John Deere Plow Co. v. McDavid

Citations

• 137 F. 802
• 70 C.C.A. 422
• 1905 U.S. App. LEXIS 4205

Syllabus

<p>1. Contracts—Construction—Conditional Sales—Agency.</p> <p>Claimant contracted to consign goods to a bankrupt according to schedules and certain requests of the bankrupt, which agreed to pay transportation charges, furnish warehouse room, pay taxes, licenses, and rents, keep the goods insured, and be personally liable for any damage to goods while in its custody, to make all reasonable efforts to sell the goods, not to sell other makes to the exclusion of goods consigned under thé contract, and to sell for enough more than the net schedule prices to pay freight, taxes, expenses, charges, and commission for handling and selling the goods, which should be the difference between the net amounts and the gross amounts received from the sales. The contract expressly provided as to what warranties should be given, and entitled claimant to require the goods to be returned. The bankrupt ordered goods under this contract, agreeing to pay therefor in par funds or give notes, and agreed that the title and ownership of all goods should remain in the claimant, which should be subject to its order until paid for. Held, that the contract was one of agency, and not a contract of conditional sale.</p> <p>[Ed. Note.—For cases in point, see vol. 43, Cent. Dig. Sales, § 1335.]</p> <p>2. Same—Preferred Claims—Trust Funds.</p> <p>Where a bankrupt improperly mingled funds belonging to its principal with its own funds, and it was not shown that the trust funds, either in their original or a substituted form, came into the hands of the bankrupt’s trustee, the principal was not entitled to a preference therefor.</p> <p>[Ed. Note.—For cases in point, see vol. 6, Cent. Dig. Bankruptcy, § 539.]</p> <p>3. Federal Courts—Rule of Decision.</p> <p>Whether a creditor of a bankrupt is entitled to a preference on the ground that the claim is based on the bankrupt’s misappropriation of a trust fund, does not depend on- the construction of the contract between the parties, but on a rule of preference