UNITED STATES

DISTRICT COURT REPORTS.

Northern District of New York.

DECEMBER, 1869.

IN THE MATTER OF SEYMOUR T. SMITH, ALLEGED TO BE AN INVOLUNTARY BANKRUPT.

ACT OF BANKRUPTCY.-GENERAL ASSIGNMENT WITHOUT PREFERENCES. INTENTION OF BANKRUPT.-PRESUMPTION.

The execution by an insolvent of a general assignment of all his property for the benefit of his creditors, without preferences, is an act of bankruptcy. Where the execution of such an assignment is admitted, an adjudication of bankruptcy will be made, even though the respondent denies any intention to defeat or delay the operation of the Bankruptcy Act, or to hinder his creditors, or to prevent his property from being distributed according to the provisions of the Act.

Every person of a sound mind is presumed to intend the necessary, natural, or legal consequences of his deliberate act. This legal presumption may be either conclusive or disputable, depending upon the nature of the act and the character of the intent; and when, by law, the consequences must necessarily follow, the presumption is ordinarily conclusive, and cannot be rebutted by any evidence of a want of such intention.

HALL, J. This petition alleges as acts of Bankruptcy: -First-That the said Seymour T. Smith, the debtor,

BT. VOL. IV-1

In the Matter of Seymour T. Smith, an Involuntary Bankrupt.

on the 4th day of November, 1869, being then insolvent, executed to Henry Tilton a chattel mortgage of all the merchandize, personal property, goods, and chattels in the debtor's store for the express purpose of securing to said Tilton the payment of $1,399.68, due and owing to said Tilton, with intent to give a preference to said Tilton over the other creditors of said Smith.

Second-That the said Smith, on the 6th of November, 1869, being insolvent, made to the Genesee Valley National Bank another chattel mortgage, upon substantially the same property, to secure (as expressed in said mortgage) the payment to the said bank of $600, which, as stated in said chattel mortgage, was loaned and advanced to said Smith upon his promissory note, which had become due on the 20th day of September, 1869; and that said mortgage was so made with the intent to give a preference to said bank over the other creditors of said Smith.

Third-That on or about the 20th day of September, 1869, the said Smith, being a merchant or trader, fraud. ulently stopped payment of his commercial paper, and had not resumed within a period of fourteen days; and that among said paper was the note to the Genesee Valley National Bank, mentioned in said chattel mortgage as aforesaid.

Fourth-That the said Smith, on the 11th day of November, 1869, being insolvent, and possessed of certain property, rights and credits, as described, made an assignment of all his property, of every name and description, to Moses H. Jewell, with the intent to defeat or delay the operation of the Bankruptcy Act, and to hinder and delay the creditors of the said Smith, of their just suits, and to prevent his property from being distributed according to the provisions of the said Act.

The respondent, Smith, by his answer, denies that he committed an act of bankruptcy by the making of the chattel mortgage to Tilton, or that to the Genesee Val

In the Matter of Seymour T. Smith, an Involuntary Bankrupt.

ley National Bank, as alleged in the petition. He then affirms, in respect to each of such mortgages, that it was executed in good faith to secure an honest indebtedness from the mortgagor to the mortgagee, to the amount secured by such mortgage; and expressly denies that he executed the same with the intent to give a preference to the mortgagee over other creditors. He affirms that he then believed that he had property sufficient to pay all his debts, and intended to do so. He further alleges that both said mortgages were executed by him without any knowledge or belief that he was insolvent, and without intending to commit any fraud on the Bankruptcy Act. He also denies that he committed a further act of bankruptcy, as alleged in the petition, in that on or about the twentieth day of September last past, being a merchant or trader, he fraudulently stopped payment of his commercial paper, but, on the contrary, by reason of being unable to collect his debts, he could not meet such paper, but intended to, and believed he could, meet it soon thereafter; but that such intention was defeated "by circumstances entirely beyond his control;" and he adds an express denial that he had fraudulently stopped payment of his commercial paper. He also denies that he committed an act of bankruptcy in executing the general assignment set forth in the petition, and also expressly denies that "he executed the same with the intent to defeat or delay the operation of the said Act, and to hinder or delay the creditors of him, the said Smith, of their just suits, and to prevent his property from being distributed according to the provisions of the said Act."

In the conclusion of his answer, the respondent "alleges and affirms that the said chattel mortgages were executed in good faith, as above stated, and because the creditors named therein requested security, and because he believed that he could give them such security without injustice to his other creditors, as he