Waldschmidt v. Gilly (In re IMI, Inc.)

*443MEMORANDUM DECISION

C.N. CLEVERT, Bankruptcy Judge.

In the case at bar, the court was required to determine the applicability of the common law rule enunciated in Hinz v. VanDusen, 95 Wis. 503, 70 N.W. 657 (1897). The essential facts showed that just prior to bankruptcy, IMI, Inc., the debtor, repaid an $11,250 loan to Melva Lorenz, one of its officers and directors, and that the payments constituted a voidable preference under 11 U.S.C. § 547(b) as well as conversion of a trust fund created in equity imposed for the benefit of IMI’s general unsecured creditors. (See, Waldschmidt, Trustee v.…