American & British Securities Co. v. American & British Mfg. Corporation
| Decision Date | 30 July 1921 |
| Citation | 275 F. 121 |
| Parties | AMERICAN & BRITISH SECURITIES CO. v. AMERICAN & BRITISH MFG. CORPORATION. |
| Court | U.S. District Court — Southern District of New York |
Campbell Flaherty, Turner & Strouse, of New York City, for receiver.
Louis H. Strouse and William H. Griffin, both of New York City, for petitioners.
Choate Hall & Stewart, of Boston, Mass., for Charles F. Choate, Jr.
Walter A. Hall, of New York City, for petitioner Empire State Finance Corporation.
William H. O'Hara, of Bridgeport, Conn., for petitioner Blue Ribbon Body Co.
Larkin Rathbone & Perry, of New York City, for petitioners Wolfe Wilson, Godfrey, Greebe, and Leary.
Winthrop & Stimson, of New York City, for petitioners G. W. McNear, Inc., and Colt.
Wm. Dewey Loucks, of New York City, for defendant.
This motion comes up upon rule nisi and petition to which an opposing affidavit has been filed. From these papers and the other papers on file it appears that this is a sequestration suit in which a simple creditor has with the defendant's consent obtained the appointment of a receiver, alleging that the affairs of the corporation are involved, and that executions and attachments will waste the assets unless the court takes them over to conserve them. The petition alleges that a third party, a corporation, signed and delivered a note to the defendant which the latter indorsed over to the petitioner, which thus 'bought' the note. The answering affidavit alleges that the transaction was a direct loan by the petitioner to the defendant, which took this form. I shall accept this interpretation of the transaction, and also that the collateral pledged was the property of the defendant. This does not certainly appear, but there is no other plausible interpretation, and nothing in the petition contradicts the allegations of the answer. The loan was secured by bills of sale of two motor cars, signed by both the defendant and the third party, and followed by a 'trust receipt' signed by the third party corporation in whose possession the cars now are. This third party is apparently an agent for the defendant. Both petition and answer are woefully inartificial, and from their vague statements it is impossible to be certain of just what occurred.
If all this be true, the situation is one of a loan with a pledge the property remaining in the possession of the pledgee's agents as such, it is in every sense a chattel...
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