Taylor Co v. Anderson, 114

• Citation: 72 L.Ed. 354,48 S.Ct. 144,275 U.S. 431
• Decision Date: 03 January 1928
• Docket Number: No. 114,114
• Parties: N. & G. TAYLOR CO., Inc., v. ANDERSON et al
• Court: United States Supreme Court

275 U.S. 431

48 S.Ct. 144

72 L.Ed. 354

N. & G. TAYLOR CO., Inc.,

v ANDERSON et al.

No. 114.

Argued Dec. 5, 1927.

Decided Jan. 3, 1928.

Mr. Henry S. Drinker, Jr., of Philadelphia, Pa., for petitioner.

[Argument of Counsel from Pages 432 intentionally omitted] Mr. Hobart P. Young, of Chicago, Ill., for respondents.

[Argument of Counsel from Page 434 intentionally omitted] Mr. Justice BUTLER delivered the opinion of the Court.

N. & G. Taylor Company, a partnership composed of Taylor and Justice, had long been engaged in the manu- facture of tin plate. November 1, 1916, respondents and that partnership entered into a contract by which the former agreed to furnish, in fairly equal monthly quantities, and the latter agreed to take and pay for the fuel oil required by it, estimated at 1,200,000 gallons, for the eight months ending June 30, 1917. On January 31, 1917, the partners caused petitioner to be organized, giving it the name of the partnership with the word 'Incorporated' added. As of February 1, 1917, the corporation assumed the liabilities of the partnership and took over all its property and has since carried on the business.

The petitioner commenced this action in the Northern district of Illinois, Eastern division, March 7, 1918. The declaration alleged an agreement between respondents and petitioner for the delivery of the oil, a breach by respondents, and resulting damage. No reference was made to the partnership, the contract between it and respondents, the subsequent creation of petitioner or its acquisition of the business. At the trial in May, 1924, petitioner by leave of court filed an amended declaration alleging that respondents and the partnership made an agreement for the oil in question; that on February 1, 1917, petitioner became the owner of all the assets of the firm including the agreement and all rights appertaining to it; that respondents failed and refused to deliver the oil either prior to February 1, 1917, to the partnership or afterwards to the petitioner-except approximately 40,000 gallons which was delivered to the partnership-and that thereby petitioner itself and as successor of the firm was subjected to great loss. Section 18 of the Illinois Practice Act (chapter 110, Cahill's Revised Statutes 1927) provides that the assignee of any chose in action not negotiable may sue thereon in his own name, 'and he shall in his pleading on oath, or by his affidavit, where pleading is not required, allege that he is the actual bona fide owner thereof, and set forth how and when he acquired title. * * *' In order to comply with that provision, the petitioner filed the affidavit of its president, stating that on February 1, 1917, it took over the partnership assets including the contract and a right of action against respondents for its breach from the time it went into force to January 31, 1917.

Respondents, by plea to the amended declaration, set up a statute of Illinois (Revised Statutes, c. 83, par. 21) declaring that, when a cause of action has arisen in another state 'and by the laws thereof an action thereon cannot be maintained by reason of the lapse of time, an action thereon shall not be maintained in this state,' and one of Pennsylvania (section 13857, Pennsylvania Statutes) providing that actions on contracts must be commenced within six years from the time the right of action accrued, and alleged that the cause of action arose in Pennsylvania more than six years before the filing of the amended declaration and was barred by the laws of both states. The trial court held that the amended declaration stated a new cause of action and that it was barred, directed a verdict and gave judgment for the respondents. The Circuit Court of Appeals affirmed. 14 F.(2d) 353. This court granted a writ of certiorari. 273 U. S. 681, 47 S. Ct. 237, 71 L. Ed. 837.

Section 18 of the Illinois Practice Act will be applied in the courts of the United States sitting in that state. R. S. § 914 (28 USCA § 724; Comp. St. § 1537); Delaware County v. Diebold Safe Co., 133 U. S. 473, 488, 10 S. Ct. 399, 33 L. Ed. 674. In the absence of such a provision an assignee of a nonnegotiable chose in action could not sue in his own name. Glenn v. Marbury, 145 U. S. 499, 509, 12 S. Ct. 914, 36 L. Ed. 790. The advantage conferred is taken subject to the terms specified, and the assignee must make the required showing in respect of ownership and source of title. It is established by the decisions of the Supreme Court of Illinois that in an action under that section a declaration that does not state that plaintiff is the actual bona fide owner thereof and set forth how and when he acquired title fails to state a cause of action. And it is also held that a cause of action set forth in a declaration amended to comply with that section is barred if the period fixed by the statute of limitations has expired when the amended pleading is filed. Applying the state law, it must be held that the amended declaration set up a new cause of action which was then barred. Gallagher v. Schmidt, 313 Ill. 40, 144 N. E. 319; Allis-Chalmers Mfg. Co. v. Chicago, 297 Ill. 444, 130 N. E. 736.

Petitioner invokes R. S. § 954 (28 USCA § 777; Comp. St. § 1591), providing that any court of the United States may at any time permit either of the...