Voluntary Insolvency of Go Kim Chia. Hunter v. Samuel Murray

Summary

This case involves competing creditor preferences in the voluntary insolvency of Go Kim Chia. Hunter, Kerr & Co. obtained an attachment on merchandise just 27 days before Go Kim Chia filed for insolvency, while Samuel Murray claimed preference as the unpaid seller of the same merchandise. The Supreme Court held that the attachment was dissolved by operation of law under the Insolvency Law since it was levied within 30 days of the insolvency filing. The Court applied Civil Code Article 1922, granting Samuel Murray preference over the P650 proceeds from his unpaid merchandise, while allowing Hunter, Kerr & Co. to recover P390.80 in lawful attachment expenses. The decision established that Civil Code credit preferences operate cumulatively with Insolvency Law remedies, and that an assignee's possession is deemed the insolvent's possession for preference purposes.