Ashton

The appellant, as trustee in bankruptcy for the estate of Jerome M. Glaze, brought this action to avoid transfers of property which had been made by the bankrupt to his daughter; also, to set aside mortgages or pledges of the property which had been made to the Automobile Owners Indemnity Underwriters, an inter-insurance exchange. The appellee Carpenter, is the insurance commissioner of the State of California, acting as liquidator of the insurance exchange. For convenience, the latter will be referred to in the opinion as Underl writers. The case was referred to a special master, who recommended a decree setting aside the conveyances and quieting title in the appellant trustee, without prejudice to the rights of the appellee insurance commissioner, as liquidator of Underwriters. Such decree was entered, and the trustee alone has appealed.

Appellee’s interest in the property involved arises out of two transactions, which for convenience will be discussed, as in the briefs, under the captions “$25,-000 transaction” and “$10,000 deal.”

The “$25,000 Transaction.” In 1929, Glaze agreed with promoters to purchase stock in a proposed corporation to be known as the Citizens Union…