Court Opinion

ID: 8633561
Source: CourtListenerOpinion
Date Created: 2022-11-24 19:41:29.103219+00
Date Added: 2024-06-11T16:55:51.249402
License: Public Domain

NELSON, District Judge.
If the notes described in the petition were not given by Lanz in the course of his business as a manufacturer, the petition must fall, and the proceedings be dismissed. The facts in regard to the consideration for the notes and the manner they were executed are undisputed. Lanz, and the payee of the notes, Randall, had dissolved a manufacturing co-partnership, and were winding up their business; the retail stock had been sold, and there remained on hand all the machinery and the unmanufactured stock to quite a large amount. Lanz purchased this at the time of the dissolution, June, 1873, and on a subsequent settlement between the partners. and after an examination of the partnership books, December 13, 1874, gave his notes to Randall for the sum of thirty-five hundred dollars, which amount included the price agreed upon for the latter’s interest in the machinery, etc., and the balance found due upon the books of the firm. The first note was paid, but the other three — two for seven hundred and fifty dollars each, with interest, payable in one year from date, and one for fifteen hundred dollars, with interest, due in two years from date — are unpaid, the latter not due. These notes were transferred by Randall to A. J. Lamberton, one of the petitioning creditors, before maturity, and subsequently two of them were passed by him to the other petitioning creditors.
I do not think, upon the facts thus proved, these notes can be regarded as the commercial paper, within the meaning of the bankrupt law [of 18G7 (14 Stat. 517)] of a manufacturer, issued in the course of his business as such. They were given on the settlement of the copartnership business between the partners, upon a full examination of the firm books, and the consideration was not only the purchase price of one partner’s interest in the machinery, etc., but also all balances appearing against the other partner. The consideration was entirely unconnected with any commercial transaction of a manufacturer, and the notes fall within another class than commercial paper made by a manufacturer in the course of his business as such. Entertaining this view of the case, it is unnecessary to consider the other defences urged. Petition dismissed.