Vice Chancellor denies Globe Pottery creditors claim mortgage bonds should not be used to purchase property

CHANCERY DECISION

AGAINST WILLIAMS

Vice Chancellor Edwin Robert Walker today filed in Chancery a memorandum in the application of William H. Williams, John Cochran, George Cochran and David Allen for leave to use mortgage bonds of theirs as part of the purchase price for the property of the Globe Pottery Company at Bordentown in which he denies the petitioners claim to relief in the present status of the case. He holds that if they have a fair question to try out in the litigation it is the court's duty to compel them to sue with the receiver Charles B. Case for the offset which they claim the mortgage bonds constitute to the extent of $50,000.

Answering this contention the petitioners assert that the fraudulently issued stock has never been transferred and that they are not considered stockholders with reference to that issue. The Vice Chancellor does not support this view and says it is at least a fair question which has not been decided in this state as to whether or not in equity they are to be regarded as holders of the stock and liable to respond to creditors. The court also says that it is but fair to the petioners to say that they have been quilty of no intentional wrong doing and have perpetuated no actual fraud but that they appear to be the victims of an unfortunate train of circumstances yet Chancery at this time cannot relieve them.