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Staggers v. Otto Gerdau Co.

decided: April 11, 1966.

JOHN W. STAGGERS, INDIVIDUALLY AND/OR AS ASSIGNEE OF AND/OR ATTORNEY IN FACT FOR YOUNG H. WOOH, DOING BUSINESS UNDER THE FIRM NAME AND STYLE OF OVERSEAS JURISTICAL AGENCIES, ASSIGNEE OF AND/OR ATTORNEY IN FACT FOR KONGSUNG DYESTUFF CO. LTD., PLAINTIFF,
v.
OTTO GERDAU COMPANY, INC., AND SEMBODJA CORPORATION OF NEW YORK, DEFENDANTS-APPELLEES, NEDERLANDSCHE HANDEL-MAATSCH APPIJ N.V. (ALSO KNOWN AS THE NETHERLANDS TRADING SOCIETY), DEFENDANT. RARITAN CHEMICAL CORPORATION, KONGSUNG DYESTUFF CO. LTD. AND HAROLD WENDELL LADY, AS ADMINISTRATOR OF THE ESTATE OF JOHN W. STAGGERS, DECEASED, APPELLANTS



Friendly and Hays, Circuit Judges, and Blumenfeld, District Judge.*fn*

Author: Hays

HAYS, Circuit Judge.

The temptation is strong to dismiss this case as a hopeless imbroglio since a series of egregious errors committed by plaintiff's attorney has so far complicated it that it is almost impossible to put it into shape for a consideration of the merits. The fact remains, however, that the merits have never been reached and for all that appears there may be a valid claim for breach of contract. We believe that one more opportunity ought to be given to straighten out the procedural preliminaries so that a trial on the merits can be had. To that end we reverse the orders of the district court and remand the case for further proceedings.

The case arises out of two contracts entered into in November 1952, between Kongsung Dyestuff Co. Ltd., a Korean corporation, and Otto Gerdau Company, Inc., a New York corporation, for the sale of 19,000 tons of rice. Appellants seek to recover for a loss totaling $380,000 allegedly sustained as a result of appellees' breach of the contracts in 1953.

Although succeeding events have been obscured by alternative and sometimes contradictory positions taken by appellants, the following seems to have occurred:

On September 17, 1956, Kongsung delivered to Overseas Juristical Agencies, a Korean law firm, an instrument designating

" OVERSEAS JURISTICAL AGENCIES * * our true and lawful attorney in fact, for our organization or as individuals, and in our name, place and stead, to demand and institute legal proceedings for collecting and receiving all sums of money which [are] or may become due, owing, payable and belonging or assigned to us or detained for us by any and all persons whatsoever. And, upon receipt thereof, to execute and deliver effectual receipts, releases and discharges therefor."

On March 15, 1957, Overseas delivered to John W. Staggers, an attorney and resident of Maryland, an "Assignment of Claim," which reads in part:

"Whereas Otto Gerdau Company and Sambodja Corporation of New York is indebted to the said assignor in the sum of Three Hundred Eighty Thousand Dollars ($380,000) for and on account of Letters of Credit furnished for the purchasing of rice and whereas the said assignor has agreed to assign the said debt to the said assignee for the sum of One Dollar ($1.00).

Now this indenture witnesseth, that in consideration of the sum of One Dollar ($1.00) paid by the said assignee, the receipt whereof the said assignor hereby acknowledges, they the said assignors, doth [sic] hereby assign to the said assignee the said debt of Three Hundred Eighty Thousand Dollars ($380,000) now owning [sic] to them by the said debtor, and all their right, title and interest both legal and equitable therein." (Emphasis added.)

By the first instrument Overseas received only a general power of attorney, whereas by the second it attempted to convey an "Assignment of Claim." Appellants explain this by directing our attention to a contract between Heu, the president of Kongsung ("A" party), and Wooh, the president of the Far Eastern Trading Co. Inc., and the Chairman of Overseas ("B" party), which was signed on December 8, 1952, and reads in part:

"'A' party promised to operate business with 'B' party as mutual partners for procurement of foreign rice sales of which are sold to the Office of Procurement, ROK, of contracts, dated, November 15th, 1952 for 10,000 metric tons of rice and November 25th 1952 for 9,000 metric tons of rice." (Emphasis added.)

The assignment to Staggers by Wooh, acting as Chairman of Overseas, is assertedly based on this contract. If it is found that Wooh had transferable rights in the contract between Kongsung and appellees, and that he intended to convey his own rights by the assignment, then Staggers must be considered an assignee. An assignee for collection may sue as the real party in interest. See Rosenblum v. Dingfelder, 111 F.2d 406, 407-408 (2d Cir. 1940). The affidavit of Marte Previti, the president of Raritan Chemical Corporation, the New York agent of Kongsung, quotes Wooh as believing that he had conveyed to Staggers a "vested interest in the claim."

On January 8, 1959, Staggers, represented by appellants' present counsel, commenced this action in the Southern District of New York, and indicated his uncertainty ...


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