Brusselback v. Cago Corporation

• Decision Date: 11 August 1938
• Citation: Brusselback v. Cago Corporation, 24 F.Supp. 524 (S.D. N.Y. 1938)
• Parties: BRUSSELBACK et al. (Alig et al., Interveners) v. CAGO CORPORATION et al.
• Court: U.S. District Court — Southern District of New York

24 F. Supp. 524

BRUSSELBACK et al. (Alig et al., Interveners) v. CAGO CORPORATION et al.

District Court, S. D. New York.

August 11, 1938.

COPYRIGHT MATERIAL OMITTED

Root, Clark, Buckner & Ballantine, of New York City (John M. Harlan, Leslie H. Arps, and Emory T. Nunneley, Jr., all of New York City, of counsel), for plaintiffs.

Henry Woog, of New York City, for plaintiffs-interveners.

Holm, Whitlock & Scarff, of New York City (Joseph Fischer, of New York City, of counsel), for defendant Agnes O'Brien.

Sackett, Chapman, Brown & Cross, of New York City (E. Douglas Hamilton, of New York City, of counsel), for defendant Tribune Fresh Air Fund.

Gibbs, Hand & McCabe, of New York City (Joseph V. McCabe, of New York City, of counsel), for defendant William F. Greegan.

Benjamin Sholemson, of New York City, for defendant Arthur Vare.

Clark, Carr & Ellis, of New York City (Paul A. Crouch, of New York City, of counsel), for defendant Gladys Patterson.

Gifford, Woody, Carter & Hays, of New York City (Charles L. Woody, of New York City, of counsel), for defendants Charles E. Roehl and C. Melville Haight, Jr.

Mack, McCauley, Spiegelberg & Gallagher, of New York City (Paul J. McCauley and George A. Spiegelberg, both of New York City, of counsel), for defendants Cago Corporation, Paul Fox, John H. Gertler, and George A. Spiegelberg.

LeRoy Danziger, of New York City (David Klein, of New York City, of counsel), for defendant Arthur P. Wollheim.

Proskauer, Rose & Paskus, of New York City (Charles Looker, of New York City, of counsel), for defendant Silas M. Moorman.

Louis Scadron, of New York City, for defendant estate of William H. Gleitzman.

Wilson, Wager & Cornell, of New York City (George W. Cornell, of New York City, of counsel), for defendant Mary B. Chamberlaine.

John G. Jackson, of New York City (John G. Jackson, Jr., and Raymond M. Tierney, both of New York City, of counsel), for defendant Battelle, Ludwig & Co.

Wickes & Neilson, of New York City (Joseph F. Regan, of New York City, of counsel), for defendant H. Elbert Foster.

Chadbourne, Wallace, Parke & Whiteside, of New York City, for defendant Elia G. Riggio.

James S. Lawler, of New York City, for defendant Edward W. Banta.

William T. Van Alstyne, of New York City, for defendant Charity Alker.

Coudert Bros., of New York City (Frederick C. Bellinger, of New York City, of counsel), for defendant Joseph P. Bartram.

Jack Fogelson, of New York City, for defendants Sirma and Michael J. Devlet.

WOOLSEY, District Judge.

My decision is:

1. That this suit be dismissed as against defendant Spiegelberg without costs for the reason that he was made a party hereto solely for the purpose of discovery, and has complied with the prayer of the complaint in that respect, leaving no residuum of relief due from him to the plaintiffs.

2. That the suit be dismissed as against Sirma Devlet without costs.

3. That the complainants have, with costs, a decree, as hereinafter indicated in the following memorandum opinion, as against all the other defendants herein who have been served with process and still remain parties because they have not settled with the plaintiffs, or already had the complaint dismissed as against them for other reasons than settlement.

I. My subject matter jurisdiction in this cause is based on the fact that the matter in controversy exceeds, exclusive of interest and costs, the sum or value of $3,000, and arises under the laws of the United States. Title 28 United States Code, Section 41 (1) (a), 28 U.S.C.A. § 41 (1) (a).

Subject matter jurisdiction herein on this basis has been sustained, and a remedy in equity for the relief herein sought has been approved by the Circuit Court of Appeals of this Circuit. Brusselback et al. v. Cago Corporation et al., 2 Cir., 85 F.2d 20.

II. The following defendants have been served with process and have appeared and answered: Cago Corporation; Luberta Realty Corporation; Edward W. Banta; Isabel Burgheim; Mary B. Chamberlaine; Michael J. Devlet; Sirma Devlet; John F. Devlin; John H. Gertler; Louis H. Gleitzman and William Gleitzman, as executors of Isaac Gleitzman, now deceased; C. Melville Haight, Jr.; Silas M. Moorman; Agnes O'Brien; Ella G. Riggio; Norman Schloss; William Greegan; Gladys M. Patterson; Miriam B. Kohn; Albert P. Wollheim; Paul Fox; George A. Spiegelberg; Seavey Battelle, Frederick W. Ludwig, Charles Gilbert Miller and Stanley L. Roggenburg, formerly doing business as co-partners under the firm name and style of Battelle, Ludwig & Co.; H. Elbert Foster, Jr., formerly one of the co-partners of Foster-McConnell & Co.; Mary B. Chamberlaine as executrix and Robert L. Chamberlaine as executor of the estate of Rebecca C. Fabens.

III. The following defendants have been served with process and have defaulted, and in respect of them the trial herein constituted an inquest: Florence F. Clifford; R. Earl Merrifield; Mary Z. Shapiro; Anna J. Sullivan; Ray Weinberg; Jacob Zeller; Mary T. Earle; Lucy G. Hesselman; Thomas J. Shanley; Charles S. Irish; Emil H. Sparfeld; Frank R. Swift; Ruth M. Tallman; Robert A. Wallace; Grace B. Whall; John Wilson Cutler and Junius A. Richards, formerly two of the co-partners of Edward B. Smith & Co., and Glee Jamison Smith, as executrix of Albert L. Smith, deceased, formerly one of the partners of Edward B. Smith & Co.

IV. The following defendants have settled with the plaintiffs, and the suit has been dismissed as to them: Charity Alker; Wilbur L. Ball; Condict W. Cutler, Jr.; Charles B. Drake; George E. Hall; David L. Hodgens; Emil Joseph; Edwin H. Kreig; Jessie McHugh; Marie E. Rohn; Michael L. Sinsheimer; S. B. Searing; Helen O. W. Nesmith; Alvano T. Nickerson; Charles E. Roehl; Stuyvesant Fish, Samuel T. Callaway, Trowbridge Callaway, Robert H. Cox, Walter Merrill Hall, Herman N. Rosenwald, William A. Tall, Willard S. Simpkins, and Frank L. Scheffey, formerly co-partners doing business under the firm name and style of Callaway, Fish & Co.; Jansen Noyes, Leo M. Blancke, Clifford Hemphill, Walter T. Collins, Stanton Griffis, Charles L. Morse, Jr., Harold C. Strong and Kenneth K. Ward, co-partners doing business under the firm name and style of Hemphill, Noyes & Co.; Russell Merrick doing business under the firm name and style of Merrick & Co.; Joseph P. Bartram, as trustee for Daisy D. Bartram.

V. The following defendants were served but as to them the suit was dismissed for various reasons other than settlement: Arthur A. Marshall; Arthur Vare; Walter Hewett; Henry Gee; Meyer Salzman; Tribune Fresh Air Fund.

VI. The following defendants named herein have not been served with process and, therefore, they are not parties to this cause: Jeanne Gertler; Combined Industries, Inc.; J. D. Andrews; Charles Armbrecht; M. T. Arnold; Charles S. Bartow, Jr.; Anita D. Brown; Andrew Casazza; Louis T. Chiavelli; James T. Dean; Ida B. Evans; Anne Dalzell Harris; Joseph Kahn; Pauline Lettermen; Cecelia Livingston; W. McClure Locher; Thomas McKnight; Katherine Schuman; Robert Scoville; William L. Trumble; Frieda Bernstein; Anna Frost; R. R. Koeser; Carrie Meyer; Mildred Zaretzby; Freeman G. Allen; Judith Eve Cowen; Margaret J. Sylvester Cowles; Elizabeth F. Ellis; Amy E. Haviland; Arthur Oakly; Charles J. Russ; Doris Goldstandt; Frieda Brand; Radcliffe Cheston, Jr.; Charles S. Cheston; Reginald G. Coombe; Edward C. Sayers; Rodney W. Brown; Harold G. Hathaway; Robert F. Whitmer, Jr.; Harcourt Amory, Reginald E. Heard, Walter C. Boothroyd and Edward B. Smith, Jr., together with Albert L. Smith, now deceased, formerly some of the co-partners doing business under the firm name and style of Edward B. Smith & Co.; Girard Trust Co., Geoffrey S. Smith and Charles S. Cheston, as executors of Albert L. Smith; Lorenzo Semple; Robert E. McConnell, Walter S. Marvin, Harvey S. Mudd and Seeley G. Mudd, formerly some of the copartners doing business under the firm name and style of Foster, McConnell & Co.

VII. Inasmuch as under the decision of the United States Supreme Court on April 25, 1938, in Interstate Circuit, Inc., v. United States, 304 U.S. 55, 57, 58 S.Ct. 768, 769, 82 L.Ed. 1146, it is indicated that formal findings of fact and conclusions of law separately stated under Equity Rule 70½, Title 28 United States Code Annotated following Section 723, must supersede any opinion in an equity case, I shall content myself with indicating generally my findings of fact and reasons therefor and my conclusions of law herein, without attempting to write a considered opinion such as the interesting questions of law herein raised by the defendants tempt me to do.

VIII. The Question of Insolvency and Quantum of Assessment

I hold that the original receivership set up by the Federal Farm Loan Board on October 1st, 1932, is a matter with which this Court cannot properly deal. That was an act of an executive administrative board, and I think, whilst there may be some question as to whether the bank was insolvent at the time — on October 1st, when the receiver was originally appointed — there is not any question whatever that it would have been insolvent on November 1st, 1932, and therefore the directors were merely forestalling by one month, at most, the situation which they had to meet. And I think that there is nothing which I can possibly do about the original receivership, so we have to take that as it stands.

Now, how does it stand? I was thoroughly satisfied by the evidence of the five farm experts called herein, — Arnold, Cochrane, Kahlert, Brown and Wahler — for I thought they knew their job most extraordinarily well. They all had seen all the farms as to which they were testifying, and they seemed to know, even by name, every tract; they had it all absolutely letter perfect and they were marvelous, it seemed to me, as experts, so it is abundantly safe for me to say that they knew what they were testifying about, and to adopt what they testified to as correct, namely, that the present...