National Bank of Newport v. National Herkimer County Bank of Little Falls
Citations
- 225 U.S. 178
- 32 S. Ct. 633
- 56 L. Ed. 1042
- 1912 U.S. LEXIS 2078
Syllabus
<p>To constitute a preference under the Bankruptcy Act it is not necessary that the transfer be made directly to the creditor; it may be made to another for his benefit, and if preferential circuity of arrangement will not avail to save it.</p> <p>Unless, however, the creditor takes by virtue of a disposition by the insolvent debtor of his property for the benefit of the creditor so that the estate is diminished the creditor cannot be charged with receiving a preference.</p> <p>Where the endorser of the bankrupt's note, which is under discount at a bank and secured by the endorser’s own collateral, pays the note, thereby recovering his collateral and charges the.payment to the bankrupt to whom he is indebted in a larger sum on open account, there is no preferential payment to the hank which the trustee can recover from it as such, it not appearing that the bank ' was concerned with, or ,had any knowledge of, the relations between the endorser and the maker of the note. ■</p>
How courts have described this case
Verbatim parenthetical descriptions written by other courts when citing this decision. Ranked by citation-network relevance.
- concluding that there was no transfer of the debtor’s property under § 60 of the 11 BAP Appeal No. 21-29 Docket No. 30 Filed: 05/27/2022 Page: 12 of 33 rationales for this conclusion, including that (1) the transfer was of the new creditor’s, not the debtor’s, property; (2
- “It is not the mere form or method of the transaction that the Act condemns....”
- “Neither directly nor indirectly was this payment to the bank made by the [debtor], and the property of [the debtor] was not thereby depleted.”
- “Neither directly nor indirectly was this payment to the bank made by the [debtor], and the property of [the debtor] was not thereby depleted.”
Source: CourtListener parenthetical corpus (CC0).
Judges: Hughes
Read full opinion on CourtListenerSourced from CourtListener / Free Law Project (CC0).
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