219 F. 68 | 6th Cir. | 1915
This is an appeal from an order dismissing the petition and intervening petitions for adjudication of bankruptcy. The original petition was filed March 1, 1913, by Andrew Emerine, Sr., as a creditor by judgment for upwards of $12,000. The act of bankruptcy charged was an alleged preferential and fraudulent conveyance by the debtor to his daughter of a farm of about 193 acres. The bankrupt answered, denying insolvency, as well as the alleged act of bankruptcy, and making sufficient showing that his creditors exceeded 12 in number. Thereupon three intervening creditors’ petitions were filed: (1) That of Andrew Emerine, Jr., a son of the original petitioning creditor; (2) that of Alonzo Emerine, likewise a son of the original petitioning creditor, on account of a mortgage upon the premises whose conveyance constituted the alleged act of bankruptcy; (3) that of Robert G. Young, receiver, representing as such a claim against Tarault.
Previous to final hearing, the court on its own motion struck from the files the petition of Andrew Emerine, Jr. Upon final hearing, without a jury, Tarault’s insolvency was admitted. The court, while intimating doubts as to the bona fidcs of the claim of Alonzo Emerine, found it unnecessary to determine- that question, as it held that the assailed conveyance was not an act of bankruptcy.
“Xes. Well, X was buying it. I do not know that it was suggested by my father.”
The District Judge, who personally heard all the testimony given on both hearings, says in his’ opinion upon final hearing that:
“The testimony of Alonzo Emerine, taken on the first occasion, tends to suggest his holding of the note and mortgage upon which his intervening petition is based is in the interest of his father, the original petitioning creditor.”
Upon final hearing, when the bona fides of his holding was in issue, to the question of his counsel, “I will ask you if you are the owner of a $4,000 mortgage purchased by you from the Oak Harbor State Bank?” he answered, “I am;” and to the question, “Are you still the owner of that?” he answered, “Yes, sir.” On cross-examination, he said that with respect to the levy he acted at his father’s direction and in his behalf; that “then I counseled with him, talked with him about buying this’mortgage”; that he told his father about the result of the examination of the records and about the mortgage, talked it over with his father, and then (at a later date) went to the bank and bought the mortgage. In view of his relations to his father and to the transaction in question, his previous testimony, the issue later raised as to the bona fides of his status as creditor, and the entire history of the case, we think a burden practically rested upon him to show definitely that his holding of the mortgage, when bankruptcy intervened, was not in his father’s interest. This burden was apparently recognized, for the second question asked him upon final hearing was the one we have first quoted above. We think his testimony does not fairly sustain the
“That the said 397 acres of land above set forth as security, as this intervening petitioner is informed, may not be sufficient to secure said claim, for the reason of the defect in and clouds upon the title to said land securing said mortgage; and it may be necessary for intervening petitioner to not only prove but have allowed in this court any deficiency existing in his favor against the said Joseph Tarault, after the said land has been subjected to payment of the amount due intervening petitioner herein upon said mortgage.”
The judgment of the. District Court is accordingly affirmed, with costs.