Hadden v. Natchaug Silk Co.

• Citation: 84 F. 80
• Parties: HADDEN et al. v. NATCHAUG SILK CO. et al.
• Decision Date: 13 January 1898
• Court: U.S. District Court — Southern District of New York

84 F. 80

HADDEN et al. v. NATCHAUG SILK CO. et al.

United States Circuit Court, S.D. New York.

January 13, 1898

William B. Putney and Henry B. Twombly, for complainants.

Edward Winslow Paige, for defendants.

COXE District Judge.

It is of course, my duty to follow the decisions of this court and of the circuit court of appeals even though a different opinion may be entertained upon some of the propositions involved. Different judges do not make different courts. When the circuit court has spoken through any of its judges its decision should be, and generally is, regarded as controlling upon all the others. This is the spirit of American jurisprudence. We sacrifice much to precedent. A proposition once decided between the same parties on similar facts must stand decided. It is of little moment that the decision was made by another than the sitting judge. If entitled to any consideration this circumstance gives the decision even greater weight. A judge may change his own mind; he cannot change the mind of another. Manifestly, then, the first inquiry is, what has been already decided, and what, if anything, is left open for decision? The motion to dissolve the injunction brought up the entire controversy for review. With the injunction removed it was possible for the defendants to defeat the main purpose of the action by disposing of the property in dispute. In such circumstances it is plain that the court would have preserved 'the existing state of things' if it had supposed that there was a reasonable chance of the complainants' success. The decision dissolving the injunction could have proceeded only upon the theory that the defendants' title to the goods in dispute was good and the complainants' title bad. So much for the effect of the decisions in general. I proceed to the examination of them in detail.

First. The circuit court of appeals. It may fairly be said that the logical conclusion to be drawn from the language of the opinion regarding the first question considered is that the court would have held Chaffee's transfers valid if it appeared that he was vested with unlimited authority. The court holds that 'the decisions of the state of Connecticut apparently recognize that a president and unlimited general manager of one of its manufacturing corporations is vested with' power 'to sell a large portion of the personal property of the company to one of its creditors in part payment of its debt, ' and that such a transfer is valid even though the company was insolvent and known by the president to be insolvent at the time of the transfer. In an able opinion the court of appeals of Maryland took an entirely different view of the law. Hadden v Linville, 38 A. 40. They were in no way controlled by the decision of the circuit court of appeals, but they proceed to 'distinguish' as follows:

'The court did not decide as to the power of Chaffee. As to that, the question was of a character which cannot be determined on affidavits. Nor does he decide what the power of a general manager is in Connecticut, but only what it 'apparently is,' and that it is subject to modification by other facts than those before him in that case.'

This distinction, based largely upon the use of the word 'apparently' by the circuit court of appeals is too shadowy to be accepted by this court. It is more apparent than real. I have little doubt that upon the proof then before it the court would have held the sales by Chaffee valid, and failed to do so only because the question 'may be controlled by the facts which may subsequently appear as to any limitation of Chaffee's actual powers of which the bank had knowledge.'

The only question left open upon this branch of the controversy is whether the subsequent proof discloses such limitation, and also whether the acts of Chaffee were subsequently ratified by the directors. Upon the other question--the validity of the notes upon which the Pangburn judgment is based--the court decided nothing of importance, leaving the question of fact for further examination. The decision of the circuit court of appeals was based wholly upon affidavits, but an examination of the briefs shows that with one exception every proposition now argued was there argued, but, of course, upon a less ample and reliable record. The contention that the bank and the silk company were jointly engaged in a scheme to defraud the complainants does not seem to have been presented. This decision was rendered in May, 1896. When the case was next considered in November, 1896, the motion to vacate was argued upon full proofs and the most elaborate briefs. In granting the motion upon certain conditions, subsequently supplied, the circuit court begins its opinion with the following proposition:

'Under the decision of the court of appeals two questions and two only are left open, viz.: the sufficiency of the assignment of title to the silk by Chaffee, and the validity of the notes assigned to Pangburn as obligations of the Natchaug Silk Company.'

The court then proceeds to close the latter question by holding the following propositions: First, that four of the notes assigned to Pangburn were valid in any view of the case. Second, that 'the delivery of a note for indebtedness evidenced by an old one does not extinguish the indebtedness nor render the old note void, unless the creditor by discounting it and crediting the records, or in some other way, agrees to accept it in payment. ' Third, that though other notes were given in renewal of the notes sold to Pangburn the original debt was not thereby extinguished, and he could recover upon the notes held by him as surrendering all subsequent notes which were delivered as evidences of such debt. Fourth,...