Page:Federal Reporter, 1st Series, Volume 4.djvu/66

 62 'fedeeaij eeporteb. �of the lord ohancellor, in Ex parte Sayers, 5 Ves.169, 172, "if the money got into the general fund, it got ont again." It seems to me, therefore, that the title to the deposited fund vested iramediately in the association, and no act of ratifica- tion on its part was necessary to complete the transaction. �It is, however, urged with great earnestness that if the foregoing view is correct the deposit in question was an un- lawful and void preference. But to avoid a preference as fraudulent under the late bankrupt law, it must appear that the party reeeiving it, or to be benefited thereby, had at the time reasonable cause to believe that the debtor was in- solvent, and knew that the payment or security was made or given in fraud of the act. In Clark v. Iselin, 21 Wall. 360, 375, after stating what must concur in order to .avoid a preference, Judge Strong says : "In fine, there must be guilty collusion to constitute the fraudulent preference condemned by the statute." , That case arose under the thirty-fifth sec- tion of the original act, but the amendmentof June 22, 1874, went further to uphold preferences than did the original act. "Having reasonable cause to> believe that sùch person is in- solvent, and knowing that such * * * payment, pledge, assigrunent, or conveyance ig made in fraud of the provisions" of the act, is the language of the amendment. ; Eeaeonablo eause to believe that insolvency exists, ànd knowledge of a fraudulent intent to give a preference, must both be shown. Now, if under the original. act it was necessary to show "guilty collusion" in order to set aside a preference, much more is it necessary under the ameaded act. But where is there any evidence tending to show "guilty collusion" between W. F. Casey and the Lambert Building & Loan Association? Throughout this whole transaction the good faith of the as- sociation is conspicuous. As already observed, Casey was the mere custodian of the moneys of the association. It was not intended that the relation between him and the corpora- tion should be that of debtor and creditor. The association did not contemplate that Casey should use the trust funds or commingle them with his own, and at the time the deposit was made had no actual knowledge that he had violated hia ����