Eastern Milling & Export Co. v. Eastern Milling & Export Co. of Pennsylvania
| Decision Date | 14 July 1906 |
| Docket Number | 37. |
| Citation | 146 F. 761 |
| Parties | EASTERN MILLING & EXPORT CO. v. EASTERN MILLING & EXPORT CO. OF PENNSYLVANIA. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
H Gordon McCouch, for Corn Exchange Nat. Bank.
Stacy B. Lloyd, for receiver.
This matter is brought before the court on a petition presented on behalf of the Corn Exchange Bank, to which an answer was filed by the receiver of the Eastern Milling & Export Company of Pennsylvania, and a stipulation of counsel as to certain facts, which are admitted by the parties, and which do not appear in the petition and answer. They are as follows: The milling company became a debtor to the bank on a promissory note of $4,500, dated May 11, 1903, payable at the expiration of 60 days, and it came due July 11th, the same year. Nine of the first mortgage bonds, for $1,000 each, of the company were deposited with the bank as collateral security for the note. The milling company was also a depositor with the bank and had filed a statement of its assets and liabilities in which the milling company agreed that:
'In consideration of granting any credit by the said bank, the undersigned (the milling company) agrees that, in case of failure or insolvency on the part of the undersigned, * * * all or any of the claims or demands against the undersigned held by said bank shall at the option thereof immediately become due and payable, and it is hereby understood and agreed that all moneys, funds, stocks, bonds, notes, and other property in the hands of the said bank belonging to the undersigned may at all times at the option of the bank be held and appropriated by the said bank to the payment of all notes, indorsements, obligations, or indebtedness in any form; matured or unmatured, made by the undersigned, which the said bank may hold.
Further that the exercise of or omission to exercise such option or options in any instance shall not waive or affect any other or subsequent right to exercise the same.'
On July 3, 1903, the milling company had credit with the bank as a depositor for the sum of $554.54, some of which was for collection on our of town checks. A receiver was appointed for the milling company on July 6, 1903, because of its insolvency, and on May 11th the $4,500 note made by the milling company to the bank fell due, and on February 9 1904, the bank appropriated the deposit on account of the note. Prior to the appointment of the receiver and on the 3d day of July, 1903, the milling company drew a check to Charles H. Burr for $500, which was presented the same day, but payment refused on the ground that while the milling company's bank book showed a credit of more than enough to meet the check, the credit was made up of certain checks that day deposited by the milling company with...
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