Flanders Motor Co. v. Reed

• Decision Date: 17 February 1915
• Docket Number: 1053.
• Citation: 220 F. 642
• Parties: FLANDERS MOTOR CO. v. REED.
• Court: U.S. Court of Appeals — First Circuit

220 F. 642

FLANDERS MOTOR CO. v. REED.

No. 1053.

United States Court of Appeals, First Circuit.

February 17, 1915

Percy W. Carver, of Boston, Mass. (Carver & Carver, of Boston Mass., on the brief), for appellant.

George W. Reed, of Boston, Mass., for appellee.

Before PUTNAM, DODGE, and BINGHAM, Circuit Judges.

DODGE Circuit Judge.

The questions here arising were submitted first to the referee and afterward to the District Court on an 'agreed statement of facts,' supplemented by a statement of 'further agreed facts' and by certain documents made part of the facts agreed by reference in the statements thereof. We find no reason to believe that, in these proceedings, such a submission restricts the power of the court to draw inferences of fact, because we are judges alike of the law and the facts as fully as in ordinary equity appeals.

The petitioner sought to reclaim certain automobile parts claimed to be its property, though in the bankrupts' possession at the time of the bankruptcy. The District Court affirmed the referee's order dismissing the petition. 212 F. 542. The parts in question had been furnished to the bankrupts by the Metzger Motor Car Company, of Detroit, in pursuance of a written agreement dated June 28, 1911 (Exhibit D). Though the bankrupts had not kept the parts so furnished separate from their other goods, the trustee was able to separate them after the bankruptcy, and had done so. The petitioner had succeeded to all the Metzger Company's rights.

By Exhibit D the Metzger Company gave the bankrupts the right to sell 'Everitt' automobiles within a certain territory, and agreed to sell 'Everitt' cars to them at specified discounts from specified list prices, f.o.b. at Detroit. Another clause of Exhibit D provided that 'on orders for parts' the bankrupts should 'be allowed 30 per cent. discount from the last list prices' established by the Metzger Company.

Clause 9 of Exhibit D provided that the title to each and every automobile, and to all automobile parts furnished, should not pass to the bankrupts until the same were paid for in full in cash.

There is nothing in the record to show whether or not any cars were actually furnished under the agreement, or, if any, how many were furnished, or what course of dealing was followed regarding them.

According to the first agreed statement of facts, a 'great many parts applicable for use in said 'Everitt' cars were furnished'; and the questions here involved relate only to the parts thus furnished. Payment for them in full never having been made, the petitioner asserts that title to them never passed.

The case, as the opinion below states, is to be determined according to the law of Massachusetts, which does not make recording necessary to the validity of an agreement for conditional sale. If the provision for reservation of title in clause 9 expresses an agreement made in good faith intended by both parties to be actually observed according to its terms in their dealings regarding the parts in question, and in fact so observed by them until the bankruptcy, the petitioner is entitled to the parts as against the bankrupts' trustee.

We do not find in the 14 other clauses of Exhibit D, containing numerous other stipulations between the parties as to their contemplated dealings with the goods to be furnished, any provisions adapted to secure such dealings with the parts furnished or their proceeds, while in the bankrupts' hands, as it would be natural to expect, had retention of title by the vendor been what the parties really...