There must be a trial by jury on the question of the revocation of a discharge.1

"Parties in interest" in this and the preceding sections includes all persons whose interests are affected by the discharge. It is apparent, however, from the terms of the section that one who acquires rights after the discharge has no standing to apply for a revocation. 2

The application must be filed within a year by a person not guilty of laches. As to what delay will amount to laches, each case will depend on its own circumstances and no general rule can be laid down, but the courts, in view of the evident intent of Congress to expedite as much as possible the settling of estates, will probably adopt a strict interpretation of the section.3

A debtor might obtain a discharge by fraudulently concealing the fact that he has done some of the things which disqualify him. It would be a fraud if he bribed a creditor to conceal such an act. If the person applying for the revocation of the discharge knew of the fraud before the discharge was granted the court will not revoke it. This was the law under the Act of 18674 and in some states.5 It would be an easy matter, however, for the person desiring a revocation of the discharge to tell some creditor not disqualified by knowledge of the fraud. The latter could then petition.

The circuit court has no jurisdiction over the matter of discharges.

§ 479. Act of 1898.- SEC. 16. Co-DEBTORS of BankRUPTS.-a. The liability of a person who is co-debtor with, or guarantor or in any manner a surety for, a bankrupt shall not be altered by the discharge of such bankrupt.

This is the rule whether mentioned in the statute or not, since the discharge is personal to the bankrupt." It does not

1 See infra, § 482.

2 See Sanborn v. Doe, 92 Cal. 152; Wright v. Worthley, 84 Maine, 182.

3 See Cook v. Barrett, 155 Mass. 413. 4 § 34, 14 Stats. 533, R. S. § 5120.

5 Blake v. Clary, 83 Maine, 154; Goodwin v. Selby, 77 Md. 444.

6 Commercial Bk. v. Buckner, 20 How. 108.

7 Supra, § 458.

depend on whether the creditor filed his proof or not.1 Sureties on a bond to dissolve an attachment are included in this rule. The court may allow a judgment to proceed against a discharged bankrupt to determine the liability of such sureties. In such a case it will protect the principal debtor by granting a stay of execution against him. Where the stockholders of a corporation are subject to liability for the corporate debts up to the amount of their stock, a discharge of the corporation does not relieve them of this liability. This question may arise if corporations are held to be entitled to a discharge under this act like natural persons.5

An interesting question arises whether a person will be liable as a surety for his partner who has been discharged from firm debts. The former law included partners by name in the section relating to the liability of co-debtors. The separate estate of a partner is liable to joint creditors after the separate creditors have been paid. It seems clear therefore that Congress intended that a partner should still be liable for firm debts when his co-partner had been discharged from them, as otherwise an established principle of the law relating to bankruptcy of partners would be changed without an express indication of the intention to change it. The mercantile view of a partnership is that partners are sureties for the firm, and the framers of the act very likely had this in mind when they used the expression "in any manner a surety for."

The rule of § 16 applies as well to composition proceedings. The confirmation of a composition does not release co-debtors.9

§ 480. Act of 1898.-SEC. 17. DEBTS NOT AFFECTED BY A DISCHARGE.-a. A discharge in bankruptcy shall

1 Schott v. Youree, 142 Ill. 233.

2 Bernheimer v. Charak, 170 Mass. 179; White v. McCaughey, 37 Atl. Rep. 350 (R. I.).

3 Hill v. Harding, 130 U. S. 699. 4 Willis r. Mabon, 48 Minn. 140.

5 Supra, § 477.

R. S. § 5118; Re Downing, 3 N. B. R. 748, Fed. Cas. No. 4044.

7 Supra, § 135.

8 See Bankruptcy of Partners, 19 Am. Law Rev. 32.

9 Mason & Hamlin Organ Co. v. Bancroft, 1 Abb. N. C. 415; Robson,

6 Act of 1867, § 33, 14 Stats. 532; Bankruptcy, 7th ed. 755; Ex parte

Jacobs, L. R. 10 Ch. 211.

release a bankrupt from all of his provable debts, except such as (1) are due as a tax levied by the United States, the State, county, district, or municipality in which he resides; (2) are judgments in actions for frauds, or obtaining property by false pretenses or false representations, or for wilful and malicious injuries to the person or property of another; (3) have not been duly scheduled 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 (4) were created by his fraud, embezzlement, misappropriation, or defalcation while acting as an officer or in any fiduciary capacity.

All provable debts are discharged except those enumerated, so that if a debt be provable which does not come within one of the exceptions it will be discharged. And so of collateral undertakings connected with a provable debt and costs and expenses connected with it. See sections 441 et seq. as to what other debts are not discharged.

1

Debts due the sovereign were not discharged, and this clause has extended the exemption as far as it relates to taxes.

The distinctions formerly taken as to whether a judgment in a suit brought for a cause of action arising out of fraud was released by a discharge are done away by clause 2.

4

Clause 3 prevents the injustice which occurred under the former law that a creditor who had no notice of the proceedings would be barred.5

It might still happen, however, that a creditor whose debt

1 Supra, § 437.

2 Supra, § 440.

8 Supra, § 439.

4 Supra, § 435.

5 Supra, § 459. Re Archenbrown, 11 N. R. R. 149, Fed. Cas. No. 504; Lamb v. Brown, 12 N. B. R. 522, Fed. Cas. No. 8011; Symonds v. Barnes, 59

Maine, 191; Payne v. Able, 7 Bush, 344; Pattison v. Wilbur, 12 N. B. R. 193; Williams v. Butcher, 12 N. B. R. 143; Platt v. Parker, 13 N. B. R. 14; Thurmond v. Andrews, 13 N. B. R. 157; Heard v. Arnold, 15 N. B. R. 543; Fuller v. Pease, 144 Mass. 390; Heim v. Chapman, 171 Mass. 347.

was duly scheduled was not notified. This clause would not apply to such a case and would give such a person no remedy.

Under the composition law passed in 18741 there was a provision similar to that of clause 3.

Clause 4 is substantially the same as § 5117 of the Revised Statutes 2 except that the word "misappropriation" is added. Debts created by fraud are excepted, and this means actual fraudulent intent.3 There must be fraud at the time the debt is created.4

The words "fiduciary capacity" have been given a somewhat limited construction by the Supreme Court of the United States. The decisions seem to depend on the terms of the Act of 1841,5 which used the words "executor, administrator, guardian or trustee, or while acting in any other fiduciary capacity." It is held that factors and other persons acting in a quasi fiduciary capacity are not within the terms of the act. Such decisions would seem to be binding, as the words in this statute are the same as those of the Revised Statutes.

As to defalcations by a public officer see supra, § 434.

1 Act of June 22, 1874, Ch. 390, § 17, 18 Stats. 182.

2 Formerly § 33 of the Act of 1867, 14 Stats. 533.

8 Supra, § 433.

4 Ib. Re Blumberg, 1 N. B. N. 258.

6

§ 1, 5 Stats. 440.

• Supra, § 431.

CHAPTER IV.

COURTS AND PROCEDURE THEREIN.

§ 481. Act of 1898. -SEC. 18. PROCESS, PLEADINGS, AND ADJUDICATIONS.-a. Upon the filing of a petition for involuntary bankruptcy, service thereof, with a writ of subpoena, shall be made upon the person therein named as defendant in the same manner that service of such process is now had upon the commencement of a suit in equity in the courts of the United States, except that it shall be returnable within fifteen days, unless the judge shall for cause fix a longer time; but in case personal service can not be made, then notice shall be given by publication in the same manner and for the same time as provided by law for notice by publication in suits in equity in courts of the United States.

b. The bankrupt, or any creditor, may appear and plead to the petition within ten days after the return day, or within such further time as the court may allow.

c. All pleadings setting up matters of fact shall be verified under oath.

d. If the bankrupt, or any of his creditors, shall appear, within the time limited, and controvert the facts alleged in the petition, the judge shall determine, as soon as may be, the issues presented by the pleadings, without the intervention of a jury, except in