EDISON ELECTRIC LIGHT CO.
(Oircuit Court, 'D. N8'IJJ J6'I'861/. January 10,
CORPORATIONS-:-CONSOLIDATIO'N__A:OTIONs__ABATEMENT AND ' REVIVAL.
Act N. Y. May 22, 1884, 867, p. 448,) authorizing the "consolo .1datiQllof manufacturingoorporath>us, "provides that no action to which the old co.\Cporation was a party, ,shall be abated by reason of sucb consolidation pending. suit, but that shall proceed as if the consolidation had not tll;ken place; or.that the new corporation shall be substituted by order of court. , l!eld, on motion to dismiss a bill filed by a corporation subseqwmtly consolid.a'ted on ,t,be ground that 1'Iaintiff's corporate existence was by the cOIlsolidation, and that a bill of review was necessary under equity rule 56, 'Bl1d on counter-motion to substitute the consolidated corporatIOn: that the " suit did not abate, the proviljions of the New York statute being binding upon ",) the federal courts, and that the latter motion should prevail.,
R. W., Doer, J. a. Tomlinson,ahd a. A. Seward, for cotllplainant. 'L. E. Ourtis, S. A. Duncan and W. Bakewell, for respondents·. , . , t
WKt.ES, J.' The bill in this cause wl;'tsflled on the 22d day of December, 1886, and contains the ustial allegations of infringement by the defendants; On the 4th of Aptil;1'887,the defendants filed a plea and alls'i'er"setting up various defenses, but not denying infringement. A repliciatititi W.as duly filed, and upon the record thus far the defendants are conced-edinfringers. The defendants now move H that the bill of complaint herein be dismissed,for the reason that the corporate existence ot the corporatioll complainanthereiti terminated on orabout the 31st day of December, 1886, bya consoJidation and merger ofthesaid complainant with the Edison Compahy for Isolated Lighting, by virtue ofcertain proceedings had under the laws of the state of New York." The laws cited are contained in the statute ofNew York of the 22d of May, 1884, known as chapter 367 of the laws of that, year. The' defendants insist that by the act of consolidation the complainant company ceased to exist, and that, therefore, as in the case'of the death of a natural person, penderl.telite, the 'suit abated, and' it is necessary that the proper parties, whoever they may be, should be substituted to carryon the suit, under the provisions of equity rule 56' of the supreme court. Under the New York statlite it appears that there is no termination of the existence,or a dissolution of the complainant in to actions, in which it was a: party, pending at the time of thecotlsolidation. The provision relating to this matter is in these words: .. Arid no sllch'action or-other proceeding then pending before any court or tribunal In which any corporation that may be so consolidated is a party '" ... '" shall be deemed to have abated or been discontinued by reason of any such consolidation, but the same may be prosecuted to final judgment in the same manner as if the said corporation had not entered into the said a!(reement of consolidation; or the said new corporation may be substituted as a party in the place of any corporation so consolidated, as aforesaid, with any other corpo, ration or corporations, and forming such new corporation by order of the court in which such action, suit, or proceeding may be pending."
On motion to !Hsmiss bill.
The defendants, however, intei'pose the objection that the provision just cited is for the government oithe New York courts alone, and car>. have no control over the equity practice in the federal courts. On such examination as we have given to the matter and to the authorities cited in the briefs of counsel, we cannot assent to this view. No good reason has been assigned, nor does there appear to be any, why this court should not recognize the statutory provision of New York, and apply it to the pending suit between these parties. The question would seem to involve som.ethingmore than a mere rule of practice; it embraces the legal and equitable rights of the plaintiff under the laws of the state which create,d it, and, pres,cribed the terms and .conditions on which it might be consolida'ted with onear more corporations of the same state. In Banking .,Co.y.Georgin" 92U. S. 665" it was held that the of. two companie!> does not reasonably work a dissolution of both, and thecreationoh neW corporation. 'Whether such beits effect dependsnpon the intent manifested in the statute under whicq the consolidation takes place. Andso, in Bank v. Colby, 21 Wall, 614, the suprem.e court of the United States recognizes the doctrine that the' existence of corporation, whose chartered life had come to an end by forfeiture'qf. Gharter, or lapse of time, may be prolonged by statute for the purpose of conducting pending suits to judgment; nor was the idea anyWhere entertained in that case, as intimated by counsel, that it.,would make any difference whether the corporation had Peen created ,by,nn.act of congress or by the law of a state legislature. Hthe statute of New York WaS o( any or policy of the United States, r pJ;:lere would .· be'substantialgrounds for allowing this motion; but it has does it appellrto be, objectionable in this, to dismiss, .the bill is therefore and the motiqn on bebalf'of the ,cOIioplainant, founded on the defendants' to company as complainal1t, is granted, althc;lligh substitute there w041d El to. be no valid objeption to prosecuting the suit/lsit em now stands of as the act authorizing the consolidationlJermits either CQurse to b.6 taken. .
«(Jireutt Court. E.D. Mtaaourt, N. D. March 5,1888.)
PRINCIPAL Jl,.1Q'D AGENT'S GtJARANTIilR.
OF AGENCY-A:LTERATION-RIGBTS OF " . ' . '.
A'contract of agency in writing provided that the agent was to conduct 11 lumber·yard for the principals. they to supply him with stock, which he' was to sell; for "cash in all cllses." K. indorsed this agreell:l(mt. the ."due performance" by the agent "of his obligations iIkthe above contract. " Shortly after. the yard was opened, the agent hegan on credit. and continued to do 86 for several years; when he defaulted:' The principals not only knew of these sales, but they warned the agent "to be cautious in giving credit." and told him "to watch his book·,accountsi 'al1d<Ii'eep