or about the 16th day of July, 1921, the representatives of the creditors of the mercantile company together with the attorney representing the respondent bank, met in Salt Lake City. At this meeting ways and means were discussed looking to the rehabilitation of the business of the mercantile company, or, rather, an attempt was made to devise some means by which the business of that company could be continued, and, if possible, permit the company to gradually pay off its indebtedness. As a result of that meeting a written agreement was drawn to be executed by the creditors, but apparently it was never signed. A Mr. White had been secretary and manager of the mercantile company from May 10, 1921. He was in charge of the business on June 1st. At the Salt Lake meeting it was agreed that the business should be continued under Mr. White's management with the understanding and under the direction that he make monthly reports to the creditor, including the respondent bank, and pay $1,000 per month on the past indebtedness. Apparently no affirmative action was taken by the sheriff releasing the levy made under the writ of attachment, but it does appear that the sheriff returned to the clerk of the court unsatisfied the execution issued on respondent's judgment of June 27, 1921. It appears that Mr. White, as manager, was permitted to sell such parts of the goods levied upon under the attachment as he found necessary in conducting the business of the company. After the meeting held in Salt Lake City, an answer was filed to the petition in involuntary bankruptcy denying the insolvency, and subsequently such proceedings were had in that matter whereby the petition was dismissed and the bankruptcy proceeding ended. Under the arrangement made at the Salt Lake meeting the business of the mercantile company was conducted for a period of approximately five months, and $2,000 was paid on the general indebtedness. An additional indebtedness, however, of $5,000 was incurred by Mr. White while so conducting the business. Subsequently, on January 6, 1922, another or supplemental execution was issued upon the judgment of June 27th. A levy was made under that execution on the entire stock of merchandise and fixtures of the mercantile company. A sale in bulk was had under that levy on January 14, 1922. At this sale the respondent bank became the purchaser.

It will probably enable the reader to get a better understanding.

of the facts and relationship of the parties to state at this point that the Utah Association of Creditmen is a corporation with its place of business in Salt Lake City. Its constituent members are various merchants, wholesale and retail, doing business in this intermountain country. One of its objects or duties, as found by the court, is "in the collection of debts owed to its several members." In other words, it represents creditors, and, as appears from the testimony, its chief duty or function is to look after the interests of the creditors of mercantile institutions that are unable to meet their obligations-to salvage the assets of insolvent mercantile concerns and realize all that is possible for the creditors. In its activities it represents other creditors in addition to the members of the association. Mr. Wright, appellant here, was the general manager of the credit association during all the time from June 12, 1921, to January 14, 1922.

The court found in this case that the credit association repre sented all of the creditors of the mercantile company except respondent. That finding is vigorously assailed in the brief of counsel for appellant as lacking support in the evidence and as being contrary thereto. It cannot be claimed that there is no substantial testimony in the record to support this finding. A few days prior to the sale of January 14, 1922, a Mr. Evans, admittedly a representative of the credit association, was in Beaver City, and had some negotiations with the attorney for the respondent bank. At that time the execution had been issued and the levy made upon the stock of merchandise. It is the testimony of two witnesses, Mr. White, the manager of the mercantile company, and Mr. Barton, cashier of the respondent bank, that Mr. Evans repeatedly stated in conversations with and in the presence of these witnesses that the association of creditmen represented all of the creditors of the mercantile company with the exception of the respondent. The same witnesses testified that in those conversations or negotiations Mr. Evans requested that the merchandise be sold in bulk. This request was granted, as stated by the witnesses, by reason of the fact that Mr. Evans represented all the creditors of the mercantile company other than the respondent bank. It was agreed, at the request of Mr. Evans, that, if there were no other bidders, the merchandise and fixtures would be sold to the respondent for the amount of its claim, and that immedi

ately after such sale the credit association would pay the bank the full amount of its claim and take an assignment of the certificate of sale to be issued by the sheriff.

There is an additional reason why this court cannot review the findings of the court that the credit association represented all creditors save the bank. The error assigned is that the evidence is insufficient to sustain that finding of the court, but there is no effort or attempt to point out in what way the evidence is insufficient. In a recent opinion of this court (Thomas v. Perry Irr. Co. [not yet reported], 227 Pac. 268) the rule of the court and the authorities bearing upon that question are fully set forth.

The court found that under the above-mentioned agreement the merchandise was sold in bulk and the respondent bank became the purchaser; that after carrying out the agreement the amount of respondent's claim was paid by the credit association and an assignment of the certificate of sale given to that association. The merchandise was resold to one of the larger creditors of the mercantile company for $10,000. This finding of the court is supported by substantial competent evidence.

It also appears that on a date not designated, between January 1st and the date of the sale of the merchandise to the respondent, the association of creditmen obtained an assignment to it of all of the bills receivable of the merchandise company, and held that assignment of January 12, 1922, the date upon which the second petition for involuntary bankruptcy was filed in the United States District Court.

The trial court was of the opinion that the conduct and acts of Mr. Evans as representative of the credit association constituted an estoppel against the appellant as the trustee in bankruptcy from now insisting that the respondent had obtained a preference over other creditors. The appellant's claim is that this conclusion. of the court is not warranted by the facts. Whether the acts and conduct of the parties constitute an estoppel operating against the appellant need not be determined. We are satisfied that the record discloses other grounds upon which the judgment should be affirmed. The respondent, as appears from the testimony, was claiming its rights by virtue of the lien created by its levy made. under the writ of attachment. The levy under the attachment was made more than four months prior to the filing of the second

petition in involuntary bankruptcy. If a valid lien was created by that levy and had not been released, it would not be affected by section 67f of the Bankruptcy Act (U. S. Comp. St. § 9651). Whether the respondent had lost or forfeited such lien we need not determine. If the respondent was claiming a lien against the property of the bankrupt, any agreement between the creditors founded upon such claim would be binding upon the parties to the agreement as based upon a legal consideration. Moreover, it appears from the testimony that the officers of the credit association were desirous that the assets of the mercantile company be released from any claim by reason of the judgment of the bank, and also be released from the control of the officers of the mercantile company so that the entire assets in some way might be placed under the control of the officers of the association of creditmen. As stated above, the association of creditmen had obtained an assignment of all the bills receivable of the mercantile company. One of the reasons for the desire to eliminate the bank and the officers of the mercantile company is shown by the subse quent acts in transferring the stock of merchandise and fixtures to one of the principal creditors. That transfer was made, and the creditor has since that time been carrying on the business at the same place. The sale under the execution, pursuant to the agreement, effectually transferred and took away from the mercantile company its entire property and any control over the same. It likewise eliminated the bank from any further consideration as a creditor. In other words, there seems to have been a completely executed contract between the respondent and the representative of the other creditors, supported by sufficient consideration to justify a court in refusing to disturb it even at the suit of a trustee in bankruptcy who, in that capacity, is a representative of the general creditors.

Complaint is also made that the court failed to make findings upon material issues presented (a) as to the insolvency of the mercantile company, and (b) as to whether the respondent knew of such insolvency or had reasonable cause to believe that it would get preference by the sale. For the reasons stated, it is evident that the failure of the court to make findings upon those issues could not have been prejudicial to appellant.

We find no reversible error in the record. The judgment of the District Court is affirmed, with costs.

THURMAN, FRICK, and CHERRY, JJ., and WOOLLEY, District Judge, concur.

WEBER, C. J., did not participate herein.

WILCOX, IVES & COMPANY V. S. E. LEVERETT.*

South Carolina Supreme Court, January, 1918.

DISCHARGE-EFFECT ON DEBTS AND LIABILITIES OF BANKRUPT LIABILITY FOR FRAUD, EMBEZZLEMENT, MISAPPROPRIATION OR DEFALCATION-AGENT ATTORNEY-LIABILITY OF AGENT FOR COLLECTION FOR PRINCIPAL NOT DIS

CHARGED.

OR

A discharge in bankruptcy does not release an agent from liabilities for moneys collected on notes of customers taken in payment for merchandise Bold.

(See Collier, 13th Ed., p. 636; Am. B. R. Digest, § 1120.)

Appeal by plaintiff from a judgment entered upon a directed verdict in favor of defense. Reversed and new trial granted.

Leon L. Rice, for appellants.

A. H. Dagnall, for respondent.

WATTS, J.:

This is an appeal from a directed verdict in favor of the defendant by his honor, Judge Prince, at the conclusion of the evidence of the trial at summer court, 1914, for Anderson county.

The verdict was directed by the court in favor of the defendant on the ground that the debt was discharged in bankruptcy and because there was no evidence showing an intent to defraud the plaintiffs. The appellants by exceptions impute error to the circuit judge in directing the verdict.

The circuit judge held that the claim of the defendant was released by his discharge in bankruptcy and that the claim was not a debt coming within the terms of section 17, subd. 4, of the Bankruptcy Act (U. S. Comp. St. § 9601), which is as follows:

123 S. E. 101.