Court Opinion

ID: 6556661
Source: CourtListenerOpinion
Date Created: 2022-07-20 18:59:13.306592+00
Date Added: 2024-06-11T15:56:20.929380
License: Public Domain

Rice, J.,
delivering the opinion of the Court:
The defendant argues that the allegations “unsecured creditor” and “antecedent debt” are statements of legal conclusions and therefore are not sufficient, and the plaintiff should be required to state facts from which it would appear that the defendant was an unsécured creditor and that the money paid by the bankrupt to the defendant was credited on an antecedent debt.
The plaintiff contends that he has fully alleged in the declaration all the necessary essentials of a voidable preference, and to plead the nature of the indebtedness, between the bankrupt and the defendant, would, in effect, be a statement of the evidence.
We have been unable to find a bankruptcy case in which the question before the court has been considered. Many of the reported cases, and the text-book writers state four essential elements as constituting a voidable preference, viz. insolvency of the debtor, the giving of the preference within four months of bankruptcy, the security to the creditor of a greater percentage of his debt than others, and knowledge by the preferred creditor that he was getting a preference. However, in the same cases, whenever a statement of the declaration appears in the report of the case, there is some statement of the nature and origin of the indebtedness. And we think properly so, for the fact that the declaration must contain allegations of four essentials of a voidable preference should not excuse the necessity of alleging other material facts ordinarily required by the principles of pleading.
We believe the statements “unsecured creditor” and “antecedent debt,” as used in the declaration, are statements of legal conclusions and are practically equivalent to a statement that the *37bankrupt was indebted to the defendant, and the reported cases hold such a general statement of indebtedness to be a statement of a legal conclusion and, therefore, insufficient. Larimore v. Wells, 29 Ohio St. 16; Pelton v. Bemis, 44 Ohio 58, 4 N. E. 714; Bailey v. Richmond, 49 N. Y. Super. Ct. 519; Jaqua v. Shewalter, 10 Ind. App. 234, 36 N. E. 173, 37 N. E. 1072.
For the reasons stated the demurrer is sustained to both counts of the declaration.