183 F. 160 (N.D.W.Va. 1910), In re Charles Town Light & Power Co.
|Citation:||183 F. 160|
|Party Name:||In re CHARLES TOWN LIGHT & POWER CO.|
|Case Date:||November 23, 1910|
|Court:||United States Courts of Appeals, Court of Appeals for the Fourth Circuit|
A petition in involuntary bankruptcy was filed herein by C. J. Devore, a single creditor, alleging defendant to be a corporation, principally engaged in trading and mercantile pursuits, owing petitioner a debt of over $2,600, having less than 12 creditors, and with having committed acts of bankruptcy: (a) By causing to be recorded within four months of its property to secure a conveyance by mortgage or deed of trust all of its property to secure $18,000 of bonds; and (b) by suffering a receiver to be appointed for it by a state court. To this petition answer has been filed by the alleged bankrupt, averring itself to be a corporation chartered for the purpose of 'supplying light and power by electricity to the public at Charles Town, Jefferson county, W. Va., and to such persons, partnerships, and corporations residing therein or adjacent thereto as may desire the same,' denying that it is 'engaged principally in trading and mercantile pursuits,' denying that its creditors are less than 12, but alleging their numbers to be between 17 and 20, and setting forth the names and addresses of some 17 of such creditors. It admits that it executed the deed of trust to secure $18,000 of bonds on November 18, 1904, for the purpose of betterment of its plant, to which it alleges the money was applied, and admits that such deed of trust was not admitted to record until within four months of the filing of this petition, but why not, was, it alleges, for reasons known to the trustee and not to it. It denies the execution and recordation of this deed of trust to be an act of bankruptcy. It admits its assent to the appointment of a receiver for it 'because, for prudential business reasons, it was deemed better that any conflicting claims of creditors could be more easily and with more rapidity adjudicated and arranged. ' It avers that it owes debts not exceeding $30,000 and owns a plant and property that cost between $35,000 and $45,000 and has contracts with the town of Charles Town and with other corporations and individuals, and the 'question of its insolvency would depend upon the market value of this plant and property * * * and the value of its contracts.'
Pending consideration of this petition, the Shenandoah Valley Bank and the Winchester & Washington City Railway Company, as creditors, have entered appearances and joined in the petition, as provided in section 59f of the bankruptcy act (Act July 1, 1898, c. 541, 30 Stat. 562 (U.S. Comp. St. 1901, p. 3445)), and some 12 other creditors have also appeared and expressed opposition to the adjudication of the defendant as bankrupt. By order, the issue raised by petition and answer was referred to a referee 'to ascertain and report the facts'; but since the entry of this order counsel have agreed certain facts and submitted the cause to this court for decision.
The agreed facts substantially are: That prior to March 26, 1906, the alleged bankrupt company generated electricity by its own power at its plant in Charles Town, and still has in possession this plant and electric equipment; that on said 26th day of March, 1906, it entered into a contract with the Winchester & Washington City Railway Company whereby it contracted to buy from the latter, under certain terms and conditions set forth in the contract, its entire supply of electricity to be supplied over the alleged bankrupt's lines by the railway company from its power plant on the Shenandoah river three miles from Charles Town; that since the execution of said contract it has not been generating electricity at its own plant, but has been selling and delivering over its own lines the electricity so purchased by it from the railway company to its patrons in Charles Town, including the town itself, under a contract exhibited, its profit being the...
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