Tilford v. Atlantic Match Co.

• Decision Date: 18 February 1905
• Citation: 134 F. 924
• Court: U.S. District Court — District of New Jersey
• Parties: TILFORD v. ATLANTIC MATCH CO.

134 F. 924

TILFORD v. ATLANTIC MATCH CO.

United States Circuit Court, D. New Jersey.

February 18, 1905

Edwin G. Adams, for receiver of National Match Company.

Thomas B. Harned, for Champion Construction Company.

Lindabury Depue & Faulks, for receivers of Atlantic Match Company.

LANNING District Judge.

This matter comes before the court upon an application to determine the validity of the respective claims of the receiver of the National Match Company, of the Champion Construction Company, and of the receivers of the Atlantic Match Company to the sum of $869, being part of the proceeds of the sale of the boiler hereinafter mentioned. The facts are as follows: On August 15, 1900, the Atlantic Match Company, a corporation of New Jersey, executed to the Real Estate Loan & Trust Company of Camden, N.J., as trustee, a mortgage to secure $1,000,000 of its bonds. The mortgage covered all real and personal property owned by the company at the date of its execution, and all real and personal property that it might thereafter at any time acquire. It was duly recorded on October 9, 1900, both as a real estate mortgage and as a chattel mortgage. In August, 1901, the National Match Company, also a corporation of New Jersey acquired all of the capital stock of the Atlantic Match Company except five shares standing in the names of the latter company's directors. The Atlantic Match Company had a plant and factory in operation, but the National Match Company never owned any plant or factory. On October 8, 1901 the Stirling Company submitted to the Atlantic Match Company a written proposal as follows:

'Phila., Pa., Oct. 8, 1901.

'For and in consideration of the hereinafter named amount we propose to furnish to Atlantic Match Company, Philadelphia, Pa., 250 horse power water tube boiler (here follow specifications) to be delivered f.o.b. cars Camden, New Jersey, for the sum of $2793, one-third to be paid when contract is accepted, one-third on delivery of certain documents, balance when boiler is erected ready for brick-work, final payment to be guaranteed as understood when contract is completed.

'This proposal will be void if not accepted within thirty days. All previous communications between the parties hereto either verbal or in writing are hereby abrogated and this proposal shall constitute a contract. Any modifications in this proposal must be in writing and attached hereto. We assume no liability for damages on account of delays. The title and right of possession to the material we furnish remains in the Stirling Company until the same has been fully paid for in cash.

'The Stirling Company, 'By James Meily, 'Fisher.'

On November 11, 1901, the president of the Atlantic Match Company was also president of the National Match Company, and certain other persons, being directors of the Atlantic Match Company, were also directors of the National Match Company, and F. C. Eaton was then the vice president and general manager of both companies. On that day-- November 11, 1901-- F. C. Eaton indorsed on the above proposal the following acceptance:

'Nov. 11, 1901.

'The Stirling Company, Chicago, Ill.-- Gentlemen: We hereby accept the foregoing proposition. Name required on front, National Match Co. Description of fuel to be used, Soft Coal and Wood Shavings. Date to be delivered, Dec. 1st, 1901. Shipments to be consigned to Atlantic Match Co., Camden, New Jersey.

'Yours truly,

'National Match Co. 'By F. C. Eaton, Vice-Prest.'

Between November 11, 1901, and July 7, 1902, the exact date not appearing, the Stirling Company delivered upon the premises of the Atlantic Match Company a boiler of the character mentioned in the proposal, and between the same dates the Atlantic Match Company made two payments of $931 each on account of the boiler. The boiler was purchased for the purpose of being permanently installed in the plant of the Atlantic Match Company in lieu of an old and inadequate boiler then in use. On December 31, 1901, the Atlantic Match Company executed and delivered to Thomas W. Synnott its promissory notes to the amount of $91,150, and, as collateral security for the payment thereof, issued and delivered to Synnott 250 of its above-mentioned mortgage bonds, which bonds were the only ones ever issued by the company. These notes, which fell due in six months after their date, were not paid, and subsequent to their maturity Synnott sold them to the Champion Construction Company, which company then came into possession of both the notes and the bonds collateral thereto. On July 7, 1902, the Atlantic Match Company, under an order of this court was put into the hands of receivers. Besides its indebtedness on the notes above mentioned, at the time of the appointment of the receivers it was indebted to general creditors in a sum exceeding $60,000. On September 7, 1902, the National Match Company, under an order of this court, was put into the hands of a receiver. In November, 1902, the Stirling Company demanded payment of the third installment of the purchase price of the above-mentioned boiler, and threatened, if such payment were not made, to take possession of the boiler and forfeit the payments previously made to it. The boiler had never been set up or put into use by the Atlantic Match Company. When the Stirling Company threatened to take possession of it, the receiver of the National Match Company claimed it as the property of that company, the Champion Construction Company claimed that it was subject to the lien of the above-mentioned trust mortgage, and the receivers of the Atlantic Match Company claimed that it was the property of that company. In consequence of these conflicting claims, it was agreed on December 6, 1902, that the boiler should be sold for the sum of $1,800, that out of the proceeds of the sale there should be paid to the Stirling Company the sum of $931 in satisfaction of the third...