1 U.S. 366 (1788)

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U.S. Supreme Court

GORGERAT v. MCCARTY, 1 U.S. 366 (1788)

1 U.S. 366 (Dall.)

Gorgerat et al.

Court of Common Pleas, Philadelphia County

December Term, 1788

On a rule to show cause why the Defendant should not be discharged on common bail, M'Carty stated in his deposition, that, being considerably embarrassed, he had, according to the laws of France, declared himself a bankrupt by filing a statement of his debts and credits, and delivering all his books and papers into the Consular Court of L'Orient, for the benefit of his creditors; the principal part of whom, in consequence of this surrender, had met together, appointed Trustees, or Syndics, in the usual form, and then granted him a letter of license for three years, together with a power of attorney, to collect his outstanding debts in America, in order to remit the same for their use; stipulating, however, that he should return to France within one year from the time of his departure. The Plaintiff, among others, had proved and registered his debt in the Consular Court; and, it was agreed by the Counsel for both parties, that, on a surrender of this description, if three fourths in value of the creditors had consented to the Defendant's discharge, the agreement or composition by them signed, being homologated, that is to say, recorded and confirmed by the Court of Parliament, (which is a matter of course unless fraud is shown) became by the lex loci obligatory upon the non subscribing creditors.

Ingersol, in support of the rule, contended, that it was settled by the decisions in Millarv. Hall (ant. 229.) and Thompson vs. Young (ant. 294.) that a discharge under the laws of one country, operated as such in every other; and he offered to prove by the testimony of the Defendant himself, that three fourths in value (the deposition only stating that the principal part) of the creditors had agreed to the composition at L'Orient; observing, that, if this would be sufficient to induce the Court to order an Exoneretur after judgment, it would also be sufficient to induce them to discharge the Defendant in the present stage of the cause.

Du Ponceau, having read a positive affidavit of a subsisting debt, opposed the admission of the Defendant's testimony. He said,

Page 1 U.S. 366, 367

that, even if M'Carty's discharge according to the lex loci could be actually proved, it would not operate against the Plaintiff on a motion of this kind. The mutual spirit of intercourse among nations has, indeed, introduced a more liberal idea of the cessio bonorum; and, upon the trial of the cause, such proof would probably be fatal to the Plaintiff's demand: but, whether he is discharged, or not, as a matter of fact, to be decided by the verdict of a jury; Salk.100. and to deprive the Plaintiff of special bail, at this time, would not only be an illegal anticipation of that decision, but, in effect, a denial of justice, as it appears that the Defendant is under an obligation to repair shortly to France, and would probably never venture again within the jurisdiction of this Court. He contended, however, that, even by his own showing, M'Carty had not been discharged in France; and represented, that the proceedings in the Consular Court amounted to no more than an inchoate bankruptcy; for, the concurrence of three fourths in value of his creditors to the composition alledged, and the homologation or confirmation thereof by the Parliament, being an indispensable requisite to his discharge, 'till that was established, it could not avail the Defendant that he had made a surrender, or that the Plaintiff had proved his debt, any more than the surrender of a bankrupt here, or the proof of a debt under the commission, would be sufficient to preclude a creditor from his remedy at law, before a certificate was actually granted. Nor is the Defendant's testimony, he urged, competent to prove the fact, which, by the lex loci, operates as a discharge; it is a matter to be shown by an exemplification of the foreign record; when, perhaps, it may be tantamount to a bankrupt's certificate; or, with stricter analogy, it may be compared to the case of a discharge under the composition law of England; and he cited a case which he said was exactly in point from Salk. 99. pl. 7, where the Court, on a question of bail, would not allow the Defendant to show that he had obtained his discharge under that act, and that the Plaintiff was bound, though a non subscriber, to the composition. Ingersol, in reply, said, that he did not mean to contend, that the debt was discharged; but only to show, by the testimony of the Defendant, a collateral fact, which entitled his person to an exemption from arrest in the present case. He agreed that the proceeding amounted only to an inchoate bankruptcy under the insolvent laws of France; but, he insisted, that it would be cruel and unjust to allow the Plaintiff all the advantage of his concurrence there, and likewise the benefit of special bail in an action here. Although it may be true, therefore, that the Defendant had not yet received what would amount to a certificate, yet, as he has surrendered all his effects, muniments, and vouchers, to the proper officers, for the benefit, and with the knowledge and approbation of the Plaintiff, as well as his other creditors, the Court will not suffer the oppression that is now attempted, but rather incline to hear the Defendant in favor of the rule; and, if it can be shown that three fourths in [1 U.S. 366, 368]

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