Public Industrials Corporation v. Reading Hardware Co.

• Citation: 29 F.2d 975
• Decision Date: 04 January 1929
• Docket Number: No. 3835.,3835.
• Parties: PUBLIC INDUSTRIALS CORPORATION v. READING HARDWARE CO.
• Court: United States Courts of Appeals. United States Court of Appeals (3rd Circuit)

29 F.2d 975 (1929)

PUBLIC INDUSTRIALS CORPORATION v. READING HARDWARE CO.

No. 3835.

Circuit Court of Appeals, Third Circuit.

January 4, 1929.

Frederick H. Wood, of New York City, and William Clarke Mason, of Philadelphia, Pa. (Bruce Bromley, of New York City, and Colin C. Ives, of Louisville, Ky., of counsel), for appellant.

Cyrus G. Derr and H. F. Kantner, both of Reading, Pa., and Owen J. Roberts, of Philadelphia, Pa., for appellee.

Before BUFFINGTON and WOOLLEY, Circuit Judges, and THOMSON, District Judge.

THOMSON, District Judge.

In a contract for the sale of its property by the Reading Hardware Company to the Public Industrials Corporation, plaintiff below and appellant here, for the sum of $3,900,000, $300,000 was deposited by the plaintiff with the Penn Trust Company of Reading, Pa., to be forfeited to the defendant as liquidated damages in case of plaintiff's breach of the contract, or to be credited on the purchase price if the contract was consummated. This amount was paid to the defendant on plaintiff's failure to close the contract on the dates stipulated for closing.

This suit was brought by plaintiff to recover said sum of $300,000 on the ground that defendant had breached the contract, and therefore that plaintiff was entitled to recover back the money. A verdict being rendered for the defendant, judgment was entered thereon, from which judgment this appeal was taken.

All the material issues of fact were fairly submitted to the jury, and in the absence of error in the court's submission, the jury's verdict is conclusive. Nor do we find any difficulty on the questions of law involved.

The contract of sale was clear in its terms, and the rights of the parties plainly defined. Time was definitely made of the essence of the contract, and the closing of the contract was in no event to be later than April 1, 1926. The facts, which are undisputed, together with the clear weight of the evidence on all controverted questions, show conclusively that the vendor was at all times ready, willing, and able to carry out its contract in good faith, while the purchaser was clearly resorting to subterfuge in its endeavor to extend the time of closing beyond the period designated in the contract. This was plainly due to its inability to finance the purchase.

The condition of the vendor's property as of the date of the contract, as shown by the balance sheets and the income statements, was as represented by the vendor, as well as the net current assets and cash on hand at the date of closing. Any failure to inventory the property, or any lack of a certificate from an appraisal company, was solely chargeable to the plaintiff, as they were its agents specially designated, and for their dereliction the defendant is in no sense answerable.

The verdict of the jury and the law applicable to the facts show that the defendant tendered a marketable title for the property. The five mortgages on portions of the vendor's property at Reading, Pa., the last being dated in 1869, had long since lost their lien through legal presumption of payment. Not only were the mortgages considered as a debt...