Guardian Trust & Deposit Co. v. Greensboro Water Supply Co.

Citations

• 115 F. 184
• 1902 U.S. App. LEXIS 4918

Syllabus

<p>1. Corporation — Priority of Lien as between Mortgage and Judgment-North Carolina Statute.</p> <p>The statute of North Carolina (Code, §§ 697, 698) provides that, where all the property of a corporation shall be sold and conveyed under a mortgage, the corporation shall ipso facto be dissolved, and the purchaser shall be a new corporation, succeeding to all the franchises and charged with all the duties of the old, except the payment of its debts. The property of a water company was sold on foreclosure of a second mortgage, and, under an arrangement between all parties in interest, including the first mortgage bondholders, was bought by a new corporation, which assumed payment of the first mortgage, and also assumed performance of a contract between the old company and the city for the furnishing of water for a term of years. Held that, so far as the rights of the bondholders of the old company were concerned, the new company was but a continuation of the old, and that a judgment against the new company for a tortious injury to property arising from its negligent performance of the duties imposed on it by its contract with the city, which by statute was made superior to the lien of a mortgage upon its property, was equally as effective against such bondholders as though their mortgage had been executed by the new company.</p> <p>8. Same — Judgment in Tort.</p> <p>A property owner whose property was injured by fire by. reason of the negligence of a water company in failing to supply water for fire purposes, as it was obliged to do by a contract with the city, as well as by the duty imposed on it by law as a quasi public corporation which had received valuable franchises from the city, granted for the purpose of seeming a water supply for fire protection as well as for private use, may sue such company either in contract or tort, at his election; and a judgment recovered in such an action, which expressly recites that it is “for the tortious injury and damage done h