Young v. Upson

Citations

• 115 F. 192
• 1902 U.S. App. LEXIS 4919

Syllabus

<p>h Bankruptcy — Preference—Security for Present Loan.</p> <p>The transfer by a merchant of notes and accounts as collateral to secure the repayment of a present loan does not create a preference, within the scope of the bankrupt act1</p> <p>9l Same — Presumption of Fraud — Choses in Action — Goods and Chattels— Mode of Transfer.</p> <p>Choses In action are not “goods and chattels,” within the contemplation of Laws N. Y. 1897, c. 417, art. 2, ? 25, providing that every assignment of goods and chattels by way of security, not constituting or intended to operate as a mortgage, unless accompanied by an immediate delivery followed by actual and continued change of possession, is presumed to be fraudulent and void as against the creditors of the vendor; and a transfer of choses in action on the books of the assignor, to secure a present loan, is not presumed to be fraudulent under such act.</p> <p>t. Collateral Security — Bills Receivable — Mode of Transfer.</p> <p>Where, on the transfer of bills receivable as security for a loan, the borrower opened a separate account of such bills on his books, and as fast as collected the proceeds were paid to the lender, and all questions of renewal and extension were referred to him, the transfer was complete and effectual.</p> <p>4. Same — Notice to Debtors.</p> <p>Where accounts and bills receivable are transferred as collateral security for a loan, notice to the debtors is not necessary to make the transfer effectual as against the creditors of the borrower.</p> <p>6. Same — Application op Proceeds.</p> <p>Where, under an agreement to loan to a merchant the money he should need during a certain season, the loan to be secured by the transfer of notes and accounts, and the money to be advanced from time to time as the needs of the business required, money was advanced at divers times, and each time a note given for the amount, and indorsed with a list of accounts, and notes then assigned as security, the sums so advanced should be