Atherton v. Green

Citations

• 179 F. 806
• 30 L.R.A.N.S. 1053
• 1910 U.S. App. LEXIS 4707

Syllabus

<p>Bankruptcy (§ 163*) — Preference—Transfer in Payment for Property Converted.</p> <p>A bankrupt conducted a bank as sole owner, and as such banker received a note from defendants for collection and remittance of the proceeds. He collected the note but converted the proceeds to his own use. He was at the time insolvent and within a few days thereafter executed a conveyance to defendants of real estate which he had long owned, sending it to them with directions to hold it until they had definite notice of the closing of his bank. The bank was closed at the time, and, receiving notice of such fact, defendants accepted the deed.</p> <p>Held, that while the conversion of the proceeds of the note gave the bankrupt no title thereto, and defendants were entitled to follow and recover the amount in so far as it remained on hand or was traceable into other property, their acceptance of the conveyance of the property with knowledge of the conversion, and insolvency was an election to treat the misappropriation as creating an indebtedness, and they stood in no better position than general creditors, and that the conveyance constituted a preference voidable at suit of the trustee in bankruptcy.</p> <p>[Ed. Note. — For other cases, see Bankruptcy, Gent. Dig. § 247; Dec. Dig. § 163.*]</p>