In re Blair

102 F. 987, 1900 U.S. Dist. LEXIS 235

Opinion

BROWN, District Judge.

Although the collection by execution and payment to the creditor constituted a “preference” (Bankr. Act, § 00a), yet, as the money was received by the creditor before the petition in bankruptcy was filed, the transaction thereby became consummated, thus differing from In re Kenney, 3 Am. Bankr. R. 353, 97 Fed. 554. If the preference was received by the creditor, without reasonable .cause to believe a preference was intended (Bankr. Act, § 60b), it seems not to be recoverable back by the trustee. Here the petition does not charge that the creditors had reasonable cause to believe the bankrupts to be insolvent; but only the fact of- their insolvency at that time, which the creditors in their answer deny, and also deny all knowledge of that fact, if true.

Under the recent decision of the supreme court, I am of opinion that this transaction being completely executed by the payment of the money by the sheriff before the petition was filed, the remedy of the trustee is by plenary action alone in the state court. See Hicks v. Knost, 2 Am. Bankr. R. 153, 94 Fed. 625; In re Knost, 2 Am. Bankr. R. 475; Strobel & Wilkin Co. v. Knost, 3 Am. Bankr. R. 631, 99 Fed. 409.

Motion denied.