Sasso

The appeal is from an order in bankruptcy subordinating appellant’s claim to the claims of other general creditors.

The Pomoc Oil Company, debtor, undertook the development of certain oil land. The stock of the debtor corporation was owned entirely by George Marcell and wife. In order to raise money for the development the debtor sold a number of participating royalty interests in the proceeds to be derived from the oil expected to be produced, and it also obtained loans from several individuals, of whom the appellant was one.

In August, 1936 Marcell wrote appellant a letter containing the following offer:

“The Pomoc Oil Company owns a lease of 140 acres in Kern County, more particularly described as follows: (Description).

“As per our conversation, the Pomoc Oil Company is about to develop this property, and I offer you one-half (%) of my net profits in either the development or the sale of said lease, for the consideration of your advancing the preliminary, or so-called front money to put the company in a position to qualify its lease. In other *211 words, to spud in the well before August 21.

“The amount of money necessary to do this would be approximately $2500. However,…