Shamrock Golf Company v. Richcraft, Inc.

Shamrock Golf Company appeals from the district court’s dismissal of its appeal from the bankruptcy judge’s order adjudicating Shamrock to be bankrupt. The parties agree that the case is subject to the law in effect prior to the enactment of the 1978 Bankruptcy Code. The order of involuntary bankruptcy was based on the assumption that the original petition was timely, i.e. that it was filed within four months of the date of the alleged preferential transfers, in compliance with 11 U.S.C. § 21 (aX2), prior to its repeal.

The issue is a narrow one and it is not necessary to dwell on the factual details. The original petition was filed on October 20, 1977. The transfers that form the basis of the allegations of preference were by checks that were delivered on June 17, 1977, but not presented to the drawee bank for payment until June 20 and 21, 1977. The checks were paid and not dishonored on that date or thereafter.

Shamrock’s position is that the payment was complete on June 17 and the transfers were not made within the statutory four-month period, thus the original petition was not timely filed. We agree. In Engstrom v. Wiley, 191 F.2d 684, 686 (9th Cir. 1951), we held that…