In re Douglas Coal & Coke Co.

Citations

• 131 F. 769
• 1904 U.S. Dist. LEXIS 228

Syllabus

<p>1. Bankruptcy — Acts of Bankruptcy — Appointment of Receiver.</p> <p>Under Bankr. Act July 1, 1898, c. 541, § 3, subd. 4, 30 Stat. 546 [U. S. Comp. St. 1901, p. 3422], as amended by Act Feb. 5, 1903, c. 487, 32 Stat. 797 [U. S. Comp. St. Supp. 1903, p. 410], in order that the appointment of a receiver at the instance of another shall constitute an act of bankruptcy, the appointment must have been made “because of insolvency,” and the appointment of a receiver for the property of a corporation in a suit to foreclose a mortgage, in which the bill does not allege insolvency, but a breach of the covenants of the mortgage, does not authorize an adjudication of bankruptcy against the corporation, although it may in fact have been insolvent, and such insolvency may have caused its default.</p> <p>2. Same — Payments with Intent to Prefer Creditors.</p> <p>Payments of comparatively small sums of money by an insolvent corporation to each of a number of its creditors, made in the usual course of business, do not raise a presumption of an intent to prefer such creditors over its other creditors, so as to establish an act of bankruptcy by a transfer of property with intent to prefer, within Bankr. Act July 1, 1898, c. 541, § 3, subd. 2, 30 Stat. 546 [U. S. Comp. St. 1901, p. 3422],</p>