In the Matter of National Tile & Terrazzo Co., Inc., Bankrupt. Edward M. Walsh, Trustee v. Josephine Paterna

OPINION

Before CHOY and GOODWIN, Circuit Judges, and REAL,* District Judge. *330CHOY, Circuit Judge:

Appellant Paterna, on December 27, 1967 owned 600 shares of the common stock of National Tile and Terrazzo Co., Inc., a California corporation (hereafter National).

Appellant sold her shares to the Corporation receiving $3,000 in cash and a note for $36,000.00 payable at the rate of $500.00 per month and bearing interest at the rate of 4% per annum. The note was secured by a deed of trust upon National’s real property designated as 198 Mississippi Street, San Francisco, California. At the time of the…