In re GARA

In re GARA. (District Court, E. D. Pennsylvania. October 3, 1911.) No. 3,971. Bankruptcy (§ 407)' — Discharge—Fraudulent Creation of Debt. Bankr. Act July 1, 1898, c. 541, § 14. 30 Stat. 550 (U. S. Comp. St. 1901, p. 3427), providing the grounds on which a bankrupt’s discharge may be denied, does not authorize such denial because of the existence of a debt fraudulently contracted from which the discharge is not a release, as provided by section 17. [Ed. Note.- — For other cases, see Bankruptcy, Dec. Dig. § 407.] In the matter of bankruptcy proceedings of Henry C. Gara. On motion to dismiss objections to bankrupt's discharge. Granted. William H. Burnett, for bankrupt. Alfred !• Phillips, for objecting creditor. For other cases see same topic & § number in Dee. & Am. Digs. 1907 to date, & Rep’r Indexes [MAJORITY — J.'B. McPHERSON, District Judge.] J.'B. McPHERSON, District Judge. It may be that the debt due to the objecting creditor was created by the misconduct of the bankrupt while acting in a fiduciary capacity. Assuming this to be true, section 17 protects the debt from discharge, but the mere existence of such a debt,does not prevent the bankrupt from receiving a discharge from his other provable obligations. The only obstacles to a discharge are described in section 14, and I do not find among them the creation of a debt by-the bankrupt’s fraud or other misconduct while acting in a fiduciary capacity. At the best, the pending specification charges such Creation and nothing more, and this is plainly insufficient. The motion to dismiss is granted.