Otte v. Landy

STEWART, Circuit Judge.

The appellants are the trustees in bankruptcy of Paper Corporation of America, a Delaware corporation which was adjudicated a bankrupt in February, 1955. The corporation’s principal property was a paper mill in Cheboygan, Michigan. Proceeding under § 70, sub. e of the Bankruptcy Act,1 the trustees brought this action to set aside a mortgage on this property which had been executed by the corporation in 1947, on the ground that the mortgage was a fraudulent conveyance under Michigan law. The court found that the bankrupt had received fair consideration for the mortgage…