Neal v. Clark, 95 U.S. 704 (1877)

By Professor M. Jonathan Hayes

Issue: Where the code at the time provided that debts “created by the fraud” of the debtor are non-dischargeable, does the fraud have to be actual or is constructive fraud sufficient?

Holding: “‘[F]raud’ referred to in [the code] means positive fraud, or fraud in fact, involving moral turpitude or intentional wrong.”  Constructive fraud is not sufficient.

Justice John Marshall Harlan

The debtor purchased certain bonds from a probate estate at a discount.  It was determined later that the executor of the estate breached his fiduciary duties in . . .

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