In re Richards

This is a petition for review of the Referee’s order that certain moneys due to the, bankrupt under a “Dealer’s Agreement” 1 constituted an “account” under the terms -of Section 3017 et seq. of the California Civil Code and could not be assigned or pledged without the notice required by the provisions of the California Civil Code.

*261 The parties are not in dispute as to the facts which briefly summarized are as follows : Richards was a dealer in television receivers and other electrical appliances; he made sales to individual customers under conditional sales contracts; he entered into a “Dealer’s Agreement” with the Bank of America by which he sold the conditional sales contracts; under it the Bank reserved at all times a balance of 5% as a protection against any defaults which might be made on the individual contracts; that fund was called a “Reserve Account;” this contract was made in September, 1945. On June 9, 1951, the bankrupt borrowed $5,000 from R. A. Pantages; contemporaneously he executed to Pantages a promissory note and what has been designated a “General Pledge Agreement” whereby he assigned as security to Pantages the 5% Reserve Account; notice of the pledge…