As a consequence, unless there are facts which have escaped or have not been brought to my attention which relieve the executor from the normal effect of an investment of this kind, he must be charged with the depreciation of these bonds, unless the beneficiaries agree to accept the bonds as such.
[NOTE BY EDITOR.--The above case, which has attracted much local attention, was in part sustained and in part overruled in the Prerogative Court on Jan. 31, and may go to the Errors and Appeals].
_Insolvent Debtor_--A preferential payment of a bona fide debt by an insolvent debtor does not bar his discharge under the Act for the Relief of Persons Imprisoned on Civil Process.
In the matter of Frank A. Vreeland. Application for discharge as insolvent debtor.
Mr. Frederick J. Ward for objecting Creditor.
FLANNAGAN, J.: On June 29th, 1921, Peter M. Dalton recovered a judgment in tort against Frank A. Vreeland, in the Orange District Court, in the sum of $211.80 and costs; execution was issued and returned unsatisfied. On September 9, 1921, the debtor was taken into custody on a capias ad satisfaciendum and released on bail on the following day. The debtor now applies to this Court for a discharge as an insolvent debtor under the Act for the Relief of Persons Imprisoned on Civil Process, having filed what he claims is "a just and true account of all his real and personal estate," as provided by Section 6 of the Act.
It appeared from the testimony of the debtor on the hearing before this Court that, after entry of said judgment and on July 5, 1921, he executed to his sister, Laura A. Vreeland, a chattel mortgage, for the sum of $1,505, being the amount of a pre-existing debt for cash advanced by her to him between August 30, 1920, and the date of the mortgage (to wit, July 5, 1921). The debtor has no property of any substantial value remaining, and, while the value of the property mortgaged is questioned, it represented substantially all his resources and appears to be by no means equal in value to the amount of the loan against it, $1,505.
The creditor contends that the debtor, having thus made a preference in favor of his sister since the entry of the judgment, he is not entitled to a discharge. This is the only question which is involved in the present application.