While working as a coal shoveler upon the platform of the so-called coal dock, plaintiff was injured, as he alleges, by the giving way of the floor of the platform. He says that the defendant Hutton instructed him to work there, and that it was the duty of Hutton to inspect the platform and keep it in repair. In his affidavit presented upon the hearing of this motion the plaintiff stated that Hutton was the only one in authority there, that Hutton supplied the plaintiff with everything he required, and that he never received anything from any one except Hutton. He also stated that he had reported at one time to Hutton that the crane was out of repair, and that Hutton caused it to be repaired; that at another time plaintiff reported that the platform was out of repair, and that Hutton examined it and caused it to be repaired; and that no one but Hutton ever made any inspection there. Hutton in his affidavit denied that the duty of making an inspection of this platform was imposed upon him. He admitted that the plaintiff had at one time reported it as being out of repair, and that he had given notice to the bridge and engineer department, and that they had repaired it. He said that it was his practice, when he noticed anything out of repair in connection with the yard or the station, to report it to the proper officials, but that it was not his duty so to do. The evidence upon this question as to whether it was or was not the duty of Hutton to inspect this platform does not make so clear a case in favor of the defendants as to indicate that the presentation by the plaintiff of a claim that it was his duty is so unfounded as to be proof of bad faith. It would in fact seem strange if the chief employé in charge of the station was not affirmatively bound by his contract of employment to exercise a general supervision over the station grounds and the appliances used therein, and to report when they were out of repair. The evidence presented by the defendants to the effect that this coal dock and platform were under the charge of the bridge and engineer department and the fuel department is not sufficient to show that the defendant Hutton had no duty in connection with their inspection. The most that can be said in favor of the defendants is that upon the evidence presented it is doubtful whether by the terms of his employment he was or was not charged with the duty of inspecting the platform. That question the plaintiff has a right to have decided in the state court. But it is said by the defendants that, even if the defendant Hutton was charged with the duty of inspecting this platform, the complainant states no cause of action against him, for it alleges only a duty imposed upon him in favor of his employer, the railroad company, and for a breach of that duty by a failure to inspect no cause of action arises in favor of the plaintiff. In other words, for nonfeasance an action lies only in favor of the master, and not in favor of a third person; the theory being that an employé in such cases owes no duty to such third person. This contention presents a question of law, and it must be determined where that question should be decided. Which court has the right to say whether the complaint states a cause of action or not? The case of Alabama Southern Ry. Co. v. Thompson was decided on the principle that the cause of action was what the plaintiff in good faith said it was. If that is true when the question is whether the liability is joint or several, it must be true also when the question is whether the facts alleged show any liability at all on the part of the defendant employé. If the plaintiff in good faith says that they do, the case cannot be removed. So upon this branch of the case, as upon the other, the point to be determined is whether the plaintiff has acted in good faith in asserting that Hutton is liable to him for failure to inspect. An examination of the authorities will show that this is a doubtful question. See the cases cited in the note to Mayer v. Thompson-Hutchison Building Company, from Alabama, reported in 28 L. R. A. 433. A plaintiff, who claims that under such circumstances as appear in this case mere nonfeasance creates a liability in his favor, cannot be said to make such claim in bad faith, even though the court should be of the opinion that the complaint would be held bad on a demurrer presented by the employé. În the Alabama Southern Railway Company Case the court said on page 215 of 200 U. S., on page 163 of 26 Sup. Ct. (50 L. Ed. 441): "And while the Powers Case [169 U. S. 92, 18 Sup. Ct. 264, 42 L. Ed. 673] was decided on the ground of the right to remove after the local defendants had been dismissed from the action by the plaintiff, it is patent from the language just quoted from the opinion that, conceding the misjoinder of causes of action appeared on the face of the petition, that fact was not decisive of the right of the nonresident defendant to remove the action to the federal court." The motion to remand is granted. In re G. & K. TRUNK CO. (District Court, W. D. Pennsylvania. February 28, 1910.) No. 5,029. 1. SALES (§ 454*)-CONDITIONAL SALE-DISTINCTION FROM BAILMENT. A contract for the delivery of showcases, by which title is retained until the price and all costs have been paid, is one of conditional sale, and not of bailment. [Ed. Note. For other cases, see Sales, Cent. Dig. §§ 1324-1334; Dec. Dig. $ 454.* What constitutes a contract of conditional sale, see note to Dunlop v. Mercer, 86 C. C. A. 448.] 2. SALES (§ 472*)-CONDITIONAL SALES-EFFECT AS TO THIRD PERSONS. In Pennsylvania a contract of conditional sale is void as to third persons. [Ed. Note. For other cases, see Sales, Cent. Dig. §§ 1366-1376; Dec. Dig. § 472.*] 3. BANKRUPTCY (§ 140*)-ADMINISTRATION OF ESTATE-TITLE OF TRUSTEE. Where a bankrupt at the commencement of the proceedings is in possession of property under a contract of conditional sale made and to be performed in Pennsylvania, the trustee in bankruptcy, and not the vendor, is entitled to the property. [Ed. Note. For other cases, see Bankruptcy, Dec. Dig. § 140.*] For other cases see same topic & § NUMBER in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes In the matter of the bankruptcy of the G. & K. Trunk Company. Petition by the Diamond Showcase Company to have certain cases declared to be its property. Petition dismissed. Charles A. Locke, for trustee. Roger Knox, for Diamond Showcase Co. M. R. Trauerman, for purchaser. ORR, District Judge. This is a petition of the Diamond Showcase Company to have certain showcases declared to be its property, and to require one who purchased the same from the receiver of the bankrupt to return the same to the petitioner. The showcases were delivered to the bankrupt under the following contract: The Diamond Showcase Co. Main Office and Factory, Cleveland, Ohio. (Town) Pittsburg, Pa., Jan. 25, 1909. The Diamond Showcase Co., Cleveland, Ohio-Gentlemen: Please enter our order for the following described (all glass) showcases, upon the terms, conditions, and at the prices enumerated below, to be set up at our store on or about April 1st, 1909. It is understood that the showcases and fixtures herein proposed to be delivered and furnished are not now in existence, but are to be manufactured in performance of the contract arising on the acceptance hereof, and the same shall remain personal property after erection, and the title thereto shall uot pass to the purchaser until the price and all costs representing the same, or any part thereof, shall have been fully paid. Delivery is subject to delays, strikes, lockouts, fire, or exceptional actions of the elements, and any other causes beyond the control of this company. There are no oral agreements outside this proposal. No lamps furnished. Wires not connected to system at building. Style: 10. Shelves: 10" & 14" P. P. in 6° cases 10" & 14" wood 8° case. Fixtures: Brackets. Backs: Panel birch. German mirrors. Floor: Parquet oak. Doors: Opening 3 doors in 6° cases, 4 doors in 8° cases. Base: 8" Creole, Ga., marble. Electric wiring: Swing electric arms 2 in 6° & 3 in 8°. Moulding: Mahogany inside. Lettering: None. Finish: Floor natural, mahogany on balance. Outside marble measurements: 7 Width 72 Depth 26 Height 42. Price: $646.00. 1 96 X 26 X 42 There is no dating on this bill. 78.00 on delivery. Salesman: H. A. Marble. G. & K. Trunk Co. [Signed] Per J. D. Kabel. The contract was made and was to be performed in Pennsylvania. It is a contract of conditional sale, and not of bailment. See Ott v. Sweatman, 166 Pa. 217, 31 Atl. 102, where many cases are cited and the distinction is carefully drawn between the two classes of contracts. In Stephens v. Gifford, 137 Pa. 219, 20 Atl. 542, 21 Am. St. Rep. 868, Mr. Justice Williams says: "It is of the essence of a contract of bailment that the article bailed is to be returned in its own or some altered form to the bailor, so that he may have his own again." This is quoted with approval in Morgan-Gardner Elec. Co. v. Brown et al., 193 Pa. 351, 44 Ätl. 459. The latter case is quite similar to the case at bar. There the contract provided for the delivery of goods by one person to another, with a retention of the legal title until certain promissory notes given for the goods should be paid, and without a provision for the return of the goods if the notes were not paid. The transaction was held to be a conditional sale, and not a bailment, although the contract was called a lease in the paper itself. From the earliest times in Pennsylvania a contract of conditional sale has been held to be void as to third persons. Ott v. Sweatman, supra. A bona fide pawnee of an iron safe, pawned by the conditional vendee, was protected against the claim of the vendor in Farrell v. Matthews, 1 Phila. 557. A bona fide purchaser of a piano conditionally sold was similarly protected in Dearborn v. Raysor, 132 Pa. 231, 20 Atl. 690. Creditors of a conditional vendee were also protected because, as Judge Rogers said in Rose et al. v. Story, 1 Barr, 190, 44 Am. Dec. 121: "By transferring the possession to the vendee under such a contract, a false credit is given to the vendee, and therefore, in respect of third persons, as he is the apparent, so he is to be considered as the real, owner." Such contracts having been held void as to third persons, the corollary follows that they were good between the parties; and this has given rise to some uncertainty in the decisions since the passage of the bankrupt law. The uncertainty is not wholly limited to the decisions in the federal courts; but an examination of the decisions of the courts of Pennsylvania show that the latter have been busy in determining the rights of creditors of the conditional vendee. The result reached by the courts of that state seems to be that, if the property has been redelivered to the vendor before the rights of creditors attach, the vendor may retain it. Hineman v. Matthews, 138 Pa. 204, 20 Atl. 843, 10 L. R. A. 233. If, however, the possession be still in the conditional vendee when such rights have attached, then the vendor cannot reclaim the goods. That such rights have been so adjudicated because the creditors have issued writs of execution or attachment must not be taken as a reason why such rights may not attach in other ways. In a late case it has been held that a creditors' bill and the appointment of a receiver of a conditional vendee give the receiver the rights of a levying creditor. Duplex Printing Press Co. v. Clipper Publishing Co., 213 Pa. 207, 62 Atl. 841. The reason is that such receiver is vested with authority, not from the debtor, but from the court acting in the interest, and for the enforcement of the rights, of creditors. Now it cannot be pretended that a creditors' bill and the appointment of a receiver in the courts of Pennsylvania can reach farther for the benefit of creditors than the proceedings in bankruptcy and the appointment of a receiver by the District Court. The conclusion is irresistible that, where a petition in bankruptcy has been filed against a conditional vendee, the assets in the hands of the conditional vendee are as much 176 F.-64 within the grasp of creditors as if some creditor had made a levy by virtue of a writ of execution or had attached the same. Under the bankrupt law the rights of all persons with respect to the estate of the bankrupt are fixed as of the date of the filing of the petition. Creditors, therefore, are prevented from seizing the property in the hands of the bankrupt after the filing of the petition, and it would be anomalous to hold that assets which the creditor could have seized if the bankruptcy proceedings had not been begun are to be excluded from, the bankrupt's assets just because a petition may have been filed in this court before the creditor had an opportunity to levy in the state court. It is argued that the case of York Mfg. Company v. Cassell, 201 U. S. 344, 26 Sup. Ct. 481, 50 L. Ed. 782, supports the contrary position. As a matter of fact, in the light of subsequent decisions of the same court, that case merely holds that the rights of parties and third persons with respect to property sold under conditional sales are to be determined by the law of the place of contract, and that decision was arrived at because the rights of parties under a contract of conditional sale in the state of Ohio were different from the rights of parties and third persons under such a contract in the state of Pennsylvania. It is perhaps unfortunate in the case last cited that the meaning could be drawn from the language used that the trustee in bankruptcy stood in the shoes of the bankrupt with respect to property sold conditionally. He does in the state of Ohio. But we have seen he does not in the state of Pennsylvania. He stands in the shoes of the bankrupt, clothed with all the rights which creditors have at the time of the filing of the petition. See Fourth Street National Bank v. Millbourne Mills Co.'s Trustee, 172 Fed. 177, 96 C. C. A. 629, and Security Warehousing Co. v. Hand, 206 U. S. 415, 27 Sup. Ct. 720, 51 L. Ed. 1117. The petitioner in this case has no standing to recover the property, and the petition must be dismissed. FAWKES v. AMERICAN MOTOR CAR SALES CO. (Circuit Court, D. Minnesota, Fourth Division. March 18, 1910.) CORPORATIONS (§ 668*)-FOREIGN CORPORATIONS CIVIL ACTIONS-PROCESSAUTHORITY OR CAPACITY OF PERSON SERVED. Defendant, a New York corporation, with its principal place of business in Ohio, was the exclusive sales agent for certain automobiles. It had no depot or warehouse in Minnesota, and at the time the action was commenced had no property in that state. The summons was served on B., M. B., and S. as defendant's resident agents. B. was defendant's northwestern sales agent, working entirely on commission, with authority only to accept orders from dealers for automobiles, but not to make contracts, all of which were closed direct with defendant and payments made to the factory. M. B. was employed by defendant to travel in the northwestern territory, ascertain from dealers what cars required new parts, to make lists of the parts so required, and send them to the company at its home office, and S. was a mechanic, employed by defendant to repair, or cause to be repaired, all of its automobiles of 1909 model needing or requiring repairs in the city of Minneapolis. Held, that none of such For other cases see same topic & § NUMBER in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes |