Tiffany v. La Plume Condensed Milk Co.

• Decision Date: 20 October 1905
• Docket Number: 589.
• Citation: 141 F. 444
• Parties: TIFFANY v. LA PLUME CONDENSED MILK CO.
• Court: U.S. District Court — Middle District of Pennsylvania

141 F. 444

TIFFANY v. LA PLUME CONDENSED MILK CO.

No. 589.

United States District Court, M.D. Pennsylvania.

October 20, 1905

T. J Davies, W. N. Leach, and R. W. Rymer, for petitioner.

C. A Van Wormer, for respondent.

ARCHBALD District Judge.

The controversy here is one of jurisdiction. The respondent, a New Jersey corporation, denies by its plea that it has had its principal place of business within the district for the greater portion of six months preceding the institution of these proceedings, as averred in the petition, and as is essential; there being no claim of residence or domicile. Bankr. Act July 1, 1898, c. 541, Sec. 2(1), 30 Stat. 454 (U.S. Comp. St. 1901, p. 3420). The evidence shows that while incorporated under the laws of New Jersey-- and, in order to comply with them, having a nominal office at Camden in that state--the company was engaged in the business of manufacturing and selling condensed milk at La Plume and at Brooklyn, Pa., in this district, from the early part of 1903 up to October 6, 1904, when its plant at the latter place was destroyed by fire; that at the other having been sold the previous January. It also had during the same period a central office at Scranton, from which the management of the company was directed; the whole of its corporate business having been conducted in these three places. The fire however, broke up what was left of its manufacturing business, which was not afterwards resumed. But it still retained its central office at Scranton, and from it, through its treasurer as its executive officer, with the assistance of a regularly employed stenographer, proceeded to settle up its affairs. An adjustment of the insurance was secured amounting to some $14,000, a considerable portion of which was not paid until the latter part of November; the relics of the fire were disposed of; accounts aggregating about $5,000 were collected in, the money received from these several sources being deposited in a local bank; and sundry bills which were due were compromised and paid. The manager of the burned condensary was also retained until the middle of November, and a man put in charge of what was left of the property for some two months after that. This was the situation on February 2, 1905, when the present petition was filed; the debts due to the petitioning creditors having been incurred in the course of its condensing business.

There can be no question upon this showing as to the principal place of business of the company being within the district, not only for the greater part, but the whole, of the six months necessary to give jurisdiction. In re Marine Machine Co., 1 Am.Bankr.Rep. 421, 91 F. 630; In re Brice, 2 Am.Bankr.Rep. 197, 93 F. 942; In re Elmira Steel Co., 5 Am.Bankr.Rep. 484; Dressel v. North State Lumber Co., 5 Am.Bankr.Rep. 744, 107 F. 255; In re Mackey, 6 Am.Bankr.Rep. 577, 110 F. 355; In re Magid-Hope Silk Co., 6 Am.Bankr.Rep. 610, 110 F. 352. The fact is that (not counting the nominal office at Camden, N.J.) not only the principal part, but substantially the whole, of its business was conducted here. It is contended, however, that after October 6th, the date of the fire, it was engaged in nothing but liquidation, which is not the doing of business within the meaning of the law, the business required to be done, either by a corporation or an individual, in order to give jurisdiction, being none other than that by which either is made liable to bankruptcy, and that, the respondent here having been out of such business for nearly four months of the six next preceding the filing of the petition, the court has no jurisdiction over it, and the proceedings cannot be maintained.

The question involved in this contention is not altogether a new one, although the particular form which it assumes here may be. (QUOTE OMITTED) as it is said in Heylor v. Hall Palmer, 325 (1619-1629), (QUOTE OMITTED) (It was agreed that if one engages in traffic and thereby becomes indebted, and afterwards abandons his trade and lives in the country without any trade, but upon his gains, and conceals it from his creditors, yet is he a bankrupt, because he lives by means of the trade out of which the debt grew). In line with this, in Meggott v. Mills, 12 Mod. 159, s.c. Ld. Raym, 286, a person exercising the trade of a victualer, in which he was liable to bankruptcy, contracted a debt, and subsequently quit the trade and became an innkeeper, after which he committed an act of bankruptcy, and it was held that, though a man quit his trade, he may be bankrupt for the debts that he owed before. And in Ex parte Bamford, 15 Vesey, 449, Lord Eldon declared that a commission in bankruptcy could be sustained beyond doubt by an act of bankruptcy committed after retiring from trade; the debts contracted during trade remaining unpaid. To the same effect are Dale v. Holsworth, Peake, 64, Doe ex dem. v. Hayward, 2 Car.& Payne, 134, and Bailie v. Grant, 9 Bing. 121; it being stated in the latter case by Tindal, C.J., that the point was settled. It seems to have been carried one step further, or at least a new form given to it, in Ex parte Griffiths, 3 De g.,M.& G. 174, where it was said by Knight Bruce, L.J.; 'A trader, who, after having become indebted, leaves off trade, is not to be heard to say to his creditor that the trading has been left off, if a question arises whether the debtor can or cannot be, as a trader, made bankrupt. ' And Lord Alverstone, C.J., in re Worsley, 1 K.B. (1901) 309, similarly declares that, so long as a debtor does not pay the debts which he contracted while engaged in trade, he is to be regarded as still so engaged. The doctrine of these cases was adopted and applied in this country, in Everett v. Derby, 5 Law Rep. 225, Fed. Cas. No. 4,576, a case arising under the bankruptcy act of 1841. It was there objected that the respondent was not liable to bankruptcy, not being at the time of the alleged acts, nor at the time of the filing of the petition a merchant actually using the trade of merchandise, nor yet a...