Blake v. Foreman Bros. Banking Co.
| Decision Date | 06 January 1914 |
| Docket Number | 13. |
| Citation | 218 F. 264 |
| Parties | BLAKE et al. v. FOREMAN BROS. BANKING CO. et al. |
| Court | U.S. District Court — Northern District of Illinois |
William E. Blake and Willie Mallory Chamberlain, both citizens and residents of Burlington, Iowa, and executors of the last will and testament of Frank W. Chamberlain, deceased, brought this action against Foreman Bros. Banking Company, an Illinois corporation, with its principal place of business in the city of Chicago, Jacob J. Shubert, a resident and citizen of New York City, and John Cort, a resident and citizen of the state of Washington. The bill charges that Frank W. Chamberlain in his lifetime owned certain theater properties, some having a charter from Illinois and some from other states, which he sold to the defendants Shubert and Cort. The method of sale was to deposit with Foreman Bros. Banking Company, as trustee, the stock in the several theater corporations, to be held by it as security for the unpaid balance of the purchase price. The stock was duly indorsed, and ample power was conferred upon the trustee to sell in case of default.
Under the contract $22,500 was to be and was paid by the defendants on August 1, 1910, and after that $150,000 was to be paid in ten equal installments of $15,000 each, payable annually beginning August 1, 1911; the deferred payments to bear interest at the rate of 5 per cent. per annum. The interest payments for 1911 and the $15,000 due on August 1, 1911, were paid. Nothing has been paid under the contract since that date. The contract contained the following clause: 'Said first and second parties further covenant and agree that all said aforementioned properties, stocks, and leases acquired by the parties of the second part hereto under and by virtue of said contract, dated June 18, 1910, may be by the said party of the second part assigned and transferred to a corporation to be organized under the laws of the state of New York, which corporation shall have a capital stock of two hundred fifty thousand dollars ($250,000), and immediately upon such corporation being organized, and assuming this agreement and the agreement of June 18, 1910, and executing an agreement so to do, then and in that event, by virtue of the said agreement so to be executed by such corporation, the parties of the second part hereto shall ipso facto be released from any liabilities or obligations hereunder, and said corporation shall thereupon be bound by each and every of the terms, covenants, and conditions of this agreement and the said agreement of June 18, 1910, as though it, the said corporation, had originally been named as the party of the second part hereto, and in the said agreement of June 18 1910, in the place and stead of the parties of the second part heretobefore mentioned.'
In June, 1912, there was organized, under the laws of the state of New York, a corporation known as the 'Western Theaters Limited...
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