Sears

This is an appeal from a judgment against a trustee in bankruptcy in his suit to recover from appellees certain moneys paid appellee Schlotzhauer by the bankrupt, which the trustee contends was a preference payment recoverable under the provisions of Section 60, sub. b, of the-Bankruptcy Act as amended in 1910. 11 U. S.C. (1934 Ed.) § 96, sub. b, 11 U.S.C.A. §■ 96, sub. b.

It is not questioned that at the time of the payment the bankrupt was insolvent,, that the payment was within four months of the filing of the petition, and that the-payment gave the payee, a creditor of the-debtor, a greater percentage of her debt than other creditors of the same class. The sole question for our consideration is-whether the payee, Mrs. Schlotzhauer, had' reasonable cause to believe the payment to-her would operate as a preference.

The bankrupt was the daughter of Mrs.. Schlotzhauer. Both mother and daughter had for some years been engaged in business enterprises. They were living in the-same city of Bakersfield, California, ancf frequently met together and discussed their business affairs. The bankrupt owed her mother the sum of $3,800, and had a deposit in the bank to her credit of…