In The Matter of Ignatius A. MONFORTE, Bankrupt-Appellant. Chemical Bank New York Trust Company, Objecting Creditor-Appellee
In The Matter of Ignatius A. MONFORTE, Bankrupt-Appellant. Chemical Bank New York Trust Company, Objecting Creditor-Appellee
2d 233
defraud plaintiff Chemical Corn Exchange Bank as his creditor * * *.' As this
transfer had been made on June 18, 1958, subsequent to the first day of the
twelve months immediately preceding the filing of the petition in bankruptcy
(See Bankruptcy Act, Sec. 14, sub. c(4), 11 U.S.C.A. 32, sub. c. (4)), it was
included in the specifications of objections to the bankrupt's discharge.
2
When the matter came on for hearing before Referee Arthur J. Doran, it was
stipulated that the hearing would be limited to this particular specification, the
others to be held in abeyance, to be considered only in the event that a decision
favorable to the bankrupt be made on the specification thus brought on for
disposition.
The judgment roll in the New York Supreme Court action was received in
evidence and relied upon to prove the allegations of fraudulent transfer as res
judicata. Objection was made 'unless the minutes of the trial are included
because it would be an unfair inference against the bankrupt unless all of the
facts to substantiate the judgment are clearly shown to the Court.' The bankrupt
also requested an opportunity to call witnesses, quite evidently for the purpose
of retrying the issue already determined in the state court. No specific element
of unfairness was alluded to, nor was any representation or offer of proof made
to impeach the validity of the judgment already rendered, or to attack the
competency of the New York Supreme Court to render the judgment, on
jurisdictional or other grounds. Moreover, no appeal had been taken from the
judgment, and the time to appeal had long since expired.
As the bankrupt prosecutes the appeal pro se and made the oral argument
before us, we can readily understand how so many irrelevant matters are urged
upon us as a basis for reversal. Nevertheless, in our scrutiny of the entire record
we have had in mind each of these miscellaneous confused and complex side
issues in order to satisfy courselves that appellant has suffered no injustice. The
fact remains that the only substantial issue in the case is whether or not it was
proper to rely upon the judgment roll in the Supreme Court action and to refuse
to require the production of the transcript of the state trial and to refuse to
permit the bankrupt to call witnesses and relitigate the issue of the fraudulent
transfer.
Preliminarily, it is clear that there is no significance in the fact that the formal
Preliminarily, it is clear that there is no significance in the fact that the formal
entry of judgment in the state court action was a few days after the filing of the
voluntary petition in bankruptcy and the adjudication. Moreover, as there was
no stay of proceedings, there was nothing to prevent the bankrupt from taking
an appeal from the judgment, had he chosen to do so.
That the principles of res judicata are applicable to such a proceeding as the one
before us has been repeatedly held. Sawyer v. Orlov, 1 Cir., 1926, 15 F.2d 952,
cert. denied, 1927, 274 U.S. 736, 47 S.Ct. 574, 71 L.Ed. 1316; Stalcup v.
Jepson, 8 cir., 1923, 289 F. 479; In re Gophrener, E.D.N.Y., 1937, 20 F.Supp.
922; In re Ruthkowski, S.D.Minn., 1930, 39 F.2d 969; In re Krall, D.Conn.,
1912, 196 F. 402; In re Skinner, N.D.Iowa, 1899, 97 F. 190.
We find it not necessary to discuss the other points argued by the bankrupt as
we find no merit in any of them.
Affirmed.