107 F.2d 123 (5th Cir. 1939), 9184, Edgewood Shoe Factories, Division of General Shoe Corporation v. Stewart

Docket Nº:9184.
Citation:107 F.2d 123
Case Date:November 10, 1939
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit

Page 123

107 F.2d 123 (5th Cir. 1939)




No. 9184.

United States Court of Appeals, Fifth Circuit.

November 10, 1939

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A. F. Whiting, of Montgomery, Ala., for appellant.

Bernard Lobman and Silas D. Cater, both of Montgomery, Ala., for appellee.

Before HUTCHESON, HOLMES, and McCORD, Circuit Judges.

HUTCHESON, Circuit Judge.

The proceeding was for reclamation of shoes delivered under a consignment contract. The defense was: That the contract, on its face, evidenced not a consignment but a sale; and that if sufficient on its face, as a consignment contract, it was a mere subterfuge for dealings, intended to result, and resulting in, sales so that as to the shoes sought to be reclaimed, claimant was not the owner, but a creditor for their price. Submitted to the referee on a record consisting wholly of the contract and an agreed statement of facts, there was a finding and order denying the claim. The District Judge on petition to review, affirmed, expressing the view: that the transactions between claimant and the bankrupt were not those of 'bailment or agency; that the bankrupt had exercised dominion and control over the property inconsistent with either bailment or agency, or what is uniformly called a consignment; and that the title, if any, retained by the vendor in the shoes was for security and a fraud against the trustee. ' Appellant is here insisting that the record does not at all support this view; that the most that appellee can make out of the agreed statement is, that the bankrupt, in some particulars, departed from the letter of the injunctions of the agreement; but, that nowhere in the agreed statement, does it appear that any of these departures 1 were known, much less consented to, by appellant. Neither does it appear that any of these departures from the letter of the contract, were intended to be, or were breaches of its spirit, or that they in any manner, effected any substantial change in the relations the agreement created, or prevented the bankrupt from carrying it out with appellant, substantially as it had agreed to do. For, the same agreed statement shows that, just as had been agreed in it, a remittance was made to it on the first of each week, for all shoes sold the preceding week, whether for cash or credit, that is, as between consignee and appellant, there were no sales on credit, they were all for cash, and the consignee accounted in cash to the appellant, for all of the shoes sold, strictly under the terms of the agreement. Thus, it appears, that such departures as there were from the letter of the agreement, were not made known to appellant, but appellant supposed, and had a right to suppose, since settlements were being made exactly as agreed that the agreement was being carried out strictly as made.

In addition to these departures, appellee relies on the fact that the agreed statement shows that in some instances, appellant issued to the bankrupt, a credit memo, at the invoice price, for defective shoes, but the same agreed statement shows that remittances were made to appellant on account of sales, before the customer had returned the defective shoes to the bankrupt, and the bankrupt had made claim on appellant, on account of the defects. Appellee relies too on the fact, that no separate

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tax assessment was made on behalf of appellant, and that no shows were ever returned. As to the taxes, appellant counters that the agreement expressly provided that the consignor was to pay no taxes, accruing on account of the handling of the shoes, and that the consignee would have no authority to bind consignor to pay them...

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