Allen & Co. v. Ferguson - 85 U.S. 1 (1873)
U.S. Supreme Court
Allen & Co. v. Ferguson, 85 U.S. 18 Wall. 1 1 (1873)
Allen & Co. v. Ferguson
85 U.S. (18 Wall) 1
A debtor, by original obligation, in one of the Southern states, writing to his creditor after he, the debtor, had applied for the benefit of the Bankrupt Act and while the proceedings were pending, a discharge in which was finally granted to the debtor, gave in the letter a statement of his affairs and of the causes which led to his applying for the benefit of the Bankrupt Act. He continued:
"Be satisfied; all will be right. I intend to pay all my just debts if money can be made out of hired labor. Security debt I cannot pay."
Adding in a postscript:
"All will be right betwixt me and my just creditors."
Held that the debt having been discharged by the discharge of the debtor under the Bankrupt Act, was not revived by what was written as above; that the promise to pay it was not clear, distinct, and unequivocal, short of which sort of promise none would revive a debt once discharged.
P. H. Allen & Co. sued A. H. Ferguson upon a promissory note dated March 20, 1867, payable one day after date, with interest.
Ferguson appeared and pleaded his discharge in bankruptcy in bar to the action.
The plaintiffs replied a new promise in writing made while the proceedings in bankruptcy were pending. This promise the plaintiffs averred that they relied upon, and in consequence of it made no efforts to collect their debt. The
alleged promise was contained in the following letter, which the plaintiffs made part of their replication, viz.:
"CROCKETT'S BLUFF, ARKANSAS, January 7, 1868"
"MESSRS. T. H. ALLEN & CO."
"DEAR SIR: I avail myself of this opportunity to give you a fare statement of my pecuniary affa'res. First, I failed to make a crop; secondly, find myself involved as security to the amount of five or eight thousand dollars; was sued, and judgments was render'd against me at the last turm of our co'rt for about $4,000, a sum suf'ic'ent to sell all the avai'ble property that I am in possession of. I lost about $3,000 by persons taking the bankrupt law. This is my situation. I was, as you can re'dily conclude, in a bad fix. To remain as I was, at that time, my property would be sold to pay security debts, and my just creditors would not get any part of it, and that I would be redused to insolvency and still ju'gments against me. As a last resort, concluded to render a skedule myself in order to forse a prorater division of my affects. The five bales cotton I shipt you was all my crop, to pay you for the meat that you had sent me, to enable me to make the little crop that I did make. The cash that I requested you to send me was, for myself and William Ferguson, to pay his hands for labor; and one hundred and fifty yards of the bag'ing was for W. Ferguson, and one barel of the salt. I have been absent from home for the last two weeks; got home last night, and has not sean him yet, but suppose he has shipt you some cotton. If he has not done so, I will see that he sends you cotton at once. Be satisf'ed; all will be right I intend to pay all my just debts, if money can be made out of hired labor. Security debt I cannot pay. I shall have a hard time, I suppose, this se'son, but will do the best I can."
"JAN. 8. -- Since the above was writ'en I have seen William Ferguson. He says he ship'ed you two bales cotton, ten or twelve days ago, and ship'ed in my name, as the baggin' was order'd by me for him. William Ferguson will be in Memphis betwixt this and the first of March, and will call and see you on bisness matters betwixt me and you'self. All will be right betwixt me and my just creditors. Don't think hard of me. Attribet my poverty to the unprincipel'd Yankey. Let me heare from you as usel."
"Yours, very respectfully,"
"A. H. FERGUSON"
To this replication the defendant demurred. The demurrer was sustained by the circuit court, and this appeal was taken by the plaintiffs.