Cleveland Trust Co. v. Consolidated Gas, EL & P. Co., 3241.
Decision Date | 12 January 1932 |
Docket Number | No. 3241.,3241. |
Citation | 55 F.2d 211 |
Parties | CLEVELAND TRUST CO. v. CONSOLIDATED GAS, ELECTRIC LIGHT & POWER CO. OF BALTIMORE, et al. |
Court | U.S. Court of Appeals — Fourth Circuit |
Gardner Abbott, of Cleveland, Ohio, and Richard F. Cleveland, of Baltimore, Md. (Semmes, Bowen & Semmes, of Baltimore, Md., and Charles E. Bodurtha and Tolles, Hogsett & Ginn, all of Cleveland, Ohio, on the brief), for appellant and cross-appellee.
Joseph France, of Baltimore, Md. (Venable, Baetjer & Howard and Hunter H. Moss, all of Baltimore, Md., on the brief), for appellees and cross-appellants, A. S. Abel Co. and Alex. Brown & Sons, and appellee Maryland Trust Co., Trustee.
Edgar Allan Poe, Jr., of Baltimore, Md. (Edgar Allan Poe and Bartlett, Poe & Claggett, all of Baltimore, Md., on the brief), for appellees and cross-appellants J. Sawyer Wilson, Jr., Guy Harrison Reese, and Abel A. Rosenburg, constituting Protective Committee for Bondholders, etc.
Charles Markell, of Baltimore, Md., for appellee and cross-appellant Consolidated Gas, Electric Light & Power Co.
Before PARKER and NORTHCOTT, Circuit Judges, and WEBB, District Judge.
This is an appeal and cross-appeals from a decree of the District Court of the United States for the District of Maryland, entered in July, 1931, in the suit of R. E. Duvall Company v. Washington, Baltimore & Annapolis Electric Railroad Company. The opinion of the learned judge below will be found in 51 F.(2d) 566, 567.
The statement of facts, taken from the opinion, filed in the District Court, is as follows:
The District Court has held, first, that the mortgage lien must be construed as restricted to property "for use for or in connection with said terminal stations and said lines of railroad," and, second, that so construed, the lien of the mortgagee does not cover the stock of the power company and the stock of the terminal company, but does include certain parcels of real estate held by the terminal company and the Maryland Company which are used for railroad purposes.
We agree with the holding of the judge below on the first point. Conceding that, as stated in the opinion of the District Court, the language of the concluding paragraph read by itself is sufficiently broad to include investment shares of stock and that after acquired property may be mortgaged, and that the rule, as to after acquired property, applies equally to securities as to other kinds of property, yet this mortgage clearly was not intended to cover after acquired property other than that used in connection with the railroad and its operation.
Questions of a character similar to the one arising here are not novel, and have frequently been considered by the appellate courts. A large number of them has been examined, and from them we conclude that the great weight of authority supports the conclusion of the judge below.1
The great weight of authority sustains the rule of strict construction in interpreting "after acquired property" clauses in a mortgage. To use the words of the court, in the case of Smith v. McCullough, 104 U. S. 25, 26 L. Ed. 637, the terms employed in describing the property mortgaged must "imperatively demand" the construction contended for. Neither the reading of the mortgage as a whole, as it must be...
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