Clay v. Smith/Opinion of the Court

This case comes up from the Louisiana district, by writ of error, to reverse a judgment obtained there by Smith vs. Clay.

Smith, is a citizen of Kentucky, and Clay, of Louisiana; and the action was brought to recover a debt incurred in the year 1808.

Clay's defense rests upon the validity of a discharge obtained in a court of the state, under a law of the state, in the year 1811. The plea sets out his petition to the court; his surrender of his effects; the schedule of his debts, in which Smith's debt is specified, as also the payment to him of ten per cent, the dividend declared by the assignees of the bankrupt; and the judgment of the court, rendered in pursuance of the consent of more than a majority of his creditors in number and amount, that he be discharged, 'as well his person as his future effects, from all the claims of his creditors.' The language of the plea is, 'upon which said petition, the usual proceedings being had thereon, the said plaintiff and other creditors and said defendant being parties thereto, the said supreme court by their final decree pronounced in the premises, on the 15th of June 1811, declared the said defendant, as well his person as his subsequently acquired property and effects, for ever released from all claims, debts, and demands,' &c. previously due.

This plea is demurred to, and thus the question is raised, whether Smith, by voluntarily making himself party to such proceedings, has not abandoned his extra-territorial immunity from the operation of the bankrupt laws of Louisiana.

We are of opinion that he did; and was bound by the decision of the state court to the same extent to which the citizens of that state were bound.

Judgment reversed.

Case remanded, with instructions to enter judgment for defendant there. And in consequence of the death of Clay, while the cause was held under advisement, that it be entered, nunc pro tunc, as on the first day of this term.

This cause came on to be heard on the transcript of the record from the district court of the United States for the district of Louisiana, and was argued by counsel; on consideration whereof, it is ordered and adjudged by this court, that the judgment of the said district court in this cause be, and the same is hereby reversed, and that the cause be, and the same is remanded to the said district court, with instructions to the said court to enter judgment for John Clay, the defendant in said court. And it is further ordered by the court, that in consequence of the death of the said Clay, while this cause was held under advisement, that judgment be entered, nunc pro tunc, as on the first day of this term.