In re The Weber Furniture Co.

seasonably urged, the court say: "Besides, it well may be taken for granted in ulterior proceedings, in cases of this kind, where the contrary is not shown by the record, that it was made to appear satisfactorily to the commissioners that such determination had been made by the mayor and aldermen. The maxim Omnia rite acta presumuntur is applicable." Martin v. Stevens, 3 Ind., 519. The evidence was not returned. On error the court say: "If any state of proofs might have sustained the charge, it will be presumed right." (Cullen v. The court say:

"The record There is one case, and only one,

And

Lowery, 2 Harring, 459.) shows it is for a school tax. in which the justice had such jurisdiction, and perhaps we ought to presume it was such a case rather than the contrary." There was no affirmative proof that it was such a case. see applying in various forms of proceeding the same general, principle of presumption in favor of the rectitude of proceedings which are being reviewed on error: McKinney v. Pierce, 5 Ind., 422; Elder v. Robinson, 2 Ind., 210; Montgomery v. Doe, 4 Ind., 266; Wagers v. Dickey, 17 Ohio, 439; Hicks v. Person, 19 Ohio, 426; Bankhead v. Hubbard, 14 Ark., 300; Richardson v. Dennison, 1 Ark., 210; Stearns v. Warner, 2 Aik., 26; Kingsley v. Bank of State, 3 Yerg., 107.

In the last case it is said: "The judgment should clearly have been for the defendant, if all the testimony was that certified in the record; but, as it does not appear there was no more, it will be presumed there was more. It may have been quite clear on the face of the statement in this instance, that the assets would have paid more than twenty cents, but, as is said in the case just cited and its numerous fellow-judgments, the presumption is the omitted testimony was sufficient to explain and overcome it. Coil v. Willis, 18 Ohio, 28, is a case quite applicable in its reasoning to the case before us. Clements v. Benjamin, 12 Johns., 299, on certiorari. The facts before the court by no means warranted the judgment, but it was held the burden was on the plaintiff in error of showing affirmatively, by procuring a proper return, that there was no additional explanatory proof. We

In re The Weber Furniture Co.

Stewart

think in this case the burden was upon the objecting creditors to show the insufficiency of the evidence collateral to the statement given by the debtor. (Holly v. Rathbone, 8 Johns., 148; Wilson v. Fenner, 3 Johns., 439; Kline v. Husted, 3 Cairnes, 275.) Similar adjudications in New York are very numerous. (See also Wight v. Warner, 1 Doug., 384; Fleming v. Potter, 14 Ind., 486; Sharp v. Johnson, 22 Ark., 79; Long v. Rogers, 19 Ala., 321; Newberg v. Henson, 12 Cal., 280; Stockton v. Burlington, 4 Greene (Iowa), 84; Baily v. Clark, 6 Fla., 516; Pratt v. Miller, 2 Kans., 192; v. Wilson, 5 Dana (Ky.), 50; Byrne v. Riddell, 2 La. An., 11; Gray v. Howard, 12 Mich., 171; Barnsback v. Reiner, 8 Minn., 59; Anderson v. Williams, 24 Mass., 684: Raymond v. Edgar, 19 Mo., 32; Weed v. N. Y. R. R. Co., 29 N. Y., 616; Brindle v. Brindle, 50 Pa. St., 387; Martin v. Bank of Tennessee, 2 Coldw., 332; Ward v. Townsend, 2 Tenn., 581; Edmiston v. Garrison, 18 Wis., 594; Lamb v. Grover, 47 Barb., 317; Hayes v. Haye's Adm., 26 Mo., 123; People, ex rel. v. Circuit Court Judge, 18 Mich., 483.)

This is not the larger portion of judgments we have examined on this subject on a former occasion; reference to them all would serve no useful purpose. There is no department of the law where judgments are more numerous and pointed to a principle, or where they have applied one in more diverse circumstances or more universally. They authorize us to apply it in the case before us, and say that where no fraud appears, the duty is cast upon the objecting creditor to show affirmatively that the resolution of the creditors is unwarranted, and that the court should record it, unless upon notice and hearing it inquires into the testimony, which shows it ought to be rejected.

We should not understand from the judgment of the learned Judge of the District Court that he would at all disagree with these generalities. We should infer that the only difference between his judgment and our own consists in a mere matter of practice. Shall the burden of bringing this additional testimony before the District Court be assumed by

In re The Weber Furniture Co.

the creditors, whose resolution is to be recorded, or shall the presumption exist that that resolution is right until attacked by those who are interested in showing it to be erroneous? We think a more convenient practice is to extend to those interested the presumption of rightfulness which attends all other judicial and statutory action. We think it would be, in the last degree, inconvenient, if, whenever an apparent discrepancy between the assets and the compromise appears, the court is to be burdened with the duty of re-hearing the testimony and acting as the guardian of those interests which the creditors themselves, in the very nature of the case, are so much more capable of protecting. We cannot assume any such duty upon petitions of review, and think it will lead to ill consequences, if adopted as a practice in the District Court.

We have been favored by full citations of English and American judgments upon this statute. In selecting a portion of these which have been cited and commented upon, in justification of our judgment, we do but little more than reproduce their analysis and consideration from the very able brief of the counsel for the debtor. This efficient aid is sufficiently rare in its occurrence to make our acknowledgment for its presence here not unworthy of mention.

We think the following adjudications upon the English act, precisely like our own, so far as this subject is concerned, differing from it only in the mere practice by which the subject is reached, show that the British courts have uniformly held that in all questions of mere amount, and all conditions, and terms which affect the simple question of policy on the part of the creditors, up to the point where fraud or ill-faith is reached, it is left entirely to the discretion of those who are alone interested in the result. Without being called upon to affirm that this will be accepted as law under our own statute, we think the adjudications there and in this country already pronounced upon the same subject, are coercive to at least this extent-that when a resolution has been regularly passed, and there is nothing before the court but it and the

In re The Weber Furniture Co.

statement of the debtor under the act, it will, prima facie, be held to be good, and that unless there is some feature in it so gross as to excite the suspicion of fraud, it will be affirmed.

In re Radcliffe Investment Company, L. R., 17 Eq., 121, decided in 1873 on appeal to the Bankruptcy Court. Bacon, C. J., in construing that clause of the statute which provides for adding to or varying the original resolution of compromise, and holding that the persons who are not to be affected by the amendatory resolution are not creditors, discusses with much fullness the powers conferred upon creditors, under the English statute, and says: "Now, the existing statute has made this striking and marked difference in the law of bankruptcy-that all, or nearly all, the powers and authority which were given to the court under the former statutes are now transferred to the creditors. They are made the administrators and judges of their own affairs, and they are, under the terms of the statute, bound by the votes of a certain majority at a meeting duly convened. One of the things contemplated by the existing statute is to regard only the interests of creditors, and it is in their interest alone that it provides that it shall be in their power to prefer the acceptance of the composition to the issuing of proceedings in bankruptcy against their debtor, or to resorting to any other legal remedy they may possess." His whole judgment rests largely upon the assumption that the absolute power of binding the minority is conferred upon the majority of creditors. The primary authority is vested in them.

Ex parte Duignan, L. R., 11 Eq., 104, in 1870. The deputy judge had ordered a levying creditor to deliver property to the trustee in liquidation, holding that the same principle. applied in such case as in that of an ordinary adjudication in bankruptcy. Affirming this ruling, on appeal, Bacon, C. J., again minutely reviewing these statutory provisions, says: They hand over to the creditors of insolvents generally an absolute power of determining the manner in which, and the terms upon which the assets of the debtor who is found to be bankrupt, whether in consequence of a hostile proceed

In re The Weber Furniture Co.

ing originated by his creditors, or by his own confession, shall be administered and distributed." It is this unlimited power conferred by the statutes which furnishes the keynote for their construction.

Latham v. Lafone, L. R., 2 Ex., 115, has been cited at the bar, and is relied upon in the opinion of the learned Judge of the District Court to show, what is not doubted, that power is given by this law to reject or set aside the resolution of compromise. A motion was made to discharge a debtor from arrest because a deed of composition had been signed and registered. The motion was denied. Two judges held the deed unreasonable upon grounds having nothing to do with the mere quantum of money to be paid. The circumstances were so gross as to incline an equal number to base their judgment upon the far better ground that it was not a deed under the statute at all. The judgment has no tendency to show that the court, without collateral facts, will review the decision of creditors as to the percentage they shall receive. This criticism is fully supported by the following language in one of the opinions: "The main object of this section was to enable the creditors to manage their own affairs. It was clearly intended to confer large discretionary powers on the creditors, and we ought to give every effect to that intention. I agree that if the deed is unreasonable to the extent of absurdity we ought not to sanction it, but prudence is so much a relative matter that it becomes very difficult to say conclusively that a deed is unreasonable on this score, where the creditors have said it is reasonable, and, except in cases of inequality, we have no certain test to go by."

In re Cowen, L. R., 2 Ch. Ap., 563, was relied upon for the same purpose as the preceding. Leave was given below to issue execution, notwithstanding a composition by the debtor, under the Act of 1861. Lords Turner and Cairns both rest their judgments upon the ground that the deed was not executed in good faith. There was an expectation of benefit peculiar to the consenting majority, which is expressly pro