In re Friend

278 F. 153 | 2d Cir. | 1921

HOUGH, Circuit Judge

(after stating the facts as above). [1] The question presented is raised both by an appeal and a petition to revise. But the matter before the District Court was in effect an assertion by the vendors of a right to property in the possession of the court’s representative in the bankruptcy; it was an endeavor by a third party to take something away from the estate in bankruptcy. Consequently the appeal taken is proper under In re Prudential, etc., Co. (C. C. A.) 270 Fed. 469, and the petition to revise is not proper.

[2] The fact that in the written agreement above recited but two Friends are named as the partners constituting the firm is quite immaterial. It is admitted that in ordinary parlance the bankrupt firm is the same firm as made agreement with the appellants; non constat but that the two women were subsequently admitted; but, even if that be not true, the sale was to a firm, and the agreement was with a firm, and that firm is now the bankrupt firm.

[3] All the transactions above referred to took place in New York, and if summarily states the difficulty in appellant’s position to say that the entire contract upon which appellant relies is a wholly unsuccess-iul attempt to evade sections 134-137 of the Personal Property Paw (Consol. Paws, c. 41) of this state. Statute in effect September 1, 1911 (Paws 1911, c. 571).

Jly section 134 the unpaid seller of goods has the “right to retain them for the price while he is in possession of them.” This is the vendor's lien which appellants exercised and to which they had good right. But section 137 declares that the “unpaid seller of goods loses bis lien thereon * * * (b) when the buyer or his agent lawfully obtains possession of the goods.”

Nowhere in this record is it asserted that at any of the times mentioned the vendors appellants had title to die goods or owned the goods. They rest upon the proposition that their vendor’s lien was by specific agreement kept alive and permitted to affect, not only the goods themselves while in possession of the bankrupt vendees, but the proceeds of those goods as far as such proceeds can be traced.

There was no record made of this agreement. It is a rather naive instance of an attempted secret lien. There is no secrecy about a vendor’s lien when he is in possession of that upon which the lien exists; and possession is sometimes a very technical word. But here there is no pretense of possession, and it is of the essence of appellant’s posi-lion that, although the buyer lawfully obtained possession of the goods, yet nevertheless by secret agreement between vendors and vendee the lien was continued, and continued by this secret agreement.

This is flying in the face of the act; it is the sort of thing the statute is designed to prevent, and in so doing the act is in accord with the spirit of nearly all modern legislation. No multiplication of words can disguise the repugnancy of this transaction to the statute.

The petition to revise is dismissed, without costs, and the order appealed from is affirmed, with costs.