173 F. 445 | 1st Cir. | 1909
On April 9, 1909, Connell and others filed a petition in involuntary bankruptcy against the Concord Motor Car Company, a corporation established under the laws of Massachusetts, “to manufacture, purchase, sell, hire, lease, and operate automobiles, motor boats, and motor engines, and, further, to act as general or special agent of any individual, company, or corporation now or hereafter engaged in the manufacture and sale of automobiles, motor boats, and motor engines.” Cate and others, being creditors of the respondent, duly intervened to resist the petition, and among other defenses set up that the respondent was not at the time of filing the petition engaged principally in manufacturing, trading, printing, publishing, or mercantile pursuits, within the meaning of the bankruptcy act (Act July 1, 1898, c. 541, 30 Stat. 544 [U. S. Comp. St. 1901, p. 3418]). The case was referred to the referee, under rule 12 of the General Orders in Bankruptcy (32 C. C. A. xvi, 89 Fed. vii), to ascertain the facts and report on the question of adjudication.
“’JLTiat at least 75 per cent, of its [tlie respondent’s! business consisted in repairing automobiles and furnishing supplies of all sorts for them, and that, making such repairs and furnishing such supplies were its principal and foremost business.”
He therefore decreed an adjudication.
The respondent’s business, as stated in its charter, included some pursuits which are within and others which are without the operation of the bankruptcy act. We are here concerned, not with the broad limits of the' respondent’s charter, but with the nature of its business actually transacted at or about the time the petition in bankruptcy was filed. In re Kingston Realty Co., 160 Fed. 445, 87 C. C. A. 406; In re Quimby Co. (D. C.) 121 Fed. 139, s. c. on appeal 126 Fed. 167, 61 C. C. A. 111. Tne petitioners do not contend that the operation of the garage, pure and simple, is a pursuit within the purview of section 4 of the bankruptcy act. The referee and the learned judge of the District Court have agreed in finding that repairs and supplies constituted at least 75 per cent, of- the respondent’s business. Neither of them discriminates by any finding concerning the respective proportions of these two kinds of business, and we find no evidence in the record which enables us to separate the two. The objecting creditors do not deny that the furnishing of supplies is a trading pursuit, and so within the purview of section 4; but, inasmuch as there is no evidence that the furnishing of supplies alone constituted the principal part of the defendant’s business, the petitioners, in order to maintain their case, must show that the repairing, as well as the supplying of automobiles, as carried on by the respondent, is within the purview of the bankruptcy act. To support their contention the petitioners do not rely upon any word in section 4 except “manufacturing,” and so the decision of the case is made to turn upon the answer to this question: Was the repairing of automobiles, as performed by the respondent, a manufacturing pursuit ?
The words descriptive of the various pursuits which bring a corporation within the scope of the bankruptcy act are words in common use,
The decree of the District Court is reversed, the case is remanded to that court, with instructions to dismiss the petition with costs, and the appellants recover their costs of appeal.
NOTE. — Tlie following is the opinion of Dodge, District Judge, in the court below:
According to tlie petition in this case tlie alleged bankrupt is a corporation “engaged principally in manufacturing and tradiug automobiles.” According to the answer which is filed, not by the alleged bankrupt, but by a firm which claims to be its creditor for. insurance premiums, it was not at the filing of Ihe petition a corporation engaged principally either in manufacturing, trading, or mercantile pursuits, and therefore not within section 4 of the bankruptcy act (Act July 1, 1808, c. 541, 30 Stat. 547 [U. 8. Comp. St. 1901, p. 34231).
The evidence is that on or about January 1, 1908. the corporation had practically ceased tlie purchase and sale of automobites; an agency under which it had previously dealt in them having been wound up. From January 1, 1008, to tlie filing of the petition on April 9, 1909, it “operated a garage,” by which is meant that it stored automobiles, cared for them, and furnished them with gasoline and oil. Had the mere storage and care of automobiles been tlie principal business carried on during the period referred to, ilie analogy of the decisions which hold livery and boarding stables not within section 4 would no doubt require me to hold this corporation not subject to adjudication, Re H. J. Quinby Co. (D. C.) 121 Fed. 139; Id., 126 Fed. 167, 61 C. C. A. 111 ; Gallagher v. De Lancey Co. (D. C.) 158 Fed. 381. But the referee has found, and I see no reason in the evidence for disagreeing with him. that, besides operating a garage, the alleged bankrupt, during the same period, carried on a machine shop at its plací1 of business; that at least 75 per cent, of its business consisted in repairing automobiles and furnishing supplies of all sorts for them; and that making such repairs and furnishing such supplies were its principal and foremost business. This, 1 think, is sufficient to bring it within section 4b.
The only act of bankruptcy charged is a general assignment. An instrument purporting to he a general assignment such as the petition describes was executed by J. E. Saveli, tlie alleged bankrupt’s president and treasurer, in its name, and was acknowledged by him to be its free act and deed. There had been a vote of the directors that (his assignment he made, and Saveli he authorized to sign (he necessary papers as president and treasurer. The re
Adjudication ordered.