IN RE HJ. FEHMI HASSAN (V2) 1 CLR 84

IN RE HJ. FEHMI HASSAN (V2) 1 CLR 84 ΠΑΓΚΥΠΡΙΟΣ ΔΙΚΗΓΟΡΙΚΟΣ ΣΥΛΛΟΓΟΣ CyLaw | Αναφορικά μ'εμάς | " target="_top">Επικοινωνία | Όροι χρήσης Έρευνα - Κατάλογος Αποφάσεων - Εμφάνιση Αναφορών (Noteup on) - Αρχείο σε μορφή PDF - Αφαίρεση Υπογραμμίσεων (V2) 1 CLR 84 1892 November 10 [SMITH, C.J. AND MIDDLETON, J.] IN RE HADJI FEHMI HASSAN. INSOLVENCY-MERCHANT-DEBTS NOT ARISENG FROM COMMERCIAL TRANSACTIONS-OTTOMAN COMMERCIAL CODE, §§ 1 AND 147-APPENDIX TO COMMERCIAL CODE, § 28. By Article 147 of the Ottoman Commercial Code a merchant who is unable to pay the debts that he has incurred in his capacity as a merchant may be declared insolvent. F. who had carried on the business of a timber merchant, ceased to do so and became a farmer. K. and A. were the holders of promissory notes given by F. for moneys advanced and seed corn supplied to him as a farmer. F. was unable to pay the notes. HELD (reversing the decision of the District Court): That the facts proved were not sufficient to show that he had the legal status of a merchant ; that the debts were not incurred by him in his capacity as a merchant, and that consequently he was not liable to be declared insolvent. APPEAL from the order of the District Court of Nicosia declaring Hadji Fehmi Hassan insolvent. The order was made on the application of two creditors, Hadji Kypri Constantinides and Athanassio Papadopoulo, who alleged that Hadji Fehmi Hassan was a merchant, and that he was unable to pay his debts. The evidence was to the effect that Hadji Fehmi Hassan used to deal in timber, but that he had ceased to do so for a period of four years: that he was now engaged in farming, and was also a partner in a partnership or company formed for the purpose of making rope. The debts owing to the applicants arose on promissory notes given by Hadji Fehmi Hassan for cash advanced to him, and seed corn purchased by him for the purpose of carrying on his farm. There was also evidence that he owed a sum of money borrowed by him for the purpose of purchasing timber, but that this money was secured by a promissory note which was not yet due. The District Court decided that he was a merchant and that he was unable to pay his debts, and declared him to be insolvent. Hadji Fehmi Hassan appealed. Economides for the appellant: There is no evidence that the appellant is a merchant: the evidence shows him to be a farmer. The debts of the petitioning creditors are not debts arising from commercial transactions, but for moneys advanced to appellant to enable him to carry on his farm and for seed corn supplied, and there is no debt now due by him for any commercial transaction on which he could be declared insolvent. His interest in the partnership is only an interest to the extent of £5 or £6, and that fact will not make him a merchant within the meaning of the Commercial Code. Chakalli for petitioning creditor: The question is one of fact which has been decided by the Court below, and the Appeal Court will not reverse it. The fact that he is a partner in a business, whether his interest be large or small, is quite sufficient to make him a merchant, and he can be declared insolvent. If he is a merchant, the source whence the debts arise is immaterial. The law makes no distinction between commercial and private debts. The French translation of Article 147 of the Commercial Code says "cesse ses paiements" merely. Judgment: This is an appeal from an order of the District Court of Nicosia made on the application of Hadji Kypri Constantinides and Athanassio Papadopoulo, declaring Hadji Fehmi Hassan insolvent. The appeal is made by Hadji Fehmi on the ground that he is not a merchant, and that in consequence he is not a person who can be declared insolvent. Article 147 of the Commercial Code enacts that every merchant who is unable to pay his debts arising from commercial transactions, is in a state of insolvency, and under the Commercial Code no other person can be declared insolvent. We use the term insolvency in place of the ordinary expression bankruptcy, as the more correct term: a bankrupt under the Ottoman Law being an insolvent, who by reasons of his acts, is liable to certain punishments. A merchant is defined in Article 1 of the Code to be a person who is engaged in commerce, or who enters into written agreements relating to commerce, and the point we are called upon to decide is, whether Hadji Fehmi is a merchant within the meaning of the law. It is contended for the respondents that this is a question of fact which has been decided by the District Court, and that the Supreme Court, in accordance with its usual practice, will not interfere with that decision unless very strong grounds are shown; but we are of opinion that the question is more in the nature of a question of law, viz.: as to whether the facts proved in the case are sufficient to show that the appellant has the legal status of a merchant. The evidence shows that up to about four years ago the appellant traded in timber, and since that time, so far as appears, he has been engaged in farming. The debts of Hadji Kypri and Athanassio arose from money lent, and the value of seed corn advanced, to the appellant, which are secured by bonds given to them by him. There is no definition in the Ottoman Code of what is meant in Article 1 by commerce. Article 28 of the Appendix to that Code defines what the law regards as acts of commerce, and amongst these is the giving of bills of exchange or promissory notes, etc., by any persons. Assuming that, at the time the promissory notes in the hands of these two creditors of the appellant were given, the appellant was engaged in the occupation of a farmer, does the giving of these notes make him a merchant within the meaning of Article 1 of the Commercial Code, and so render him liable to be declared insolvent? We are of opinion that on these transactions alone it is not possible to say that the appellant is a merchant. Article 28 of the Appendix to the Commercial Code is contained in a section which is passed for the purpose of defining the jurisdiction of the Commercial Court. Paragraph 2 of Article 27 gives that Court jurisdiction in all actions relating to commercial matters, and the following article defines what commercial matters are. The Ottoman Commercial Code is taken directly from the French, so much so, that what purports to be the French translation is, in many parts, and particularly in the articles we have referred to, viz.: Article 1, Article 147 and Article 28 of the Appendix to the Code, a literal transcription from the French, and we have but little doubt that the Turkish text is meant to be a translation of the French. But whilst this is so, the Turkish text of course contains the law; and we must look to it alone to guide us, putting upon it such construction as it appears to us to warrant. The language of the Turkish text is in some respects more precise, and in others more loose, than the French. For instance, the French text of Article 147 says, "every "merchant who suspends his payments is in a state of "insolvency;" thus appearing to leave open the question that was argued on this appeal, viz.: in respect of what debts a merchant can be declared insolvent, whether for instance, a merchant who did not pay his private debts could be so declared. The Turkish text, on the other hand, says distinctly, that the debts for non-payment of which a merchant can be declared insolvent, must be debts contracted by him in his capacity as a merchant, that is, commercial debts. A literal translation of the Turkish text is as follows: "if a merchant whose business transactions are in con-"formity with the calling (or capacity) of a merchant "finds that he is unable to pay the debt which he has "incurred in that capacity, he shall be taken to be "insolvent." On the other hand the French text of Article 1 says that a man who is habitually engaged in commercial transactions is a merchant, whilst the Turkish text defines merchants as those "who are engaged in commerce or "enter into written agreements relating to commerce," and it is not very easy to see what is meant by the latter part of this clause. A merchant, in the ordinary meaning of the term, is one who is engaged in the buying and selling of goods, and we are unable to say that a farmer who borrows money and purchases seed corn, and pays, or gives security for payment, in the shape of promissory notes,-ipso facto becomes a merchant. We think it would be necessary to hold that a person must, as the French text says, be habitually engaged in what the law regards as commercial transactions in order that he should be regarded as a merchant, and the mere fact that on isolated occasions he engages in such transactions would not be sufficient to give him the legal status of a merchant. This view is supported by those commentaries of Ottoman lawyers on the Code, to which we have had access. It is further argued, that the appellant being a partner. in a business for the purchase of the entrails of animals is a merchant; but it seems clear that a merchant can only be declared insolvent in respect of commercial debts; and the debts proved in the case before us, are not debts that he has incurred in his quality or capacity as a merchant and, therefore, that he is not liable to be declared insolvent. If the debts had been incurred by him in his capacity as a dealer in entrails, the case would have been different, but it appears to us clear that these debts were incurred by him in his capacity of a farmer. We see no evidence in the present case of any transactions by the appellant in respect of which it was competent for the District Court to declare him insolvent. For these reasons we are of opinion that this appeal must be allowed, and that the order of the District Court must be set aside: but under the circumstances we shall make no order for costs. Appeal allowed. cylaw.org: Από το ΚΙΝOΠ/CyLii για τον Παγκύπριο Δικηγορικό Σύλλογο