SAGE
v.
WYNCOOP
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In a bankruptcy preference case, the Supreme Court upheld a lower court decision finding that a creditor obtained a preferential claim against a bankrupt debtor with the debtor's active assistance and with knowledge of the debtor's insolvency. The Court held that the creditor's actions—including timing a lawsuit and judgment levy to precede a voluntary bankruptcy filing—constituted sufficient evidence of a fraudulent preference that invalidated the creditor's claim.
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Mr. Chief Justice Waite delivered the opinion of the court.
There are two questions in this case: 1. Whether the preference which the appellant claims to have secured by his judgments and levies was obtained with the active assistance of the bankrupt; and, 2. Whether the appellant is chargeable with notice of the insolvency of the bankrupt.
We said, in Wilson v. City Bank (17 Wall. 473, 487), “very slight evidence of an affirmative character of the existence of a desire to prefer one creditor, or of acts done with a view to such preference, might be sufficient to invalidate the whole transaction.” This case seems to us full of such evidence. The bankrupt was largely insolvent, and we cannot but believe his •son, who-was the agent of the appellant, knew it, in a legal sense, when, as he was leaving for Europe, he said to the attorney in whose hands he put the claim for collection, “ If you can assist him [the bankrupt] in any way I want you to do it; but Gardner Sage is my client; this is his money, and I want him protected at'all hazards.” One of the suits was begun on the same day, and, as we think, with-the help, if not by the procurement, of the bankrupt. Before the property was taken into the actual possession of the sheriff under any levy, the papers in voluntary bankruptcy were prepared and sent to the clerk of the bankrupt court, with instructions not. to file until directed to do so by telegraph; and as soon as the sheriff had perfected his last levy and was in actual possession of the goods, the proceeds of which are how in controversy, the necessary despatch, was sent and the proceedings begun. Four days afterwards an adjudication of bankruptcy was secured. We deem it unnecessary to go over the evidence in detail. It is sufficient to say we are satisfied with the conclusions reached below.
Decree affirmed.