There is practically no dispute between the parties with respect to the facts in this ease. It appears] that the American Overseas Warehouse Company ix a corporation organized under the laws of the State of Delaware, and for sometime Prior to the appointment of the assignee herein, was engaged in carrying on and conducting, among other things, a warehouse business the city of Tientsin, China; that ts business dealings and transac-us said warehouse company was closely affiliated with a company) known as the Union Trading Company, which Ist named company] was engaged in conducting in said city of Tientsin-the exporter and importer on a rather extensive scale. It further appears that carly in the month of July,
house Company had outstanding godown warrants, or warehouse receipts, calling for the delivery of more than a million bags of flour of various brands. When, therefore, the plaintiffs in this action presented their godown warrants and demanded delivery of the flour supposed to be stored with the warchouse company, it was immediately ascertained that there had been colossal failure, and that frauds of an astounding nature had been perpetrated upon those persons avho had been doing a storage business with the warehouse company. It was ascertained that the warchouse'company had in its godowns, or ware. houses, only about 91,656 bags of flour of various brands, whereas it should have had, if its' officers and agents had been conducting a legitimate and proper business, approxi mately 1,156,000 bags of flour.
The Assignec's Problem When, therefore, the assignee o August 1, 1927, took possession o the' godowns and property of the warehouse company, he was cor: fronted with the problem of return-if to claimants all personal proper. ty which belonged to them, and which the American Oversens Warehouse Company did not have title The assignee found in the warehouses of the company only 91,666 bags of flour. These plaintits ime mediately presented to him warehouse receipts, or godown warrants, calling for the delivery of 996,000 bags of flour of various brands, and the National City Bank of New York. presented to him six certain documents which the assignee has construed as standing upon the same footing as warehouse receipts, and runtier which the bank claimed that it was entitled to receive 161,000 bags of flour of various brands, By the consent of all parties concerned the 91,606 bags of flour were sold by the assignee for Mex, $300,486.86, and he thereupon in the month of January, 1928, devised the plan referred to in the complaint for the distribution of such proceeds, less his expenses, to the various claimants holding godown receipts, which plan included the National City Bank of New York as one of the claimants. The only question presented in this case is whether the National City rik of New York is entitled to participate in its proportionate share to these monies in necordanco with the plan proposed by the assignee.
Precise Nature of Transaction It the various instruments in ing held by the National City Bank, and under which it asserts title to 161,000 bags of flour in the godown of th Overseas Warehouse Company, were of the same char acter, or the legal equivalent, of the srehouse receipts held by the plain-'s herein, there would manifestly he no controversy as to the right of the bank to participate along with these plaintiffs in the disposition and distribution of these funds by the assignee. It is the contention of counsel for the assignee in behalf of the bank, that, while these six instruments held by the bank, evidene~ ing title to 161,000 hases of flour, are different in form from the warehouse receipts held by the plaintiff, that in legal effect they are equivalent to warehouse receipts und must be construed us such by the Court in determining the right of the bank to participate in the distribution of the funds. It there. fore becomes necessary to examine somewhat closely and critically the precise nature of the transaction which the bank became invested with title to certain bags of flour supposed to have been deposited in the godowns of the Overseas Warehouse Company.
The Rights of the Parties The judgment then goes on to analyze the documents in question, and concludes:
It may be that the principles of law governing the rights of parties participate in the allotment and distribution of fungible goods not be applied by the assignee in this cease with complete accuracy, for the reagan that he is attempting to distribute " particular fund instead of the property itself. Tt will be remembered that the flour was sold by the assignee with the consent of all the parties claiming an interest therein. If the flour had been sold by the assignee in lots of the various brands found in the warehouse and a separate account of such sies and
Text read from the printed page and cleaned; old type leaves the occasional error.