New Orleans Acid & Fertilizer Co. v. O. Guillory & Co.

Citations

• 117 La. 821
• 42 So. 329
• 1906 La. LEXIS 777

Syllabus

<p>1. Fraudulent Conveyances — Action to Set Aside.</p> <p>For making out a prima facie ease in the revocatory action and action en declaration de simulation, it does not suffice for plaintiff to prove that the reprobated sale was made. Plaintiff must, in addition, show facts which are sufficient to throw doubt upon the good faith of the purchaser in the revocatory action, or upon the reality of the transaction in the action en declaration de simulation.</p> <p>[Ed. Note. — For cases in point, see Cent. Dig. vol. 24, Fraudulent Conveyances, §§ 867, 904-908.]</p> <p>On Rehearing.</p> <p>2. Same — Evidence.</p> <p>A transaction between an insolvent and his son-in-law, in the form of a cash sale of real estate, followed a few days later by the payment of an unsecured note due by the vendor to the vendee, will be considered, in the absence of satisfactory explanation, as a disguised giving in payment in fraud of creditors.</p> <p>[Ed. Note. — For cases in point, see Cent. Dig. vol. 24, Fraudulent Conveyances, §§ 329-332, 887.]</p> <p>3. Bankruptcy — Trustee—Intervention in Action.</p> <p>A trustee in bankruptcy, under the United States bankrupt act of 1898, as the representative of all the creditors, has the right to intervene in a pending revocatory action in a State court and prosecute the same to final judgment for the benefit of the bankrupt estate.</p> <p>4. Same — Bankrupt Firm.</p> <p>Where a commercial firm goes into bankruptcy, it is a proceeding against each and every member, and both the firm and individual assets must be administered in the bankruptcy.</p> <p>5.Same — Rights of Individual Creditor.</p> <p>The right of an individual creditor to be paid by preference out of individual assets must be enforced in the bankruptcy proceedings. Such a right is no defense in an action in a state court by partnership creditors to annul a sale as operating an undue preference.</p> <p>Provosty, J., dissenting.</p> <p>(Syllabus by the Court.)</p>