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MERRIMACK MFG. CO. v. BERGMAN

August 22, 1957

MERRIMACK MANUFACTURING COMPANY, Plaintiff,
v.
Sid BERGMAN and Sam Bergman, doing business under the fictitious name and style of 'Little Bitty', Star Novelty Company, Inc.; and Louis Kohn, Samuel Wulwick, Gene Kohn and Julie Bass, doing business as co-partners under the Fictitious name and style of 'Star Novelty Co.', Defendants



The opinion of the court was delivered by: LEVET

The defendant partnership, Star Novelty Co., has moved for summary judgment. Plaintiff, Merrimack Manufacturing Company, has made a cross-motion for summary judgment and for attorney's fees and has moved to dismiss the counterclaims, denials and affirmative defenses of the defendants. The basic issue is the ownership of 72 cases of fabric now in plaintiff's mill in Massachusetts. The action arises under Title 28 U.S.C.A. §§ 1335 and 2361, as amended (Federal Interpleader Act); the amount in controversy is of a value of approximately $ 10,000. The fundamental question is whether a seller under conditions hereinafter described has a right of stoppage in transitu.

For the purpose of this motion the plaintiff, a Massachusetts corporation, will hereinafter be referred to as Merrimack; the defendants Sid Bergman and Sam Bergman, doing business in Pennsylvania under the name and style of 'Little Bitty,' as 'Bitty'; Star Novelty Company, Inc., a New York Corporation, as 'Star,' and Louis Kohn, Samuel Wulwick, Gene Kohn and Julie Bass, doing business in New York under the name and style of 'Star Novelty Co.,' as 'Star Novelty.'

 The conceded facts as hereby found by me are as follows:

 1. On or about October 1, 1956, Merrimack, a manufacturer of textile fabrics, sold certain 72 cases of fabric to Bitty. Bitty paid Merrimack on or about October 15, 1957.

 2. Bitty thereafter, on or about October 9, 1956, sold the 72 cases to Sid Silverman, Inc. (not a party to this action), hereinafter known as 'Silverman.' The invoices are dated October 12, 1956 at Philadelphia.

 3. On or about October 9, 1956, Bitty notified Merrimack to transfer 55 cases of the goods to Silverman. On October 10, 1956, Merrimack acknowledged the instructions to Bitty and stated: 'We are to accept shipping instructions from Sid Silverman, Inc.'

 4. On or about October 22, 1956, Bitty notified Merrimack to transfer the balance to Silverman. On October 24, 1956, Merrimack acknowledged the instructions to Bitty with a copy to Silverman.

 5. By letter dated October 10, 1956, Silverman directed Merrimack to transfer 55 cases to Star and to accept their shipping instructions. Star Novelty Co., Inc. is also referred to as Star Novelty Co.

 6. Pursuant to a letter dated October 22, 1956, Silverman directed the transfer of the balance, 17 cases, to Star Novelty Co., Inc., also referred to in the letter as Star Novelty Co., and on October 31, 1956, Merrimack acknowledged that it held all these 72 cases for Star.

 7. Thus, Merrimack sold and transferred title to Bitty, Bitty sold and transferred to Silverman, and Silverman sold and transferred title to Star.

 8. Payments were made by parties involved as follows:

 (a) Bitty paid Merrimack;

 (b) Silverman ultimately paid Bitty. Silverman's check for $ 10,509.40 is dated October 26, 1956 and appears to have cleared on October 29, 1956, and Silverman's check for $ 5,293.69 is dated December 31, 1956 and was cleared on January 4, 1957;

 (c) Star Novelty (the partnership) paid Silverman by checks to a factor on October 12, 1956, January 15, 1957 and January 28, 1957. Accordingly, Star Novelty (the partnership) as purchaser of the goods is the real ...


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