Brum v. Merchants' Mutual Ins.

16 F. 140 | U.S. Circuit Court for the District of Eastern Louisiana | 1883

Pardee, J.

If it (the Home Insurance Company) is bound for the liabilities of the old Home Mutual Insurance Company, then it owes this debt to the libelants, for there is no doubt the partnership styled “The Harbor Protection Company” collected the salvage money, which, under former decisions of this court, belonged to the libelants, and that the Home Mutual Insurance Company was a partner in the Harbor Protection Company, and as such partner was liable for its virile share of the debts of said company.

The evidence with regard to the liquidation of the Home Mutual and the organization of the Home shows that the real fact, stripped of the forms with which the parties surrounded it, was that the assets, business, good-will, and stock in trade — everything which could be relied upon belonging to the Home Mutual to pay and satisfy its outstanding liabilities — went into and constituted the capital and assets of the new Home. Calculations and arrangements were made as to the known liabilities of the old company, and some stockholders in the old company were allowed to withdraw their pro ra,ta value of stock in cash; but the fact remains that the capital of the new company was exclusively made up of what was left of the assets of the old company. I have no doubt that everything was intended and earrried out in the best of faith, and I am inclined to think that if the debts due libelants for salvage moneys had been known that they would have been provided for. As the Home took all the property of the old company, leaving nothing to pay the amounts due libelants, and as it took them, not as creditors, but as owner, it seems clear to me that -it must pay the debts of the old company, at least to the amount of the assets converted. The claim of libelants — being in the nature of one for money had and received — would not bo prescribed under the laws of Louisiana, where tho obligation was created, and is one that ought not to be considered stale in an admiralty court.

The district judge held that tho libelants were entitled to recover, and I concur in his judgment in this case. In the view I take of the facts, I do not find it necessary to pursue the line of reasoning showing the liability of the defendants, because of the distribution made by the Harbor Protection Company to the Home Mutual, and the responsibility of the Home because of the identity of its officers, stockholders, etc., with the old Home Mutual.

Let a decree be entered in favor of libelants in the same terms as that of the district court, and for all costs.