223 F. 369 | D. Mass. | 1915
The learned referee was of the opinion that an intent not to pay for the goods had not been made out. While such.an intent must be, of course, established, it is not necessary that there should be direct evidence, of it;' it may be, and usually is, inferred from the facts. When these goods were purchased the buyer was deeply and hopelessly insolvent. Presumably the men in control of it were aware of its condition; there is no evidence to the contrary. They must- have known, and their knowledge is imputable to the bankrupt, that it could not pay for these goods except at the expense of its other creditors, and by giving what would have been a preference; in other words, that it could not pay in an honest and regular way. Purchase under those conditions was, I think, the legal equivalent of purchase with an intent not to pay, and was fraudulent. The facts are meager, but they seem to me as strong for the claimants as those on which, in Watson v. Silsbee, 166 Mass. 57, 43 N. E. 1117, it was held to be a question of fact for the jury whether the purchaser bought without an intention to pay. See, too, In re Spann (D. C.) 183 Fed. 819; In re Gillespie v. Piles, 24 Am. Bankr. R. 502, 178 Fed. 886, 102 C. C. A. 120, 44 L. R. A. (N. S.) 1. The intent not to pay inferable from the financial condition of the buyer, might perhaps have been rebutted by evidence that its managers honestly expected to be able to continue, and bought the goods in an effort to do so. Nothing of that sort, however, appeared.
I accordingly find that at the time when the goods were purchased and delivered there could have been no reasonable expectation, on the part of the buyer’s managers that it would be able properly to pay for them, and consequently no honest intention to pay for them at all; and that the purchase was therefore a fraudulent one, which the sellers were entitled to rescind. It follows that the order of the referee dismissing the petition must be reversed, and the petition allowed.
So ordered.