
    No. 862
    HOILES v. FIDELITY & DEPOSIT CO. and COHN
    Ohio Appeals, 9th District, Lorain County
    No. 266.
    Decided Nov. 2, 1923
    54A. BANKRUPTCY.
    Surety in uncontested attachment suit failing t< set up bankruptcy of debtor cannot set up bank ruptcy as defense to action on bond.
    Attorneys — W. P. Duffy, for Hoiles; F. M. Steve for Fidality and Deposit Co.
   WASHBURN, J.

Epitomized Opinion

Hoiles brought an attachment suit against Coh and seized 'the latter’s property.’ Fidelity and De posit Co. furnished a bond for Cohn and the proj erty was .released to him by the sheriff. Coh Having failed-to file, an answer, judgment was rei| dered against him. Between the time of the fili: of the bond for Cohn ■ and the rendering of tl| Judgment, a petition in bankruptcy was filed again, Cohn in Marylend. He was adjudicated a bankru Hoiles was listed as a creditor and though he fail' to participate in the composition, he received a dh dend which he applied on the claim. This aett is to hold the Surety Co.'-for the balance of t judgment, interést and costs. In reversing ■ judgment and finding that the Surety Co. must p the Court of Appeals hold:

I. The Bankruptcy Act does not prevent an e terprising creditor from getting security for 1 claim, not out of the property of the debtor, I by the obligation of a third party as surety i his debt. Though the bankruptcy of the debtor d charges the debt, the bankruptcy must be plead a p oved in the action against the debtor, and whd Ihe debtor or his surety fail to set up the bajj ruptcy and a default judgment is rendered, surety ’s bound thereby and cannot sat up bankruptcy as a defense in an action on the bo  