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for shares of a particular stock legally subject to the demand of the
customer for whom shares of that stock were bought by the bank-
rupt, the customer is entitled to the same although the certificates
may not be the identical ones purchased for him. (Richardson v.
Shaw, 209 U. S. 365.) Ib.

3. Brokers; right of customers to stock certificates; presumption as to
identity of certificates.

Where there are in the bankrupt's possession certificates for enough
shares of a particular stock to satisfy the legal demand of a cus-
tomer for whom shares of that stock were purchased, and no other
customer can legally demand any shares of that stock, those
certificates will be presumed to be the certificates kept by the bank-
rupt in accordance with his duty so to do to satisfy the demand
of such customer. Ib.

4. Brokers; duty to customers to replace securities used; effect to deplete
estate.

It is the right and duty of the bankrupt, if he uses securities belonging
to a customer, to use his own funds to replace such securities with
others of the same kind, and in so doing he does not deplete the
estate against his other creditors. Ib.

5. Brokers; stock certificates in possession of; presumption as to title.
There is no presumption that certificates of stock in the possession of
the bankrupt were embezzled or stolen, but there is a presumption
that such certificates were bought and paid for out of his own funds
to replace those which he had used belonging to a customer. Ib.

6. Exemptions under § 70f of Bankruptcy Act; interest of trustee in.
While title to property exempted under § 70f does not vest in the

trustee, it does pass to him as part of the bankrupt's estate for the
purposes named elsewhere in the statute, including the duty of
segregation, identification and appraisal. Chicago, B. & Q. Ry.
Co. v. Hall, 511.

7. Exemptions under § 67f of Bankruptcy Act; waiver of.

Section 67f does not defeat rights in exempt property acquired by con-

tract or waiver of exemption; but where, as in this case, there has
been no waiver, no rights can be acquired. Lockwood v. Exchange
Bank, 190 U. S. 294, distinguished. Ib.

8. Exempt property; liens on; effect of § 67f of Bankruptcy Act to annul.
The decisions of the state and lower Federal courts in regard to annul-
VOL. CCXXIX-41

ment of liens on exempt property have been conflicting, and this
court now holds that § 67f annuls all such liens obtained within
four months of the filing of the petition, both as against the prop-
erty which the trustee takes for benefit of creditors and that which
may be set aside to the bankrupt as exempt. In re Forbes, 186
Fed. Rep. 76, approved. Ib.

9. Jurisdiction of bankruptcy court over estate situated in States other
than that in which court sits; application of act of 1893, relative to
sales of real estate.

The bankruptcy court is not confined in the administration of the
property of the bankrupt to state or district boundaries; nor is it
necessary to institute independent or ancillary proceedings in the
different States in which the bankrupt's property is situated, or to
conform to the provisions of the act of 1893 prescribing the method
of selling real estate under orders and decrees of courts of the
United States. Robertson v. Howard, 254.

10. Preferential transfer; what constitutes.

To constitute a preferential transfer within the meaning of the Bank-
ruptcy Act of 1898 there must be a parting with the bankrupts'
property for the benefit of the creditor and a consequent diminu-
tion of the bankrupt's estate. (Newport Bank v. Herkimer Bank,
225 U. S. 178.) Continental Trust Co. v. Chicago Title Co., 435.

11. Preferential transfer; consideration in determining.
In determining whether there has been a preferential payment, the
nature of the property transferred is not as essential as the facts
showing exactly what transpired between the parties. Ib.

12. Preferential transfer; effect of arrangement which does not diminish
estate of bankrupt.

The arrangement involved in this action, made between a bank and a
grain broker, in regard to transferring certificates of deposit held
as collateral for dealings in grain on the Chicago Board of Trade,
do not appear to have in any way diminished the estate and held
not to have amounted to an illegal preference. Ib.

13. Preferences; status of bank with reference to.
Nothing in the Bankruptcy Act deprives a bank with which the insol-
vent is doing business of the rights of any other creditor taking
money without reasonable cause to believe that a preference will
result. Studley v. Boylston National Bank, 523.

14. Preferences; right of bank to set-off deposits against notes.

In this case it having been found that the deposits and payments of
notes were not made to enable the bank to secure a preference by
the right of set-off, the bank had a right under its agreement to
set off the deposits against the notes within four months of the
bankruptcy. (New York County Bank v. Massey, 192 U. S. 138.)
Ib.

15. Sales of real estate; application of act of 1893.

General Order XVIII in Bankruptcy does not contemplate that the
act of 1893 be followed in sales of real estate. Robertson v. Howard,
254.

16. Sales of real estate; irregularities cured by confirmation.
After sale of real estate by the trustee and confirmation by the referee,
lack of appraisal and error of description in published notice are
mere irregularities cured by the order of confirmation and validated
under § 70b of the Bankruptcy Act, and the conveyance cannot be
attacked collaterally. Ib.

17. Set-offs under § 68a of Bankruptcy Act.
Section 68a of the Bankruptcy Act did not create the right of set-off
but recognized its existence and provided a method for its enforce-
ment even after bankruptcy. Studley v. Boylston National Bank,
523.

18. Set-off; right of, under Bankruptcy Act; relation of act to banking.
The right of set-off is recognized by the Bankruptcy Act and it cannot

be taken away by construction because of possibility of its abuse;
nor will the act be so construed by denying such right as to make
banks hesitate to carry on business and thus produce evils of serious
consequence. Ib.

19. Set-offs; purpose of § 68a of Bankruptcy Act to prevent.

The purpose of § 68a of the Bankruptcy Act is to prevent debtors of
the bankrupt from acquiring claims against him for use by way of
set-off and reduction of their indebtedness by way of set-off; but
the transaction in this case does not come under § 68a. Western
Tie & Timber Co. v. Brown, 196 U. S. 502, distinguished. Con-
tinental Trust Co. v. Chicago Title Co., 435.

20. Trustee's title; estate vested in; right of administration.

The effect of adjudication in bankruptcy is to transfer title of all of
the property of the bankrupt wheresoever situated and vest the

same in the trustee, who has the right to administer the same
under the authority of the court. Robertson v. Howard, 254.
See CONSTITUTIONAL Law, 17, 18.

BANKS AND BANKING.

1. Collections; when collecting and crediting check equivalent to payment
in usual course.

When a bank has performed the dual function of collecting and credit-
ing a check the transaction is closed; and, in the absence of fraud
or mutual mistake, the transaction is equivalent to payment in
usual course as though presented to another bank and paid over
the counter. (National Bank v. Burkhardt, 100 U. S. 686.) Amer-
ican National Bank v. Miller, 517.

2. Notice to officer; imputation to bank.
While knowledge of an officer of a bank of a fact which it is his duty
to declare, and not his interest to conceal, is to be treated as that
of the bank; where it is his interest to conceal such knowledge
the law does not, by a fiction, charge the bank with such knowl-
edge. Ib.

3. Notice; knowledge of officer; presumptions as to disclosure to bank.
There is a presumption that an officer of a bank will disclose his knowl-

edge of matters which affect the bank and which it is not to his
personal interest to conceal; and there is also presumption that he
will not disclose those matters of which he has knowledge and
which it is his interest to conceal, including his own bankruptcy
and indebtedness to other banks. Ib.

4. Notice; imputation to bank of knowledge of officer.
A bank, on which the president of another bank just before his own
bankruptcy drew a check in favor of the latter, cannot, after hav-
ing paid the check by crediting it to the payee bank, cancel the
credit and retain the money on the ground that the payee bank is
to be imputed with constructive knowledge of its president's bank-
ruptcy. Ib.

See BANKRUPTCY, 13, 14, 18;

ESCROW, 2, 3, 4;

ESTOPPEL.

BILLS AND NOTES.

See BANKS AND BANKING, 1.

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Claflin v. Claflin, 149 Massachusetts, 19, approved in Shelton v. King,

90.

In re Forbes, 186 Fed. Rep. 76, approved in Chicago, B. & Q. Ry. Co.

v. Hall, 511.

Russell v. American Bell Tel. Co., 180 Massachusetts, 467, approved in
National Safe Deposit Co. v. Hibbs, 391.

CASES DISTINGUISHED.

Boom Co. v. Patterson, 98 U. S. 403, distinguished in McGovern v. New
York, 363.

Brown v. Elliott, 225 U. S. 392, distinguished in Nash v. United States,

373.

Cashman v. Amador Canal Co., 118 U. S. 58, distinguished in Wheeler
v. Denver, 342.

Henry v. Dick Co., 224 U. S. 1, distinguished in Bauer v. O'Donnell, 1.

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