178 P. 291 | Mont. | 1919
delivered the opinion of the court.
This action was brought by plaintiff, as trustee in bankruptcy of George Wilson, to recover from the defendant certain sums of money paid to it by debtors of Wilson within four months prior to the filing of the petition in bankruptcy, whereby, it is alleged, the defendant obtained unlawful preferences over other creditors. The petition was filed by several creditors of Wilson on November 11, 1914, and he was adjudged a bankrupt on January 11, 1915.
During the years 1913 and 1914 Wilson was conducting the business of a plumber at Great Falls. He secured- subcontracts from contractors and builders to install the necessary plumbing in buildings in course of construction by them in Great Falls and vicinity. These were A. G. Anderson, Pappin & Son and A. S. Hulden. He obtained supplies of material from the defendant on account. On November 11, 1914, when the petition in bankruptcy was filed he had become largely indebted to the defendant. In_ order that the contractors might deliver their buildings upon completion free from claims of lien for the materials furnished, they paid-to defendant the amounts due
Plaintiff in his complaint sought recovery of other sums collected by or paid to defendant on Wilson’s account, but during the trial these were eliminated from the case. The jury found for the plaintiff for the several sums above referred to, and judgment was entered accordingly. Defendant has appealed from the judgment and an order denying its motion for a new trial.
The assignment of error upon which defendant mainly relies is that the evidence did not justify the verdict in that it did not show that Wilson had made a transfer; nor that the defendant had reasonable cause to believe that any payment made to it would effect a preference; nor that at the time any payment was made the bankrupt was insolvent.
1. The provisions of the Bankruptcy Law, so far as they are pertinent here, are the following:
“Sec. 60 (a). A person shall be deemed to have given a preference if, being insolvent, he has, within four months before the filing of the petition or after the filing of the petition, and before the adjudication, * * * 'made a transfer of any of his property, and the effect of the enforcement of * * * such * * * transfer will be to enable any of his creditors to obtain a greater percentage of his debt than any other of such creditors of the same class,” etc.
“Sec. 60 (b). If a bankrupt shall have * * * made a transfer of any of his property, and if, at the time of the transfer, * * * and being within four months before the filing of the petition in bankruptcy or after the filing thereof and before the adjudication, the bankrupt be insolvent and * * * the transfer then operate as a preference, and the person receiving it or to be benefited thereby, or his agent acting therein, shall then have reasonable cause to believe that the enforcement
The first of these sections defines a preference by a bankrupt,
Though a transfer is made which amounts to a preference,
Counsel, conceding that a payment of money by a bankrupt to one of his creditors may be a transfer of property whereby an unlawful preference is given insists that the payments in
The evidence disclosing the circumstances under which the various payments were made may be epitomized as follows:
Anderson was engaged in the erection of two buildings in Great Falls and a third in the village of Belt. Wilson contracted with him to do the plumbing, the price of all of which aggregated $675. The contract provided that before he should be obliged to make payment to Wilson, the latter was to present receipts showing that he had paid for all' materials which he had obtained from defendant or any other dealer. Anderson paid Wilson in installments as the work progressed, one installment being in cash, the others in checks made payable to defendant. Being bound by his contracts with the owners to deliver the buildings upon completion free from claims of lien for materials, after the first payment, when Wilson demanded money, Anderson insisted on having receipts from the defendant. Wilson not being able to obtain them, Anderson, by his consent, made out checks payable to defendant and delivered them directly to the defendant. The payment made on August 8 was by Wilson’s express consent; that made on September 10 was without Wilson’s consent, because he at that time had absconded and Anderson made it upon the presumption that he had a right to make it under the permission given him at the time of the earlier payments.
Pappin & Son were engaged in constructing a building at Great Falls. Wilson did the plumbing. When the building
Hulden, being engaged in the construction of several buildings in Great Falls, contracted with Wilson to do the plumbing. Wilson had been paid everything due him except $200 for work done on one building which had just been completed. In the meantime Wilson had absconded. Thereafter, on the dates above noted, this amount was paid to the defendant by Hulden. When the last payment was made on October 26, Peters & Smith, attorneys at Great Falls, were threatening to file liens on behalf of the defendant upon the different buildings for the cost of the materials furnished to Wilson. The payment was made to prevent this. Authority had been given Hulden by Wilson, before he absconded, to make these payments, Wilson being unable to furnish receipts from the defendant.
No evidence was introduced which tended directly to show when Wilson became insolvent or when knowledge of his condition was first brought home to the defendant. That he was insolvent at the time the petition in bankruptcy was filed, was conceded by counsel for both parties. Counsel for the defendant also conceded that defendant was informed of Wilson’s insolvency as early as September 3.
It is clear that none of the several payments were made
As to the payments of August 8 and 11 by Anderson and
As to the other payments the condition was different. At
Counsel insist, however, that since the contractors were
Neither Pappin & Son nor Hulden sustained any contract relations with the defendant or Wilson, authorizing them to pay Wilson’s debts. They merely paid the debts of Wilson by his consent with money due him. True, it may be said that all three contractors paid under a sort of coercion in order to clear the buildings of claims of lien; but in no event could they have discharged Wilson’s debts without his consent. They were not induced to make the payments by duress or menace, within the meaning of the Code provisions on the subject (Eev. Codes, secs. 4975, 4976).' If there is any principle or rule of law by which the defendant can avoid liability, it has not been suggested by counsel, nor does it suggest itself to us.
In relation to the assignment that there was no evidence tending to show that Wilson was insolvent at the time any of the payments were made, counsel do not insist that the evidence is deficient as to all payments, but limit their claim to the Anderson and Hulden payments made in August. What we have said above with reference to these payments disposes of this contention.
In paragraph 7 of its charge the court instructed the jury,
Error is assigned upon several rulings of the court upon questions of evidence. We find no error in any of them.
The order denying defendant a new trial is affirmed. The cause is remanded with directions to the district court to modify the judgment by striking out the Anderson payment of $133.25 and the Pappin & Son payment of $100. So modified, the judgment will be affirmed.
Modified and affirmed.