APPEAL FROM THE CIRCUIT COURT OF APPEALS FOR THE FIRST CIRCUIT.
MR. CHIEF JUSTICE FULLER, after making the foregoing statement, delivered the opinion of the court.
The facts found established that on August 15 the aggregate
of the property of the bankrupts was not, at a fair valuation, sufficient in amount to pay their debts, but that Alden was ignorant of this, and in good faith and in the regular course of business sold material to the bankrupts, and received payment therefor, several times between August 15 and November 26, when the petition was filed, on which day the amount of $546.89 for material delivered shortly before had not been paid. All the material so sold to them was manufactured by the bankrupts and increased their estate in value.
The question is whether the payments made to Alden (or either of them) were preferences within section 60 of the bankruptcy act of 1898, which must be surrendered under section 57g, before his claim could be allowed.
Provisions of the act bearing on the subject are given below.*fn1
In Pirie v. Chicago Title & Trust Company, 182 U.S. 438, the Circuit Court of Appeals for the Seventh Circuit had affirmed an order of the District Court for the Northern District of Illinois, rejecting a claim of Carson, Pirie and Company against the estate of Frank Brothers, bankrupts, and the case was then brought to this court on findings of fact and conclusions of law of the Circuit Court of Appeals made and filed "pursuant to the requirements of subdivision 3, Rule 36 of General Orders in Bankruptcy." The three first of the findings were as follows:
"First. That on February 11, 1899, August Frank, Joseph Frank and Louis Frank, trading as Frank Brothers, were duly adjudged bankrupts.
"Second. That for a long time prior thereto appellants carried on dealings with the said bankrupt firm, said dealings consisting of a sale by said appellants to said Frank Brothers of goods, wares and merchandise amounting to the total sum of $4403.77.
"Third. That said appellants in the regular ...