Court Opinion

ID: 6584563
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:41:20.221398+00
Date Added: 2024-06-11T15:57:25.086400
License: Public Domain

TYLER, J.
It is found that the debt of $64,000 due J. De Rivera & Co. from the partnership called the Poultney Slate Works, was valid and represented the entire cost of the plant, and that when the corporation was formed it assumed the payment of the debt. H. C. De Rivera caused the eighteen notes to be discounted from time to time by the plaintiff and gave the corporation credit for the several amounts, though they were insufficient to pay the entire debt by about $10,000, and the plaintiff gave De Rivera & Co. credit for the amounts on its bank account. These transactions were known and approved by all the stockholders of the corporation. The plaintiff discounted the notes in good faith and in the regular course of business, and H. C. De Rivera subsequently drew from the plaintiff for his firm all the money so credited to it. The firm failed in July, 1886, and the corporation was adjudged insolvent the following month. All the notes were duly protested.
The same facts are found in respect to the other three notes, excepting that the plaintiff held them as collateral security for a loan made by the plaintiff to J. De Rivera & *34Co. for a much larger sum than the amount of the notes. The debt was never paid and the three notes were protested for non-payment.
Neither the referee’s report nor the defendant’s brief discloses a defence to the suit. The plant, property and business of the partnership, Poultney Slate Works, were conveyed to the corporation to pay for the capital stock that was issued, and were the consideration for the corporation assuming the debt of the partnership to J. De Rivera & Co. The fact that the plaintiff knew that H. C. De Rivera was treasurer of the corporation and the main partner and financial manager of the affairs of the New York firm did not affect the validity of the notes, nor is it a defence for the corporation or its assignee in insolvency that no meeting of the stockholders or directors is shown to have been held.

Judgment affirmed.