Blake v. Foreman Bros. Banking Co.

CARPENTER, District Judge (after stating the facts as above). [1] Considering the pertinent questions as if all of the corporations involved were incorporated in states other than Illinois, I am of the opinion that stock certificates such as are described in the bill in this case, when properly indorsed and delivered as security to a resident trustee, with power of sale in case of default in the trust agreement, are property within the definition of section 57 of the Judicial Code, conferring jurisdiction upon this court. Such stock certificates were intended as property, endowed with all the characteristics of property, and regarded as such by the parties and by the business community. I agree fully with the reasoning of the court in Simpson v. Jersey City Contracting Co., 165 N. Y. 193, 58 N. E. 896, 55 L. R. A. 796, and Merritt v. American Steel Barge Co., 79 Fed. 228, 24 C. C. A. 530. The case of Chase v. Wetzlar, 225 U. S. 79, 32 Sup. Ct. 659, 56 L. Ed. 990, does not announce a contrary rule. [2] The clause in the contract which permits an assignment of the contract to a New York corporation having a capital stock of $250,-000 I believe indicated an intention of the parties to allow the transfer only to a corporation which had its capital stock of $250,000 actually paid in, or for the payment of which some responsible person was liable. Otherwise, the assignment clause in the contract would seem foolish. [3] As to the requirement in section 57 of the Judicial Code as to service of the warning order upon the trustee: It is not necessary that such service be made, where the trustee is within the jurisdiction of the court and duly served with a subpoena to appear, as was done in this case. [4] The Western Theaters Limited Company is not made a party to the bill. This I regard as a fatal defect. The Theaters Company is an indispensable party. It may be thoroughly responsible and interested in the execution of the contract, and may desire to make the payments and accept the benefits of it. The motion to dismiss, therefore, must prevail, and the bill will be dismissed, with leave to the complainants, if they see fit, to amend the bill within 30 days; and it is so ordered.