Lee v. Franklin Ave. German Sav. Inst.
District Court, E.D. Missouri
The bankrupt, John ¡H. Luehrman, was a member of the firm of Woerheede, Luehr-man & Bro., owning one-third interest in a planing-mill and its business. The firm was solvent. In June and July, 1868, the bankrupt indorsed for the firm of Th.
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The bankrupt, John ¡H. Luehrman, was a member of the firm of Woerheede, Luehr-man & Bro., owning one-third interest in a planing-mill and its business. The firm was solvent. In June and July, 1868, the bankrupt indorsed for the firm of Th. Klein-schmidt & Co. two notes, one for two thousand five hundred dollars, maturing September 24, 1868, and the other for three thousand five hundred dollars, falling due October, 1868. In August, Kleinschmidt & Co. failed in business, and the bankrupt became exposed to the payment of these notes, amounting to six thousand dollars. In September, the bankrupt…
1Opinion of the Court
THE COURT
held that, although the deed of trust executed by the bankrupt did in fact give a preference to the savings institution, yet, that its officers did not at the time know that the bankrupt was insolvent, and did not have reasonable cause to believe him to be insolvent, or to be acting in contemplation of bankruptcy or insolvency, and that the security was valid.
THE COURT further held, as the defendant had enforced its security by a sale under the deed of trust after the filing of the petition in bankruptcy, without proving its debt as secured creditor, the sale was invalid; but as the…
2Cited by1 opinion
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