Page:Federal Reporter, 1st Series, Volume 2.djvu/195

 188 FEDERAL REPORTER. �was insolvcnt, or in contemplation of insolvonny, that the security was designee! to give a preference, and that the crediter had reasonable cause to believe the insolvency, and itnew the security was desigued as a preference. �Samb — Insufficient Evidence to Charge Crkditok.— Evidence in this case considered, and hdd insufflcient to charge a crediter, who had ob- tained a preference for her claim, with reasonabic cause to believe that the debtor was insolvent at the time. �ÏCXECnTION — LrBN — LeVT AFTER BaNKEDPTCT PROCEEDOrGS ARE COM- �MENCBD. — Wherethe lienof an execution attached before the lilingof a petition in banliruptcy, the fact that the levy was not uiade until after- wards is immaterial. �Brownell de Lathrop, for complainants. �M. E. Smvyer, for defendants. �Choate, D. J. ïhis is a suit in equity brought by the assignees in bankrnptcy of the Hudson Eiver Manufacturing Company, a corporation organized under the laws of New York, to avoid and annul certain judgments, executions and levies under the same. The grounds on which it is claimed in the bill that they should be avoided are — First, that they were an illegal preference under the bankrupt law; second, that they were the means of effecting a fraudulent assignment of the property of the bankrupt under the bankrupt law; third, that they were the resuit of a fraudulent conapiracy between the defendant Emma C. Penny, the execution cred- itor, and her husband, William G. Penny, who was also the secretary and treasurer of the corporation, to defraud the Com- pany; fourth, that under the laws of New York the execu- tions were dormant at the time of the levies, and, therefore, that the levies were void; and, Jîftk, that the judgments were opened before the commencement of the bankruptcy proceed- ings, and were not, at that time, judgments which could sup- port the executions and levies. The defendant Hutton was the sheriff of Eockland county, by whom the levies under the executions were made. �The three judgments in question were recovered by the defendant Emma C. Penny, in the marine court of the city of New York, on the twenty-third day of July, 1877, upon alleged notes of the corporatiop — one dated May 1, 1875, for ����