual form (1 Dan. Ch. Pr. 392 and note; 3 Ib. 2165); and in the absence of any law or rule to the contrary, such should be the practice here. Equity Rule 90.

A practice has grown up, however, in the equity courts of the United States, and is of long standing in this district, and no doubt in most of the others, of verifying bills by the complainant, his agent, or solicitor, making oath to the truth of the bill itself, the officer administering the oath adding his jurat, or certificate of the fact, as was done in this case. And I am inclined to the opinion that such practice has been of sufficiently long standing, and of such uniformity, as to give it the authority of a rule of practice, and therefore to hold that this manner of verifying bills is competent in this court.

The certificate or jurat of the officer should show clearly and specifically that all those things necessary for the court to know and be informed of were sworn to. It should appear that the person making oath is the same person who signed the bill; and when the bill is signed by an agent or officer of a corporation complainant, or by an agent or the solicitor of the complainant, it should appear that the person made oath that he was such agent, officer, or solicitor ; and when by the agent or solicitor of complainant (except perhaps in the case of a corporation complainant) it should appear that such agent or solicitor inade oath to the reason for his making the oath instead of the complainant, in order that the court may see that such agent or solicitor was competent to make the oath under equity rule VOL. I.

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Vol. I.]

Tome v. PARKERSBURG BRANCH R. R. Co.

[No. 10.

nine-five; it should also appear, although perhaps this is not essential, that the person making oath made oath to his knowledge of the contents of the bill; and when he swears partly upon his knowledge, and partly upon his information and belief, it should clearly appear what portions of such contents he so swears to upon knowledge, and what portions upon information and belief.

Apply these tests to the jurat to the present bill and fatal defects are at once apparent - so apparent as to avoid the necessity of specifying them here.

It results that the motion cannot be granted as the case now stands. It will not, however, be dismissed, but it will be allowed to stand over, with leave to complainant to have its bill properly verified, and to file and serve affidavits in support of the motion within thirty days, and to the defendants to file and serve affidavits in opposition within ten days thereafter. Ordered accordingly.

COURT OF APPEALS OF MARYLAND.

[TO APPEAR IN 39 MARYLAND.]

PRINCIPAL AND AGENT. RESPONSIBILITY OF PRINCIPAL FOR FRAUD

ULENT CONDUCT OF AGENT. DAMAGES. EVIDENCE TOUCHING GENUINENESS OF SIGNATURES. · PHOTOGRAPHIC COPIES WITH EXPLANATIONS BY PHOTOGRAPHER.

TOME V. PARKERSBURG BRANCH R. R. CO.

By the by-laws of a railroad company, its treasurer was made the custodian of the ledger and other books relating exclusively to the ownership and transfer of the capital stock of the company; he was required to prepare and countersign all certificates of ownership of stock and scrip that might be issued, and to receive and enter upon the proper books all transfers thereof. It was made his duty, also, to affix the seal of the company to all certificates of ownership of stock and scrip properly issued by the company, and signed by the president. Such treasurer, wishing to obtain money for his own use, fraudulently issued from the office of the company sundry certificates of stock, signed by himself, sealed with the corporate scal of the company, and haring also the signature of the president, and purporting to be genuine in every respect. Upon the stock so issued, the treasurer through the agency of a broker, borrowed large sums of money, the lender not knowing for whom the money was wanted, and advancing the same solely upon the faith of the certi ficates, which he believed to be genuine. Two of the certificates were issued directly to the lender, and the third was issued to the broker and by him assigned to the lender. Some months afterward it was discovered that there had been a fraudulent issue of stock to a large amount by the treasurer, who soon after the discovery absconded. The company thereupon gave notice requesting the holders of its genuine stock to present their certificates and receive in exchange new certificates. Upon presentation of the above certificates by the holder thereof, in pursuance of this notice, he was informed that they were spuri

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