the legal definition of insolvency; Ring v. Vogel Paint etc. Co., 44 Mo. App. 115, holding that when a merchant represented himself as solvent it meant present ability to meet current engagements; Dewey v. St. Al-` bans Trust Co., 56 Vt. 480, 48 Am. Dec. 806, holding that in a petition to appoint a receiver of a company alleged to be insolvent, where the record did not show that it was insolvent in fact, but only in the sense of being unable to meet its obligations in due course of business, there was no dissolution of the corporation; Martin v. South Salem Land Co., 94 Va. 52, 26 S. E. 598, holding that a corporation was insolvent, under both general and restricted definitions, against which executions had been issued and returned nulla bona, and a creditors' bill filed in which insolvency was alleged; Stadler v. First Nat. Bank, 22 Mont. 217, 56 Pac. 119, definition is also applicable to banks. Distinguished in Hussey' v. Richardson-Roberts Dry Goods Co., 148 Fed. 600, 78 C. C. A. 370, where creditor had sold bankrupt goods and sent attorney to look after claim, and on being told that debtor was solvent and doing good business, took chattel mortgage on stock, and debtor became bankrupt, mortgage not preference; Hardy v. Gray, 144 Fed. 925, 75 C. C. A. 562, determining that preference made where insolvent returned goods to creditor in payment of debt; Griffin v. State, 142 Ga. 643, Ann. Cas. 1916C, 80 L. R. A. 1915C, 716, 83 S. E. 543, holding "insolvency" of bank within meaning of Penal Code was condition in which its entire property and assets were insufficient to pay debts; Sacry v. Lobree, 84 Cal. 46, 23 Pac. 1089, holding that under the State bankruptcy law a trader cannot be said to be insolvent because not possessed of money in hand to pay his debts as they become due, if he has other means from which they can be paid; Sabin v. Columbia Fuel Co., 25 Or. 28, 42 Am. St. Rep. 764, 34 Pac. 696, holding that so long as a corporation was a "going concern, "it was not in state of insolvency, so as to prevent execution in good faith of mortgage to secure a debt. Bankruptcy act of 1867 does not define what shall constitute insolvency or evidence of insolvency in every case. The general and popular meaning of the term is insufficiency of the entire property and assets of an individual to pay his debts; as to traders, the term is more restricted. Approved in Ecfort v. Greely, 6 N. B. R. 438, 8 Fed. Cas. 281, holding that a trader must be held insolvent when, owing large amounts, he was unable to meet two small demands and was disposing of his property in such manner as to defeat his creditors generally; In re Hauck, 17 N. B. R. 158, 11 Fed. Cas. 832, holding that insufficiency of assets when ultimately converted into money to pay all debts is not essential to constitute a state of insolvency, inability to convert assets into money to meet business engagements as they mature may be insolvency; Cohen v. Parish, 100 Ga. 338, 28 S. E. 123, holding if the property of a person whether real or personal, tangible or intangible, leviable or unleviable, be in value more than sufficient to discharge all of his debts, such person can in no sense be termed an insolvent; Akers v. Rowan, 33 S. C. 470, 10 L. R. A. 715, 12 S. E. 171, holding that the general and popular definition of insolvency was that properly applicable to the State "assignment" law, Gen. Stats. 1882, c. 72; Mitchell v. Mitchell, 42 S. C. 483, 20 S. E. 409, to same effect; Leon v. Welbourne, 58 Tex. 161, holding that an answer was insufficient which failed to show that the debtor, a trader, was not in contemplation of insolvency in a suit attacking an assignment for benefit of creditors; Wolf v. McGugin, 37 W. Va. 557, 16 S. E. 798, holding that to render a person insolvent under statute of West Virginia he must be one whose whole property will not pay all his debts even though a trader. When person deemed insolvent within bankruptcy law. Note, 11 Transfer by debtor, while insolvent, of a larger portion of his property to one creditor, without making provision for equal distribution among all, is a preference, and is conclusive evidence that a preference was intended, unless debtor can show that he was at the time ignorant of his insolvency, and had a reasonable expectation of his ability to pay. Burden of proof is on debtor. Approved in Debus v. Yates, 193 Fed. 436, 438, holding under evidence transfer with knowledge of insolvency was not preference; In re C. J. McDonald & Sons, 178 Fed. 492, holding mortgage by bankrupt was void as preference; John Naylon & Co. v. Christiansen Harness Mfg. Co., 158 Fed. 293, 85 C. C. A. 522, upholding decree that payments were made to prefer creditors of insolvent corporation; Macon Grocery Co. v. Beach, 156 Fed. 1013, holding payment of two hundred and seventy-five dollars for current store bill while owing thirteen thousand dollars did not constitute preference amounting to act of bankruptcy; In re Pollmann, 156 Fed. 222, holding lien obtained by foreign creditors by unopposed attachment in foreign country while bankrupt was solvent but within four months of bankruptcy was preference, and creditor could not prove balance of claim without surrendering property; In re Moody, 134 Fed. 632, where merchant sold entire stock to local firm, receiving in return farm which was taken in wife's name, and purchasers paid debt to bank of which they were stockholders, transfer was void, under Bankruptcy Act, § 67e; Crandall v. Coats, 133 Fed. 969, where sureties on obligations of bankrupt obtained transfer of property from him in consideration of payment of debts which they had secured, and they executed new obligations to creditors, conveyance was prefer VII-31 ence; Rex Buggy Co. v. Hearick, 132 Fed. 311, 65 C. C. A. 676, insolvent merchant who, within four months of involuntary bankruptcy, pays certain creditors in full and refuses others, commits act of bankruptcy within Bankruptcy Act, § 3a, cl. 2; In re Gilbert, 112 Fed. 955, holding presumption of intent to prefer slight transfer comprising small portion of debtor's property; In re Bloch, 109 Fed. 792, 793, 48 C. C. A. 650, holding court erred instructing rebutting evidence no avail, if at date of actual insolvency bankrupt paid a considerable debt; In re Eggert, 102 Fed. 739, 43 C. C. A. 1, refusing to review finding that creditor had not reasonable ground to believe debtor insolvent when security received; In re Emslie, 98 Fed. 720, 722, dissolving mechanic's lien filed two or more months after work completed but within four months after debtor adjudged bankrupt; Lampkin v. People's Nat. Bank, 98 Mo. App. 240, 71 S. W. 716, holding evidence sufficient to show reasonable cause to believe preference intended; Rochford v. Barrett, 22 S. D. 87, 115 N. W. 524, holding fraudulent intent in obtaining notes was inferable from acts of agents procuring same; dissenting opinion in Jas. Clark Co. v. Colton, 91 Md. 242, 46 Atl. 401, court holding directors chargeable with knowledge of bank's insolvency, fact ascertainable from examination of books; In re Rome Planing Mill, 96 Fed. 814, following rule; principle applied in Wager v. Hall, 16 Wall. 602, 21 L. Ed. 506, holding that where a creditor, whose claim was overdue two years and who had pressed for payment without effect and who obtained a mortgage on nearly all of the debtor's real estate a few days before insolvency petition presented, the deed was prima facie evidence that a preference was intended; Catlin v. Hoffman, 2 Sawy. 492, Fed. Cas. 2521, holding that a lien of a judgment acquired in contravention of the act was void though the judgment itself might be valid, and a deed made in consideration of the judgment would be void; Corbett v. Woodward, 5 Sawy. 413, Fed. Cas. 3223, holding that where there was no doubt about the insolvency of a corporation executing a note and mortgage to a creditor and the money was applied on the creditor's claim, the reasonable inference was that it was made with a view to prefer the creditor and it would be void; In re Hapgood. 2 Low. 202, Fed. Cas. 6044, holding that if the presumption of preference arising from payment by an insolvent to a creditor with knowledge was to be held conclusive, it must be a payment in full or of a larger proportion than other creditors would have, but a payment of a percentage not in excess of what other creditors would get is not a preference; Alderdice v. State Bank, 1 Hughes, 56, 59, Fed. Cas. 154, holding a deed given to a creditor bank by a debtor to secure a large overdraft, obtained by collusion with the bank teller, was an undue preference; In re Forsyth, 7 N. B. R. 176, 9 Fed. Cas. 466, holding that where the evidence showed a debtor to have been insolvent at and after a certain date, payments made thereafter to a creditor constituted an undue preference and must be accounted for to the assignee in insolvency; In re Seeley, 19 N. B. R. 1, 21 Fed. Cas. 1010, that a voluntary assignment to a trustee with a view to a voluntary petition in insolvency and intent to secure the property from attachment meanwhile, might be held fraudulent; Stobaugh v. Mills, 8 N. B. R. 364, 23 Fed. Cas. 111, holding that where no proof was offered by the debtor to show his solvency and it was evident that an assignment was made out of the ordinary course of the bankrupt's business it was a prima facie case of fraud under the act; Warren v. Delaware etc. R. R. Co., 7 N. B. R. 455, 29 Fed. Cas. 272, holding that the suffering of judgments, executions and levies by the chief officers of a corporation, with knowledge that the corporation was insolvent, must be held to constitute undue preference; In re Nathan, 92 Fed. 593, holding that under the act of 1898, as well as under former acts, a sale or other disposition out of the usual course of business of all of a debtor's stock in trade to a person who knows the seller's insolvency is prima facie evidence that the sale was fraudulent; Riley v. Carter, 76 Md. 607, 35 Am. St. Rep. 456, 19 L. R. A. 498, 25 Atl. 672, holding that creditors of an insolvent should be allowed to select the permanent trustee; Parsons v. Topliff, 119 Mass. 249, holding that if the plaintiff proved the transfer to defendant was not made in the usual and ordinary course of business, it would be prima facie evidence of fraud, but the burden of proof would not be changed; In re Howes, 38 Minn. 404. 38 N. W. 105, holding that a transfer by an insolvent of a large amount of property to pay one creditor in full could not well be otherwise than preferential in its nature. Distinguished in In re Kerlin, 209 Fed. 44, 126 C. C. A. 184, holding payment of bankrupt's note by another was substitution, of creditors, and not transfer to creditor with intent to prefer. Participation in debtor's fraudulent intent invalidating transfer. Preferred creditor will be charged with reasonable cause to believe his debtor insolvent, when such a state of facts is brought to creditor's notice in respect to affairs and pecuniary condition of bankrupt as would lead prudent business men to conclusion that debtor could not meet his obligations as they matured in ordinary course of business. Approved in Grant v. National Bank, 232 Fed. 212, upholding find that judgment by confession was recovered with knowledge that it constituted preference; Healy v. Wehrung, 229 Fed. 690, holding under evidence that preferred creditor initiated transaction by which he received preference for that purpose; In re Harrisson Bros., 202 Fed. 250, holding transfer by bankrupt amounted to preference; In re Wolf Co., 164 Fed. 456, holding creditor receiving preference not chargeable with knowledge of insolvency when facts could only be learned from inaccessible sources; Wright v. Sampter, 152 Fed. 198, holding where creditor received payment without request from bankrupt firm, and without suspicion of bankruptcy, no preference was effected; Hewitt v. Boston Straw Board Co., 214 Mass. 264, 101 N. E. 425, holding creditor accepting preference chargeable with knowledge of insolvency inferable from circumstances of payment; Rosenfeld v. Siegfried, 91 Mo. App. 184, sustaining charge directing verdict for plaintiff if evidence established that defendant had knowledge of insolvency; Pepperdine v. National Exchange Bank, 84 Mo. App. 242, holding creditor's knowledge that debtor insolvent furnishes foundation to believe that unlawful preference intended; Wilson v. Taylor, 154 N. C. 218, 70 S. E. 289, and Patterson v. Baker Grocery Co., 73 Or. 439, 144 Pac. 675, both holding circumstances gave notice of debtor's insolvency to creditor receiving preference; Sirrine v. Stover-Marshall Co., 64 S. C. 459, 42 S. E. 432, holding payment not a preference where creditor had not reasonable cause to believe preference intended; Buchanan v. Smith, 16 Wall. 308, 21 L. Ed. 287, holding that judgment creditors issuing executions on judgments obtained on long overdue demands against a debtor who had been repeatedly pressed and failed to pay must be held to have had reasonable cause of belief that debtor was insolvent; Wager v. Hall, 16 Wall. 601, 21 L. Ed. 506, holding that in the case at bar the preferred creditor had actual knowledge that the insolvent was unable to meet his obligations, but that actual knowledge was not necessary; Merchants' Nat. Bank v. Cook, 95 U. S. 346, 24 L. Ed. 414, holding that when a bank, immediately on receipt from a debtor of a clearing-house check, deposited as collateral, presented it for payment contrary to custom, they must be held to have had reasonable cause to believe the creditor insolvent; Burpee v. First Nat. Bank, 5 Biss. 409, Fed. Cas. 2185, holding a mortgage void when the acts known to the mortgagee were sufficient to put them on inquiry and they were then chargeable with the knowledge which an investigation would have disclosed; Alderdice v. State Bank, 1 Hughes, 57, Fed. Cas. 154, saying the law does not require that the reasonable cause shall be perceived by the beneficiary of a deed of preference, but only that it shall exist; Singer v. Sloan, 11 N. B. R. 434, 22 Fed. Cas. 203, holding in a suit to set aside an assignment made shortly before bankruptcy, on the ground that the assignee had reasonable cause to believe the assignor was insolvent, that the amendment in the act of 1874 required actual knowledge to render the deed a fraud on creditors; Brooke v. Scoggins, 11 N. B. R. 264, 4 Fed. Cas. 234, in charging the jury, as the correct rule, but where jury found that a receipt of wheat by a creditor shortly before insolvency was without reasonable belief of his |