Court Opinion

ID: 3903513
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:33:15.909718+00
Date Added: 2024-06-11T07:42:25.380411
License: Public Domain

The appellant predicates error in giving the requested peremptory instruction of appellee. That the trustees of the company and appellant agreed to a rescission in April, 1920, of the sale of the stock made to appellant in March, 1920, and that the purchase price of the stock was refunded to him on October 10, 1920, are not denied. It is further fully established by proof that the company, operating under a qualified trust agreement, was adjudged a bankrupt on November 4, 1920. It is not established, though, we think, by competent and admissible evidence, that the company or association was insolvent either at the time when the agreement of rescission was made or at the time when the refund was paid. Neither do all the circumstances of the case tend to the irresistible conclusion of fact that the appellant or his agent knew or had reasonable cause to know that the company was indebted or insolvent at any time prior to the date of adjudication of bankruptcy, and that a preference was intended or would result from his agreement and the resulting payment made to him. Therefore, in view of the evidence, it is believed that there was reversible error in giving the peremptory instruction. The burden of proof was upon the trustee in bankruptcy to show, in order to recover, the elements of a voidable preference. R. C. L p. 285; Pyle v. Transportation Co., 238 U.S. 90, 35 S. Ct. 667, 59 L. Ed. 1215; Tumlin *Page 312 
v. Bryan, 165 F. 166, 91 Cow. C. A. 200, 21 L.R.A.(N.S.) 960; Grandison v. Bank, 231 F. 800, 145 C.C.A. 620.
Reversed and remanded.