Page:Federal Reporter, 1st Series, Volume 2.djvu/203

 196 FEDERAL REPORTER. �done, on the part of the corporation, whieh amounts to more than mere passive non-resistance to the enforcement, by judgment, of a valid claim. Wilson v. City Bank, 17 Wall. 473. They must also prove, by a fair preponderance of the evidence, that the corporation was insolvent, or in contempla- tion of insolvency, and that the security was designed to give the judgment debtor a preference, and that the creditor had reasonable cause to believe that the corporation was insolvent and knew that the security was designed to be a preference. It is not enough that the creditor suspects the debtor may be insolvent. He must have suoh a knowledge of facts as to induce a reasonable belief thereof. "He may feel auxious about his claim, and have a strong desire to secure it, and y et such belief as the act requires may be wanting." Grant V. Bank, 97 U. S. 80. �It is unnecessary to discuss at length the testimony upon this issue. It is very voluminous and at some points conflict- ing. But in several respects the proof adduced by the com- plainants f ails short of what is required to sustain the burden which is upon them. I think it is clear from the testimony that the primary purpose of the defendant Emma G. Penny in suing the company was not to obtain a preference over other creditors, but to have her claim, as to the validity of which one of the officers of the company had in a suit against her husband expressed a doubt, secured or paid, and that this pur- pose had no reference to any insufficiency of the assets of the company to pay ail the debts. It was in June, 1877, that this question was raised as to whether she had loaned the money to the company, and it at once led to her consulting counsel on the proper course for her to pursue. Her husband was also consulted. It was then concluded to wait till after the annual meeting of the corporation, which was to take place on the second of July, the suggestion being made that at that meeting the claim might be in some way recognized by the company or security for it authorized. The matter was brought before the meeting and some discussion was had. The same person who had expressed doubt about it before expressed doubt about it then, and the meeting was adjourued ����