McDougall v. Page. is essential to the revival of a debt that is barred by a discharge in bankruptcy. Allen v. Ferguson, 18 Wall. 1. Indeed no promise whatever to pay is found, but only an attempt to compromise shown. The main question is this: Does a discharge under the United States Bankrupt Act operate in the courts of this State to bar the enforcement of a debt provable under said act, but contracted and payable in Canada by a person resident in this State to a person resident in Canada, who neither proved his debt in bankruptcy, nor in any way became a party to the proceedings, nor had any personal notice thereof? This is an important question, and has been twice argued before the full bench, aud has received our careful consideration. * * Section 5119, U. S. Rev. Stat., provides, that "a discharge in bankruptcy duly granted shall release the bankrupt from all debts, claims, liabilities, and demands which were or might have been proved against his estate in bankruptcy." Section 5019 provides for giving notice of the institution of proceedings to all creditors upon the schedule filed with the debtor's petition, or whose names may be given to the register in addition by the debtor. Upon application for a discharge, notice is to be given to all creditors who have proved their debts. Sec. 5109. Some things connected with this subject may be regarded as settled. And in the first place, there is no doubt that a debt or liability arising in any country may be discharged by the laws of that country; and that such a discharge, if it releases the debt or liability, and does not merely interfere with the remedy, or course of procedure to enforce it, will be an effectual answer to the claim, not only in the courts of that country, but in every other country. This is the law of England, and is a principle of private international law adopted in other countries. Peck v. Hibbard, 26 Vt. 698; Story Confl. Laws, §§ 335, 338; BOVILL, C. J., in Ellis v. M' Henry, L. R., 6 C. P. 228. Secondly, as a general proposition, it is also true that a discharge under a foreign bankrupt law is no bar to an action in the courts of another country on a contract made and to be performed there. M'Millan v. M'Neill, 4 Wheat. 209; Smith v. Buchanan, 1 East, 6; Ellis v. M'Henry, L. R., 6 C. P. 228. This is because of want of jurisdiction in the court granting the discharge, so that the debt or liability is not thereby released. McDougall v. Page. But it is contended on the part of the defendants, that a discharge under the bankrupt law of any country is a bar in the courts of that country to all debts and liabilities provable under the law, wherever contracted or to be performed; that by resorting for the enforcement of his debt to the courts of the country granting the discharge, the creditor waives his extra-territorial immunity, subjects himself to the lex fori, and cannot deny the effectiveness of the discharge against him. And this seems to be the doctrine in England, though we think that none of the cases to which we have been referred go to the full extent of holding it, as none of them appear to be cases in which the liability was contracted or to be performed in countries in nowise subject to British rule. For it is important to be remembered in this connection, that for the purposes of the Imperial Bankrupt Act, the British dominions form one country or law-district (Dicey's Law of Domicile, 355 et seq.); and that in case of the legislature of the United Kingdom making laws that will be binding upon her colonies and dependencies, a discharge in the colonies or in the mother country may by the imperial legislature be made a binding discharge in both, whether the debt or liability arose in one or the other, and that a discharge created by an act of the English Parliament would be clearly binding on the English courts, and that they would be bound to give effect thereto. Ellis v. M'Henry, L R., 6 C. P. 228. Armani v. Castrique, as reported in 13 M. & W. 443, was a mere question of pleading, and the effect of an English certificate in an English court as against a foreign creditor was not involved, though some discussion on that subject incidentally arose between the court and counsel during the argument, when POLLOCK, C. B., said that an English certificate was a discharge as against all the world in the English courts. And he put it on the ground that the goods of the bankrupt all over the world were vested in the assignee, and that it would be manifest injustice to take the property of the bankrupt in a foreign country, and then allow a foreign creditor to come and sue him in England. Edwards v. Ronald, 1 Knapp, 259, came up on appeal from the Supreme Court of Calcutta. It was an action of general assumpsit. Plea, discharge in bankruptcy in England. Replication, that the cause of action accrued in Calcutta, where the appellees were domiciled, and that they had no notice of the proceedings in bankruptcy. McDougall v. Page. Held, that the certificate was a good bar. But Calcutta, as shown by the case, was "a place governed by and subject to the laws of England." Royal Bank of Scotland v. Cuthbert, 1 Rose, 462, was an action in the Court of Sessions in Scotland, and holds that an English certificate is a bar in the Scotch courts to a debt contracted in Scotland. And in Sidaway v. Hay, 3 B. & C. 12, it was held that a debt contracted in England by a trader residing in Scotland was barred by a discharge under a sequestration in Scotland issued in conformity to the 54 Geo. 3, in the same manner as debts contracted in Scotland. These cases simply give effect to imperial legislation. Odwin v. Forbes, 1 Buck, 57, was a suit instituted in the Dutch Colonial Court of Demerara, for the recovery of the balance of an account for sugars consigned to and received by the defendant and his partner in London, and the defendant pleaded his discharge in bankruptcy in England. The Colonial court held the certificate a discharge of the debt, putting the case mainly, if not wholly, on the grounds of comity and reciprocity which were shown to exist between England and Holland, and that the effect of the certificate ought, in justice, to be co-extensive with the assignment, and that if foreign courts allowed the assignee under an English commission to strip the debtor of his foreign property by giving effect to the assignment in their jurisdiction, they were bound in justice to give equal effect to the certificate, and not leave the debtor liable to actions by foreign creditors. From this judgment the plaintiffs appealed to the king in council, and the case came on to be heard on appeal at the Cock Pit, on Saturday, 31st May, 1817, when judgment was affirmed; but on what ground does not appear, as no opinion of the English court is given. Demerara is a part of British Guiana, the government of which is vested in a governor appointed by the British Crown, and a court of policy, originally instituted by the Dutch in 1773 for Demerara, 11 Enc. Brit. 251; and whether this case is to be regarded as merely giving effect to imperial legislation or not, it does not seem to be much authority for the doctrine that an English certificate in an English court is a bar to a debt whereever contracted, but involved rather the question whether the Colonial court would give effect to an English certificate. We have examined some English cases to which we have not been referred, and among them is Ellis v. M'Henry, L. R., 6 P. C. 228, in which it was held that a discharge from a debt or liability under a McDougall v. Page. bankrupt act of the Imperial Parliament is a discharge from such debt or liability in the courts of any country forming part of the British dominions. But without further consideration of the English cases, we think it may be said that the defendant's contention is in accordance with the English rule. Recognitions of that rule are found scattered through the English reports and text-books. Dicey's Law of Domicile, rule 2, 355. But it seems to rest largely on the ground put by POLLOCK, C. B., in Armani v. Castrique, namely, the universal effect there given to an assignment in bankruptcy. For it is the settled law of England that an assignment under the bankrupt law of a foreign country passes all the personal property of the bankrupt situate, and all debts owing, in England, and that the attachment of such property by an English creditor, after bankruptcy, with or without notice to him, is invalid to overreach the assignment. And the same doctrine holds there under English assignments as to personal property and debts of the bankrupt in foreign countries. And upon principle, it is said that all attachments made by foreign creditors in foreign countries, after such assignments, ought to be held invalid; and that at all events, a British creditor will not be permitted to hold the property acquired by a judgment under any attachment made in a foreign country after such assignment. Story Confl. Laws, § 409. The same doctrine obtains in France and Holland. Story Confl. Laws, § 417. the ubiquity of the operation of assignments under foreign bankrupt laws has always been denied in this country, and such assignments are not permitted to prevail against a subsequent attachment of the bankrupt's effects found here. Our courts will not subject citizens to the inconvenience of seeking their dividends abroad when they have the means of satisfying their demands at home. Booth v. Clark, 17 How. 322, and cases passim. The law of Germany is the same. Whart. Conf. Laws, § 844. The wording of our Bankrupt Act is certainly broad enough to cover foreign debts, for the bankrupt is to be released from all debts which were or might have been proved against his estate. But is the act to be construed as intended to include foreign contracts, they not being particularly mentioned therein? Not if we adopt the rule laid down in Suydam v. Broadnax, 14 Pet. 67, in these words: "And it may be laid down as a safe proposition, that a statute discharging contracts or denying suits upon them, without McDougall v. Page. the particular mention of foreign contracts, does not include them.” "Ratio est, quia statutum intelligit semper disponere de contractibus factis intra et non extra territorium suum.' In M'Menomy v. Murray, 3 Johns. Ch. 435, Chancellor KENT adopts the same rule, and says: "A bankrupt or an insolvent act ought not to be presumed to have been intended to reach foreign contracts unless it be so declared." But in Murray v. De Rottenham, 6 Johns. Ch. 52, which was concerning the same subject-matter as M'Menomy v. Murray, he held this language: "But I do not apprehend that we are to require an express declaration of the legislature that foreign creditors are included in the operation of a bankrupt law, when the language of the statute is otherwise sufficiently general and comprehensive, and when the evident policy of the law is to embrace all debts that can be proved under the commission, and to give the unfortunate merchant who conducts himself fairly new credit in the commercial world and new capacity for business." But in Reimsdyk v. Kane, 1 Gal. 371, Judge STORY adopted and applied the rule in Suydam v. Broadnax. We think this the true rule to be adopted in construing this class of statutes, rather than to impute to the legislature an intention to include matters beyond its jurisdiction. In Penniman v. Meigs, 9 Johns. 325, a discharge under the insolvent law of New York was held to bar a suit on a promissory note given in Connecticut to the plaintiff resident in Rhode Island, who did not assent to the proceedings nor receive any dividend from the defendant's estate. The case was put on the ground that the statute was peremptory and binding on their courts, and that they were bound thereby to treat the discharge as a bar to all suits brought there on antecedent contracts wherever made. It will be seen hereafter that this case is opposed to the whole current of American decision, State and Federal; and in Hicks v. Hotchkiss, 7 Johns. Ch. 312; 11 Am. Dec. 472, Chancellor KENT refers to it as overruled by M'Millan v. M'Neill, 4 Wheat. 209. Going upon the ground of Penniman v. Meigs, and referring to it as a well-considered case and "much in point," it was held in Murray v. De Rottenham, that a discharge under the United States Bankrupt Act of 1800 was a bar to a debt provable under said act, though contracted and payable in Germany. But the authority of this case is very much shaken by the overruling of the case on which it is based; and we think it runs counter to the great current of American cases. |