(after stating the facts as above). The objection to the discharge of the bankrupt is based upon the contention that the drawing of the two drafts by Armstrong, the assistant cashier, was ground for refusing a discharge under subdivision 3 of section 14b (Act July 1, 1898, c. 541, 30 Stat. 550 [U. S. Comp. St. 1901 p. 3427]) of the bankruptcy act, namely, that the bankrupt had thereby “obtained property on credit from any person upon a materially false statement in writing made to such person for the purpose of obtaining such property on credit.” * The words quoted came into the law by the amendment of the act made in 1903. Act Feb. 5, 1903, c. 487, § 4, 32 Stat. 797 (U. S. Comp. St. Supp. 1909, p. 1310). This ground for denying a discharge was evidently leveled particularly at the practice of making false statements of one’s financial condition by a buyer or borrower for the purpose of obtaining from the person to whom such false statement is made, in writing, the articles or money desired “on credit.” The false statement in writing which is enough to deny a discharge implies a statement knowingly false, or made recklessly, without an honest belief in its truth, and with a purpose to mislead or deceive, and thereby obtain from the person to whom it is made property upon a credit.
In Gilpin v. Merchants’ National Bank, 165 Fed. 607, 611, 91 C. C. A. 445, 449, 20 L. R. A. (N. S.) 1023, the Circuit Court of Appeals for the Third Circuit, speaking by Circuit Judge Gray, said of this clause, that:
“The written statement made by the bankrupt for the purpose of obtaining credit, etc., should be knowingly and intentionally untrue, in order to constitute a bar to the discharge of the bankrupt. In other words, ‘false statement' connotes a guilty scienter on the x>art of the bankrupt. The primary and ordinary meaning of the word ‘false’ cannot be ignored. It is the primary meaning given in the ordinary lexicons of the English language. Webster gives as its primary meaning: ‘Tittering falsehood; unveracious; given to deceit; dishonest.' As an adjective, it is correlative with thq noun ‘falsehood.’ To charge a person with making a false statement is equivalent to charging him with uttering a falsehood, and imputes moral delinquency to ■the person so charged. It is true that the word may have a secondary meaning in certain collocations, and* be merely equivalent to ‘untrue’ or ‘incorrect.’ But this is not the ordinary or usual signification attached to the word. To charge a person with making false entries in books of account means something more than that incorrect or untrue entries have been made, and it has been so held by the courts in the consideration of offenses of that character. The last edition of Bouvier’s Taw Dictionary says of the word ‘false’ that, when ‘applied to the Intentional act of a responsible being, it implies a purpose to deceive.’ In Black’s Daw Dictionary, under the title ‘false,’ it is said: ‘In law, this word means something more than untrue; it means something designedly untrue and deceitful, and implies an intention to perpetrate some treachery or fraud.’ In a recent and well-accepted publication called *578‘Words and Phrases,’ the word ‘false’ is thus defined: ■ ‘False means that which is not true, coupled with a lying-intent.’ Wood v. State, 48 Ga. 192, 297, 15 Am. Rep. 664. ‘False in jurisprudence usually imports something more than the vernacular sense of ‘erroneous’ or ‘untrue.’ ”
The theory upon which Harvey is to be held as having made a false statement, in writing, made by Armstrong, assistant cashier who drew these drafts, is based upon the fact of Harvey’s actual insolvency at the time, his knowledge of the state of the account with the Columbus Bank, and that he knew also that Armstrong had before drawn drafts upon the same bank when there were no funds to meet them. But does it follow that, because Harvey had upon other occasions drawn such: dtafts when there were no funds- to meet them, these drafts, drawn confessedly without Harvey’s direction, or knowledge, are enough to constitute them a false.statement, knowingly false and made by Harvey with intent to mislead' or deceive and thereby obtain checks against his bank about which he actually knew nothing? We think that is going too far. Does it even follow that if Armstrong himself w.ere the bankrupt that the drawing- of these drafts under the circumstances here in evidence would constitute a false statement within the meaning of this clause of the bankruptcy act? Had Armstrong no ground for an honest belief that these drafts would be met? Counsel for the appellants in their brief say that he had “the habit of drawing on the Columbus Bank when there were no funds with which to meet such drafts”; that “he had done this some 16 times between December 30, 1907, and January 22, 1908.” Kxhibit A seems to bear out this statement. But the inference from the same exhibit is that all such prior overdrafts were in some way provided for, the account showing deposit of funds shortly thereafter, so that at the end of the 16 transactions referred to there appeared a balance to the credit of Harvey’s Bank of $192.83.
. The appellants, as well as the appellee,- seem to have been engaged in the banking business at Lisbon, and one of .the facts in the agreed statement was that the two banks had daily settlements between them, and that, when the amount of any balance due from one to the other exceeded $500, the debtor bank would give the other bank a draft on some different bank for the amount. The drafts here involved were thus given under this clearing house plan of settlement.
Harvey may be civilly liable for drafts drawn by Armstrong in the course of such a business, but it is quite another thing to say that the drafts drawn by Armstrong under the circumstances of this case constitute that willful kind of false statement by Harvey necessary as a ground for preventing a discharge in bankruptcy.
Judgment affirmed.