Engstrom

The trustee in bankrupt of Chemurgy, a cooperative corporation, brought action against Benzel, claiming the latter had received a preference because he had received money on February 3, 1947, on a check of bankrupt drawn January 14, 1947, and within four months of the date of filing petition in bankruptcy, May 29, 1947. The cause was tried before the District Judge without a jury, on an agreed state of facts.

On January 3, 1947, Arthur Benzel endorsed and delivered to Chemurgy a negotiable warehouse receipt, intending to make a cash sale to Chemurgy of the actual wheat at an agreed net price of $1,627.50. Chemurgy failed, without fault of Benzel, to draw its check in that amount until January 13, 1947. The check was payable to Benzel, drawn on the Wenatchee Valley Branch of the Seattle-First National Bank, Wenatchee, Washington, and was received by Benzel January 14. He deposited the check in the Ritzville Branch of the Old National Bank. Upon presentation for payment to the drawee bank, the check was returned because there were no funds of Chemurgy on deposit to pay it. Benzel redeposited the check and it was presented to the drawee bank on January 27, 1947, but was not then…