by John Marshall Harlan

“ However meritorious the claim of the Lackawanna company may be as between it and the railroad company, we cannot, by reason of anything appearing in the record, impair or displace the liens of mortgage creditors for its benefit. Under all the circumstances, including the amount of the debt and the long period of credit, the claims in question must be regarded as general, unsecured debts not contracted in the ordinary course of business and with the expectation of the parties that they were to be met out of current receipts in preference to claims of mortgage creditors. ”

“ Then there is the circumstance that the Lackawanna company, during the negotiations resulting in the execution of renewal notes under the second contract for rails, demanded and received collateral security to a large amount from the railroad company-a circumstance tending to show that it did not regard itself as entitled to an equitable claim upon net earnings in preference to mortgage creditors, but relied upon the general credit of the railroad company. ”

“ Besides, the rails in question were delivered long before the railroad company had made any default in the payment of interest; about sixteen months before the company's property was put into the hands of a receiver, and about five and a half years before the appointment of a receiver in this cause. ”