San Mateo Feed & Fuel Co. v. Hayward

This is an appeal from an order of the district court affirming and adopting an order of the referee requiring appellants to turn over to the trustee in this bankruptcy proceeding the sum of $1,025.35 from the San Mateo Feed & Fuel Co. and the sum of $2,534.76 from H. E. Casey Company.

The evidence shows that within the four months of the adjudication in bankruptcy the bankrupt delivered checks in the above amounts, respectively, to each appellant, at which time he had an indebtedness to each in a sum greater than the amounts of the checks. The evidence also supports findings that each appellant at the time of the delivery of the checks had reasonable cause to believe that the bankrupt was insolvent.

The principal controversy here concerns the character of the checks. The bankrupt was a plaster contractor in the construction of a building. The appellants were materialmen furnishing plastering materials for the building to the contract- or for which, under the California law, they had liens on the building. The checks were for amounts owed hy the owner to *876 the contractor and payable within the four months’ period. Each check was made payable jointly to the contractor and one…