The New York herald., 1869-02-27
NEW YORK CITY.
TIE COURTS.
UNITED STATES DISTRICT ccu,T-M BANKRUPTCY.


Important Decision Fraudulent Preferences
Before Judge Batchford.
IN the Natter or Ad0lDh Louis d Henry Rosennam.
Bdnkrupts.The first nine specifications filed IN op-
position the discharge Of the bankrups are that
the bankrupts early in April, 1867, at Cnclnnali'
Ohio while insolvent transferred to various creu-
tors Of theirs seven In number, real estate ia Ken
tucky, Iowa and Texas two stocks OF goods In Mem
phis, Tenn; stock Of goods at Nashville, Tenn,
and stock OF goods at Bolivar Tenn, for the pur-
pose of preterring such creditors and OF preventing
such property from coming into the nands OF an
assignee In bankruptcy; that the transfer OF the
stocks Of goods were made In lump to each credi-
tor without any inventories being made, and that
such transfers were fraudulent and void under the
Bankrupt act The paper OF the baakrupts first went
to protest about the lst OF April 1887 They then
In fact insolvent but processing TO believe that they
We're not, they commenced immediately ana cou-
tinued during April ana May, 1851 TO turn out Their
property payment OF debts due to certain OF their
creditors TO the exclusion of Others Their indebted
ness on the lst OF April, 1857 was about ss000o0.
Ry the LIST Of June according to the evidence they
had in that way PAID oil from S5J0000 TO $40oC Coz OF
such Indebtedness. When Their paper SO went TO
protest they were engaged in business as general
merchants anu copartners under the name Of A.
Louis u Co. Their assets consisted oi merchandise,
real estate. bank stocks, insurance stocks book ac-
key at Cincinnati was seized by the United States
about the l5t OF April, 1867 with their manufacture
inlractoas OF the internal revenue law. The enect
OF the gong TO protest OF their paper aud oi the
suu taneous SEIZURE OF their properly at Cincinnati
TO have bean 10 break UP their business every
wnele for witaln aNeek Or SO thereafter they tHrned
out to creditors the four stocks Of goods referred
to and tncir real estate in Kentucky, iowa
AID Texas. one 0l the stocks OF goods AZ .4emphs
was transferred towards payment OF debt OF
S1ooo00 una the other towards pay ment OF debt OF
$C0U00. The stock OF goods al Nashville was turned
out towards payment OF q debt OF about $4,000,
and the stock OF goods at Bolivar towards payment
0fn AAtaf Of ttNgtf ~
the government was turned over aoout the 23d OF
May. 1867, on compromise with person who paid
to the government, on behalf or the DankruptS,
$4,000. when tney suspended payment they made
out no balance sheet. 1helr petition IN bankruptcy
was neu Fenfuary ~ lsas u sets ior.n depls Que
debts the amount OF which Is put down us un-
known. Among these eighteen creditors are the cre
dtors to Whom the four stocks Of goods and the real
estate before mentioned were transferred. There are
no copartnersnip assets set out In the petition eX
Cept about SS5,000 OF debts due to the firm upon
account from creditors, nearly 800 number scat
tered all over the United States and lease OF real
estate IN Cincinnati, valued at $50 0Jo, and mort
cages lor s2a.50o. On the foregoing facts must
hold not only that the Dankrupts were ins0lvcnt
and alter lst OF April 1867. but that they had good
grounds for believing themselves insolyent and that
they acted on such belief in making the preferences
they did among the creditors. After the lst Of April,
1867 they were not able to pay all their debts IN the
ordinary manner and course Of business, anu their
business was broken up. Ali this they knew. They
contemplated Insolvency within the meaning Of
the Bankrupt act, and they therefore not only
had reasonable grounds for believing themselves
1ns0lveuC, but IN Judgment OF law they knew they
were insolvent. VITA tins knowledge, as one OF
them tesnled, they struggled along and paid along
till the latter part OF May In doing 80 they made
the preferences referred 10, intending TO pay the
favored creditors whether the others should re-
ceive any thing or MOI. This was giving Of traudu-
lent preferences under section twentyline ana con-
trary to the provisions OF section thirty nine OF the
acI. The first nine specifications are therefore sus
tained and discharges are refused.
G. & M. sacAett ior tine bankrupts; h. H. Rice for
the opposing creditors.
IN inc Mdtle. Q, Join T. HacEett-Order Of stay OF
proceedings granted.