American Surety Co. of New York v. Campbell & Zell Co.
| Decision Date | 08 June 1905 |
| Docket Number | 560. |
| Citation | 138 F. 531 |
| Parties | AMERICAN SURETY CO. OF NEW YORK v. CAMPBELL & ZELL CO. |
| Court | U.S. Court of Appeals — First Circuit |
In Error to the Circuit Court of the United States for the District of Massachusetts.
For opinion below, see 129 F. 491.
Where an attachment bond was executed to the receiver of a corporation, his successors and assigns, in an action by such receiver to realize upon an asset of the corporation, a termination of the receivership control over the action did not discharge the surety on the bond.
Where, in an action by the receiver of a corporation, a bond to discharge an attachment was given to H., receiver of the C. & Z. Co., a corporation, to be paid to H., 'his successors and assigns,' and the record in the action was sufficient to advise the surety from the beginning that the corporation was the real party in interest, the term 'successor' was not limited to another receiver, but also meant succession in corporate control, so that on the termination of the receivership control over the action, in which the bond was given, the corporation was entitled to prosecute an action on the bond.
Henry Wheeler (Hutchins & Wheeler, on the brief), for plaintiff in error.
Byron E. Crowell (Mahoney, Crowell & Sullivan, on the brief), for defendant in error.
Before COLT, Circuit Judge, and ALDRICH and BROWN, District Judges.
This is an action on behalf of Campbell & Zell, a Maryland corporation, as plaintiff upon an attachment bond under seal. The bond in question was filed to dissolve an attachment in a case pending in the state courts of Massachusetts, in which Charles C. Homer, receiver of the Campbell & Zell Company, was plaintiff, and the Barr Pumping Engine Company was defendant. Subsequently, upon motion of the plaintiff, the writ in the cause in which the bond was filed was amended by striking out the name of Homer as receiver, leaving the action to be maintained and prosecuted to judgment in the name of Campbell and Zell. As a general rule, an action on an attachment bond, as well as upon other bonds under seal, must be in the name of the obligee when the name is clearly defined, and is without addition or descriptive enlargement; but who the real obligee is is often a matter of construction. In this case it is true the condition in the bond is to pay the plaintiff in the action, and the principal question here relates to the inquiry as to whom the plaintiff and real obligee is. This inquiry must be solved, as observed by the learned judge in the Circuit Court, upon consideration and construction of the whole contract, having regard, of course, to the character of the proceeding to which the bond relates, as the condition in the bond expressly refers to the writ and the plaintiff in the action in which the bond was given, and because the description of the obligee embraces something more than the individual name of Homer. The name of Charles C. Homer was only a part of the description of the obligee. In every substantial sense the real obligee was the Campbell & Zell Company. Homer, as receiver, was simply an official, and an instrument of the law, and as such represented the corporate interest, and in such representative capacity brought an action for the benefit of the company to establish its rights and to recover upon a debt due it as the disclosed beneficiary. The bond was not to Homer individually, or Homer as receiver, in so many words, but to 'Charles C. Homer, of the state of Maryland, receiver of the Campbell and Zell Company, a corporation established under the laws of the state of Maryland, in the full and just sum of five thousand dollars, to be paid to said Charles C. Homer, his successors and assigns. ' His capacity was fully disclosed. The receiver sued not for himself, but officially, and as an instrument of the law, for the corporation, which was temporarily incapacitated from suing; and when the incapacity was removed by the termination of the receivership control over the action the disclosed beneficiary became his successor, and fully succeeded to all rights, in respect to the action and the bond dissolving the attachment which the receiver and instrument of the law had created in its behalf. The writ and the bond itself set out to the surety company full information in respect to the character of the claim and as to the real plaintiff and obligee in interest. The parties contracted with reference to a receivership situation which was liable to be terminated at any moment, the beneficiary thereupon succeeding to all right to carry forward pending legal proceedings for the collection of its just claims. It should be assumed, upon construction, that the parties understood all this, as they undoubtedly did. It is a miscarriage of justice, if a bond discharging an attachment in a suit by a receiver in behalf of a disclosed beneficiary interest which is set out in a description of the party plaintiff, and as a part of the description of the party obligee in the bond as well, is not enforceable by the beneficiary, and an asset is lost, because the receivership control over the action terminates before the action instituted in behalf of the beneficiary is brought to a conclusion.
We need not, however, consider whether, under construction of the whole contract, the interest of Campbell & Zell is so substantial and so apparent, and the corporate name so substantial a part of the description of the obligee, as to entitle the corporation to sue in its own name upon the bond as the expressed obligee. This case may be rested upon the position that the bond expressly runs to Homer in his official and representative capacity, and expressly to his successors as well. This results because the bond itself contemplates succession. As has already been said, the action in question was by a receiver, who fully disclosed his official capacity and described by name the beneficiary plaintiff. The action was to recover upon indebtedness to the disclosed, but temporarily incapacitated, company. The bond was filed in the ordinary course of judicial procedure, discharged a valid attachment, and was subject to the ordinary course of judicial procedure, including the amendment striking out the representative capacity of Homer, and leaving the action to be prosecuted by Campbell & Zell, the disclosed party in interest, the real plaintiff and beneficiary. As sustaining the general view that the tenor of an attachment bond is to secure the payment of any judgment that may be recovered in the ordinary course of judicial procedure and pursuant to law, see Tapley...
To continue reading
Request your trial
-
Bassick Mfg. Co. v. Ready Auto Supply Co.
...Ed. 641; Fowler v. Stebbins (C. C. A.) 136 F. 365, 367; Campbell & Zell Co. v. American Surety Co. (C. C.) 129 F. 491, affirmed (C. C. A.) 138 F. 531, certiorari denied 199 U. S. 607, 26 S. Ct. 747, 50 L. Ed. 331. The presumption is rebuttable, but no evidence was offered to rebut it, and p......
-
Dunkley Co. v. California Packing Corporation
... ... Corporation (which is formed under the laws of New York), all ... its 'business, franchise and property as a ... may mean succession in corporate control. ' American, ... etc., Co. v. Campbell, 138 F. 531, 534, 71 C.C.A. 55, ... ...
-
North Texas Nat. Bank v. Thompson
...or a right, or an interest or a power, official or otherwise. It may mean succession in corporate control.' American, etc., Co. v. Campbell, 138 F. 531, 534, 71 C. C. A. 55, 58. "Both from reason and authority we conclude that a grant to a corporation and its successors is a phrase to be in......
-
Baltimore Trust Co. v. Metropolitan Casualty Ins. Co., 3547.
...corresponding change in the obligee of the surety bond. Longfellow v. McGregor, 61 Minn. 494, 63 N. W. 1032, and American Surety Co. v. Campbell & Zell Co. (C. C. A.) 138 F. 531, are especially relied On the other hand, it is contended that the words "successors and assigns" indicate only "......