Art. 8. Effect of Discharge in Bankruptcy.

ruptcy. That a claim for damages, such as for libel, slander, assault and battery, is not discharged; distinguishing Hennequin V. Clews, 77 N. Y. 429; Neil v. Clark, 95 U. S. 704.

The "fiduciary capacity in the provision of the Bankrupt Act, which excludes from the protection of a discharge debts contracted in that capacity, relates to cases of technical trust, not to such as are implied by the contract between principal and agent, and the "fraud " intended by the same provision is an active or express fraud, as distinguished from an implied or constructive one. Palmer v. Hussey, 87 N. Y. 303.

The same rule is also held in Lawrence v. Harrington, 122 N. Y. 408, 412, distinguishing Bradner v. Strang, 89 N. Y. 299, 114 U. S. 555.

A judgment recovered on an indebtedness incurred by a defendant because of failure to pay over rents collected by him as agent is barred by his discharge in bankruptcy. The provisions of the Bankruptcy Act with regard to debts created "while acting in a fiduciary capacity" do not apply to cases of implied, but only to those technical trusts which are actual trusts constituted by the parties.

In an action against several partners, to recover for goods furnished to the firm, alleged to have been obtained by false and fraudulent representations, it is enough, where the defense of a discharge in bankruptcy is interposed, to prove that one of the partners was guilty of the fraud; and such evidence will justify the recovery of a judgment against him and his innocent copartners. Schroeder v. Frey, 60 Hun, 58.

SUBDIVISION 3.

Decisions under Present Bankruptcy Act.

The amendment of 1903 referred to in subdivision 1, where the statute is cited as it stood before and since that amendment, renders some of the decisions construing the section in question obsolete and unnecessary by reason of embodying, by way of amendment, the result of the decisions. By the omission of the word "fraud," and substitution of the word "liabilities" other decisions may be superseded or otherwise affected.

In Colwell v. Tinker, 65 App. Div. 217, 72 N. Y. Supp. 505, affirmed 169 N. Y. 531, it was held that the application under section 1268 of the Code of Civil Procedure for cancellation of a

Art. 8. Effect of Discharge in Bankruptcy.

judgment recovered in an action for criminal conversation was properly denied, as plaintiff was not released by discharge in bankruptcy.

The liability of a husband for alimony decreed to be paid to his divorced wife was held, in Massner v. Massner, 62 App. Div. 286, 70 N. Y. Supp. 1107, not to be affected by discharge in bankruptcy. The same rule with regard to a bankrupt's liability for alimony, whether created at the time of the filing of the petition, or created thereafter. Young v. Young, 35 Misc. Rep. 335, 71 N. Y. Supp. 944.

In Dissler v. McAulay, 25 Misc. Rep. 411, it was held that a judgment against a bankrupt for breach of promise of marriage, in an action in which seduction and birth of child were proven, were not canceled by discharge in bankruptcy; reversed in 66 App. Div. 42, 73 N. Y. Supp. 270, on the ground that a female who has been seduced cannot maintain an action to recover damages therefor. (See § 17 as it now stands.) In Finnegan v. Hall, 35 Misc. Rep. 773, it was held that a judgment for breach of promise of marriage, where there was no proof of seduction, malice, or any injury to character, is a merely contract debt, and not one for willful and malicious injury to person " within the provisions of section 17 of the Bankruptcy Act, and is released by a discharge under that act.

A complaint by a grantee of land to recover the price from the grantor because she was induced to withhold her deed from being recorded, the grantor conveying the same property to another person, does not charge fraud, and a judgment recovered thereon is not a judgment in an action for fraud" which is not released by discharge. Collins v. Walter, 35 Misc. Rep. 648, 72 N. Y. Supp. 203.

Where the complaint charged wrongful misappropriation and embezzlement of certain money, and averred the ownership of the plaintiff, demand therefor and a refusal, a discharge in bankruptcy is properly pleaded as a defense in an action for conversion, although not effective as against a cause of action for embezzlement. Watertown Carriage Co. v. Hall, 66 App. Div. 84, 72 N. Y. Supp. 466.

A judgment against a bankrupt for converted money received by him for sales on commission is released by discharge. Matter of Benedict, 35 Misc. Rep. 230.

Art. 8. Effect of Discharge in Bankruptcy.

A private banker, knowing himself to be insolvent, who accepts trust moneys was held, under the circumstances, to be guilty of fraud and not discharged from liability by a discharge in bankruptcy. Colmer v. Torrey, 38 Misc. Rep. 127. The court held that by accepting the deposits under the circumstances disclosed the defendant was guilty of fraud.

Subdivision 2 of section 17 of the National Bankruptcy Law of 1898, which excepts from the operation of a discharge in bankruptcy "judgments in actions for frauds, or obtaining property by false pretenses or false representations," does not limit the exception to judgment recovered in common-law actions of fraud or deceit, but extends such exception to a money judgment, recovered in an action brought against the bankrupt to secure the specific performance of a contract, or to recover damages for its nonperformance, the gist and gravamen of which action, and the ground upon which the court retained jurisdiction thereof in order to award damages, after it had been shown that the bankrupt was unable to specifically perform the contract, was that the bankrupt had been guilty of actual fraud. Matter of Bullis, 68 App. Div. 508, affirmed 171 N. Y. 689.

In Matter of Bullis, 68 App. Div. 508, affirmed 171 N. Y. 689, and Frey v. Torrey, 70 App. Div. 166, affirmed 175 N. Y., in Memoranda without opinion, the construction of subdivision 4 of section 17 is considered, and it is held that the words "while acting as an officer in any fiduciary capacity" in the sentence reading "created by his fraud, embezzlement, misappropriation, or defalcation while acting as an officer or in a fiduciary capacity" do not qualify the words "fraud, embezzlement, or misappropriation," but only the word "defalcation," collating and discussing authorities.

XIII. Double, treble, and increased damages..... 283
XIV. Damages against joint tort feasors..

285

XV. New trial for insufficient or excessive dam

ages

286

ARTICLE I.

GENERAL RULES.

"In cases of tort, the primary question of liability may itself depend, and it often does, on the nearness or remoteness of the harm complained of. Except where we have an absolute duty and an act which manifestly violates it, no clear line can be drawn between the rule of liability and the rule of compensation. The measure of damages, a matter appearing at first sight to belong to the law of remedies more than of antecedent rights,' constantly involves, in the field of torts, points that are in truth of the very substance of the law." Webb's Pollock on Torts, 31, 32.

The term "damages" is said (Am. & Eng. Encyc. of Law [2d ed.], vol. 8, p. 541) to be defined by the Century Dictionary as "the value in money of what is lost or withheld; the estimated money equivalent for detriment or injury sustained; that which is given or adjudged to repair a loss.”

66

Bouvier's Law Dictionary defines damages as a pecuniary compensation or indemnity which may be recovered in the courts

Art. 1. General Rules.

by any person who has suffered loss, detriment, or injury, whether to his person, property or rights, through the unlawful act or omission or negligence of another."

Still another definition is, " a sum of money found as compensation for an injury done the successful party as against a party doing the injury."

Underhill, p. 96, citing Mayne on Damages, says that the principles governing the measure of damages in actions for tort are very loose, and that there are many cases in which no measure can be given; but that, aside from circumstances of aggravation or mitigation, the compensation to be awarded in respect to the injury to property can be much more correctly calculated than in respect to injury to person and reputation.

The injured party is restricted in the recovery of damages for torts, not intentionally committed, and breaches of contract, to such as result, naturally and necessarily, from the act complained of. This is a rule of general application, including all cases, except those in which, for great ends of public justice, punitive damages may also be awarded and added. The People v. The Mayor, Aldermen, etc., of the City of Albany, 5 Lans. 524 (529), citing Crain v. Petrie, 6 Hill, 522; Hamilton v. McPherson, 28 N. Y. 72; Passinger v. Thorburn, 34 N. Y. 634; Ryan v. N. Y. C. & H. R. R. R. Co., 35 N. Y. 210; Railroad Co. v. Reeves, 10 Wall. 176; Pennsylvania R. R. Co. v. Kerr, 68 Pa. 353; 2 Greenl. Ev. (5th ed.), § 256.

It is a general rule that, whenever one owes another a duty, whether such duty be imposed by voluntary contract or by statute, a breach of such duty causing damage gives a cause of action. Duty and right are correlative; and where a duty is imposed, there must be a right to have it performed. When a statute imposes a duty upon a public officer, it is well settled that any person having a special interest in the performance thereof may sue for a breach thereof causing him damage, and the same is true of a duty imposed by statute upon any citizen (Cooley on Torts, 654; Hover v. Barkhoff, 44 N. Y. 113; Jetter v. N. Y. C. & H. R. R. R. Co., 2 Abb. Ct. App. Dec. 458; Heeney v. Sprague, 11 R. I. 456; Couch v. Steele, 3 Ell. & Bl. 402). Willy v. Willy v. Mulledy, 78 N. Y. 306 (314).

It is said in Ehrgot v. Mayor, 96 N. Y. 264, 281, that the wrongdoer is responsible for the natural and proximate consequences