Guaranty Trust Co. of New York v. Koehler

• Decision Date: 02 February 1911
• Docket Number: 5,512.
• Citation: 187 F. 192
• Parties: GUARANTY TRUST CO. OF NEW YORK v. KOEHLER et al.
• Court: U.S. District Court — Eastern District of Missouri

187 F. 192

GUARANTY TRUST CO. OF NEW YORK v. KOEHLER et al.

No. 5,512.

United States Circuit Court, E.D. Missouri, Eastern Division.

February 2, 1911

Eliot Chaplin, Blayney & Bedal and Davis, Stone & Auerbach, for plaintiff.

Reynolds & Harlan and Jones, Jones, Hocker & Davis, for defendants.

DYER District Judge.

On the 21st of October, 1907, the original petition was filed in this case. On the 20th of June, 1908, an amended petition was filed by leave. On the 12th of December, 1908, three of the defendants, to wit, the American Brewing Company, Hugo A Koehler and Henry Koehler, Jr., filed their joint answer and counterclaim. On the 13th of January, 1909, the plaintiff filed its answer to the counterclaim of the defendants. On the 23d day of January, 1909, a stipulation was filed, signed by the respective attorneys for the respective parties to the suit waiving a jury and for an order of reference. By consent of parties the cause was referred to Jesse A. McDonald, as referee.

On October 27, 1910, the referee's report was filed, and on the same day exceptions to the report were also filed by defendants. On the 30th of November, 1910, the exceptions to the report of the referee were argued and submitted to the court.

The statement of the pleadings by the referee the court accepts and adopts. The pleadings as stated by the referee are as follows:

Statement of the Pleadings.

The Guaranty Trust Company, a corporation organized under the laws of the state of New York with its principal office and place of business in the city of New York, filed its declaration on the 21st day of October, 1907, and its amended declaration on the 20th day of June, 1908, against Hugo A Koehler, Henry Koehler, Jr., and the American Brewing Company, a corporation, all citizens of the state of Missouri; William Wolff, doing business under the name of William Wolff & Company; Frederick H. Hilbert, Charles H Hilbert, and the Pacific Oriental Trading Company, a corporation, all resident in and citizens of the state of California. Only three of the defendants, to wit, Hugo A. Koehler, Henry Koehler, Jr., and the American Brewing Company, are before the court. The amended declaration contains three counts, all of which were relied upon at the trial.

The first count, for money had and received, states that plaintiff advanced moneys to the Philippine Lumber & Development Company, prior to June 14, 1905, and held a deed of trust on the company's property in the Philippine Islands to secure repayment; that proceedings were pending for a judicial sale of the property to satisfy the deed of trust; that the defendants as owners of the whole, or the greater part of the equity in the mortgaged property, formulated a plan to buy in the property at such sale and obtained the plaintiff's assent thereto and its promises to advance money to defendants to make the purchase; that such agreement between plaintiff and defendants was made in writing in the city of Manila in the Philippine Islands; that the sale was had on the 14th day of June, 1905, and the plaintiff, at the special instance and request of the defendants, advanced them about $62,500, with which the property was bought in for and on the defendants' account; that it was jointly and severally agreed on the part of the defendants that the advances made by plaintiff should bear interest at the rate of 7 per cent. per annum, and that upon defendants' purchase of the property a mortgage thereon would be executed to secure to plaintiff the repayment of $40,000 theretofore advanced by it, and to mature and be repaid in annual installments of $3,750 each, with interest thereon at the rate of 7 per cent. per annum; that defendants agreed jointly and severally to repay the plaintiff's additional advances, amounting to $22,500, in installments of $3,750 annually, with interest [187 F. 194] at 7 per cent. per annum, in equal monthly installments on the 14th day of each month; and that defendants agreed jointly and severally to pay interest on the said sum of $40,000, secured by mortgage unless such was otherwise paid when due; that the property of the Philippine Lumber & Development Company was sold, and in accordance with their agreement the defendants acquired the title thereto through their representatives and agents, Clarence H. Mitchell and Paul Reiss; that the defendants executed the mortgage to secure the $40,000, and interest thereon, and defaulted on the principal and interest payment due thereunder June 30, 1906; that default was likewise made by defendant in the payment of the installment of $3,750 of the unsecured sum of $22,500, which became due June 14, 1906, together with interest on the latter sum; that upon plaintiff's demand for payment of these sums, Hugo A. Koehler, Henry Koehler, Jr., and the American Brewing Company, expressly ratified the agreement made for them by their agents, as above recited, and the plaintiff, in consideration thereof, agreed to and did defer proceedings to collect any of the sums so due until January, 1907; that about the 14th day of January, 1907, Hugo A. Koehler, Henry Koehler, Jr., and the American Brewing Company paid plaintiff $7,500 to be applied in discharge of the two installments of principal so maturing June 14, 1906; that a $3,750 installment on the $22,500 unsecured became due on the 14th day of June, 1907, and has not been paid; that a $3,750 installment on the $40,000 secured by mortgage became due on the 30th day of June, 1907, and has not been paid; that interest installments in the sum of $364.58 each became due on the 1jth day of each month from July, 1906, to January, 1907, both included, and interest installments in the sum of $320.83 each became due on the 14th day of each month from February to July, 19078 both included, for all of which sums, aggregating $13,320.29, the plaintiff asks for judgment.

The second count of the amended declaration states a case based on a guaranty by the defendants of the repayment of a part of the moneys referred to in the first count and payment of interest on the entire sum. It states: That an agreement in writing was entered into in the city of Manila, Philippine Islands, which was by plaintiff performed, and by the terms of which, in consideration of the assent by the plaintiff to the plan formulated by the defendants to buy the mortgaged property of the Philippine Lumber & Development Company, as averred in the first count, and the advances made by plaintiff and thereafter to be made by it on account of the defendants, to the amount of $62,500, the defendants guaranteed the repayment to the plaintiff of the sum of $22,500 of principal, with the interest accruing thereon, and also guaranteed the payment of the interest accruing on the remaining sum of $40,000 of principal so advanced by plaintiff, the $22,500 of principal to be paid in installments of $3,750 each on the 14th day of June, of each year, and the payment of interest on both said sums of $22,500 and $40,000 at the rate of 7 per cent. per annum to be made on the 14th day of each month from and after the 14th day of June, 1905. That the installment of $3,750 of the said sum of $22,500 becoming due on the 14th day of June, 1906, was not paid, and that no part of the interest that became due on or after the 14th day of June, 1906, on either the $22,500 or the $40,000, was paid. That, upon demand made for payment, defendants Hugo A. Koehler, Henry Koehler, Jr., and the American Brewing Company expressly ratified the respective individual agreements, made for them by their authorized representatives as aforesaid, and requested indulgences in the payment of the sum then due, and plaintiff agreed to and did defer proceedings for the collection of such sums till the 14th day of June, 1907, when the last-mentioned three defendants paid plaintiff the sum of $3,750 due on the $22,500 on the 14th day of June, 1906. That interest installments on such advances are due and unpaid from July 14, 1906. And that an installment amounting to $3,750 became due on said $22,500 on the 14th day of June, 1907, and remains unpaid. Judgment is asked on this account against the defendants jointly and severally for $3,750 with interest at 7 per cent. per annum from June 14, 1907; and for six monthly installments of $364.58 with interest at 7 per cent. per annum on each from maturity beginning with the maturity of the first on the 14th day of July, 1906; and for ten monthly installments of interest of $320.83 with interest at 7 per cent. per annum on each from maturity, beginning with the maturity of the first on the 14th day of January, 1907.

The third count is based on the guaranty referred to in the second count, covering only the sum of $22,500 and interest thereon. It states that, in consideration of the assent by the plaintiff to the plans formulated by the defendants to buy the mortgaged property mentioned in the first count, and the plaintiff's participation therein, and of the advances made and to be made by the plaintiff, aggregating $62,500 on account of defendants, and at the latter's instance and request, the defendants respectively guaranteed the repayment of $22,500 of principal so advanced, in installments of $3,750 annually on the 14th day of June, of each year, and interest at 7 per cent. per annum payable in equal monthly installments on the 14th day of each month until the whole was repaid; that plaintiff performed its part of the contract; that Hugo A. Koehler, Henry Koehler, Jr. and the American Brewing Company on the 14th day of January, 1907, paid the installments of $3,750 of principal that became due on the 14th day of January, 1906; and that no other part of said sum of $22,500 has been paid, and no part of the interest maturing after the 14th day...