The Federal Reporter with Key-Number Annotations, Volume 250: Cases Argued and Determined in the Circuit Courts of Appeals and District Courts of the United States, August-October, 1918. Page: 742
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250 FEDERAL REPORTER
TEXAS CO. v. INTERNATIONAL & G. N. RY. CO. et aL
(Circuit Court of Appeals, Fifth Circuit. March 15, 1918.)
No. 3090.
1. RECEIVERS =163---LABORB AND SUPPLIES-CLAIMS---INTEREST.
Where receivers were appointed at the suit of second mortgage bond-
holders, and the net income from the operation of the road by receivers
would have been sufficient to have paid supply claimants, with interest
had no payments been made on the first mortgage bonds and upon equip-
ment, the supply claimants are entitled to payment, with interest.
2. SALEs e=85(1)---CONTRArrTS-IMPLIED CONDITION.
A contract to supply a railroad company with fuel oil contains no im-
plied condition that it should be canceled in event a receiver is appointed
for the company.
3. CONTRACTS 4=10(4)-MUTUALITY.
Where a railroad company, which had contracted for the purchase of
fuel oil, became insolvent, and receivers were appointed, the fact that the
seller could not, after the company's default, be required to furnish oil
without payment, does not destroy the mutuality in the contract, so as to
prevent the seller from recovering for the breach.
4. RECEIVERS 90-RIGHTS OF--CoNTINUATION OF CONTRACT.
When a receiver is appointed, he has the right to confirm and carry
out those contracts which are advantageous to the insolvent; hence such
contracts continue, despite the receivership, for otherwise the receiver
would not be given the option.
5. SALES =384(1)-BREACH OF SALE CONTRACT--DAMAGES.
Where a railroad company, which had contracted for the purchase of
fuel oil, went into the hands of a receiver, and the receiver canceled the
oil contract, and thereafter bought from the seller oil at a less sum, the
difference between the contract price and the price paid by the receiver
cannot be accepted as fixing the measure of recovery for the breach, but it
should be measured by the market value of the oil.
Foster. District Judge, dissenting.
Appeal from the District Court of the United States for the South-
ern District of Texas; Waller T. Burns, Judge.
Bill by the Central Trust Company of New York against the Inter-
national & Great Northern Railway Company and others, in which the
Texas Company intervened. From the decree on its intervening peti-
tion, intervener appeals. Reversed and remanded.
See, also, 237 Fed. 921, 150 C. C. A. 571.
Robert A. John, of Houston, Tex., and Amos L. Beaty, of New
York City (T. J. Lawhon, of Houston, Tex., on the brief), for ap-
pellant.
William H. Wilson, H. M. Garwood, and Jesse Andrews, all of
Houston, Tex. (Joline, Larkin & Rathbone, of New York City, and
Baker, Botts, Parker & Garwood and Wilson, Dabney & King, all of
Houston, Tex., on the brief), for appellees.
Before WALKER and BATTS, Circuit Judges, and FOSTER, Dis-
trict Judge.
4=For other cases see same tooic & KEY-NUMBER in all Key-Numbered Digests & Indexes
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The Federal Reporter with Key-Number Annotations, Volume 250: Cases Argued and Determined in the Circuit Courts of Appeals and District Courts of the United States, August-October, 1918., legislative document, 1918; Saint Paul, Minnesota. (https://digital.library.unt.edu/ark:/67531/metadc38821/m1/757/: accessed March 28, 2024), University of North Texas Libraries, UNT Digital Library, https://digital.library.unt.edu; crediting UNT Libraries Government Documents Department.