47 Minn. 177 | Minn. | 1891
This is an action by the receiver (appointed under our insolvent law) of an insolvent debtor, to recover money paid by 4he insolvent to the defendants, his creditors, in discharge of the indebtedness, less than four months prior to the insolvency proceedings; guch payment being claimed to be an unlawful preference by force of the statute. The statute makes invalid a preferential payment by an insolvent debtor only in ease the creditor has reasonable cause to believe the debtor to be insolvent. Upon the evidence the court found that the defendants did not know, nor did they have reasonable cause to believe, their debtor to be insolvent when the payment was made. The principal question on this appeal is whether the evidence justified that finding. In our opinion, it did. As to the undisputed facts, it may be said that they are not inconsistent with that conclusion. For instance, the fact that the debtor was not ready to pay this debt when application for payment was made, and .■desired to postpone payment, may be explained by the fact that the debt was not then due. And to the suggestion that the application by the creditors for payment, before the maturity of the debt, indicates their apprehension of his insolvency, it is reasonably explained that the debtor was understood to be about to sell out his property and go out of business, on account of ill health, a favorable opportunity for doing so being presented. The testimony bearing most directly upon this point was conflicting, and upon the whole case we find no reason for overruling the decision of the learned judge who heard the evidence.
The plaintiff claims that the prior insolvency proceedings, culminating in the order of the court appointing the receiver, determined the very question here involved, so that it was res judicata. The determination of the insolvency of the debtor, and that he had preferred certain creditors, including these defendants, upon which the order appointing the receiver was based, was not an adjudication of the question whether the creditors had reasonable cause to believe the debtor to be insolvent when they received the payment which constituted a preference. That question was not involved or passed upon in the proceeding. Under section 2 of the insolvent law, if an insol
Order affirmed.
