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CLEVELAND WRECKING CO. v. FDIC

August 16, 1946

CLEVELAND WRECKING CO. OF CINCINNATI
v.
FEDERAL DEPOSIT INS. CORPORATION



The opinion of the court was delivered by: KALODNER

This action was brought by the plaintiff, a Delaware corporation duly authorized to do business in Pennsylvania, against the Federal Deposit Insurance Corporation, an instrumentality of the United States, to recover damages for breach of an agreement of sale.

The cause having come on to be heard before the Court without a jury, after consideration of the pleadings and the evidence, I make the following

 Findings of Fact

 1. The plaintiff, Cleveland Wrecking Company of Cincinnati, at all times material herein was, and is, a corporation organized under the laws of Delaware, and duly registered and authorized to do business in Pennsylvania.

 2. The defendant, Federal Deposit Insurance Corporation, at all times material herein, was, and is, a corporation of the United States, duly created by Act of Congress, June 16, 1933, 48 Stat. 168, as amended, 12 U.S.C.A. § 264 et seq.

 3. At all times herein material, the defendant, Federal Deposit Insurance Corporation, owned a tract of land in the Borough of Emmaus, Lehigh County, Pennsylvania, known as the 'Crumwold Furnace Property,' which it had acquired in the course of liquidation of the Emaus National Bank, a national bank located at Emmaus, Lehigh County, Pennsylvania.

 4. At all times herein material, there was situated on the 'Crumwold Furnace Property' a steel frame building formerly used as a caste house in connection with furnace operations.

 5. The 'Crumwold Furnace Property' was subject to tax liens of the Borough of Emmaus, the School District of Emmaus, and the County of Lehigh, in a total amount in excess of $ 2500.

 6. At all times herein material, the defendant was represented by one Edward S. Appel, Liquidator, who had direct supervision over the assets of the Emmaus National Bank, in liquidation.

 7. On or about December 31, 1942, the plaintiff, acting by its agent and general superintendent, one I. M. Sogg, verbally proposed to Edward S. Appel, to purchase from the defendant the cast house located on the Crumwold Furnace Property, for the sum of $ 500, free clear of all encumbrances, the plaintiff to dismantle and remove said building from the premises without further cost to the defendant.

 8. Appel told Sogg that the Federal Deposit Insurance Corporation did not warrant or guarantee title; that there were certain tax liens existing against the 'Crumwold Furnace Property'; that he could not give a bill of sale for the cast house unless the tax liens were cleared off; that his authority was limited to submitting the offer together with his recommendation to the Main Office, and that if 'they' approved of the sale, he would endeavor to effect a settlement, by compromise, with the taxing authorities.

 9. It was understood that the plaintiff was not to pay the taxes, but that defendant would take care of the taxes. Appel intended to pay the tax arrears out of the proceeds of the sale.

 10. Sogg delivered to Appel a deposit in the amount of $ 100 and received a receipt therefor.

 11. Appel contacted the solicitor for the Borough of Emmaus with a view to compromising the tax liens. The solicitor for the Borough agreed to take twenty-five percent of the purchase price. Appel was under the impression that he had settled all the tax liens, but in fact he had settled only the claim of the Borough. He did not communicate to Sogg the conversation he had with the solicitor of the Borough.

 12. Sometime between December 31, 1942, and April 3, 1943, Appel told Sogg, in a telephone conversation, that 'We have got everything cleared off now,' but that he had better increase his offer. In compliance with the request, the offer was increased to $ 610, the terms and conditions of the agreement to remain the same.

 13. The statement that everything is cleared off, tended to induce the plaintiff to purchase the cast house, and plaintiff relied upon the statement.

 14. On April 3, 1943, Appel wrote to Sogg stating that he was authorized to accept the offer for the purchase of the cast house, and that Sogg could set a date to take delivery.

 15. On April 15, 1943, Sogg and Appel met, and Sogg gave Appel a check to the order of defendant dated April 14, 1943 in the amount of $ 510. Sogg executed ...


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