Traylor Engineering & Mfg. Co. v. United States Shipping Board Emergency Fleet Corp.

THOMPSON, District Judge. The rule for judgment raises three questions: [1] 1. Is the suit in substance and effect against the United States, and therefore maintainable only in the Court of Claims ? The Supreme Court in .the case of United States v. Strang, 254 U. S. 491, 41 Sup. Ct. 165, 65 L. Ed. —, decided that, notwithstanding all the stock of the United States Shipping Board Emergency Fleet Corporation was owned by the United States, it must be regarded as a separate entity; and it has been held by this court and other federal courts throughout the United States that, where it enters- into contracts, it is suable in tiie same manner as other corporations. 2. Was the contract between the parties one of suretyship or guaranty? It is unnecessary to determine this question upon this rule, unless the following question is answered in the affirmative: [2] 3. Is a contract of guaranty or suretyship within the corporate powers of the United Stales Shipping Board Emergency Fleet Corporation? The general rule is that no corporation has the power to become a guarantor or surety, or otherwise to lend its credit to another person or corporation. Humboldt Mining Co. v. American Manufacturing Co.. 62 Fed. 356, 10 C. C. A. 415; Tod v. Land Co. (C. C.) 57 Fed. 51. [3] There are exceptions to the rule, based upon the statutes under which corporations have been organized, and upon the powers conferred by their charters. Without the charter of the defendant upon the record, this question cannot be answered upon this rule. Rule discharged.