In re George M. Hill Co.

• Decision Date: 14 April 1903
• Docket Number: 904
• Citation: 123 F. 866
• Parties: In re GEORGE M. HILL CO.
• Court: U.S. Court of Appeals — Seventh Circuit

123 F. 866

In re GEORGE M. HILL CO.

No. 904

United States Court of Appeals, Seventh Circuit.

April 14, 1903

John W Swarts, for appellant.

George Packard, for appellee.

The Dexter Folder Company, in December, 1901, agreed in writing with the bankrupt to sell to it a Dexter automatic feeding machine, to be attached to a No. 101 Dexter double sixteen folder, then owned and operated by the bankrupt, guarantying the machine to do in a satisfactory manner, when in the hands of competent operators, the work for which it was designed. The bankrupt agreed to be responsible for the full value of the machine against loss or damage (aside from general wear and tear) until settlement was made. The title and right of possession was to remain with the Dexter Folder Company until the machine was fully paid for in cash. The bankrupt agreed to buy the machine, and to pay therefor $750 when the machine was running satisfactorily, as follows: One Sheridan automatic feeder, $50; the balance in cash or its equivalent deferred payments to bear interest. The machine was furnished and was put up and adjusted to a paper folder owned by the bankrupt, being a Dexter No. 101, sixteen folder, originally of the size 31x44, and claimed the feeder would not feed such enlarged machine, and objected to the machine shipped under the contract for that reason. The Sheridan feeder then operated with the folder, and which was to be taken at $50 in part payment, was removed to make place for its substitute-- the feeder in question-- was placed outside the building and becoming rusty from exposure, with permission of the bankrupt, was broken up and sold by the petitioner for old iron, realizing $3. The bankrupt continued to use the machine furnished until March 6, 1902, the date of filing the petition in bankruptcy, constantly objecting to taking it in fulfillment of the contract, at which date the machine and the property of the bankrupt were taken possession of by the receiver in bankruptcy.

On April 3, 1902, the Dexter Folder Company filed its petition in the bankruptcy proceedings, setting forth the facts stated, representing that the machine was delivered to the bankrupt on trial, and with a view of selling it to the bankrupt in case it could be adjusted to the paper folder in use by the bankrupt and satisfactorily operated in connection therewith as an automatic feeding attachment; that the machine could not be so adjusted and operated because the paper folder had been enlarged subsequently to the contract, and without the knowledge of the petitioner; and that the bankrupt had refused to and did not accept the machine, alleging that it did not work satisfactorily and was too small for the folder for which it was intended; and thereupon prayed for an order requiring that the receiver be directed to deliver the feeding machine to the petitioner. The answer of the receiver to this petition admits the receipt of the machine by the bankrupt alleges that the same was accepted by the bankrupt, alleges the payment of the $50 by the delivery of the old feeder according to the contract, and asserts title to the machine to be in the bankrupt, and that his possession as receiver was lawful. The bankruptcy court referred the matter to a referee, who reported upon the facts as alleged and stated. Testimony relative to acceptance consists of the statements of the western manager at Chicago of the petitioner and of the president of the bankrupt. The former states explicitly that the latter said that he would not accept the machine; that it was not large enough; that the Dexter Folder Company must put in a larger one. The latter states that the feeder was too small for the folder, which had been enlarged after making the contract; that he wanted a machine of the right size for the folder; that he told the manager of the petitioner that he would not take the machine; that he wanted it to be made right; and, upon the manager remarking, 'We will make this one so that it will handle that sheet,' he replied: 'I told him no; I did not want a machine that was all butchered up. I wanted a machine that was right, that was all. The machine would do the work, but it did not suit me. ' The referee concluded his report as follows: 'The contention of the petitioner herein is that the contract was not consummated, that the clause that it should do in a satisfactory manner the work for...