258 F. 688 | D.N.J. | 1919
William Silver & Co., a corporation (hereinafter called the petitioner), has brought here for review the referee’s order denying its petition to recover the value of a car of tomato pulp sold by the receiver of the Arctic Stores, bankrupt. The pulp was originally sold by the petitioner to the Arctic Stores on credit. From the bill of lading it appears that the car of pulp was consigned to the “Arctic Stores, Cussen’s Siding, Marion, New Jersey, f. o. b. Salem, New Jersey.” The car arrived at Marion, and was placed on the siding referred to, before 7 o’clock a. m. on October 18, 1917, at which hour it was seen by the consignee’s chief clerk on his arrival at the consignee’s warehouse. This siding bore the name of the president (Cussen) of the Arctic Stores, and was alongside the latter’s warehouse.
About noon of that day, upon the filing of an involuntary petition in bankruptcy against it, and its written admission of inability to pay
The referee found that both actual and constructive delivery of the pulp had been made to the receiver “before the shipper gave the railroad company notice to stop the goods in transit, and that therefore the petitioner’s notice to the carrier came too late,” and he thereupon made the order here under review. The petitioner seeks a reversal of this order on the ground that the possession of the receiver was not that of either the bankrupt, who, by the adjudication, was bereft of all interest in that property, or of the trustee, who had not yet been appointed, but of the persons who would be ultimately found entitled to the property, and that, as the right of stoppage in transitu was exercised before the appointment of the trustee, it was in time to reinvest the petitioner with the title to, and the right of possession of, the property in question.
The bankruptcy receiver’s taking the pulp out of the car the day following its delivery on the designated siding (an adjudication in bankruptcy having taken place in the meantime) was not a necessary act in order to bring the transportation to an end. Such removal was to release the car for further use and to safeguard the property of the bankrupt, which by the delivery of the day before had become absolute.
The referee could have properly denied the petitioner’s claim on the ground that delivery had been made to the Arctic Stores before bankruptcy had intervened. However, as noted, he based his denial not upon that ground, but upon the ground that delivery had been made to the receiver before the stop notice had been given to the carrier.
The receiver in thus removing the pulp was acting in the line of his duty. He did nothing more than what the Arctic Stores could have done between the time the car was placed on the siding and the time of the filing of the petition in bankruptcy. In thus dealing with the pulp the receiver was not, as petitioner’s counsel claims, taking goods belonging to the petitioner, but property the title to which had vested in the Arctic Stores from the time it was delivered to the carrier f. o. b. the place whence the shipment came, and which had become absolute upon its being placed on the siding referred to.
, To accept petitioner’s contention that there was no one between the time of adjudication and the qualification of the trustee to do any act either on behalf of the bankrupt, who by the adjudication was shorn of all power to do anything in respect to the property but recently subject to its dominion, or of the trustee, who could not be appointed for at least 11 days, and might not be for several months, after.the adjudication,, is to hold that there is a hiatus in the admin-, istration of bankruptcy estates during which certain creditors might secure a preference over other creditors, a bare statement of which is sufficient to reject such contention.
From the foregoing it follows that whether the right of stoppage in transitu be held to have ended on the arrival of the car at its billed destination, or upon the removal of its contents by the receiver, the petitioner’s claim that it is exclusively entitled to the proceeds of the sale of the pulp must be denied, as its notice to stop delivery was not given until after the last of these two acts had taken place.
The referee’s order is affirmed.