Laurent v. Stites (71 F.2d 802, 1934)

HICKS, Circuit Judge.

Kentucky Wagon Manufacturing Company, a Delaware- corporation (herein called New Company), was adjudged a bankrupt on January 12, 1931. Laurent, receiver of the Banco Kentucky Company (herein called Banco), filed claim against the bankrupt for $2,795,211.70, alleging that the indebtedness was secured by a $2,000,000* first mortgage real estate temporary bond of the New Company. Stites, the bankrupt’s trustee, objected upon the ground that the bankrupt was a corporate agency entirely owned and controlled by the National Bank of Kentucky (herein called the' Bank), from whom Banco, with knowledge thereof, had on July 3, 1930, acquired its claim. George D. Caldwell, trustee under the mortgage, filed a foreclosure petition in the bankruptcy cause. Stites, trustee, by answer resisted this petition upon substantially the same grounds upon which he disputed Banco’s claim. Paul C. Keyes, ieeeiv