Central Trust Co. of New York v. Ashville Land Co.

72 F. 361, 18 C.C.A. 590, 1896 U.S. App. LEXIS 1712
CourtCourt of Appeals for the Sixth Circuit
DecidedMarch 3, 1896
DocketNo. 342
StatusPublished
Cited by2 cases

This text of 72 F. 361 (Central Trust Co. of New York v. Ashville Land Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Central Trust Co. of New York v. Ashville Land Co., 72 F. 361, 18 C.C.A. 590, 1896 U.S. App. LEXIS 1712 (6th Cir. 1896).

Opinion

LURTON, Circuit Judge.

The Central Trust Company of New York, trustee under a mortgage made by the American Association, Limited, an English corporation owning lands in Tennessee, [362]*362filed its foreclosure bill in tbe circuit court of the United States for the Eastern district of Tennessee. Subsequently Henry Hol-brook Curtis filed an independent bill in the same court for the purpose of winding up the affairs of the American Association, Limited, as an insolTent corporation. Receivers were appointed, the property of the corporation placed in their possession, and the two causes consolidated. The Ashville Land Company, a corporation of the state of Tennessee, and the county of Claiborne, one of the counties of the state of Tennessee, became parties by intervention, for the purpose of asserting claims against the American Association, Limited^ Each of these interveners obtained decrees, from which appeals were allowed to" this court. The claim of the Ashville Land Company, as presented by its intervening petition, was that it was the owner of lands in Tennessee upon which the American Association, Limited, had trespassed by cutting and removing timber to the value of about $2,000, and thqt its claim for damages had, by agreement between the two corporations, been submitted for arbitration to one John M. Brooks, who assessed the damages at the sum of $1,933.71, which sum the American Association, Limited (hereafter called the "English Company”), had not paid, although it had accepted the award, and promised to pay the sum thus awarded. The English Company denied the trespass, denied the authority of its agent to submit the matter to arbitration, and denied any agreement to pay the award of the arbitrator. It also set up a claim for money paid for and on account of the Ashville Land Company, amounting to $600, and pleaded this by way of offset. The issues thus presented were referred to D. A. Caut as special master, to take proof, and report his conclusions of law and fact. The special master reported that the claim of the Ashville Land Company had been submitted to the arbitration of John M. Brooks, through the action of A. A. Arthur, general manager and representative in Tennessee of the English Company, and that the arbitrator had found that the English Company was liable, by reason of the trespass mentioned, to pay the sum of $1,933.71. He further reported that this award had been ratified by the directors of said English Company. He found in favor of the set-off claimed by the latter company, and that, after crediting same, there was due $1,462.86, with interest from'May 28, 1892, and that this sum was entitled to priority over the mortgage to the Central Trust Company by virtue of priority in date and the statute of Tennessee giving preference to domestic creditors out of the assets of foreign corporations doing business within the state. The exceptions filed to this report were overruled, and a decree rendered accordingly.

The errors assigned involve two questions. First. The authority of A. A. Arthur, as an officer of the English corporation, to submit the claim of the Ashville Land Company against the English Company to arbitration. Second. If his authority was insufficient, then has his act in excess of Ms agency been ratified by the corporation?

[363]*363Arthur's position is designated as that of “general manager.” Whether iiis duties and powers were defined by any by-law of the company does not appear, though no such office or officer is mentioned in its clur ter. The company whose agent he was, in respect of such matters as were properly within the scope of a “general manager,” was, as before stated, an English corporation managed by a board of directors from its principal office in London. Its charter powers were very wide, and contemplated the conduct of a varied business in America. It had authority to buy, own, and sell lands, lay off and build up towns, engage in iron and steel making, railroad building, and generally to do all that pertains to a town-building, mining, manufacturing, and land-speculating company. Arthur was its chief representative in America, where these varied enterprises were to be chiefly conducted. A power of attorney was given him of limited character, and evidently intended as only partially defining his powers, for it relates alone to his power to make sales of town lots or parcels of land, lay off roads, streets, etc. It is, however, difficult, on this record, to say that he had authority, by reason of either the recorded power of attorney or the general and undefined powers of a general manager, to submit a claim against his corporation to arbitration, without express authority from the directors. This it is unnecessary', however, to decide, for we are clearly of opinion that if he exceeded his powers in signing the articles of submission his act was subsequently affirmed by his directors. He did, while its representative in America, and while exercising the authority of a general manager, enter into an agreement with the appellee for an arbitration of a matter in dispute between the two corporations, and that the award should be final. After the award was made, it, Together with the submission, and a statement of the circumstances made out by his assistant, was forwarded to the company at its London office, which thus became apprised of the action of its general manager, and of (he result. That the company had the power to sujbmit such a claim to arbitration, or to authorize Arthur, in his discretion, to do so, is not questioned. The most that can be said is that he, as general manager, exceeded his power in doing so under the constitution and by-laws of the corporation. If the company so regarded this agreement, it was its undoubted duty, upon being apprised that he had made this submission, to in a reasonable time disaffirm his act, and notify the Ashville Land Company of its disapproval. Failing to do this within reasonable time, a ratification mav be presumed. Indianapolis Rolling-Mill v. St. Louis, Ft. S. & W. R., 120 U. S. 256, 7 Sup. Ct. 542; Pittsburgh, C. & St. L. Ry. Co. v. Keokuk & H. Bridge Co., 131 U. S. 371, 9 Sup. Ct. 770. The evidence submitted not only fails to show such disaffirmance within a reasonable time, but tends strongly to establish that his action was affirmed. The correspondence between the London office and the American office, and between the latter and the Ashville Company, seems to establish that the directors sought to offset the award by the assertion of [364]*364counterclaims, or to pay the award, provided they could recoup from certain persons to whom it had sold timber from its own lands, and who were supposed to be the real trespassers or beneficiaries of the trespass. Under the circumstances, the company was called upon, when apprised of the agreement to submit to arbitration, to distinctly repudiate the agreement, and give notice accordingly. This it did not do, and the assertion of counterclaims was by no means a disaffirmance, but was such conduct as justifies a presumption that it affirmed the submission. The decree in favor of the appellee must be affirmed.

The petition of the county of Claiborne asserted that the English Company was liable for the privilege tax assessed in 1890, 1891, 1892, and 1893 for county purposes, for exercising the privileges of a land-stock company within that county.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Pettengill v. Blackman
164 P. 358 (Idaho Supreme Court, 1917)
Price v. Peeples
1917 OK 146 (Supreme Court of Oklahoma, 1917)

Cite This Page — Counsel Stack

Bluebook (online)
72 F. 361, 18 C.C.A. 590, 1896 U.S. App. LEXIS 1712, Counsel Stack Legal Research, https://law.counselstack.com/opinion/central-trust-co-of-new-york-v-ashville-land-co-ca6-1896.