Court Opinion

ID: 3600521
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:47:03.817408+00
Date Added: 2024-06-11T09:22:21.491309
License: Public Domain

If this insolvent corporation had only suffered the defendant to recover judgments against it on notes which were due, there would, doubtless, be no violation of the statute.
It was found, however, by the trial court that on the 10th of September, 1891, the defendant held four notes of the corporation aggregating $7,000, none of which was then due; that a balance of indebtedness, amounting to $3,976.19, remained in open account; that defendant had previously advanced to the corporation in cash $500; that upon the suggestion of the treasurer of the corporation, and with knowledge of its insolvency, the defendant surrendered the four undue notes and received for the indebtedness due and not due eleven notes due on demand, ten of one thousand dollars each and one for a less amount; that the notes were so made to enable the defendant to bring actions upon them in the Municipal Court of the city of Rochester at once; judgments were recovered on the notes and executions issued thereon September 17th, 1891, and the next day the corporation was placed in the hands of a receiver. *Page 446 
Under these peculiar circumstances, and in view of the active participation by the treasurer of the corporation in this transaction changing the legal status, it seems clear that the result accomplished was a transfer of the property of the corporation by one of its officers, in contemplation of insolvency, to the defendant thereby securing to him a preference which the statute forbids.
I think the judgment should be modified so as to set aside seven judgments representing the indebtedness that was not due of $7,000, and, as modified, affirmed, with costs to the plaintiff.
All concur, with PECKHAM, J., for affirmance, except BARTLETT, J., who reads for modification of judgment, and HAIGHT, J., not sitting.
Judgment affirmed.