Love v. Export Storage Co.

• Decision Date: 01 February 1906
• Docket Number: 1,422.
• Parties: LOVE v. EXPORT STORAGE CO. et al.
• Court: U.S. Court of Appeals — Sixth Circuit

143 F. 1

LOVE v. EXPORT STORAGE CO. et al.

No. 1,422.

United States Court of Appeals, Sixth Circuit.

February 1, 1906

J. C McReynolds and E. E. Barthell, for appellant.

W. L Granbery, for Export Storage Co.

Lawrence Maxwell, Jr., for Third National Bank.

Before SEVERENS and RICHARDS, Circuit Judges, and COCHRAN, District judge.

COCHRAN District Judge.

On July 13, 1901, the American Hardwood Company, a Tennessee corporation, was engaged in the lumber business at West Nashville, in said state, and had been since March 8, 1900 date of its organization. The lumber yard, in which was a small frame building used as its office and a buggy house, was held under a lease and comprised about four acres of ground, bounded on the north by a railroad, on the south by the Centennial Boulevard, on the west by Thirteenth street, and on the east by an alley. It was surrounded by a fence composed of four wires and a string of plank, with gates in it, except on the side next to the railroad, which was open. The office building was in the center of the south side next to the boulevard, and on top of it was a large sign bearing the company's name on both sides. The company had in the yard over 1,000,000 feet of lumber distributed in 369 piles, worth about $30,000. William H. Lewis was its inspector and yard foreman. He was subject to a Miss Albright, who occupied the office building and may be said to have had general charge of the premises. No officer nor any other superior servant was stationed there. Its head or principal office was in the Union Savings & Trust Company building at Cincinnati, Ohio, and was in charge of its secretary, Clarence G. Corkran, who resided temporarily in that city. Charles E. Corkran was president and treasurer and resided in New York City. The two Corkrans, and K. W. Hobart, B. W. Cross, and G. W. Daniels, constituted its board of directors. The residence of the last three does not appear. Charles W. Corkran was interested in and officially connected with 10 or more other corporations engaged in like business at other points in the United States. He seems to have dominated all of said corporations, including said hardwood company. Indeed he was really the owner substantially, if not entirely, of all their capital stock. By the by-laws of the company it was provided, amongst other things, that it should be the duty of the president to sign and execute all contracts in the name of the company and affix the seal thereof thereto, when instructed so to do by the board; that the treasurer should have the care and custody of all funds that might come into his hands and deposit the same as treasurer in such bank or banks as the president might select; that the treasurer should have power to borrow money and execute and negotiate the promissory notes or bills of exchange received by the company in the course of its business, and should draw all checks against the bank account; and that either the president, vice president, secretary, or treasurer might, in the name of the corporation, issue checks, drafts, and notes and indorse or deposit for collection or discount, as the case might be, checks, drafts, or notes.

On the date aforesaid, to wit, July 13, 1901, the Export Storage Company, one of the appellees, an Ohio corporation, with its principal place of business in said Union Savings & Trust Company building at Cincinnati, was engaged in the business of warehousing, mostly, if not entirely, in certain of the southern states. It had no warehouse of its own. Its business was confined to warehousing on the premises, whether actual warehouses or not, of those who desired to warehouse their goods. Prior to said date it had transacted a large amount of business, but had done but little, if any, in the state of Tennessee. It had a general agent for the state located at Nashville named Charles Sykes. A statute thereof provided for the payment of a certain annual tax by warehousemen for the privilege of carrying on their business therein, and declared it a misdemeanor for one to exercise such privilege without first paying the prescribed tax, punishable by a certain fine. Chapter 128, Acts. 1901, pp. 200, 221, and 227. The appellee company had not paid this tax. The general agent, Sykes, had advised with the Comptroller of the state in regard to its payment, and had been told by him that there was no provision requiring a company like his to pay the tax. He stated that he stood ready to pay it if the company was liable, and an agreement was had that upon its being determined that it was, he was to be notified and to pay the tax. On said date, which was Saturday, the two Corkrans were in Cincinnati. Charles E. had been there for several days prior thereto and remained over until Monday, the 15th. One other director, G. W. Daniels, at the least, was also there on the 15th. It had been determined on behalf of said hardwood company, at the least by said Charles E. Corkran, its dominating personality and real substantial owner of its stock, to warehouse the lumber in its yard at West Nashville with the appellee storage company, to which it had given its consent, and two certain persons, T. J. Wilson and H. C. Yates, had been sent there to see to the taking of necessary steps to that end. Yates was inspector and yard foreman of the hardwood company at another yard, which it had in Tennessee, but Wilson does not appear to have had any further connection with it than in this particular matter. The former was to assist in inventorying the lumber and the latter to supervise what was done. Friday, the 12th, Yates and Lewis inspected and inventoried the lumber. They numbered the piles from 1 to 369, inclusive, ascertained the kind of lumber and number of feet in each pile and put a valuation thereon, and divided the piles into 13 distinct lots, designating them by the letters 'A' to 'M,' inclusive. On Saturday, the 13th, at the office of Sykes in Nashville, a contract was entered into between Lewis and the appellee storage company for Lewis to act as custodian of the lumber, Sykes making the contract on the company's behalf, and a bond in the sum of $5,000 was executed for the faithful performance of his duties as such by him, with a Philadelphia surety company as surety. It is possible that the bond was not actually executed by that company until a later date, but it is dated the 13th. The contract provided that Lewis was to be paid $1 per month for his services as custodian. At the same time and place Lewis signed 13 statements, termed 'inspection reports,' one for each lot, giving the piles of lumber therein and the number of feet and kind and value of lumber in each pile, and executed 13 receipts for the lumber as custodian, one for each lot. Sykes prepared a lease from the hardwood company to the appellee storage company of the lumber yard, dating it the 13th, and obtained the written consent of the former's landlord thereto, which was indorsed thereon. It was for one year and provided that the yard should be known as 'Storage Premises No. 2,' and should be used exclusively for storing personal property. The rental was recited to be $1 and other valuable considerations, receipt of which in advance was acknowledged. He also prepared 13 warehouse receipts, numbered from 2,035 to 2,047, to the hardwood company for the lumber and executed them on behalf of his principal. He then, the same day, mailed the lease, warehouse receipts, and Lewis' contract, bond, inspection reports and receipts to the appellee storage company at Cincinnati. That evening he and Lewis tacked on the inside of the plank forming the top of the fence, at each of the four corners of the yard, a yellow card, 10 inches long by 5 wide, having on it in print the words 'Premises No. 2. Leased and Occupied by the Export Storage Company, of Cincinnati, Ohio. (Incorporated.)' Probably not more than one of the cards could be seen from the outside, and the printed matter thereon could hardly be read therefrom. Beginning on Sunday, and completing it in a day or so, Lewis, by Sykes' direction, fastened on each one of the piles a paper tag. The tags so used were advertising cards of the hardwood company and on the blank side thereof in pencil were the initial letters of the Export Storage Company's name, 'E.S.C.'; each tag having, also, the number of the pile to which it was fastened, the kind and quantity of lumber it contained, the lot to which it belonged, and the number of the warehouse receipt covering it. About a week afterward, by like direction, Lewis attached to each pile a wooden tag dressed on one side, upon which the name of the Export Storage Company was written in full, with the number of the warehouse receipt covering it and the number of the pile and the quantity of lumber it contained.

On Monday, the 15th, at Cincinnati, the papers from Sykes having been received, the lease from the hardwood company to the storage company was executed, Charles E. Corkran as president, acting on behalf of the former and affixing its seal thereto, and W. G. Coldeway, its general manager, acting on behalf of the latter. At the same time a contract between the two companies as to warehousing said lumber, dated the 13th, was executed in like manner, the warehouse receipts were further executed on behalf of the storage company by its said general manager and its secretary and treasurer, and registered with the Union Savings & Trust Company, and were then delivered to said Charles E. Corkran; he receipting therefor in the name of the hardwood company by him as president and treasurer. The warehousing contract provided that the hardwood company was to keep the premises in repair and that the storage company as full compensation for storing the property and issuing its receipts was to...