and mutilate," and "transfer' shall include the sale and every other and different mode of disposing of or parting with property or the possession of property, absolutely or conditionally, as a payment, pledge, mortgage, gift, or security." It has been held that permitting the appointment of a receiver of a corporation by a State court is not a transfer of property for the purpose of defrauding creditors.10 (2) "A person shall be deemed insolvent within the provisions of this act whenever the aggregate of his property, exclusive of any property which he may have conveyed, transferred, concealed, or removed, or permitted to be concealed or removed, with intent to defraud, hinder or delay his creditors, shall not, at a fair valuation, be sufficient in amount to pay his debts." It has been held that property which is exempt from execution is to be included in the computation.12 The following acts have been held to be transfers with the intent to prefer creditors: a transfer in payment of a debt of personal property sufficient in value to satisfy it in full; 13 the conveyance to a creditor of personal property of greater value than the debt, the debtor receiving the difference in cash;" the transfer of a merchant's stock in trade to a creditor, part of the consideration being payment by a creditor to a bank to meet the debtor's overdrawn account there, for which the transferee was responsible; 15 and even the payment of a debt in money; 16 but not the sale of property to a person or creditor and the application of part of the proceeds to the defraying of liens upon the same, such as taxes and arrears of rent upon a leasehold and the expenses of the same." It has been held that a transfer of property by an insolvent with intent to prefer a creditor is not an act of bankruptcy unless the transferror has then some other creditor whose claim could be proven in bankruptcy.18 930 St. at L. 544, 545, § 1; In re Shapiro, 106 Fed. R. 495; In re Greenberg, 106 Fed. R. 496. 10 In re Baker-Ricketson Co., 97 Fed. R. 489. 11 May v. Le Claire, 18 Fed. R. 164. Cf. Anshutz v. Hoerr, 1 Fed. R. 592; In re Rome Planing Mill, 99 Fed. R. 937; In re Baumann, 96 Fed. R. 946. 12 In re Baumann, 96 Fed. R. 946. 13 Johnson v. Wald (C. C. A.), 93 Fed. R. 640. Cf. In re Grant, 106 15 Goldman v. Smith, 93 Fed. R. 182. 16 In re Ft. Wayne El. C'n, 99 Fed. R. 400; Strobel & Wilken Co. v. Knost, 99 Fed. R. 409; John T. Pirie v. Chicago T. & Tr. Co., U. S. (1901). 17 In re Pearson, 95 Fed. R. 425. 18 Beers v. Hanlin, 99 Fed. R. 695. 23 (3) The preponderance of authority holds that affirmative action by the debtor is not a requisite to his suffering or permitting a creditor to obtain a preference through legal proceedings; 19 and that a failure to prevent the preference is an act of bankruptcy; 20 even when judgment is entered and a levy made under execution without the debtor's knowledge in pursuance of a warrant of attorney given when he was solvent more than four months before." The preference through legal proceedings means any proceeding in a court of justice, whether interlocutory or final, by which the property of the debtor is seized and diverted from his general creditors; " such as an attachment, and irrespective of the question whether the attachment was made in time to give the attaching creditor a valid lien.24 It has been held that liens acquired by legal proceedings more than four months before the petition in bankruptcy was filed; 25 the appointment of a receiver of a corporation, although certain classes of persons obtain, by the State law, a preference in a distribution of assets by the receiver, and the recovery of judgment for the foreclosure of a lien more than four months old with a levy upon the land covered thereby, even when the judgment is general, provided that no levy is made upon any property not bound by the lien," are not acts of bankruptcy. The creditors need not wait until the sale takes place, but they may file their petition within a few days before the day for which it is advertised, and upon a proper showing obtain an injunction.28 26 (4) A general assignment for the benefit of creditors is an 19 In re Rome Planing Mill, 96 Fed. R. 812; In re Moyer, 93 Fed. R. 188; In re Cliffe, 94 Fed. R. 354. Contra, Duncan v. Landis (C. C. A., 2d Ct.), 106 Fed. R. 839. 20 Ibid. 21 In re Moyer, 93 Fed. R. 188. Contra, In re Nelson, 98 Fed. R. 76; Balfour v. Wheeler, 18 Fed. R. 893; Duncan v. Landis (C. C. A.), 106 Fed. R. 839. Where the sheriff had been instructed by the attorney for the judgment creditors to do nothing until further orders under executions on confessed judgments levied a year before, and the keeper who had been placed in charge was withdrawn, it was held that these executions became dormant and that new executions issued and levied under the same judgments consti 22 In re Rome Planing Mill, 96 tuted new acts of bankruptcy. Ibid. Fed. R. 812, 815. 23 In re Richman, 91 Fed. R. 624. 24 Parmenter Mfg. Co. v. Stoeber (C. C. A.), 97 Fed. R. 330. 26 In re Baker-Ricketson Co., 97 Fed. R. 489. 27 In re Chapman, 99 Fed. R. 395. 25 In re Ferguson, 95 Fed. R. 429. R. 812. act of bankruptcy irrespective of the solvency of the assignor or his good faith, and whether or not he intends to prefer any creditors. 29 (5) It has been held that the laws of Massachusetts do not permit the officers or the directors of a manufacturing corporation to admit, in writing, its inability to pay its debts and its willingness to be adjudged a bankrupt on that ground, even when ratified by a vote of the stockholders after the petition is filed; 3 30 and that an admission by an officer, made after the filing of a petition in involuntary bankruptcy under authority by an unanimous vote of the stockholders previously given to make the admission, "in the event of an involuntary petition in bankruptcy being filed against said company," is not sufficient.31 § 477. Petitions in bankruptcy.-"Petitions shall be filed in duplicate, one copy for the clerk and one copy for service on the bankrupt."1 "All petitions and the schedules filed 29 West Co. v. Lea, 174 U. S. 590. So is a general assignment by the officers of a corporation under the authority of a resolution of its board of directors in pursuance of a vote at a stockholders' meeting, although against the objection of a minority of the stockholders, Clark v. Am. Mfg. & Em. Co. (C. C. A.), 101 Fed. R. 962; and a confession of judgment to a trustee for all of the confessor's creditors. In re Green, 106 Fed. R. 313. It has been held that a voluntary application by a corporation for its dissolution and the appointment at its request of a receiver to wind up its affairs and distribute its assets on the ground of its insolvency is not "a general assignment for the benefit of its creditors" and an act of bankruptcy. In re Empire Met. Bedstead Co. (C. C. A.), 98 Fed. R. 981; In re Harper & Bros., 100 Fed. R. 266. And that neither is the appointment of a receiver for a partnership on the application of the administrator of the deceased partner, although not opposed by the survivors; and that a partnership is not insolvent so long as the firm and so much of the individual property as is applicable thereto is sufficient to pay the copartnership debts, although the only solvent partner died. Vaccaro v. Security Bank (C. C. A.), 103 Fed. R. 436. See also Davis v. Stevens, 104 Fed. R. 235, 241, 242. But an act of bankruptcy by a corporation such as permitting judgment and execution against it is not obviated by the institution of a voluntary proceeding for its dissolution. In re Storm, 103 Fed. R. 618. 30 In re Bates Mach. Co., 91 Fed. R. 625. It has been held that the directors of a New York corporation have the power to authorize an officer to make the statutory admission. In re Marine Mach. & Conv. Co., 91 Fed. R. 620. 31 In re Baker-Ricketson Co., 97 Fed. R. 489. § 477. 130 St. at L. 544, 561, § 59. It must be filed with the clerk, not sent immediately to the judge. In re Sykes, 106 Fed. R. 669. As to the time of filing, see In re Stevenson, 94 Fed. R. 110; In re Washburn, 99 Fed. therewith shall be printed or written out plainly, without abbreviation or interlineation, except where such abbreviation and interlineation may be for the purpose of reference." Forms of the petitions are prescribed by the General Orders. The rules of the different District Courts make special requirements concerning petitions and bankruptcy. In North Carolina the petitions must be set forth in the prescribed printed forms. The petition must be verified. A petition in a voluntary bankruptcy must be accompanied by schedule showing the names, with their residences, a description of the nature and consideration of the debts, and a reference to the ledger and vouchers of all the creditors, separately specifying those to whom priority is secured by law, those who hold securities with the particulars of the security, and in case of unsecured creditors, whether any judgment, bond, bill of exchange, promissory note, &c., and whether contracted as partner or joint contractor with any other person, and if so, with whom. The schedules must also contain statements of the liabilities of the bankrupt on notes or bills discounted which ought to be paid by the drawers, makers, acceptors, or indorsers, with specifications of the same; of all accommodation paper signed, accepted, or indorsed by him and unpaid; of all property owned by the bankrupt, with specifications, and separately classified as real estate, personal property, choses in action, property in R. 84; In re Romanow, 92 Fed. R. 510; 2 G. O. v. 3 See Appendix, infra. Form No. 3, mutatis mutandis, should be used for a petition in involuntary bankruptcy against a partnership. Mather v. Coe, 92 Fed. R. 333. It has been held that such a petition should show the insolvency of each partner as well as the insolvency of the firm. In re Blair, 99 Fed. R. 76. But see In re Meyer (C. C. A.), 98 Fed. R. 976, 979, quoted supra, § 475, note 9. The same petition in voluntary bankruptcy may be presented on behalf of a partnership and on behalf of each member individually, provided that the schedules contain the individual debts and assets as well as those of the firm. In re Gay, 98 Fed. R. 870. Cf. In re McFaun, 96 Fed. R. 592. 4 Mahoney v. Ward, 100 Fed. R. 278. Cf. Mather v. Coe, 92 Fed. R. 333. 530 St. at L. 544, 551, sec. 18. The affidavit of the attorney for the petitioners might be held insufficient. In re Simonson, 92 Fed. R. 904; In re Nelson, 98 Fed. R. 76. An informality in the verification is waived by a plea or answer to the merits. Simonson v. Sinsheimer, 95 Fed. R. 948; Leidigh Carriage Co. v. Stengel (C. C. A.), 95 Fed. R. 367. An omission by a notary to affix his seal to the verification of the petition and the proof of debts is not a jurisdictional defect. In re Donnelly, 5 Fed. R. 783. reversion, remainder, or expectancy, including property held in trust for the debtor, or subject to any power or right to dispose of or to charge; and a particular itemized statement of the property claimed as exempt; and a list of all books, papers, deeds and writings relating to the bankrupt business and the estate which are in existence, with the names of the persons who hold them in their possession. "In all cases of involuntary bankruptcy, in which the bankrupt is absent or cannot be found, it shall be the duty of the petitioning creditor to file, within five days after the date of the adjudication, a schedule giving the names and places of residence of all the creditors of the bankrupt, according to the best information of the petitioning creditor. If the debtor is found, and is served with notice to furnish a schedule of his creditors and fails to do so, the petitioning creditor may apply for an attachment against the debtor, or may himself furnish such schedule as aforesaid."7 "Whenever a petition is filed by any person for the purpose of having another adjudged a bankrupt, and an application is made to take charge of and hold the property of the alleged bankrupt, or any part of the same, prior to the adjudication and pending a hearing on the petition, the petitioner or applicant shall file in the same court a bond with at least two good and sufficient sureties who shall reside within the jurisdiction of said court, to be approved by the court or a judge thereof, in such sum as the court shall direct, conditioned for the payment, in case such petition is dismissed, to the respondent, his or her personal representatives, all costs, expenses, and damages occasioned by such seizure, taking, and detention of the property of the alleged bankrupt." 8 In cases of both voluntary and involuntary bankruptcy the petitioner must deposit with the clerk before filing the petition twenty-five dollars to pay the fees of the clerk, referee and trustee, "except the petition of a proposed voluntary bankrupt which is accompanied by an affidavit stating that the petitioner is without, and cannot obtain, the money with which to pay such fees." 9 6 Form 1. See Sellers v. Bell (C. C. A.), 94 Fed. R. 801. 7G. O. ix. 8 30 St. at L. 544, 547, § 3. 9 30 St. at L. 544, 556, 557, 559, §§ 40, 48, 51, 52. See supra, § 200. It was |