IN RE HENSELMAN.

• Decision Date: 12 November 1935
• Docket Number: No. 6773.,6773.
• Citation: 79 F.2d 738
• Parties: In re HENSELMAN. GOODYEAR TIRE & RUBBER CO. v. OREBAUGH.
• Court: U.S. Court of Appeals — Sixth Circuit

79 F.2d 738 (1935)

In re HENSELMAN GOODYEAR TIRE & RUBBER CO. v. OREBAUGH.

No. 6773.

Circuit Court of Appeals, Sixth Circuit.

November 12, 1935.

Henry B. Street, of Cincinnati, Ohio (Harmon, Colston, Goldsmith & Hoadly, of Cincinnati, Ohio, on the brief), for appellant.

C. Luther Swaim, of Wilmington, Ohio (H. G. Cartwright, of Wilmington, Ohio, on the brief), for appellee.

Before MOORMAN, HICKS, and SIMONS, Circuit Judges.

HICKS, Circuit Judge.

Appeal of Goodyear Tire & Rubber Company, Inc. (herein called Goodyear), from an order of the District Court confirming an order of the referee denying in part the petition of appellant for the reclamation of certain automobile tires, tubes, wheels, etc.

For a number of years prior to September 21, 1932, Roy W. Henselman, bankrupt, had been a dealer in automobile tires and other motor accessories in Wilmington, Ohio. He purchased his tires exclusively from Goodyear but for about two years had been slow in making payments on the account. Goodyear refused to extend further credit but was willing to assist him by arranging a consignment agreement whereby he could have tires on hand for sale without an investment of capital.

The consignment agreement was signed on September 21, 1932, and provided, among other things: That Henselman should reserve a suitable place in his establishment for the consigned goods and keep them separate from other merchandise; that they should be marked as the property of Goodyear, and that all books of account referring thereto or showing the sale thereof, as well as all items on the general ledger referring thereto, should be identified as belonging to Goodyear by means of a rubber stamp legend to read, "This item assigned to The Goodyear Tire & Rubber Co., Inc."; that Henselman should dispose of the consigned merchandise in his regular retail trade following the general policy recommended by Goodyear and make payment as provided in the agreement; that he should fill retail orders from stock which had been longest in his possession; that he should make semimonthly reports to Goodyear of consigned merchandise disposed of, and on or before the 10th day of each month he should, whether he had collected from the purchaser or not, account and pay to Goodyear for all merchandise disposed of during the preceding month; that Henselman on the first of each month should mail to Goodyear an inventory of stock on hand and furnish a financial statement when requested; that Goodyear should be permitted to examine the stock and the books at any time and that Henselman should be liable for any merchandise found damaged or missing; that Goodyear should insure the merchandise consigned and Henselman should pay the cost thereof as well as any taxes due thereon; that for purposes of taxation the stock should be listed by Henselman in his own name as appellee, but showing that it was held on consignment separate and distinct from his own property.

The agreement further provided that to secure the prompt payment of all sums due thereunder Henselman should assign to Goodyear all his accounts, notes, drafts, and other evidences of indebtedness arising out of the sale of Goodyear...