Case ID: nc_190/html/0494-01.html
Source: Caselaw Access Project
Author: {"author": "AdaMS, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

FAIRLEY BROTHERS v. J. A. ABERNATHY, Receiver.
    (Filed 18 November, 1925.)
    Removal of Causes — Transfer of Causes — Injunction—Equity—Personal Property — Statutes.
    Where injunctive relief is sought in a suit against the receiver of a corporation from the sale of cotton and manufactured products therefrom, and the delivery of the cotton and goods to the plaintiff, the nature of the action will be determined from the relation of the parties, their agreement upon the subject-matter of the -suit, and the allegations of the complaint, and it appearing therefrom that the relief sought is not the recovery of the debt or to enjoin a sale, but tbe recovery of tbe specific personal property witb tbe injunctive restraint as an incident thereto, tbe cause is properly removable to tbe Superior Court of tbe county, under our statute, where tbe personal property is situated. C. S., 463.
    Appeal by plaintiff from an order of McMroy, J., made at August Term, 1925, of tbe Superior Court of UNION, removing tbe cause to GaSTON.
    On 15 April, 1925, tbe defendant was appointed receiver of tbe McLean Manufacturing Company, a corporation theretofore doing business in Gaston County. In May, 1925, tbe plaintiffs brought suit against tbe defendant and filed their “petition and complaint,” in which they alleged that they were tbe owners of certain stock in process of manufacture by tbe McLean Manufacturing Company, consisting of sixty bales of cotton partially manufactured into cloth; that said property was in tbe possession of tbe defendant who was wrongfully undertaking to sell it; that a sale of it would cause irreparable injury and damage to tbe plaintiffs and that it was necessary for tbe protection of their rights that tbe defendant should be enjoined from making tbe sale.
    Tbe basis of tbe plaintiff’s claim is a written agreement made on 2 April,. 1925, between themselves and tbe McLean Manufacturing Company, and A. A. McLean, Jr., tbe material parts of which follow:
    “Whereas, on or about 12, 16, and II March, 1925, tbe party of tbe first part purchased of tbe parties of tbe second part a total of 60 bales of cotton for tbe total sum of $7,551.35, to be paid for by said McLean Manufacturing Company out of tbe proceeds of sales of goods manufactured therefrom, and title to said cotton or goods therefrom manufactured to be or remain in said Fairley Brothers until tbe purchase price of said cotton was paid, and,
    “Whereas, tbe said sum has not been paid and McLean Manufacturing Company, is indebted to Fairley Brothers in tbe sum of $7,551.35, witb interest on same from 12 March, 1925, and said cotton is now in process of manufacture in tbe plant of McLean Manufacturing Company, tbe said cotton being now identified and identifiable as all cotton in process of manufacture in machinery in said plant or in finished goods now in tbe plant manufactured therefrom, and it is agreed that same is tbe property of Fairley Brothers:
    “Now in order to protect tbe rights of Fairley Brothers, tbe parties hereto do agree as follows:
    “1. Fairley Brothers will not take steps to put McLean Manufacturing Company in tbe bands of receivers if and so long as McLean Manufacturing Company performs its part of this agreement.
    “2. McLean Manufacturing Company bolds all goods in process of manufacture hereinbefore referred to, and A. A. McLean, Jr., individually bolds same witb McLean Manufacturing Company in trust for Fairley Brothers as tbeir agent or consignee or trustee or bailee for the purpose of completing manufacture of same and safely keeping same and delivering finished product of same to Fairley Brothers or their order. It is agreed that McLean Manufacturing Company and A. A. McLean, Jr., will immediately furnish Fairley Brothers, or their representatives, with itemized statement of poundage, yardage, stage of manufacture and present location in the plant of the McLean Manufacturing Company of the 60 bales of cotton held by them for Fairley Brothers.
    “3. If and when from proceeds of manufacture, or sale of manufactured products, McLean Manufacturing Company or A. A. McLean, Jr., both shall pay Fairley Brothers, or Fairley Brothers shall receive from same the value of their cotton, namely $7,551.35, with interest as aforesaid, and expenses connected with supervision of manufacture and disposition of same, as well as any other items of. expense necessarily connected with this manufacture, this agreement is to be null and void, otherwise to remain in full force and effect.
    
      “á. McLean Manufacturing Company and A. A. McLean, Jr., covenant, agree and represent as an inducement to obtain the extension of indulgence from F air ley Brothers that:
    “1. The cotton in process of manufacture is free of all claims or liens except the title to Fairley Brothers.
    “2. That McLean Manufacturing Company and A. A. McLean, Jr., will not suffer any claims or liens to and against same and will faithfully hold same in trust for Fairley Brothers.”
    The plaintiffs further alleged that in pursuance of this agreement the Manufacturing Company and A. A. McLean, Jr., undertook to manufacture the cotton under the terms of the contract and 'had it distributed throughout the plant in course of manufacture and that it was impossible to remove it -from the machinery until the process of manufacturing it was completed; that the receiver is experienced in the operation of cotton mills, controlling the machinery necessary to complete the manufacture of the cotton as the contract provides.
    The relief prayed for is a restraining order (which was granted) and a decree requiring the receiver to complete the manufacture of the cotton into cloth and to deliver the manufactured product to the plaintiffs.
    Before the time for filing an answer had expired the defendant made a formal motion before the clerk (Laws 1921, Ex. Ses., ch. 92, sec. 1, 15) to remove this cause to Gaston County in which the Manufacturing Company has its place of business, and on appeal to the Superior Court the motion was allowed and the plaintiff excepted and' appealed.
    
      
      Vann & MilliTcin for plaintiffs.
    
    
      C. A. Jones and A. L. Quichel for defendant.
    
   AdaMS, J.

Actions for tbe recovery of personal property must-be tried in tbe county in wbieb tbe subject of tbe action, or some part thereof is situated, subject to tbe power of tbe court to change tbe place of trial in tbe cases provided by law. C. S., 463. Was tbe present action brought for tbe recovery of personal property within tbe meaning of this section ? Tbe defendant contends that it was; but tbe plaintiffs say that it was brought to enforce the' specific performance of a contract relating to personal property. Tbe nature of tbe action must be determined by tbe relation of tbe parties, their agreement, and tbe allegations in tbe complaint. Tbe contract which is dated 2 April, 1925, recites a previous sale by tbe plaintiffs (12, 16, 17 March, 1925) of sixty bales of cotton to tbe McLean Manufacturing Company, at tbe price of $7,551.35, to be paid out of proceeds to be derived from tbe sale of goods manufactured from tbe cotton, — tbe title of tbe cotton or of tbe manufactured articles to remain in tbe plaintiffs until tbe contract price was paid. In consequence of tbe manufacturing company’s failure to pay tbe price tbe parties agreed that tbe company and A. A. McLean, Jr., should bold tbe goods in process of manufacture in trust for tbe plaintiffs as their agent or consignee or trustee or bailee, for tbe purpose of completing tbe manufacture of tbe cotton into cloth and delivering tbe finished product to tbe plaintiffs or their order. Tbe relief prayed is that tbe receiver comply with tbe contract and deliver to tbe plaintiffs not tbe cotton “raw” or “partially manufactured,” but tbe cloth as tbe manufactured product. Tbe manufacture of the cotton must of course precede tbe delivery of tbe cloth; but to convert tbe raw material into cloth is only an incident in carrying out tbe main purpose of tbe contract and granting tbe chief relief demanded in tbe complaint, namely, tbe recovery of tbe cloth. If tbe cloth shall not be delivered tbe plaintiffs will not have tbe relief they ask. It is immaterial whether tbe relation between tbe parties is that of principal and agent or consignor and consignee or trustor and trustee or bailor and bailee. Their manifest purpose was to secure tbe plaintiffs by making them tbe beneficial owners of “all goods” whether manufactured or in tbe process of manufacture; and tbe plaintiffs, relying upon this claim, seek to recover tbe actual possession of tbe article in its manufactured state. Tbe manufacturing company and A. A. McLean, Jr., are alleged to be insolvent; and tbe relief sought is not tbe recovery of tbe debt and a sale of tbe property as incidental thereto, as in Piano Co. v. Newell, 177 N. C., 533, and similar cases, but tbe recovery of specific personal property, with injunctive restraint as an incident of tbe recovery. It seems to be unquestionable tbat tbis is tbe chief if not tbe sole purpose of tbe action. Tbe entire subject-matter is in Gaston County, and tbe venue, as Judge McElroy held, is fixed by C. S., 463 (4). There are several cases in which tbe apposite principle is discussed and tbe decisions are distinguished. Woodard v. Sauls, 134 N. C., 274; Brown v. Cogdell, 136 N. C., 32; Edgerton v. Games, 142 N. C., 223; Clow v. McNeill, 167 N. C., 212; Mfg. Co. v. Brower, 105 N. C., 440.

Tbe judgment is

Affirmed.