In re Baker

R. B. Baker, as to whom certain creditors have filed an involuntary petition in bankruptcy, prior to the early part of February, 1926, conducted the business of dealing in automobile tires at an established location in the city of Los Angeles. On February 11, 1926, Baker offered to sell to Sam Pearlman his business and stock of merchandise for the sum of $1,000. This offer was not accepted by Pearlman. On February 13, 1926, Pearlman returned, and Baker again offered to sell his business and stock, agreeing to take $500 therefor. Pearl-man noticed that in the interval between his first and second visit, a considerable part of the merchandise had been removed from the shop. He accepted the last offer of Baker, and paid $200 in cash, and an escrow was made covering the balance of $300 due, pending the lapse of time required by section 3440 of the Civil Code of California within which creditors might assert claims. The notice of the intended sale was recorded in compliance with the section noted. Claims of creditors were made against the escrow deposit. of amounts largely in excess of $300. An attachment was levied on process issued out of the state court, and the escrow holder was…