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Full text of "Federal Reporter (F1), Volume 152"

This volume was donated to LLMC 

to enrich its on-line offerings and 

for purposes of long-term préservation by 

Northwestern University School of Law 



National Reporter System. United States Séries. 



THE 

FEDERAL REPORTER. 



VOLUME 152. 



CASES ARGUED AND DETERMINED 

IN THB 

CIRCUIT COURTS OF APPEALS AND CIRCUIT 

AND DISTRICT COURTS OF THE 

UNITED STATES. 

PERMANr-NT EDITION. 



MAY— JUNE, 1907. 



ST. PAUL: 
WEST PUBLISHING CO. 

1907. 



COPYBIGHT, 1907. 
BV 

WKSï PUBLISHING COMPANY. 



152 F. 



FEDERAL REPORTER, VOLUME 152. 



JUDGES 



OP THE 



UNITED STATES CIRCUIT COURTS OF APFEALS AND THE 
CIRCUIT AND DISTRICT COURTS. 



FIRST CIRCUIT. 



Hon. OLIVER WENDELL HOLMES, Circuit Justice Washington, D. C. 

Hon. LE BARON B, COLT, Circuit Judge Proviclence, "R. I. 

Hon. -WILLIAM L. PUTNAM, Circuit Judge Portland, Me. 

Hon. FRANCIS C. LOWBLL, Circuit Judge Boston, Mass. 

Hon. CLARENCE HALE, District Judge, Maine Portland, Me. 

Hon. FREDERIC DODGE, District Judge, Massachusetts Boston, Mass. 

Hon. EDGAR ALDRICH, Distiict Judge, New Hampshire Littleton, N. H. 

Hon. ARTHUR L. BROWN, District Judge, Rhode Island Providence. R. I. 



SECOND CIRCUIT. 



Hon. RUFUS W. PECKHAM, Circuit Justice Washington, D. C. 

Hon. WILLIAM J. WALLACB, Circuit Judge* Aibany, N, Y. 

Hon. B. HENRY LACOMBB, Circuit Judge New York, N. Y. 

Hon. WILLIAM K. TOWNBEND, Circuit Judge i New Haven, Conn. 

Hon. ALFRED C. COXE, Circuit Judge Utica, N. Y. 

Hon. HENRY G. WARD, Circuit .ludge ^ New York, N. Y. 

Hon. JAMES P. PLATT, District Judge, Connecticut Hartford, Conn. 

Hon. THOMAS L CHATFIELD, District Judge, E. D. New York Brooklyn, N. Y. 

Hon. GEORGE W. RAY, District Judge, N. D. New York Norwich, N. Y. 

Hon. GEORGE B. ADAMS, District Judge, S. D. New York New York, N. Y. 

Hon. GEORGE C. HOLT, District Judge, S. D. New York New York, N. Y. 

Hon. CHARLES M. HOUGH, District Judge, S. D. New York New York, N. Y. 

Hon. JOHN R. HAZEL, District Judge, W. D. New York Bulfalo, N. Y. 

Hon. JAMES L. MARTIN, District Judge, Verniont Brattletoro, Vt. 



THIRD CIRCUIT. 

Hon. WILLIAM H. MOODY, Circuit Justice Washington, D. C, 

Hon. GEORGE M. DALLAS, Circuit Judge Philadelphla, Pa. 

Hon. GEORGE GRAY, Circuit Judge Wllmington, Deli 

Hon. JOSEPH BXJFFINGTON, Circuit Judge Pittsburgh, Pal 

Hon. EDWARD G. BRADFORD, District Judge, Delaware Wllmington, Del. 

Hon, WILLIAM M. LANNING, District Judge, New Jersey Trenton, N. J. 

* Resigned May 8, 1007. " Dled Junê 2, 1907. " Appointefl May 18, 1907, 

(iii) 



iV 152 FEDERAL EBPOETEB. 



Hon. JOSEPH CROSS, District Juflge, New Jersey Ellzabeth, N. J. 

Hou. JOHN B. McPHERSON, District Judge, E. D. Pennsylvanla PhiladelpWa, Fa. 

Hon. JAMES B. HOLLAND, District Judgo, B. D. Penn^ylvania Plilladelphia, Pa. 

Hon. ROBERT WODROW ARCHBALD, District Judge, M. D. Pennsylvanla. .Scranton, Pa. 
Hon. NATHANlELi EWING, District Judge, W. D. Pennsylvanla Plttsburgh, P». 



FOURTH CIRCUIT., 

Hon. MELVILLB W. FULLER, Circuit Justice Washington, D. C. 

Hon. NATHAN GOFF, Circuit Judge Ciarksburg, W. Va, 

Hon. JETER C. PRITCHARD, Circuit Judge , AsbevlIIe, N. C. 

Hon. THOMAS J. MORRIS, District Judge, Maryland Baltimore, Md. 

Hon. THOMAS R. PURNELL, District Judge, E. D. North Carollna Raleigh, N. C. 

Hon. JAMES E. BOYD, District Judge, W. D. North Carolina Greensboro, N. C. 

Hon. WILLIAM H. BRAWLBY, District Judge, B. and W. D. South Car..Charleston, S. 0. 

Hon. EDMUND WADDILL, Jr., District Judge, B. D. Virginia Richmond, Va. 

Hon. HENRY CLAY' McDOWBLL, District Judge, W. D. Virginia Lynchburg, Va. 

Hon. ALSTON G. DAYTON, District Judge, N. D. West Virginia Philippi, W. Va. 

Hon. BENJAMIN F. KELLEE, District Judge, S. D. West Virginia Bramwell, W. Va. 



FIFTH CIRCUIT. 



Hon. EDWARD D. WHITB, Circuit Justice Washington, D. C. 

Hon. DON A. PARDEB, Circuit Judge Atlanta, Qa. 

Hon. A. P. McCORMICK, Circuit Judge Dallas, Tex. 

Hon. DAVID D. SHELBY, Circuit Judge Huntsvllle, Ala. 

Hon. THOMAS G. JONES, District Judge, N. and M. D. Alabama Montgomery, Ala. 

Hon. OSCAR R. HUNDLEY, District Judge, N. D. Alabama Birmingham, Ala. 

Hon. HARRY T. TOULMIN, District Judge, S. D. Alabama Mobile, Ala. 

Hon. CHARLES SWAYNE, District Judge, N. D. Florida Pensacola, Fia. 

Hon. JAMES W. LOCKE, District Judge, S. D. Florida JacksonviUe, Fia. 

Hon. WILLIAM T. NEWMAN, District Judge, N. D. Georgia Atlanta, Ga. 

Hon. BMORY SPEER, District Judge, S. D. Georgia Maçon, Ga. 

Hon. EUGENE D. SAL'NDERS, District Judge, E. D. Louisiana New Orléans, La. 

Hon. ALECK BOARMAN, District Judge, W. D. Louisiana Shreveport, La. 

Hon. HENRY C. NILES, District Judge, N. and S. D. Mississippi Kosciusko, Miss. 

Hon. DAVID B. BRYANT, District Judge, B. D. Texas Sherman, Tex. 

Hon. EDWARD R. MEBK, District Judge, N. D. Texas Dallas, Tex. 

Hon. WALLBR T. BURNS, District Judge, S. D. Texas Houston, Tex. 

Hon. THOMAS S. MAXEY, District Judgo, W. D. Texas Austiu, Tex. 



SIXTH CIRCUIT. 

Hon. JOHN M. HARLAN, Circuit Justice Washington, D. C. 

Hon. HORACE H. LURTON, Circuit Judge NashvlUe, Tenn. 

Hon. HENRY F. SEVERENS, Circuit Judge Kalamazoo, Mlch. 

Hon. JOHN K. RICHARDS, Circuit Judge Cincinnati, Ohio. 

Hon. ANDREW M. J. COCHRAN, District Judge, B. D. Kentucky Maysvllle, Ky. 

Hon. WALTER EVANS, District Judge, W. D. Kentucky Loulsville, Ky. 

Hon. HENRY H. SWAN, District Judge, B. D. Michlgan Détroit, Mlch, 

Hon. LOYAL E. KNAPPEN, District Judge, W. D. Michlgan Grand Raplds, Mich. 

Hon. ROBERT W. TAYLER, District Judge, N. D. Ohio Cleveland, Ohio. 

Hon. ALBERT C. THOMPSON, District Judge, S. D. Ohio Cincinnati, Ohio. 

Hon. JOHN B. SATBR, District Judge, S. D. Ohio Columbus, Ohio. 

Hon. CHARLES D. CLARK, District Judge, E. and M. D. Tennessee Chattanooga, Tenn. 

Hon. JOHN E. MoCALL, District Judge, W. D. Tennessee „ Memphls, Tenn. 



JUDGBS OF THE COURTS. 



SEVENTH CIRCUIT. 

Hon. 'WILLIAM R. DAY, Circuit Justice ■Washington, D. C. 

Hon. PETER S, GROSSCUP, Circuit JuaKe Cliicago, 111. 

Hon. FRANCIS E. BAKER, Circuit Judge Indianapolis, Ind. 

Hon. WILLIAM H. SEAMAN, Circuit Judge Sheboygan, Wis. 

Hon. CHRISTIAN C. KOHLSAAT, Circuit Jud?,'e Chicago, 111. 

Hon. KENBSAW M. LANDIS, District Judge, N. D. Illinois Chicago, 111. 

Hon. SOLOMON H. BKTIIEA, District Judge, N. D. Illinois Chicago, 111. 

Hon. FRANCIS M. WRIGHT, District Judge, E. D. Illincis Urbana, 111. 

Hon. J. OTIS nUMFIIltEY, District Judge, S. D. Illinois Springfleld, 111. 

Hon. ALBERT B. ANDERSON, District Judge, Indiana Indianapolis, Ind. 

Hon. JOSEPH V. QUARLES, District Judge, E. D. Wiscousin IVIilwaukee, Wls. 

Hon. ARTHUR L. SANBORN, District Judge, W. D. Wisconsin Madison, Wis. 



EIGHTH CIRCUIT. 



Hon. DAVID J. BREWER, Circuit Justice Washington, D. C. 

Hon. WALTER H. SANBORN, Circuit Judge St. Paul, Mlnn. 

Hon. WILLIS VAN DBVAXTER, Circuit Judge Cheyenne, Wyo. 

Hon. WILLIAM C. HOOK, Circuit Judge Leavenworth, Kan. 

Hon. ELMER B. ADAMS, Circuit Judge St. Louis, Mo. 

Hon. JACOB TRIEBER, District Judge, E. D. Arkansas Little Rock, Ark. 

Hon. JOHN H. ROUERS, District Judge, W. D. Arkansas Pt. Smith, Ark. 

Hon. ROBERT E. LEWIS, District Judge, Colorado Denver, Colo 

Hon. HENRY THOMAS REED. District Judge, N. D. lowa Cresco, lowa. 

Hon. SMITH McPHERSON, District Judge, S. D. lowa Red Oak, lowa 

Hon. JOHN C. POLLOCK, District Judge, Kansas Topeka, Kan 

Hon. WM. LOCHREN, District Judge, Minnesota Minneapolis, Mlnn. 

Hon. PAGE MORRIS, District Judge, Minnesota Duluth, Minn. 

Hon. DAVID P. DYER, District Judge, E. D. Missouri St. Louis, Mo 

Hon. JOHN F. PHILIPS, District Judge, W. D. Missouri Kansas City, Mo. 

Hon. W. H. MUNGER, District Judge, Nebraska Omaha, Neb. 

Hon. THOMAS C. MUNGER, District Judge, Nebraska Lincoln, Neb 

Hon. CHARLES F. AMIDON, District Judge, North Dakota Fargo, N. D. 

Hon. JOHN E. CARLAND, District Judge, South Dakota Sioux Falls, S. D. 

Hon. JOH.V A. MARSHALL, District Judge, Utah Sait Lake City, Utah 

Hon. JOHN A. RINER, District Judge, Wyoming Cheyenne, Wyo 



NINTH CIRCUIT. 

Hon. JOSEPH McKENNA, Circuit Justice Washington, D. C. 

Hon. WILLIAM B. GILBERT, Circuit Judge Portland, Or 

Hon. WM. W. MORROW, Circuit Judge San Francisco, Cal. 

Hon. BRSKINE M. ROSS, Circuit Judge Los Angeles, Cal. 

Hon. WM. C. VAN FLEET, District Judge, N. D. California San Francisco, Cal. 

Hon. JOHN J. DE HAVEN, District Judge, N. D. California San Francisco, Cal. 

Hon. OLIN WELLBORN, District Judge, S. D. California Los Angeles, Cal. 

Hon. FRANK H. DIBTRICH, District Judge, Haho Pocatello, Idaho. 

Hon. WILLIAM H. HUNT, District Judge, Montana Helena, Mont 

lîon. EDWARD S. PARRINGTON, District Judge, Nevada Carson City, Nev 

Hon. CHARLES B. WOLVERTON, District Judge, Oregon Portland, Or, 

Hon. EDWARD WHITSON, District Judge, E. D. Washington Spokane, Wash. 

Hon. CORNELIUS H. HANFORD, District Judge, W. D. Washington Seattle, Wash. 



CASES REPORTED. 



Faefi 
A. B. r.axter & Co., In re (C. C. A.) ... 13T 
A. B. lîaxter & Co., lu re, two cases (C. 
C. A.) ]41 

Adnii-, T^niteû States v. (D. C.) 7:57 

Adler, In re (C. C. A.) 422 

Agnew, Fidelity & Deposit Co. v. (C. C. A.) IJ.j.j 
Alaska Exploration Co. v. Northern Min. 

& Trading Co. (C. C!. A.) 145 

Albert Lorscli & Co., United States v. (G. 

C.) 591 

American Bonding Co. v. Fiuuev (C. C. 

A.) 107 

American lîonding Co. v. ?iiills (C. C. A.) 107 
American iSralse Slioe & loundry Co. v. 

Railway Materials Co, (C. C. A.) 700 

American Brake Slioe & Foundry Co. v. 

Western Iron & Steel Co. (C. C. A.) 703 

Americnn Min. Co., Ladd Metals Co. v. 

(C. C.) 1008 

Amos-Kichia v. Northwestern Mut. Life 

Ins. Co. fC. CI 102 

Anderson, Stîindai-d Oil Co. v. (C. C. A.). . lîKi 

Anderson v. l.'nitid States (C. C. A.) S7 

Ann .1. Tminer. Tlie (C. ('. A.) 1021 

Ansley Land Co. v. II. Weston Lumber Co. 

(C. C.) S41 

Arts, In re fC. (\ A.) 04."', 

Arts V, Coil"r (C. C. A.) 94:! 

Atlantic Postal Telegniiih Ciiblo Co., 

Georsia R. & Banlsiiis Co. v. (G. C.) 091 

Atwond, Gooill-mder-Koliertson I.uniljci- Co. 

V. (C. G. A.) !)7S 

Avery l'ortahle Lighting Co., Commercial 

Acétylène Co. v. (O. C.) fU-> 

Axman, United States v. (C. C) 810 

Raeliman v. Clvde S. S. Co. (C. G. A.) 4()H 

Eakley, Dillingham v. (C. C. A.) 1022 

Ballantine v. Ballantine (G. C.) 77.i 

Bail & Socl-et Fastener Co. v. Patent Biit- 

ton Co. (C. G.) 187 

Bartliell. Skewis v. (J). G.) ô.'il 

Bartlett v. Farrell (C. G. A.) l.jO 

Bâtes Mach. Co. v. William A. Force & 

Co. (C. C. A 



(V.'A 
137 
1-11 

1021 



il.) 
28() 



Baxter & Co., In re (C. G. A.) 

Baxter & Co.. In re. two cases (G. C. A.). 

Bay Port, ïhe (C. G. A.) 

Beaumont v. Beaumont, two cases (C. G. 

A.) 

Belano. The .T. W. (D. G.) 

Bell, Memphis Gonsol. Gas & Electric Co. 

V. (C. C. A.) 

Bethlehem Iron Go. v. Hoadley (C. G.) 

Bishop Co. V. Dodson (C. C. A.) 

Blake v. Sargent (D. C.) 

Blitch, In re, two cases (C. G. A.) .... 

ir>2 F. (vi 



C77 
7:i-) 
12- 



i:ï7 



Page 
Blodsett, Portland Chemical & Phosphate 

Co. V. (C. G. A.) 929 

Blood, Ferguson v. (C. C. A.) 98 

Boker & Co. v. United States (G. G.) 589 

Bon Homme Min. Co. v. Steinbeck (C. G. 

A.) 833 

Bookman v. Seahoard Air Line Ry. (C. C. 

A.) 080 

Bradford v. United States (G. C. A.) (ilO 

Tîradford v. United St! tes iC. G. A.) (iJ7 

r.rids-port lîrass Co., G;mn v. (G. G. A.). . 434 
Broadway Sav. Trust Co., In re (G. G. 

A.) 152 

Bromlev, In re (I), G.) 49:; 

Brothers. Davis v. (G. C. A.) 69(> 

Brown, Knrtz v. (C. G. A.) 372 

Brown V. Merchants' Marine Ins. Co. (C. 

G. A.) 411 

Brown y. United States (G. C. A.) Oiîl 

Brown. Western Transit (M. v. (D. C.) . . . . 470 
Bnllock Electric Mfg. Co., General Elec- 
tric Go. V. (G. G. A.) 185 

BiiHock ElectTic Mfg. Co., General ÎClectric 

Go. V. (C. C. A.) 427 

Bnndy Tïecording Go., International Time 

Itecording Go. v. (G. G.) 717 

Burch, Soi.thern Pae. Go. v. (G. C. A.)... 108 
lîutler V. New York Cent. & II. R. II. Go. 

(C. C. A.) 970 

Gain, Callioun County Bank v. (G. C. A.) 98,"? 
('vilhoim ('o.i'ety l'ank v. Gain (C. (!. A. t.. 98:! 
Galifornia Bridge & Construction Go., 

United States v. (C. C.l 559 

Camors-McGonnell Co., ^IcGonnell v. (G. 

G. A.) 321 

Garop lîird v. Larson (G. C. A.) IGO 

Ganda P.ros. v. MieUigan Malléable Iron 

Co. (G. G. A.) 178 

Garlisle, Kinnear ilfg. Go. v. (G. C. A.) 933 

'';irroli v. (îavidson (>'. G. A.) 424 

Carter. Jloonej' v. (G. G. A.) 147 

Carter & Bro. v. Kirby Lumber Co. (G. G. 

A.) 022 

Case V. Smith, Lineaweaver & Go. (C. G.) . . 730 
'Central Trust Go. v. Central Trust Go. o£ 

Illinois IC. C. A.) 427 

Central Trust Go. of Illinois, Central Trust 

("o. V. IC. G. A.) 427 

Champagne Lumber Go., Jahn v. (G. C). . . 669 
Chandier-Dunbar Water Power Co., l'nited 

Stntrs V. (G. G. A ) 25 

Gliapman, School Dist. No. 11, Dakota 

County, Neb. v. (G. G. A.) 887 

Charles A. Johnson & Co. v. L'nited States 

«;. G.) C.50 

rhicago. R. ï. & P. R. Go., Crvder v. (G. 

C. A.) 417 

i) 



Vlll 



152 FEDERAL KErOIlTBK. 



Page 

Christy, IToiick v. (C. O. A.) CI 2 

Cilley V. United Shoe Mach. Co. (0. 0.1. . 720 
Oitizens' Gas & Electric Go. v. Nicliolson 
' C. A.) 389 



(C. 



City of Lowell, The (C. C. A.) 593 

City of New Cpstle v. Postal Telegraph- 

Gable Co. (C. C.) 572 

City of New Gastle v. Western tJnion Tel. 

Co. (G. C.) 509 

Clancy v. Troy Belting & Supply Co. (C. 

C.) 188 

Cleveland, Cunningham v. (C. C. A.) 907 

Glyde Commercial Steamships v. United 

States Shipning Go. (D. G.) 516 

Glyde S. S. Co., Badiman v. (C. C. A.).. 403 
G. Newman Wire Co., United States v. 

(C. C.) 488 

Coder, In re (C. C. A.) 943 

Coder, In re (C. G. A.) 931 

Coder v. Arts (C. C. A.) 943 

Coder v. McPherson (C. G. A.1 951 

Coffin, In re, two cases (C. G. A.) 381 

Cohen v. Portland Lodge No. 142, B. P. O. 

10 (C G A ) 357 

Coliin County" Nat Bank' v.' 'liùghês "(G.' C. 

A.) 414 

Commercial Acétylène Co. v. Avery Portable 

Lighting Co. (G. G.) 642 

Continental Adjustment Co. v. Cook (C. 

G.) 652 

Cook, Continental Adjustment Co. v. (O. C.) 652 

Cook V. Foley (C. C. A.) 41 

Cottone. Laclede Gaslight Co. v. (0. C. A.) 629 
Couch Patents Co. v. New York Woven 

Wire Mattress Co. (C. G.) 10?3 

Crawf ord, In re (C. O. A.) 169 

Cronse-IIinds Electric Co., Edison General 

Electric Co. v. (C. O. A.) 437 

Gryder v. Chicago, R. I. & P. R. Co. (G. 

G. A.) 417 

Gumberland Coal & Coke Go. v. Gray (C. C. 

A.) 939 

Gumberland Téléphone & Telegraph Co., 

New Amsterdam Casualty Co. v. (0. C. 

A.) 961 

Cunningham v. Cleveland (G. G. A.) 907 

Curtiti. The (V. G.) 5'-'S 

Guzco, The (D. C.) 283 

C. Van Cott, The (D. G.) 1016 

Gzarina, The (D. C.) 297 

Pavmtless, The (G. G. A.) 973 

Davidson, Carroll v. (C. C. A.) 424 

Davis V. Brothers (C. O. A.) 696 

Davis V. Garrett (C. G.) 723 

Decker Bros., International Trust Go. v. 

(G. C. A.) 78 

Deepwater R. Co. v. Western Pocahontas 

Goal & Lumber Co. (C. C.) 824 

Deguirro, United States v. (D. G.) .568 

Deitsch, Loonén v. (G. C.) 1023 

Delaware, L. & W. R. Co., United States 

V. (G. C.) 269 

Delaware & Hudson Go. v. Yarrington (C. 

G. A.) .396 

Desjeiro, Ex parte (G. C.) 1004 

Dev Time Register Co. v. Syracuse Time 

Recorrler Go. (C. C.) 440 

Diamond Meter Go. v. Westinghouse Elec- 
tric & Mfg. Co. (G. G. A.) 704 

Dickinson, Kean v. (C. C. A.) 1022 



PaK8 

Dillingham v. Bakley (C. C. A.) 1022 

Dixieland Amusement Co., Donovan v. (C. 

G.) 601 

Dr. Miles Médical Co. v. Snelleiiburg (C. 

G.) 661 

Dodson, J. W. P.ishop Go. v. (C, C. A.)... 128 

Domingo, TTnitnd St.ates v. (D. C.) 506 

Douovan v. Dixieland Amusement Co. (G. 

C.) Olil 

Du Bois V. Seyiaour (C. C. A.) 600 

Eads, The James (G. C. A.) 673 

Edison General Electric Co. v. Grouse- 

Hinds Electric Go. (C. G. A.) 437 

Edwards, Whitehouso v. (G. C. A.) 72 

Edward Thompson Co., AYest Pub. Co. v. 

(C. G.) 1019 

Eldred, In re (D. C.) 491 

Ellis, The (C. G. A.) 981 

Enoch Morgan's Sons Co. v. AVard (O. C. 

A.) 090 

Erlanp;er, Blumgart & Co. v. United States 

(C. C.) 576 

Evelyn, The (D. C.) 847 

Fairmont Coal Co., Kulm v. (C. C.) 1013 

Fanny Neil, The (C. G. A.) 073 

Farrell, Bartlett v. (G. G. A.) 150 

Fédéral Coal & Coke Go., Hyams v. (C. C. 

A.) 970 

Ferguson v. Blood (G. C. A.) 98 

Fidelitv & Deposit Co. v. Asnnv (C. G. A.) 955 
Fidelity & Deposit Go. o£ Slarvland. United 

■ States V. (O. C. A.) 596 

Finney, American Bonding Go. v. (C. C. 

A.) 107 

First Nat. Bank. In re (C. G. A.) 04 

Flora Rodgers. The (D. C.) 280 

Foley, Cook v. (C. G. A.) 41 

Force & Co., Rates Mach. Go. v. (G. C. A.) 634 

Fowler v. Gowing (G. C.) SOI 

Fox, Stancl'ft v. (G. C. A.) 6'.l7 

Francis v. United States (G. C. A.) 155 

Fritz, In re (I). C.) 56 i 

Fuld & Co. V. United States (C. G. A.) 105 

Fulier & lîennett. In re (D. C.) 538 

Furia, Ex parte (C. C.) lOOt 

F. W. AVoolworth & Co. v. United States 

(C. C.) 483 

Gahagan, Western Wheeled Scraper Co. v. 

(G. C.) 048 

Galioia. The (G. C. A.) 981 

Gnndojfi ,t Go. v. ITnifecl States fC. G.). . . . 050 
Garcia, Pennsylvania R. Co. v. (C. G. A.). . 104 

Garrett, Davis v. (C. C.) 723 

General Electric Co. v. Bul'ock Electric 

Mfg. Co. (G. C. A.) 185 

General Electric Co. v. Bullock Electric 

Mfg. Co. (C. C. A.) 427 

George Nash & Co. v. United States (C. C.) 573 
Georgia R. & Banking Co. v. Atlantic 

Postal Telegraph Gable Co. (C. C.) 991 

German Ins. Co. of Freeport, 111., Goldberg, 

Bowen & Co. v. fC. G.) 831 

Gilligan, In re (C. G. A.) 005 

Ginty V. New Haven Iron & Sleel Co. (C. 

C. A.) 979 

G. M. ïhuruauor & Bro., United States v. 
(C.C.) 600 



CASES REl'OKTED. 



IX 



Fage 
Goldberg, Bowen & Co. v. German Ins. Co. 

of Fres'iiort, 111. (C. C.) 831 

Goldeiiberj' Bros. & Co. v. United States 

(C. C.) G.-)S 

Goldsiiiith V. Koopuian (C. C. A.) 173 

Goodlaudi'r-Iiobertson Liui;bcr Co. v. At- 

wood (C. C. A.) 978 

Gornian- Wright Co., AVri-Iit v. (C. C. A.) 408 

GowinR-, Powlor v. (C C. i 801 

Gray, Cumberland Coal & Coke Co. v. (C. 

Great'NoVtiièrn'R'.'Co.VKelh.T V-'('C-'C.).'.' 211 
Great V/ostern Mfg. Co., In re (C. C. A.). . 123 
Cîunn V. TSridgeport l'.rass Co. (C. C. A.) . . 4.34 
G. W. Sheldon & Co. v. United States (C. 
C.) 318 

Haight & Freese Co., Weiss v. (C. C.) 479 

Hall V, TJnited States (C. C. A.) 420 

Hancock, Troy V/agon Works Co. v. (0. O. 

A.) 005 

Ilanson \', ITaywood Itros. & Wakefield Co. 

(C. C. A.) 401 

Haywood Bros. & Wakefield Co., Ilanson 

V. (C. C. A.) 401 

TT. B. Uawson. The fl). C.) lOCl 

Hendriek v. U'irson (C. C. A.) 03 

Hebard, Ho],kins v. (C. C. A.) 1022 

Ilennegan, Kansas City v. (C. C.) 249 

Hensel. lîruekmann & Lorbae'aer, United 

States V. (C. C.) 578 

Herm, The (D. C.) 276 

Hermann Boker & Co. v. United States (C. 

C.) r,S9 

Herskovitz, In re (D. C.) 310 

Ileywood Bros. & Wakefield Co. v. Syra- 
cuse Uanid Transit R. Co. (C. C.) 453 

Hill Chitcli Co., Victor Chemical Works 

V. (C. C. A.) 393 

Hillhouse v. United States (C. C. A.) 103 

Hoadlev. Bctlilehcin Iron C'o. v. (C. C.)... 735 

îfopkins V. ireliard (C. C. A.) 1022 

Ilouck V. Christy (C. G. A.) 012 

Hnghes, Collin County Nat. Bank v. (C. 

C. A.) 414 

Huntington Distilling Co., Iluntington 

Nat. Bank v. (C. C.) 240 

Huntington Nat. Bank v. Huntington Dis- 

tilling Co. (C. C.) 240 

H. We- tern Lumber Co., Anslev Land Co. v. 

(C. C.) 841 

Hyams v. Fédéral Coal & Coke Co. (C. C. 

A.) 970 

Illinois Cent. R. Go.. Sutherland v. (C. 

. C. A.) G94 

Illinois Téléphone Construction Co.. Thoin- 

son-IIouston Electric Co. v. (C. G. A.). .. 631 
International Coal Min. Co. v. Bennsylvania 

R. Co. (C. C.) 551 

International Coal Min. Co. v. Pennsvl- 

vania R. Co. (C. Cl 55i 

International Coal Min. Co. v. Pennsyl- 

vania R. Co. (C. G.) 557 

International Time Recording Co. v. W. H. 

Bundy Recording Go. (C. C.) 717 

International Trust Co. v. Decker Bros. 

(G. C. A.) 78 

Islander, The (C. C. A.) 385 

Islaud Queen, The (D. G.) 470 



Pasçe 
.Tahn v. Champagne Lumber Co. (C. C), . .. 6(;9 

James B. Eads, The f(;. C. A.) ()73 

Jersey Island l'acking Co., In re (D. G.),. 839 
J. L. Mott Iron \''i'orlvS, Standard Sanitary 

Mfg. Co. V. (C. C.) 635 

.Tohnson & Co. v. Uinted States (G C. ) . . . . 656 
Johnson & Co., United States v. (C. C. 

A.) 164 

John W. Moore. The (C. C. A.) 073 

Joseph, In re (C. C. A.) 141 

J. S. -Tohnson & Co., United States v. 

(C. C. A.) 164 

J. W. lielano, The (T). C.) 280 

J. W. Bishop Co. V. Dodson (G. G. A.) ... 128 

Kano, In re (D. G.) 587 

Kansas City v. Hennegan (C. G.) 249 

Kates, l'attorson v., two cases (C. C.) ... 481 

Kean v. Dickinson (C. C. A. ) 1022 

Kelley v. Great Northern R. Co. (G. G.).. 211 

Kellogg V. Malonev (C. C. A.) 405 

Kinncar Mfg. Go. v. Carlisie (C. C. A.) 9-33 

Kirby Lumber Co., W. T. Oartor & Bro. 

V. (C. G. A.) 622 

Kirkman v. McClaughry (C. C.) 255 

Klosters Aktie Bolag. William II. Perry 

Go. V. (C. C. A.) . 967 

Knipscher & Maas Silk Dyeing Co., Unit- 
ed States V., two cas(<s 500 

Koopman, Goldsmith v. (G. C. A.) 173 

Koopman, Reizenstein v. (G. C. A.) 173 

Kreigh v. Westinghouse, Church, Kerr & 

Co. (C. G. A.) 120 

Kreshower v. United States (C, G.) 485 

Kuhn V. Fairmont Coal Co. (C. C.) 1013 

Kurtz V. Brown (C. C. A. ) 372 

Lacey v. Louisvillo & N. R. Go. (G. C. A.) . . 134 
Laclede Gaslight Co. v. Cottone (C. G. 

A.) 629 

Ladd Metals Co. v. American Min. Co. (G. 

C.) 1008 

Larson, Camp Bird v. (C. C. A.) 160 

Larson, Ileadrick v. (C. C. A.) 93 

Le Marehcl v. Teagarden iC. C.) 662 

Lewis Pub. Co. v. Wvman (C. C.) 200 

Lewis Pub. Go. v. Wyman (G. C.) 787 

L. Gandolfi & Go. v. United States (G. C). . 656 

Liberty Silk Co., In re (1). C.) 844 

Loonen v. Deitsch (G. G.) 10"H 

Lorsch & Co., United States v. (C. G.) 591 

Louisville & N. B. Go., Laccv v. (C. 0. 

A.) 134 

Loy Too V. United States (C. C. A.) 1022 

Luber, In re (D. G.) 492 

McClaughry, Kirkman, v. (G. G.) 255 

McConnell v. Gamors-McConnell Go. (C. C. 

A.) 321 

■\Tr.Cormick v. Solinskv (C. G. A.) 981 

McKane, In re (D. C.1 733 

McPherson, Goder v. (C. 0. A.) 951 

Maloney, Kellogg v. (C. C. A.) 405 

Martin. In re (D. G.) 582 

Memphis Conso!. Gas & Electric Co. v. Bell 

(C. C. A.) 677 

Merchants' Marine Ins. Co., Brown v. (0. 

C. A.) 411 

Mich'gan Malléable Iron Co., Canda Bros. 

V. (C. C. A.) 178 



152 FEDERAL REPORTER. 



Miles Medi'cal Co. v. Snellpnburg (C. C.) . . 
Miller & Lux, Rickoy Land & Cattle Co. 

V. (C. C. A.) 

Mills, American Bonding Co. of Baltimore 

V. (C. C. A.) 

Minot I. Wilcox. ïhe (D. C.) 

Missouri, K. & T. H. Co. v. Smith (C. C. 

A.l 

Moilox, Moxie Nerve Food Co. of New Eng- 

land V. (C. C.) 

Jîoonev V. Carter (C. C. A.) 

Moore, The John W. (C. C. A.) 

Morsati's Sons Co. v. Ward (C. C. A.)... . 
Mott Iron Works. Standard Sanitarv Mfg. 

Co. V. (C. C.) . . ; 

Moxie Nerve Pood Co. of New Kngland v. 

Modox <C. C) 

Muller, Maclean & Co., United States v. 

(C. C.) 

Nash & Co. V. United States (C. C.) 

Natl'anr-o'i, In re (T). C.t 

National Electric Ce, Westinghouse Elec- 
tric & IVffg. Co. V. (C. C.) 

National Regulator Co., Powers lîegulator 

Co. V. (C. C.) 

Na*^!Oifil Window Glass .Tobbevs' Ass'n, 

Wheelcr-Stenzel Co. v. (C. C. A.) 

Neil, The Fanny (C. C. A.) 

N. Erlanrer, Blumgart & Co. v. United 

St^tos <('. C.) 

Neville, Quinton v. (C. C. A.) 

New p^«ie;dam Casualty Co. v. Cumber- 

land Téléphone & Telegraph Co. (C. C. 

A.) 

Newburp-er Cotton Co. v. York Cotton 

Milhi rc. C. A.) 

New Haven Iron & Steel Co., Gint%' v. (C. 
A.' 



Pase 
GGl 

11 

]0i 
548 

608 

4m 

147 
(ÎTH 
Ui)0 

035 

49,3 

575 

r.7;5 

585 



C. 



-.). 



4G0 

984 

804 
G73 

879 

961 

398 
979 



Newman Wire Co., United States v. (C. 

C.) 488 

New York Cent. & H. R. K. Oo., Butler 

r. (G. C. A.) 976 

New York Woven Wire Mattress Co., 

Couch Patents Co. v. (C. C.) 1023 

Nicholson. Citizens' Gas & Ebctric Co. v. 

(C. C, A.) 389 

North-rn ^lining & Trading Co., Alaska 

Exploration Co, v. (C. C. A.) 145 

Northern l'ae. R. Co., Plummer v. (C. C). . 20(! 

Nr,rti'"i-n S- S. Co,. I.i re (C. C. A.) 1(V>-J 

Northrup, In re (I). C.) 703 

Northwestern Jtut. Life Ins. Co., Amos- 

Richia V. (G. C.) 102 

Nusbaum, In re (D. C.) 8."5 

Onk. The rc. C. A.) 973 

O'Rrien. Palatine Ins. Co., Limited, of 

Jlanchoster. Eng. v. (G. C. A.) 922 

Oiiio Table Co„ Tyden v. (G. C. A.) 183 

Old Niek AVilliams Co. v. United States 

(C. C. \.) 925 

Or?gon & C. R. Go., United States v. (G. 

C.) 473 

Otis Steel Co. v. Wingle (C. C. A.) 914 

Palatine 1rs. Co., Limited, of Manchester, 

Eng., V. 0'P,rie]i (C. C. A.) 922 

Parkes V. Seasongood (C. G.) 583 

Parkinson, Standard Oil Co. v. (G. G. A.). . 681 



Page 



International Coal 
International t'oal 



142 

187 
481 
.524 
104 



. . 551 



554 
557 



Park & Tilford, United States T. (C. C. 

A.) 

Patent Batton Co., Bail & Sockett Fasten- 

er Co. V. (C. G.) 

Patterson v. Kates, two cases (C. C.) 

Peck V. T'nited States (G. G.) 

Pennsylvania R. Co. v. Garcia (C. C. A.). . 
Pennsylvauia R. Co., International Coal 

Min. Co. V. (C. C.) . 
Pennsylvania R. Co., 

Min. Co. V. (C. G.) . 
Pennsylvania R. Go., 

Min. Co. V. (C. G.) 
People's Stearaboat Co., Wecms Steaniboat 

Co. of Baltimore Oitv v. (C. G. A.). . . .1022 
Perry Co. v. ICIosters ■ ktie lîolag (G. C. A.) 9!i7 

Perry v. Tacoma Mill Co. (G. C. A.) 115 

Philadelphia. The (C. G. A.) 385 

Plummer v. Northern Pac. R. Co. (C. C.).. 2116 

Pomeroy, United States v. (O. G.) 279 

Po]-tland Chemical & Phosphate Co. v. 

Bloclgett (C. G. A.) 929 

Portland Lodge No. 142, B. P. O. E., 

Cohen v. (G. C. A.) 357 

Postal Telegraph-Cable Co., City of New 

Castle V. (G. G.) 572 

Power Fuel Go., Southern R. Oo. v. (G. G. 

A.) 917 

Power.s Regulator Go. v. National Regu- 
lator Co. (C. C.) 984 

Prinz Adalhert, The (D. C.) 1001 



Quinton v. Neville (C. G. A.) . . 



. .. 879 



Railway Materials C-o., American Brake 

Shoe & Foundry Co. v. (G. C. A.) 700 

Ranch v. Werlev (G. G.) .5 i9 

Ra wson, The TT. B. fD. G.) 1001 

Reis, The William (C. 0. A.) ()7;! 

Reizenst.nn v. Koopman (C. G. A.) 173 

Rickey Land & Cattle Co. v. Miller & 

Lux (G. C. A.) 11 

Rickey Land & Cattle Co. v. Wood (G. G. 

A.) 22 

Roanoke Furnace Co., In re (D. G.) 846 

Rodgers, The Flora (D. G.) 286 

Rodgers v. United States (C. C. A.> IM'i 

Rodgers v. United States (C. C. A.) 420 

Sahadi Bros. v. United States (G. C.) 486 

St. Louis, K. C. & C. K. Co. v. Wabash 

R. Co. (G. C. A.) 849 

St. Louis Southwesteru R. Co. v. Wain- 

wright (C. G. A.) 624 

Sampter, Wright v. (D. G.) 190 

Santona, Tlie (I). C.) 51 ;; 

Sargent, Blake v. (D. G.) 263 

Sass & Crawford v. Thomas (C. C. A.) 627 

Sehool Dist. No. 11, Dakota County, Neb., 

V. Chapman (G. C. A.) 887 

Scow No. 9. The (D. G.) 548 

Seaboard Air Line Ry.. Bookman v. (C. 

C. A.) 686 

Seasongood, Parkes v. (C. C.) 583 

Sentinel, The (D. C.) 564 

Seyd V. United States (C. C.) 657 

Sevmour, Du Bois v. (C. C. A.) 600 

Sh'eldon & Co. v. United States (G. C.) 318 

Skewis V. Rarthell (D. C.) 534 

Smith. Lineaweaver & Co., Case v. (C. 

C.) 730 



CASES REPORTED. 



XI 



Page 
Smith, Missouri, K. & T. R. Co. v. (C. 

C. A.) 008 

Smith, United States v. (I). C.) 542 

Snellenburg, Dr. Miles Médical Co. v. (C. 

C.) mi 

Solinsky, MoCormick v. (O. C. A.) 084 

Southern Pac. Co. v. Burch (C. C. A.) ... 1C8 
Southern Pac. R. Co., United States v. 

(G. G.) 303 

Southern Pac. R. Co., United States v. (C. 

G.) 314 

Southern R. Co. v. Power Fuel Co. (C. G. 

A.) fin 

Stanclif t V. Fox (O. C. A.) G97 

Standard Oil Go. v. Andersou (C. G. A.).. 166 
Standard Oil Go. v. Parkinson (G. C. A.) . . G81 
Standard Oil Go. of New Jersev, United 

States V. (G. C.) 290 

Standard Sauitary Mfg. Co. v. J. L. Mott 

Iron Works (G. C.) ti35 

Stearns v. United States (G. G. A.) 900 

Steinbeck v. Bon Homme Min. Go. (G. G. 

A.) 3.33 

Sully. In re (C. G. A.) 019 

Sutherland v. Illinois Cent R. Co. (G. G. 

A.) 094 

Svracuse Rnpid Transit lî. Go.. Ilevwood 

Bros. & Wakefield Co. v. (C. G.) 453 

Syracuse Tirae Recorder Co., Dey ïime 

Register Co. (G. C.) 440 

Tacoma ÎMil! Go.. Ferry v. (G. C. A.) 115 

Taylor y. United States (C. G. A.) 1 

Teagardon, Le Marchel v. (G. G.) 00'? 

Thomas, Sass & Grawford y. (G. G. A.) O'^T 

Thomas, Ihiion Pac. R. Go. v. (G. C. A.).. ."'05 
'Thompson Co., West Pub. Co. v. (C. G.). ..1019 
Thomson-riouston Electric (îo. v. Illinois 

Tel. Gonrtruction Go. (G. C. A.) 631 

Three Packages of Distilled Spirits, Unit- 
ed States V. (D. C.) ,5S0 

Thurnaner & Bro., United States v. (G. O.) Cf!0 

Toy (4ai;p v. TTnitod States ((;, G. A.) 1022 

Traîner. The Ann .T. (G. C. A.'l 1021 

Troy Belting & Siipply Co., Clancy v. (G. 

G.) 188 

Troy Wagon Works Co. y. Hancock (C. 

C. A.).. 005 

Twp«die Trading Co.. Walsh y. (D. C.) 270 

Tyden v. Ohio Table Go. (C. C. A.) 183 

Union Pac. R. Go. v. Thomas (G. G. A.).. 305 
T'nited SIior Mach. Go., Gilley v. (G G.).. 7'?0 

United States v. Adair (D. G.) 737 

United States y. Albert Lorsch & Co. (G. 

C.) . ,591 

United States, Anderson y. (G. C. A.) 87 

United States y. Axman (C. G.) 810 

United States, Bradford v. (G. G. A.) 010 

United ?!tates, Bradford v. (G. O. A.) 017 

United States, Brown y. (C. C. A.) 964 

United States v. Galifornia Bridge & Con- 

sl ructicn Go. (C. Ci 559 

United States v. Chandler-Dunbar Water 

Power Co. (G. G. A.) 25 

United States, Charles A. Johnson & Co. 

V. (G. G.) 650 

United States v. C. Xewman AVire Go. (C. 

C.) 488 



Page 

United States v. Deguirro (D. C.) 568 

United States v. Delaware, L. & W. R. 

Co. (C. C.) 269 

United States y. Domingo (D. G.) 500 

United States, E. Erlanger, Blumgart & 

Go. y. (C. C.) 576 

United States y. Fidelity & Deposit Go. of 

Maryland (C. G. A.) .596 

United States. Francis v. (G. C. A.) . . . . 155 
United States, Fuld & Co. v. (C. C. A.) . . 165 
United States, F. W. Woolworth & Co. 

V. (C. G.) 483 

United Statea, George Nash & Co. v. (C. 

G.) ; 573 

United States v. G. M. Thurnaner & Bro. 

(G. G.) 660 

United States, Goldenberg Bros. & Co. v. 

(G. C.) 658 

United States, G. W. Sheldon & Co. v. 

(G. G.) 318 

United States, Hall y. (C. C. A.) 420 

TTiiitcd Stiite-s V. Hense], Bruckmann & Lor- 

b.aclmr (C. C.) 578 

United States, Ilerraann Boker & Co. v. 

(G. G.) 589 

United States, Ilillhouse v. (C. 0. A.). ... 163 
United States v. .1. S. Johnson & Go. (0. 

G. A.) 164 

United States v. Knipscher & Maas Silk 

Dveinsr Go., two cas 's (G. G.) 590 

TJnited States, Krt shnwer v. (C. G.) 485 

United States. U. (Jando'.fi & Go. v. (C. G.) *'"li 

United States, Loy Too v. (C. C. A.) '. 1022 

United States v. Muller, :\raclean & Go. (C. 

G.) 573 

United States, Old Nick Williams Co. t. 

(G. C. A.) 925 

United States v. Oregon & (1 R. Go. (G. 

G.) 473 

United States v. Park & Tilford (G. G. 

A.) 142 

United States, Peck v. (C. C.) 52!- 

United States v. Pomeroy (G. G.) 27:1 

United States, Ro^gers y. (G. C. A.) ÎUi; 

T'nited States, Ro.]:>.efs v. (G. C. A.) 4'0 

United States, Saliadi Bro^-. y. (C. C.).]. . ^'S(' 

United States, S"v(l v. (G. C.) (;.-)7 

United States v. S"iitl' (D. (1.1 542 

United States v. Southern Pac. R. Go. (G. 

Cl . 'ïo:', 

United States v. Sonih^rn I>ac. R. Co. (C. 

G.) 314 

United States v. Standard Oil Go. of New 

Jersey (C. G.) ono 

United States. Stearns v. (G. C. A.) 900 

United States, Taylor y. (C. G. A.) T 

United States v. 'l'iireo Packaaes of Dis- 
tilled Snirits ri), r'.) r.'-^O 

United States, Tov Gaup v. (C. G. A.) 102-> 

ITnited States, AValker v. (G. G. A.l 111 

T^uited Stiit:es v. Witteinann fC. C. A.) .... .■)77 
United States v. Yee Gee You, alias Yee 

Jim (C. G. A.) 157 

United States Shippiiig Co.. Clvde Commer- 
cial Stean]shi])s v. (D. C.) 510 

Van Cntt. The G, G). G.) loii; 

Venus Sliipping Co. v. Wilson (C. C. A.). . 170 
Victor Chemical Works v. HiU Clutch Co. 
(G. G. A.) 393 



xu 



152 FEDERAL REPORTEE. 



Page 
Wabash R. Co., St. Louis, K. O. & C. B. 
Co. V. (C. C. A.) 849 

Wainwriglit, St. Louis Southwesturn R, Co. 

V. (C. 0. A.) 624 

Walder, In re (T). C.) 4Si> 

Walk'or V. United States (C. C. A.) ] 11 

Walsh V. Tweedie Trading Co. (D. C.) 276 

Ward, Enoch Jlorgan's Sons Co. v. (0. O. 

A.) 690 

Weems Steamboat Co. of lîaltimove City v. 

IVople's Steaml)oat Go. (C. C. A.) 1022 

\Veiss V. ITaislit & Freese Co. (C. C.) 47!) 

Wcudel, In re (D. C.) (172 

Werley, Uanch v. (C. C.) 500 

>Yc.steru Iron & Steel Co., American Bralîe 

Shoe & Fouudry Co. v. (C. 0. A.) 703 

WeNtern Poeahontas Coal & Lumber Co., 

Deeiiwater H. Co. v. (C. G.) 824 

Western Transit Co. y. lîrown (D. C.) . . . . 476 
Western Union Tel. Ce, City of New 

Castle V. (C. C.) 569 

Western Wlieeled Scraper Co. v. Gahasan 

(C. C.) 648 

Westinghouse. Church, Kerr & Co., Kreigh 

V. (C. 0. A.) 120 

Westinghouse Electric & Mfg. Co., Diamond 

Meter Co. v. (O. C. A.)'. 704 

Westinghouse Electric & Mfg. Co. v. Na- 
tional Electric Co. (C. G.) 466 

Weston Lumber Co., Ansley Land Co. v. 

(C. C.) 841 

West Pub. Co. V. Edward Thompson Co. 

(C. 0.) 1019 



Page 
W. H. Bundy Rccordîng Co., International 

Time Rocording Co. v. (C. C.) 717 

Wheeler-Stcnzel Co. v. National Wiudow 

Chiss Jobbers' Ass'n (G. G. A.) 864 

Whitehouse v. Edwards (G. C. A.) 72 

Whittaker, In re (C. C. A.) 141 

Wilcox, Tlie Minot I. (D. C.) 548 

William A. Force & Co., Bâtes jMach. Co. 

V. (C. C. A.) r..'U 

William E. Reis, The (C. C. A.)... 67;{ 

William II. l'erry Co. v. Klostcrs Alstie 

Tïolag (C. C. A.^ 0(57 

Williams Co. v. United States (G. C. A.). . !}2;i 
Wilson, Vpius Shipping Co v. (G. C. A.). . 170 

Wingle, Otis Steel Co. v. (C. C. A.) 914 

Wittemann. United States v. (G. G. A."i. . . . 377 
Wood, Rickey Land & Cattle Co. v. (C. G. 

A.) 22 

Woolworth & Co. v. United States (G. C.) 4H ; 
Wright V. Gorman-V,"right Co. (G. G. A.).. 40,S 

Wright V. Sampter (D. C.) 196 

W. T. Carter & Bro. v. Kirbv Lumber Co. 

(G. C. A.) 622 

Wyman, Lewis Pub. Co. v. (C. C.) 200 

W^yman, Lewis Pub. Co. v. (G. C.) 787 

Yarrington, Delaware & Iludson Co. y. (0. 

C. A.) 396 

Yee Gee You. alias Yee Jim, United States 

V. (C. C. A.) 157 

Yee .tim, alias Yee Gee You, United States 

V. (C. C. A.) 157 

York Cotton Mills, Newburger Cotton Go. 

V. (C. C. A.) 398 



CASES 

ARGUED AND DETERMINED 



UNITED STATES CIRCUIT COURTS OF APPEALS AND THE 
CIRCUIT AND DISTRICT COURTS 



TAYLOIÎ V. rXITED STATKS. 
(Circuit Court ot Appeals, Second Circuit. January 16, 1907.) 

No. 191. 

1. Altens— Immigration TjAws— Pebmittikg Aueïs's to Land ekom Ves.sel. 

ïhe provisions of Act Mareli .3, 1903, c. 1012, § 18, 32 Stat. 1217 lU. S. 
Comp. St. Supp. 190.5, p. 283], requiring officers of any vcssel brinjring an 
alien to tlie United States to "adopt due précautions" to i)revent the land- 
ing of any such alien at any tinie or place otlier than that de^ignated by 
the immigration ofHcers, and maliine any pt^rson in charge of a vessel 
liable to prosecution if lie «hall "land or permit to lanrt" any alien except at 
such designated time and place, are to be construed together, and the mas- 
ter of a ship cannot be held liaide for tlie unlawful landing ot an alien 
from his vessel, if he adopted tlue précautions to prevent it. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 2, Alieus, § 114.] 

2. Same— Construction of Statute. 

In Immigration Act March 3. 1903. e. 1012, § 18, 32 Stat. 1217 [U. S. 
Comp. St. Supp. 190.5, p. 283], whieh requires oiricers o£ vcsse!s to tai^e due 
précautions to prevent aliens from landing thorefrom, cxeeiit at the time 
and place designated by the immigration officers, the word "aliens" is 
used in its broad and full meaning, and is not restricted to alien imnd- 
grants, but includes as well aliens who are members of the ship's crew. 
While the master of a vessel is not required to prevent oliicers or mem- 
bers of bis crew vrbo are aliens from going ou shore in a port of the 
United States in every ciise, such section requires bim to take reasonalde 
précautions suited to the natiu'e of tlie case to prevent tliem from desert- 
ing and remainiug in this couidry. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 2, Aliens, §§ 113, 114.1 

3. Same — Prosecution foe Violation — Evidence. 

The master of a vessel on trial for ]iermitting an alien tnember of his 
crew to leave his vessel in New Yorlî, in violation of Act ilarch 3, 1903, 
c. 1012, § 18, 32 Stat. 1217 [U. S. Comp. St. Supp. 190.5, p. 2831, was prop- 
erly allowed to be asked on his cross exaniination as a «-ituess whether a 
iiundier of othcr alien members of bis crew did not also désert in that port, 
as material to the question whether or not he took due précautions to 
prevent aliens from leaving the vessel, as required by the statute. 

4. WlTNESSES— CLATM OF TeIVILEGE — ReVIEW by ArPELLATE CoURT. 

The question whether a witness was privileged to refuse to answer a 
question on the ground that the answer might incriminate him is not be- 

3.52 F.— 1 



2 152 FEDERAL REPORTER. 

fore an appellate court for review, where the wituess did not stand on his 
privilège, but answered tlie question. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 50, Witnesscs, §§ 
1053-1057.] 

Wallaee, Circuit Judge, dissenting. holds that Immigration Act Mardi 
S, 1903, c. 1012, § 18, 32 Stat. 1217 [U. S. Comp. St. Supp. 1905, p. 283], 
properly construed, bas no application to alien seameu wbo are bona fide 
members of a sLip's crew. 

In Error to the Circuit Court of the United States for the South- 
ern District of New York. 

This cause cornes hère upon a vprit of error to review a judgment of the Cir- 
cuit Court, Southern District of New York, entered May 21, 190C, on a ver- 
dict of "guilty" found by a jury after trial upon an iudictment for a misde- 
meanor, under section 18 of the Immigration Act of 1903 which provides (Act 
March 3, 1903, c. 1012, 32 Stat. 3217 [U. S. Comp. St. Supp. 1905, p. 283] : 

"That it sliall be the duty of tîie owners, offlcers, and agents of any vessel 
bringing an alien to the United States to adopt due précautions to prevent the 
landing of any such alien from such vessel at any time or place other than 
that designated by the immigration officers, and any such owner, officer, agent, 
or person in charge ol" such vessel who shall land or permit to land any alien at 
any time or place other than that designated by the immigration offlcers shall 
be deemed guilty of a misdemeanor, and shall on conviction be punished by a 
fine for eaeh alien so permitted to land of not less than one hundred or more 
than oue thousand dollars, or by imprisonment for a term not exceeding 
one year, or by both such fine and imprisonment" 

William G. Choate, for plaintiff in error. 

Henry L,- Stimson and Michael Byrne, for défendant in error. 

Before WALIyACE, LACOMBE, and TOWNSEND, Circuit 
Judges. 

LACOMBE, Circuit Judge (after stating the facts). Taylor was 
the captain of the Cunard steamship Slavonia, which arrived at her 
pier in New York City early in the morning of October 10, 1905, at 
the end of a voyage from Fiume, Hungary. At the time of her ar- 
rivai the place of landing designated under the statute by the immigra- 
tion officers for aliens landing from a vessel was Ellis Island. When 
the Slavonia was at Fiume, one Elias Ramadonawich, an alien, shipped 
on her as third cook in the steerage kitchen. He had previously served 
on an Austrian ship, and showed his previous shipping papers when 
he signed the articles of the Slavonia. He shipped for the round trip ; 
the terms of the articles being that he should not be paid oflf until he 
returned to Fiume. The amount of wages earned by him on his ar- 
rivai in New York was less than $6. 

At a quarter of 6 o'clock in the evening of October lOth, after finish- 
ing his day's work he reported to the head of his department that his 
work was finished, but asked no permission of him, or of any one else, 
to go ashore. He then went to his room and washed and dressed. 
After this, with two other members of the crew, he walked down the 
gang plank out on the pier and into West street. No one stopped him 
either on the gang plank or on the pier, or interfered in any way with 
his departure. So far as appears his record during the short time of 
his service was good. It was the rule of the ship that members of the 
crew whose records were good could go ashore after the day's work 



TATLOR V. tJNITED STATES. 3 

was over; each department merely keeping enough of its force to do 
the necessary night duty. No ticket of leave or written permission 
to the seaman desiring to go ashore was issued, nor any means pro- 
vided to inform the watchman at the gang plank or on the pier wheth- 
er any of the crew seeking to go past him had permission to go ashore 
or not. It does not appear whether on the evening in question there 
was any watchman, but Ramadonawich saw none, and from defend- 
ant's statement of the rule or custom of the ship when in port hère it 
is not apparent that, if he had been there, it would hâve been his duty 
to make any inquiry befofe allowing any of crew to walk ofï the pier 
into the city streets. 

Ramadonawich never returned to the ship, so that his landing be- 
came, as defendant's counsel expresses it, "the ordinary désertion of a 
roving seaman in a foreign port." The immigration officers first learned 
of his présence in this country from a letter dated November 10, 1905, 
received from the superintendent of the Flatbush Poorhouse. An in- 
spector went in search of him, and found him (November 28th) in 
the MetropoHtan Hospital, where he had been for 16 days. Evidently 
it did not take long for him to "become a pubhc charge." 

The court instructed the jury that, under section 18, "if the captain 
of the ship does not use due précaution to shut off opportunity for 
* * * désertion and landing, due précaution to prevent the overt 
act which the alien does, then he would fall under the condemnation 
of the act." Elsewhere he instructed them : 

"It is his duty to exercise ttie care that any good business man in that 
occupation would exercise ; talce the précautions that such a man would take 
and see to it that men who are aliens and part of his crew, if allowed j go 
ashore, should he allowed to do so under such rules, discipline, and restraint 
as would tend to bring them back to the ship. Now, if the captain has done 
that he has done his whole duty, and that is the essential thing for you to 
grasp and say what would a typical business man in that occupation hâve done 
under those cireumstances." 

This seems to us an entirely fair and reasonable construction of this 
section. It gives force to ail the clauses of its single sentence, coupling 
the pénal provisions against permitting to land with the provisions 
requiring the adoption of due précautions against such landing, and 
thus making the test of offense committed, not the alien's mère landing, 
but the failure to adopt due précautions to prevent it. The statute 
certainly was not intended to make the owners, officers, and agents 
insurers against the escape of every alien who might be on board the 
vessel when she reached this port, and the language used does not re- 
quire so harsh a construction. The careful and prudent man, who 
can satisfy a jury that he adopted précautions reasonably adéquate 
to prevent the landing, need be under no appréhension that he incurs 
a penalty whenever an alien who has arrived in his ship steps ashore. 

There was évidence which is discussed in the briefs as to the déser- 
tion of seamen generally in the port of New York, as to granting 
shore leave, and as to the extent to which seamen can be confined to 
the ship. None of this need be considered hère. It deals with the 
question whether due précautions were taken, and that question was 
one wholly for the jury under proper instructions. 



4 152 FEDERAL REPORTER. 

THe main contention of plaintiff in error is that tlie worcî "alien," 
in section 18, does not include seamen. The reasons why we do not 
lind this contention persuasive may be briefly stated : 

Uhe word "alien" is a broad one, with a définition whoUy unam- 
biguous and clearly understood by ail, lawyers and laymen alike. To 
warrant a construction wliich will restrict the meaning of sucli a word 
deliberately selected by tlie draftsman of a statute, there must be some- 
thing highly persuasive to show an intent not as far reaching as the use 
of such a word would import. The Suprême Court, in Holy Trinity 
Church V. U. S., 143 U. S. 457, 12 Sup. Ct. 511, 36 L. Ed. 226, con- 
struing an earlier immigration statute, found that certain broad lan- 
guage used therein should be given a restricted meaning, because of 
the "familiar rule that a thing may be within the letter of the statute 
and yet not within its spirit, nor within the intention of its makers." 
But, as was subsequently pointed out by the same court, such cases are 
few and exceptional, and only arise when tliere are cogent reasons for 
believing that the letter does not fully and accurately disclose the in- 
tent, for the "lawmaker is presumed to know the meaning of words 
and the rules of grammar." As in that case (U. S. v. Goldenberg, 1G8 
U. S. 95, 18 Sup. Ct, 3, 42 L. Ed. 394), so in this, the language of the 
act, interpreted in its ordinary sensé, "does not offend the moral sensé. 
Holy Trinity Church v. U. S., 143 U. S. 457, 12 Sup. Ct. 511, 36 L,. 
Ed. 226. It involves no injustice, oppression, or absurdity. U. S. v. 
Kirbv, 7 Wall. 482, 19 L. Ed. 278; McKee v. U. S., 164 U. S. 287, 
17 Sup. Ct. 92, 41 Iv. Ed. 437." 

It may safely be assumed that the surest guide to the intent of a lég- 
islative body will be found in the recorded action of that body itself. 
Examination of thèse so-called "immigration statutcs" discloses the fact 
that they hâve been frequently amended and recast, almost always in 
the direction of a more drastic exclusion. A review of some of thèse 
changes, following décisions of the courts which tended to relax the 
provisions of earlier acts, will be found in Re EHis (C. C.) 124 Fed. 
637. Turning, then, to the statute book, we find that section 18 of 
the act of 1903 (now under considération) substantially re-enacts part 
of section 8 of the act of Mardi 3, 1891. Act March 3, 1891, c. 551, 
26 Stat. 1085 [U. S. Comp. St. 1901, p. 1298]. In the earlier statute 
it was made the duty of officers of vessels to adopt due précautions to 
prevent the landing "of any alien immigrant." The later statute makes 
it the duty of thèse officers to prevent the landing "of any alien" (omit- 
ting the word "immigrant"). "Alien immigrant" is a less compre- 
hensive term than "alien," and, when it is deliberately discarded for the 
broader term, the change is highly significant. That the change was 
deliberate is also apparent. It was no single instance which might 
be accounted for by some clérical oversight. In sections 12, 13, 17, 
20 the term "alien" was substituted for the term "alien immigrant" 
found in earlier acts. See section 8, Act March 3, 1891 ; sections 1, 
2, 6, Act March 3, 1893; Act Oct. 19, 1888, c. 1210, 26 Stat. 666 
[U. S. Comp. St. 1901, p. 1294]. Significantly, also, the act refers, 
in section 2, to the "admission," not the "immigration," of the ex- 
cluded classes of aliens ; in section 3 to the "importation," not merely 
the "immigration," of prostitutes; in sections 4, 5, and 6 to "importa- 



TATLOR V. UXITED STATES. O 

tion or migration" of contract laborers; in section 9 to the "bringing 
to the United States of any alien aftlicted with a loathsome or conta- 
gious disease" ; in sections 1? and 13 to the "arrivai of any alien" ; 
in section 19 to "ail aliens brought into this country in violation of law" ; 
in section 30 to "any alien who shall corne into the United States in 
violation of law"; in section 2-1 to "the right of any alien to enter the 
United States" ; and in section 38 to the permitting of any "person who 
disbelieves in * * * organized government * * * to enter 
the United States." Such action by Congrcss would seem to indicate 
an intent to use the word "alien" in its ordinary and comprehensive 
meaning. 

The diligence of counsel on both sides has submitted excerpts from 
the reports of committees and the debates in Congress upon this act 
while on its passage. It is sufificient to refer to them without quoting. 
They clearly indicate that Congress was satisfied that the use of the 
Word "immigrant" had given rise to a construction of the earlier acts 
which rendered them inadéquate to accomplish their purpose, and made 
it necessary to adopt the broader term "alien." 57th Congress, Ist 
Sess., 9 Sen. Rep. No. 2119 ; Congressional Record 57th Congress, 
Ist Sess. vol. 35, pt. 6, p. 57G4; .57th Congress Ist Sess. H. R. Rep. 
No. 982; Congressional Rec. 57th Congress, Ist Sess. p. 5?(j3 ; Con- 
gressional Record, 9 Sen. R. No. 2119, p. 137; Congressional Record 
57th Congress, Ist Sess. p. .581G; 57th Congress, Ist Sess. 9 Sen. Rep. 
No. 2119, p. 135 ; 67th Congress, Ist Sess. Sen. Rep. No. 2119, pp. 
152, 130; 57th Congress, 2d Sess. 37; Congressional Record, pt. 1, 
pp. 135, 136. In view of such an illumination as to the intent of 
Congress, the mère circumstance that the title is "An act to regulate the 
immigration of aliens into the United States" is immaterial. 

The reasons urged by plaintifif in error for construing the section so 
as to read "aliens, other than bona fîde members of a ship's crew," may 
next be considered. It is suggested that the crew of a vessel cannot 
properly be held to be "brought to the United States" by such vessel, 
because the word "bring" is used in the sensé of "import." Cunard 
Co. V. Stranahan (C. C.) 134 Fed. 318. \Ve do not see why seamen, 
who upon arrivai become "importations" by leaving the ship and enter- 
ing into the gênerai body of résident population, are not "brought" 
hère by the vessel as much as its passengers are. 

It is next suggested that the statute, if held to cover seamen, would 
be so harsh and oppressive that it cannot be supposed that Congress 
would hâve passée! such an act ; and it is argued that every time an 
alien seaman or oiïïcer went ashore to report to his ship's owner, or to 
the consul, or to the customs authorities, the master would be liable to 
fine and imprisonment. This puts an unreasonable construction on the 
act. The offense is failure to provide due précautions against landing. 
It could not be held that there was any such failure where a trusted and 
apparently trustworthy ofilcer or seaman was thus engaged temporarily 
on shore about the ship's business. Where a Chinese exclusion act 
made it a misdemeanor for the master of a vessel "to land or permit 
to be landed" any Chinese labore.r, it was held that Chinese seamen 
would hâve the "right to be on shore temporarily, and not otherwise 
employed than in the business of the vessel during her stay in port." 



6 152 FEDERAL REPORTEE. 

In re Moncan (C. C.) 14 Fed. 44. See, also, In re Ah Kee (D. C.) 32 
Fed. 519, In re Jam (D. C.) 101 Fed. 989. 

Référence is made to U. S. v. Burke (C. C.) 99 Fed. 895, and Moffit 
V. U. S., 128 Fed. 375, 63 C. C. A. 117, as holding that the term "ail 
aliens" did not include seamen. The opinions in both thèse cases show 
clearly that the conclusion of the court was induced by the circumstance 
that the statutes down to that date (1891) were directed only against 
the admission of "alien immigrants" ; but, as we hâve seen, the présent 
act is textually, and apparently intentionally, of broader scope. 

Attention is called to various sections of the act providing that the 
master shall deliver to the customs officers lists or manifesta, which 
shall State as to each alien his name and sex, whether he has a ticket 
to final destination, and whether the alien has paid his own passage ; 
that ail aliens arriving by water shall be listed in convenient groups, 
and each head of a family given a tag or ticket of identification; and 
that the immigration officers may temporarily remove the aliens so list- 
ed for examination. And comment is made on the absurdity of requir- 
ing the captain with ail the officers and crew of a foreign ship, man- 
ned wholly by aliens, to list and tag themselves and proceed to Ellis 
Island leaving the ship without any persons in charge even to watch 
her, much less to work and navigate her. Thèse difïiculties, however, 
are more apparent than real. When a vessel brings to this country 
aliens, who, by coming aboard as passengers under no contract to re- 
turn, hâve advised the captain that upon arrivai they expect to leave 
the ship permanently and disappear into the gênerai body of the popu- 
lation, he must take the steps to assist the immigration officers which 
thèse sections require ; but where he is not thus advised, as in the case 
of a seaman of his crew who has signed articles for return voyage, he 
will discharge his fuU duty if he adopts due précautions to prevent 
that alien from effecting a landing which will defeat the objects of 
the statute by enabling him to become a part of the national popula- 
tion without having first been passed by the examining officers. 

We find no error in the refusai of the court to allow testimony as to 
the practice of the immigration office, and as to its recommendations 
touching further législation. Departmental construction is of value 
only in construing ambiguous provisions of statute, but we find no 
ambiguity in section 18. Nor do we find merit in the contention that 
the testimony was insufficient to support the verdict. In the case of 
an alien who had been a permanent member of the crew for years, 
proud it may be of his ship, and loyal to her flag, careful never to 
abuse any privilège of shore leave, it might be sufficient to let him 
go and come as he pleased while the ship was in port; but the same 
latitude in the case of an unknown alien of some other nationality than 
the ship, who was no sailorman, but merely a scullion or a waiter, 
might well be found to constitute a failure to adopt due précautions. 
The question was properly submitted to the jury under a charge which 
carefuUy instructed them in ail essential points and which was not ex- 
cepted to. There was no error in refusing a request to instruct them 
further that they might consider whether refusai of shore leave would 
tend to increase or diminish désertions. That was not the question 
for them to décide. They were substantially instructed that they could 



TAYLOR V. UNITED STATES. .7 

not convict, uniess they found that there was précautions which a rea- 
sonable man would hâve adopted, but which the captain failed to take. 
The last request made on behalf of défendant (they are not numbered) 
merely stated this proposition in another form. 

Upon cross-examination the défendant was asked whether during 
the trip of the Slavonia then under considération, and during her stay 
in New York October lOth to October 17th, 23 other alien seamen be- 
sides Ramadonawitch did not désert the ship. Counsel objected to 
this as immaterial, and because an answer would require défendant to 
incriminate himself as to other crimes. Objection was overruled, and 
exception reserved. The question of privilège is not before this court, 
since the witness did not stand on his privilège, but answered the ques- 
tion. Morgan v. Halberstadt, 60 Fed. 592, 9 C. C. A. 147. The tes- 
timony was clearly relevant to the main issue in the cause, namely, 
whether during the stay of the Slavonia in this port Capt. Taylor was 
adopting due précautions to prevent the landing of aliens f rom his ship. 
Information as to ail the circumstances would certainly be helpful to- 
wards a conclusion, and there is no provision of law which would 
require the exclusion of such testimony on the theory that it tended 
to show the commission of other offenses against the same statute. 
Packer v. U. S., 106 Fed. 906, 46 C. C. A. 35, 

The judgment is affirmed. 

WALLACE, Circuit Judge. I dissent from the judgment of the 
court. I think the statutory provision under which the défendant was 
indicted is not to be construed as embracing sailors who are bona fide 
members of a ship's crew. It is true the section penalizes the landing 
of "any alien," and the term, read without référence to the context, or 
the history of the législation of which it is a part, or the well-known 
objects of this législation, is broad enough to include a sailor. It is 
also broad enough to include the ambassador of a foreign government 
to our own, who cornes hère by vessel to enter upon the duties of his 
post. 

The act of March 3, 1903, îs a collocation and revision of several 
pre-existing laws of Congress, some of which relate to the exclusion 
from the United States of objectionable immigrants, and others, to the 
importation of aliens who were under contract to perform labor or 
services. It is entitled "An act to regulate the immigration of aliens 
into the United States." In the earlier acts those relating to the ex- 
clusion of objectionable immigrants usually employed the term "alien 
immigrants." In those relating to the importation of contract laborers 
the term "foreigners" or "aliens" was used, possibly because such 
laborers might corne either as immigrants — that is, with the purpose of 
acquiring a permanent résidence hère — or they might come as tem- 
porary sojourners, remaining only to perform the particular engage- 
ment which they had entered into; and the term "foreigners" or "al- 
iens" was sufficiently broad to include both classes. In the revision of 
1903 the short and comprehensive term "aliens" was used throughout, 
as well in the provisions particularly relating to immigrants, as in those 
relating to contract laborers. In codifications and revisions changes 
of phraseology for the sake of brevity or consistency are frequently 



8 152 FEDERAL EEPORTKK. 

made, and should not be construed as iiitended to make a radical change 
in the previous laws, unless the language plainly contemplâtes the in- 
tention to make such a change. Tavlor v. Delancev, 2 King's Cases, 
143, 151 ; Chancelier Kent, in Goodell v. Jackson,' 30 John. (N. Y.) 
693, 11 Am. Dec. 351 ; United States v. Dauphin (C. G.) 20 Fed. (125. 

There are two provisions, and only two, in the act of 1903, making 
it a misdemeanor for the master of a vessel to land aliens. One of 
thèse is section 8. This provision originated in section 4 of the act of 
February 28, 1885, to prohibit the importation of contract laborers, and 
made it a misdemeanor to knowingly land or permit to be landed "any 
alien laborer, mechanic or artisan" who previous to bis embarkation 
was under contract... Section 4 was re-enacted in the act of Mardi 3, 
1891 (section 6), in somewhat différent language, whereby it was made 
a misdemeanor to bring into or land in the United States "any alien 
not lawfuUy entitled to enter." That act enumerated the aliens who 
were not entitled to enter as belonging to two classes only, immigrants 
or contract laborers. Obviously section 8 of the présent act is merely 
a reproduction of the former laws, which apply only to thèse two class- 
es of aliens. The other provision (section 18) , under which the plaintiff 
in error was indicted, is less comprehensive than section 8. The mis- 
demeanor thereby created consists in perniitting to land without due 
précautions to prevent it, "any such alien frôm such vessel," as is men- 
tioned in the previous sections of the act and particularly in section 13. 
Section 13 provides that ail aliens arriving by water shall be listed in 
convenient groups, and each list be verified by the oath of the master 
of the vessel that he believes : 

"That no one of sakl aliens is an idiot, or insane pei'son, or iiaupor, or likely 
to beeonie a public eliarge, or is sufl'ering from a loatlisome or dangerous con- 
tagious disease. or is a person who bas beeu convicted of felouy or otlicr crime 
invQlving turpitude, or a ])olygainist, or an anarcbist, or not under promise, 
express or implied, to perforni labor in the United States, or a pro.îtitute." 

The offense consists in landing or permitting to land any alien "at 
any place other than that designated by the immigration officers." Sec- 
tion 16 rhakes it thè duty of the immigration officers to inspect ail such 
aliens as are mentioned in section 13, and empowers them to "order 
a temporary removal of such aliens for examination at a designated 
time and place," and this is the only provision of the act authorizing 
the désignation of any "time or place" by the immigration officers. 

Section 18 is a part of section 8 of the act of 1891, which only ap- 
plied to aliens who are immigrants, but as it uses the term "any aliens," 
instead of the term "any alien immigrant," it should be construed as 
applicable not only to alien immigrants, but to ail aliens of the previ- 
oùsly enumerated classes. Even if it were not by its terms applicable 
only to "sUcli aliens," those mentioned in the preceding sections, it 
would be by implication, because it is to be read with ail the provisions 
of the act in pari materia. This is not only a gênerai rule of statutory 
interprétation, but it is one which is especially applicable to a général 
code or statutory revision. As to thèse the ruk of construction is that 
the enactment is intended to forni one System of statutory laws con- 
temporancous in time, and ail the sections dealing with the same sub- 
ject-matter are to be construed as one statute. The accepted canons 



TAYLOR V. UNITEU STATES. 'J 

oî interprétation of ail statutes require every part of the act to be taken 
into view for the purpose of ascertaining the législative intent ; restrict 
gênerai expressions whenever nccessary to niake ail the parts har- 
monize and give an intelligible effect to each ; and limit the application 
of gênerai ternis so as not to lead to injustice or an absurd conclusion. 
U/S. V. Terra Cotta Vases iC. C.) 18 Fed. 508; Case of Chinese 
Merchant, 13 Fed. 605; Carlisle v. U. S., 16 Wall. 153, SI L. Ed. 426. 

Section 2 is devoted to a prcliminary enumeration of the classes of 
aliens who "shall be excluded from admission into the United States." 
This enumeration is somewhat more in détail than that contemplated 
by the provisions of section 13, but does not necessarily include any 
aliens who do not come intending to réside in the United States, and 
does not mention sailors. There is not a provision in the act which 
indicates any intention to embrace sailors in the classes of aliens to be 
excluded, otherwi.'^e than by the mère use of the terni "aliens." Many 
of the provisions in which the classes are referred to by this com- 
prehensive term are such as would be absurd, if they were intended to 
apply to sailors. Section 13 is an illustration, and it can hardly be 
seriously argued that hère Congress intended to require the niaster of 
the vessel to give each seaman a ticket to identify himself and his 
faniily, and then to require the niaster to swear that he believes that 
no one of his sailors is an idiot or a prostitute. 

Thèse considérations would sufFice to lead to the conclusion that sec- 
tion 18 does not by reasonable construction include sailors under the 
gênerai terni "any aliens" ; but they are reinforced because at the time 
of the enactment it was perfectly well understood that the alien exclu- 
sion laws did not apply to sailors. This had been so decided in United 
States v. Sandrey (C. C.) 48 Fed. 550, and in United States v. Burke 
(C. C.) 99 Fed. 895. 

In the latter of thèse cases the court said : 

"Thèse statutes do not contemplate the exclusion of crews of vessels whicli 
lawfully trade in our ports, and they do not, in spirit or in letter, apply to sea- 
meii eugaged in either ealllng, whose home is on the sea, who are hère to-day 
and gone to-niorrow, who conie on a vessel into the United States with no pur- 
pose to réside therein, but with the intention when they couie of leaving àgain 
on that or sonie other vessel, for the port of shipment or some other foreign 
port in the course of her trade. To hold that thèse statutes apply to aliens 
coniprising the bona flde crews of vessels engaged in commerce between the 
United States and foreign countries would lead to great injustice to suclj 
vessels, oppression to their crews, and serious injuries to commerce." 

The Attorney General of the United States had forniulated an opin- 
ion on the subject to the same effect, and had so advised that depart- 
nient of the government charged with the administration of the alien 
exclusion laws. He said : 

"That, although it was true that Congress had not excepted them (seamen) 
from the express langunge of thèse statutes, in tlu; practical administration 
of thèse laws they hâve always been exceiited, and their inclusion în the class 
of alien immigrants would lead to conseciuences so destructive to Ipgitimate 
commerce, that such inclusion could fnirly be regarded as beyond the intention 
of Congress." 23 Op. Atty. Gen. 521. 

In view of the décisions of the fédéral courts whenever the question 
had been presented, the opinion of the chief law ofïicer of the govern- 



-i-^ 152 FEDERAL REPORTER. 

ment, and tîie construction which had been placed upon the pre-ex- 
isting législation by the administrative officers of the government, the 
circumstances that in the revision no change was made specifically 
enlarging the class of prohibited aliens se as to include sailors, is sig- 
nificant that Congress had no intention of including them. 

The majority opinion adopts a construction of the statute which lias 
not hitherto been supposed possible by the head of the Immigration 
Bureau. In bis last ofïïcial report, that of 1895, the Commissioner 
General of Immigration recommends that législation should be adoptée! 
"to check violations of the immigration laws by professed seamen, 
and imposing a penalty upon masters for signing other than bona fidc 
seamen upon their crew lists." 

The majority opinion, in order to obviate the hardship and incon- 
venience which would resuit if alien seamen are included in the statute, 
attempts to mitigate thèse conséquences by giving a m^ore libéral in- 
terprétation to the term "landing" than is permitted by the language 
of the section. The opinion virtuallly déclares that, if seamen are al- 
lowed to go ashore under such rules, discipline, and restraint as would 
tend to bring them back to the ship, they are not "landed," within the 
meaning of the section. According to the accepted meaning, the act of 
landing is "setting on shore ; coming on shore." Giving the language 
of the section its ordinary meaning, it is none the less an offense to 
land a sailor that he has been landed under précautions which will in- 
sure his return to the ship. If sailors are included in the statute, it 
seems plain that they cannot be permitted to go ashore by the officers 
or the owner of a vessel, and any failure to take sufficient précautions 
in that behalf is a violation of the section. I cannot agrée to such a 
latitudinarian construction of the statute for the purpose of eliminating 
its objectionable features and fortifying the argument that Congress in- 
tended to include sailors. 

Congress either intended to include sailors under the gênerai term 
of aliens, or it did not. The majority opinion is based merely on the 
employment by Congress of the broad term. If Congress by the use 
of this term intended to include sailors, it intended to include the officers 
of the ship ; and the commanders of nearly ail the foreign steamships, 
as well as the officers of foreign naval vessels upon a visit hère, would 
be included in the term. 

I think the conviction of the plaintifï in error proceeded upon a 
wrong interprétation of tlie statute, and that it should therefore be 
reversed. 



KICKET LAND & OATTLE CO. V. MILLER & LUX. ,11 

RICIvEY LAND & CATTLE CO. T. MILLER & LUX* 

(Circuit Court of Appeals, Nintlx Circuit March 4, 1907.) 

No. 1,366. 

1. Watebs and Wateb Courses— Ibeigation—Rights of Appbopeiators— 

Incobporeai. Hereditaments. 

The riglit of an appropriator of tbe water of a stream, for tlie purpose 
of irrigation, to tiave ttie water flow in tlie river to tbe liead of its dltcti, 
Is an incorporeal hereditament appurtenant to the ditch and coextensive 
with the owner's right to the dItch itself. 

[EA. Note. — For cases in point, see Cent Dig. vol. 48, Waters and Water 
Courses, § 15.] 

2. Same— Qtjieting Title. 

A suit to quiet title to a water right for Irrigation purposes, and to 
détermine the iandowner's rlgUt to divert the waters from a stream for 
Buch purposes, Is in the nature of an action to quiet title to real estate. 

3. Same— Right to Sue— Venue— Acts Paetly in Différent States. 

Where complaiuant claimed title by prior appropriation to a certain 
part of the flow of a river to irrigate its iands in Nevada, and alieged 
that sucb rights were being Interfered with by défendant, an appropriator 
of the waters of the same stream in Califoruia, of wbich state défendant 
was a résident, complainant was eutitled to sue to quiet its title to such 
water right in tbe fédéral courts sittlug in Nevada. 

4. Same. 

ïbe Jurisdiction of the Nevada court was not defeated by the fart that 
défendant set up in its answer and eross-bill that it bad an appropriation 
of water from the same stream in California for the purpose of irrigat- 
ing Iands lu that state. 

5. Courts— State and United States Courts— Pbiority of Jueisdiction. 

Where a fédéral court sittiiig In Nevada acquired jurisdiction of a suit 
to quiet title to an appropriation of water from a stream in that state as 
agiunst delendant, a résident of California, such jurisdiction would be 
maiutained as against subséquent siaiilar actions brought by défendant for 
the same purpose in the California state courts. 

[Ed. Note. — For cases in point, see Cent Dig. vol, 13, Courts, { 1345. 

Pendency of action in state or fédéral court as ground for abatemuut in 
the otUer, see notes to 47 C. C. A. '205, 73 C. C. A. 52i.J 

6. Same — Injunction — Actions in State CouRn's. 

Kev. St § 720 [U. S. Comp. St 1001, p. 581], prohibiting the granting 
of au injunction by a fédéral court to stay a proceeding in a state court 
does not prevent a fédéral court having first acquired jurisdiction of the 
parties aud subject-niatter of an action from restraiuing tbe parties from 
resorting to proceedings in a state court having concurrent jurisdictioQ 
which would defeat or impair the fédéral eourt's jurisdiction. 

[Ed. Note. — For cases in point, see Cent Dig. vol. 13, Courts, i§ 1418- 
1430.] 

T. Lis Pendens— PuRCHASE Pendente Lite— Effect. 

Where détendant corporation acquired its property and water rights In 
controversy from R. after suit to quiet title to complainant's water riji' (s 
In Nevada, as against R., bad been begun in the fédérai court of Nevu<ia, 
and after R. bad answered therein and the court had acquired full juris- 
diction over both tbe subject-matter and R., the corporation was a pen- 
dente lite purchaser, and bound to abide the judgment in such suit 

Appeal from the Circuit Court of the United States for the District 
of Nevada. 

For opinion below, see 146 Fed. 574. 

♦Rehearing denled May 20, 1907. 



12 152 FEDERAL REPORTER. 

Walker river is a stream flowing from withiu tlie stiite of Culifornia eastiprly 
into tlie State of Nevada. Toward its source it divides iiito two brancbes, 
kiiowii as the East and West Forks. The junetion Js in the state of Nevada. 
The appellant and the appellee are each incorporated. the former having its 
résidence in the state of Califoriiin. aud the lattcr in t!;',' f-tate of Nevada. 0:\ 
tho :10th of Jime. 1002. tlie apiiellee filed its bill of coniijlaint in the Circui'. 
Court of the United States for the District of Nevada against Thomas 11 
Kickey and many other persons. Service of process was had upon Rickey 
who thereafter appeared and answered. By said bill of complaint it was 
alleged, among other thins's, that coniplainant therein (tlie appellee hère) 
was then, and for a long time p]-ior thereto had been, the owner aud seised 
in fee, and in actual possession, of certain lanrts situated in the county of 
Lyon, state and district of Nevada, particularly describing them ; that Walker 
river is a natural stream and water course which flows, and from time immé- 
morial bas flowod. to, over, upon, and through the said lands, which said 
lanfls include the banks, bed, and stream of said river; that at divers times. 
In said bill set forth, the complainant, its grantors and predecessors in intor- 
est, had first appropriated and diverted from said river portions of the waters 
thereof, amountiiig in ail to a flow of 943.2!) cubie feet of water per second, 
and had carried the same to and upon certain lands, and used the same for 
the irrigation thereof, and that said complainant was then the owner by sueh 
appropriation of certain interests in the waters of said river; sueh interests 
belng particularly set forth and enumerated. It was then furtber alleged 
that Rickey and other défendants in the suit had diverted the waters of said 
Walker river at divers places above the lands of the complainant, and above 
the points at which complainant so diverted said water, and that a large 
portion of the water so diverted by the défendants in said suit was never re- 
turned to , the ■ stream, and that sueh défendants were eontinuing the diver- 
sions aforesaid, and had thereby deprived, and were dopriving, such coniplain- 
aivt of a large portion ' of said water to which it was so entitled ; that each 
of said diversions so niade by such défendants was without right, but that 
they had diverted said watfr, and were so diverting the same, under claim of 
right so to do, adversely to the coniplainant ; that by such diversions complain- 
ant had been and was being deprived of sufflcient water to irrigate its said 
lands, and was thereby rendered unable, and so long as said diversions were 
continued would be unable, to irrigate sueh lands, which it had thcretofore 
been accustomed to irrigate, and was thereby rendered unable, and would be 
unable, properly or suecessfuUy to cultivate the same, or to raise crops tbere- 
on. And it was further alleged that if said défendants, or either of them, 
had any right to divert any water from the said river, such riglits, and each 
of them, were subséquent and snbordinate to the aforesaid appropriations so 
niade by complainant and its grantors and predecessors. The prayer was that 
the détendants in said suit, including liickey, be eujoined and restrainod 
from diverting any water from Walker river in subversion of the rights of 
<x)mp!ainant. 

Subsequently, on the lôth day of October, 1904, the Rickey Land & Cattle 
Company commenced an action in the superior court of tue county of Mono, 
state of Calitornia, against the appellee and a large uumber of other per- 
sons, by fding a complaint in said court, whereby it was alleged, among other 
thiugs, that the said company was, and had been siuce the Oth day of August, 
1002. the owner, in possession, .and entitled to the possession of certain lands 
conveyed to it by Thomas B. Rickey, ail situated in the state of Cadfornia, 
and that the same constitued an entirc coutiguous body of land, over, through, 
and upon which flowed, and from time immémorial had flowed, a braneh or 
tributary of Walker river called the "West Fork," and that said lands and ail 
thereof were, and from time immémorial had been, riparian to said stream, 
aud situated along and bordering thereupon; that the said company was the 
owner, in iwsséssion, and entitled to the possession of such lands, and had the 
right to divert and appropriate ail the waters of said West Fork of Walker 
River, and its tributaries in the state of Galifornia, to the extent of a con- 
stant flow of 1,575 cubic feet of water per second. It was further alleged that 
the défendants in said action, and each of them, including the appellee herein, 



EICKET LAND & CATTLE CO. V. MILLEK & LUX. 13 

claimed some riglit, title, and intovest adverse to the said Rickey Laiid & Cat- 
tle Company in and to said constant flow of 1,075 cubic teet of water per 
second, or some part or portion tliereof ; tliat said riglit, title, and interost so 
claimed by such défendants, and eaeb of tliem, including tbe appellee, in and 
to said water, was without riglit, and tbat ail claims of tlieiu, and each of 
them, to tbe waters of said West l''ork of said Wnlkev Kivor were subordinale 
and sul)ji'Ct to tbe ownersbip of said conipany, and its alleged rigbt to divert 
and ai)propriate from said West Fork of Walker River a constant flow of tlio 
iuuoiiut of water specified. ïbe prayer was that tbe Rickey Land & Cattle 
Coui])any be decreed to be tbe owner of tlie amount of water specified, and 
entitled to tbe use aud enjoyinent of tho sanie, and tbat appellee and tbe 
otber défendants tberein be subordinated to tbe interests of tbe said company 
in tbe flow of the waters of said West Fork of Walker River. 

On tbe sanae day, October 15, 1904, tbe Rickey Land & Cattle Comjiany 
eommenced anotber action of llke eliaracter in tlie sajue court, involving 504 
cubic feet of water in tbe East Fork of Walker River, claimed unde.r similar 
riglits, and it was alleged that ail of sucb rights were snperior to the rights 
of défendants tberein, including appellee, whatever tbey might be. 

Tbe bill of eoniplaint liereiu sets fortb ail thèse faets and proceedings, and 
further sliows tbat, after appellee bad flled its bill of complaint in tbe Circuit 
C'onrt of tbe United States for tbe District of Nevada, and aller Rickey bad 
appeared and flled bis answer tberein, be (Rickey), on August G, l!tO(i, or- 
ganlzed and incorporateil the Rid^ey Land & Cattle Company, and conveyed 
to it ail the lands and water rights thereafter claimed by it in the two actions 
eommenced in the superior court of Jlono county. in tbe stato of Cnlifornia. 
Then folîows tbe allégation: "Tbat tbe issues tendered by said comp'aints in 
said two actions so brought by the défendant herein as plaintiff against your 
orator, and said otber persons are, so far as concerns your orator, tbe same 
issues wbicb were tendered by the. said bill of complaint of your orator so 
flled in tliis court, so far as the same related to tbe défendant. Thomas B. Rick- 
ey, in said suit." , The prayer is tbat tbe défendant be eujoined from prosecut- 
ing eitber of tbe actions convinenced in Mono county, state of California, 
agfunst the complainant, and for gênerai relief. 

The cause having been heard iipon the bill and certain affidavits filed in dé- 
fense, a temporary restraining order was directed to issue, and the appeal is 
from the action of tbe court in this regard. 

Tbe record contains a supplemental cojnplaint by tbe Pacific Livo Stock 
Conipany, sliowlng tbat it bas sncccedod to the interests of tbe appellee, but 
such complaint serves no essential purpose in the présent controversy. 

James F. Peck and Charles C. Boynton, for appellant. 
W. C. Van Fleet and W. B. Treadwell {Frohman & Jacobs and 
Frank H. Short, of counsel), for appellee. 

Before GILBERT and ROSS, Circuit Judges, and WOLVERTON, 
District Judge. 

WOLVERTON, District Judge (after stating the facts). Let us 
inquire, first, touching the nature of the suit instituted by the appellee 
as complainant, against Rickey and others, in the Circuit Court of 
the United States for the District of Nevada, June 10, 1902, for the 
incjuiry will settle the jurisdiction of the court to proceed in that cause, 
and in one aspect will détermine its authority to grant the relief de- 
manded in this cause. In the course of the incjuiry, it is important that 
we first ascertain the nature of the subject-matter of the cause. 

Says the court in the case of Lower Kings River Water Ditch Co. 
V. Kings River & Fresno Canal, Co.,. 60 Cal.'^'tOS: 

" 'A water course consista of bed, banlîs and water.' Angell on AVatcr Cours- 
es, § 4. Tbe right of iilaintiff, as stated in its complaint, to hâve tbe water 



14 152 FEDERAL REPOETER. 

flow in tlie river to the head of its ditcli, is an Incorporeal hereditament ap- 
pertaining to its water course. Granting tliat plaintiff does not own the cor- 
pus of tlie water until it sliall enter its ditch, yet the right to hâve It flow In- 
to the ditch appertains to the ditch. Real property consista of land, that 
which is afllxed to land, and that wliich is incidental or appurtenant to land. 
Civil Code, 058. If the water course, consisting of tlie bed and banks of the 
trench, and of the water therein, be real property, the right to hâve water flow 
to it is incidental and appurtenant thereto." 

So in Construction Co. v. Ditch Co., 41 Or. 309, 215, 69 Pac. 455, 
458, 93 Am. St. Rep. ÎOI : 

"If the riparian owner grants a right to divert the water and convey it away 
to and upon the lands of the grantee, the grant becomes an easement appurte- 
nant to such lands, which becomes thereby the dominant estate, and the grant 
an incorporeal hereditament. If title be acquired by prescription, the estate 
and the right are the same." 

So, also, in Wyatt v. Larimer & Weld Irr. Co., 33 Pac. 144, 18 Colo. 
398, 36 Am. St. Rep. 280, Mr. Justice Goddard, speaking for the 
court, says: 

"That a valid appropriation of water from a natural stream constitutes an 
easement in the stream, and that such easement is an incorporeal hereditament, 
the appropriation being In perpetuity, cannot well be disputed." 

And, after citing Washburn on Easements and Servitudes, and 
Angell on Water Courses, proceeds: 

"ïhe right acquired to water by an appropriator under our System Is of the 
same charaeter as that defined by the foregoing authoritles as nn Incor- 
poreal hereditament and easement. The consumer under a ditch posses^es a 
llke property. He is an appropriator from the natural stream, through the 
intermediate agency of the ditch, and has the right to hâve the quantity of 
water so appropriated flow in the natural stream, and through the ditch, 
for hls use." 

And, generally, it is held that: 

"The right of the prier appropriator to hare the water flow in the stream 
to the head of his ditch is an incorporeal hereditament appurtenant to his 
ditch, and coextensive with his right to the ditch itself." Willey v. Decker, 
73 l'ac. 210, 225, 11 Wyo. 496, 100 Ani. St. Rep. 939 ; Smith v. Deuniff, 60 Pac. 
398, 24 Mont. 20, 81 Am. St. Rep. 408. 

Or, putting it in another form, that: 

"A right to divert and use the waters of a stream, acquired by appropria- 
tion, is a hereditament appurtenant to the land for the benefit of which the ap- 
propriation is made." Oonant v. Deep Creek & Curlew Yal. Irr. Co., 66 Pac. 
188, 23 Utah, 627, 90 Am. St. Rep. 721. 

See, also, Simmons v. Winters, 21 Or. 35, 27 Pac. 7, 28 Am. St. 
Rep. 727 ; Hindman v. Rizor, 21 Or. 113, 27 Pac. 13 ; Bear Lake & 
River Waterworks & Irrigation Co. v. Ogden City, 8 Utah, 494, 33 
Pac. 135 ; Tucker v. Jones, 8 Mont. 225, 19 Pac. 571 ; Sweetland v. 
Olsen, 11 Mont. 27, 27 Pac. 339 ; Cave v. Crafts, 53 Cal. 135. 

So it follows, as a déduction from thèse principles, as was said in 
the Conant Case, that : 

"An action, therefore, to quiet the title and détermine and to establish the 
right to divert and use water for such purposes, is in the nature of an action 
to quiet the title to real estate." 



EICKET LAND & CATTLE CO. V. MILLER & LUX. 15 

Under the bill there is the assertion of a valid appropriation of the 
waters of Walker river, for use upon lands in Nevada which are 
specifically described, and which the complainant owns, and the further 
averment that the défendants claim a right of diversion and appropri- 
ation adverse to that which complainant has acquired ; and the prayer 
is, in efifect, that défendants be restrained from the exercise of their 
alleged right to the injury of complainant. Could there be a plainer 
case of an attempt to quiet title to the appropriation itself ? Although 
the right to hâve the water of Walker river flow frora above down to 
and within the complainant's canals and ditches, for use upon its 
lands, is an incorporeal hereditament, it is, nevertheless, under the 
foregoing authorities, appurtenant to the realty in connection with 
which the use is applied. It savors of, and is a part of, the realty it- 
self. The suit, therefore, in its purpose and effect, is one to quiet 
title to realty. Complainant's diversion being in Nevada, and the use 
being upon realty situated in Nevada, and the suit being one concern- 
ing or pertaining to that realty, it is necessarily local in character, and 
was properly instituted in the state of Nevada. See Conant v. Deep 
Creek, etc., Company, supra. The proposition seems so clear that it 
is scarcely necessary to cite other authorities in its support. And it 
is equally clear that the courts of one state are without jurisdiction 
to hear and détermine suits instituted in another for the adjustment of 
adverse claims respecting the légal title to realty, and which pertain 
to the realty as the subject-matter of the controversy. 

There has been much discussion of the légal principle that, as to 
certain causes arising partly in one jurisdiction and partly in another, 
the right of action will be entertained in either jurisdiction. The prin- 
ciple is that, where two material facts are necessary to give a good 
cause of action, and they take place in différent jurisdictions, the cause 
may be said to hâve arisen in either jurisdiction. Numerous authori- 
ties are cited in support of this principle, among which are the fol- 
lowing : 

"When an action Is founded upon two things In différent counties, both ma- 
terial to the maintenance of the action, it may be brought in the one county 
or the other." Com. Dig. "Action," N, 11. 

"Where an injury has been comuiitted in one county to real property situate 
in another, or wherever the action is founded upon two or more material facts 
which took place in différent counties, the venue may be laid in either." 1 
Saund. PI. & Ev. 413. 

"Supposing the foundation of the action to hâve arisen in two counties, I 
think that, where there are two facts which are necessary to coustitute the 
offense, the plaintiflf may, ex necessitate, lay the venue in either." Ashurst, 
J., in Scott V. Brest, 2 Term R. 238. 

And: "When matter in one county is dépend ing upon the matter in the 
other county, there the plaintiff may choose In which countj' he will bring 
his action." And : "If a man doth not repair a wall in Essex which he ought 
to repair, whereby my land in Middlesex is drowned, I may bring my action 
in Essex, for there is the default; or I may bring it in Middlesex, for there 
I hâve the damage." Buhver's Case, 7 Coke, 1. 

So, in Barden v. Crocker, 10 Pick. (Mass.) 383, in an action brought 
in the county where the property was damaged for diversion of water 
in another, it was held that the action could be maintained in either 
county. So, also, in the case of Foot v. Edwards, Fed. Cas. No. 4,908, 



IG 152 FEDERAL EEPORTEB. 

an action for damages for an in jury to the mill property of the plain- 
tiff situated in Massachusetts, that the action could be maintained in 
Connecticut, where the water was diverted to the injury of the mill. 
And again, in the case of Rundle v. Delaware & R. Canal, 1 Wall. 
Jr. 275, Fed. Cas. No. 13,139, an action was sustained in New Jersey 
"for damage donc to plaiiitiff's realty in Pennsylvania." Thèse au- 
thorities pertaiu to actions at law. 

The gênerai doctrine of the common law is that an action for injury 
to real property, as trespass, or case for nuisance, is local, and must 
be commenced within the county or district in which the land lies. 
Watts' Administrators v. Kinney, 33 Wend. (N. Y.) 484. This seems 
to be controlled, however, by the rule above referred to, that, where 
an act bas been coinmitted in one jurisdiction which causes injury to 
realty in another, a suit may be brought in either. In further sup- 
port of the latter proposition, Mr. Gould is authority. He says: 

"If, however, a tortious act conimitted in one coxinty occasions damage to 
land or auy otlier local sub.iect situa te in another, an action for tlie injury 
tlms occasioned may be laid in either of the two eonntles, at the choice of the 
party injured. Thus. if, hy the diversion or obstruction of a water course in 
tlie county of A., damage is done to lands, tnills, or other real property in 
the county of B., the partv injured may lay his action in either of those two 
counties." Gould, PI. p. 305, § 108. 

In case of nuisance, however, where it is sought to abate the nuisance 
by injunctive process, it is requisite that the suit bç instituted in the 
jurisdiction where the nuisance is maintained, because it is said the 
remedy is quasi in rem, and must act upon the thing itself which is 
causing the damage. This was held in the case of Stillman v, White 
Rock Manufacturing Co., Fed. Cas. No. 13,446 (33 Fed. Cas. 83). 

There is but little c[uestion that the sanie rule as to venue in the com- 
mencement of suits in equity will apply as in actions at law. It is of 
primary importance, however, that a cause in equity exist, for, unless it 
does, the suit cannot be maintained anywhere. A suit may be local or 
transitory, as well as an action at law ; and, if a suit pertains to or is 
concerning realty as the direct subject-matter of the inquiry, like an 
action at law in ejectment, it must be cornmenced in the jurisdiction 
where the realty is located. But if jurisdiction rests ripon an équitable 
cause, such as multiplicity of suits, irréparable injury, spécifie perform- 
ance, rescission, or the like, the suit need not necessarily be local. It 
may be transitory as actions are transitory, and if the appropriats con- 
ditions are présent, the suit may be brought, as actions may be brought, 
in either jurisdiction, and is therefore governed by the same principle. 
But, as we hâve heretofore determined, the présent suit is one affecting 
realty, and was therefore local, and for this reason the venue was prop- 
erly laid in the state of Nevada. 

It is well determined that : 

"In a case of fraud, of tru,st, or of contract, the .iurisdiction of a court of 
cliancery is sustainable wherever tlie person be found, although lands not with- 
in the .iurisdiction of tliat court may be afCected by the deeree." Massie v. 
Watts, C Cranch, 148, 3 L. Ed. 181. 

Or, as expressed in gênerai terms in the case of Phelps v. McDonald, 
99 U. S. 298, 308, 25 L. Ed. 473, that: 



RICKET LAND & CATTLE CO. V. MILLEB & I,UX. 17 

"Wliere tlic neeessary partips are before a rourt of equity, it is iniinatcrial 
that the res of tlie controversy, w]>etlicr it be real or ])ers(inn] proiicrty, is 
beyond tbe territorial jurisdietiou of tiic tribunal. It lias tbc iiower to tom- 
])el the rti'feiulant to do ail tliings neces;!<ary, according to tlie Icx loci rei sitie, 
which he could do voluntarily, to give full effect to the den-ee aiiaiiist hini. 
Withoiit regard to tbe situation of tbe suljjeet-matter, sucb covu'ts consider tbe 
eqiiitlos between tlie ])arties, aiid decree in personani aecording to tlioKo equi- 
ties, and enforee obédience to thcir decrees by process in persouam." 

This rule "has becn often applied," savs the court, in Cole v. Cun- 
ningham, 133 U. S. 107, 119, 10 vSup. Ct.' 20!), 273, 33 L. Ed. 53<S, "by 
the Courts of the domicile against the attempts of sonie of its citizens to 
defeat the opération of its laws to the wrong and injury of otliers." 

If such be the law where the res is without the jurisdiction of the 
court, by how much stronger will be its application where the jurisdic- 
tion extends over the res as wcll as to the person. So that the court 
having jurisdiction of the res — that is, of the thing in controversy, 
which is the realty in the présent instance — has undoubtcd authority 
and jurisdiction, having also jurisdiction of the person, to protect the 
thing against the encroachments of the person, whether those encroach- 
ments corne from within the state or without. 

The appellant's counsel maintain that, because the appellant has set up 
in its answer and cross-bill to the original suit that it has an appropria- 
tion in California for the purpose of irrigating lands in that state, there- 
fore the court in Nevada has no jurisdiction to détermine its rights in 
the state of California. The contention seems to us to be beside the 
question. The défendant will not be permitted, by thus setting up a 
cause of suit in the state of California, to defeat the jurisdiction of the 
court in the state of Nevada. The complainant must be permitted to 
proceed upon the case made by its pleadings, and the défendant cannot 
defeat the jurisdiction by alleging that it has rights elsewdiere which may 
conflict with the rights of the complainant. It may be said that the 
court in Nevada has not the power to quiet the title of the défendant in 
the state of California. But the défendant has the right to set up its 
conflicting interests, which arose in California, as a défense against the 
attempt of the complainant to hâve its title in Nevada quieted, because 
the complainant's title must dépend upon whether it has the better right 
as against the défendant — the rights of the parties arising in the states 
in which their respective interests are found. So that the answer and 
cross-complaint of the défendant can only operate defensively in the 
original suit, and not to give the défendant a right to hâve its title also 
quieted in the state of California. Though the Nevada court is not au- 
thorized or empowered to settle the rights of the parties in the state of 
California, it may look, nevertheless, under the défensive answer to the 
appropriation in the state of California, to ascertain and détermine 
whether such appropriation is prier and paramount to the complain- 
ant's appropriation, and, if not, then to settle and quiet complainant's 
title and rights thercto. 

That our position may be fuUy understood, we will extend the dis- 
cussion a little. The water in the stream, which has a propensity to 
seek its level, and will continue in its current to the sea, is in strict real- 
ity the véritable thing in controversy. It knows not imaginary state or 
1.j2 F.— 2 



18 152 FEDERAL REPORTER. 

county lines, and is a thing in which no man has a property until cap- 
tured to be applied to a bénéficiai use. The right of appropriation is 
recognized in law, which means the right of diversion and use. It is 
the right, not to any spécifie water, but to some definite quantity of that 
which may at the time be running in the stream. So the right acquired 
by an appropriation includes the right to hâve the water flow in the 
stream to the point of diversion. The fact of a state line intersecting 
the stream does not, within itself, impinge upon tlie right. In other 
words, the appropriation may still be acquired although the stream is 
interstate and not local to one state; nor wiU the mère fact that the 
stream has its source in one state authorize a diversion of ail the water 
thereof as against an earlier and prior appropriator across the line in 
another state. On the contrary, one who has acquired a right to the 
water of a stream by prior appropriation, in accordance with the laws 
of the state where made, is protected in such right as against subsé- 
quent appropriators, though the latter withdraw the water within the 
limits of a différent state. Howell v. Johnson (C. C.) 89 Fed. 556 ; 
Hoge V. Eaton (C. C.) 135 Fed. 411; Anderson v. Bassman (C. C.) 
140 Fed. 14. So that, iv determining the right of appropriation in one 
state, it may become neccssary to ascertain what are the rights in an- 
other, and a mère assertion of rights in the courts of the latter state 
cannot operate to preclude the courts of the former from exercising 
cognizance over the entire subject-matter before them. The very ques- 
tion that appellant makes was determined in the case of Anderscm v. 
Bassman, supra : 

"It Is objected by the défendants," says Morrow, Circuit Judge, "that the 
relief sought by the bill, In determining the rights of the complainants to a 
spécifie quantity of the waters of tlie West Forli of the Carson River, is be- 
yond the jurisdiction of this court, in that it is aslciug the court to pass upon 
titles to real property in another state." 

And the décision was against the contention. So the décision hère 
must be against appellant's contention upon the point urged. 

That the présent bill is ancillary to the original suit instituted in the 
Circuit Court for the District of Nevada is not questioned. It is not 
infrequent that the state courts corne in conflict with the fédéral courts, 
and vice versa of the fédéral with the state, and this where they ex- 
ercise concurrent jurisdiction. In ail such cases it has been firmly es- 
tablished that the court first acquiring jurisdiction of the subject-mat- 
ter of the action or suit, and of the parties, is entitled to maintain it 
until the controversy is at an end and the rights of the parties are fuUy 
administered, without interférence from, and to the exclusion of the 
other. Pitt v. Rodgers, 104 Fed. 387, 43 C. C. A. 600 ; Starr v, Chicago, 
R. I. &P. Ry. Co. (C. C.) 110 Fed. 3. In the maintenance of such 
jurisdiction, it is a common remedy to invoke the injunctive process, 
not against the court offending, but against the parties, to restrain them 
from proceeding therein in antagonism to the jurisdiction first ac- 
quired; and the remedy is available either before or after judgment or 
decree, either to enable the court to render an effective adjudication, 
or to command full obédience to its mandates. In support of the 
doctrine generally, we quote from three of the authorities out of many 



EICKET LAXD & CATTLE CO. V. MILLER & LUX. 19 

that may be cited. In Peck v. Jenness, 7 How. 612, 634, 12 I,. Ed. 
841, the court says : 

"It is a doctrine of law too long established to require a citation of au- 
thorities, tliat, wliere a court has jurisdietion, it bas a riglit to décide every 
question whicli occurs in the cause, and, whettier its décision be correct or 
otlierwise, its judgment, till reversed, is regarded as binding in every other 
court ; and that, where the jurisdietion of a court, and the right of a plaintiff 
to prosecute his suit In it, hâve once attached, that riglit cannot be arrested 
or taken away by proceedings in another court. ïhese rules hâve thelr 
foundation, not merely in comity, but on necessity. For if one may enjoin, 
the other may retort by injunction, and thus the parties be without remedy ; 
being liable to a process for contempt in one, if they dare to proceed in the 
other. Neither can one take property from the custody of the other by replev- 
in or any other process, for this would produce a conflict extremely embar- 
rassing to the administration of justice." 

So in Root V. Woolworth, 150 U. S. 401, 410, 14 Sup. Ct. 136, 138, 
37 h. Ed. 1133 : 

"It is well settled that a court of equity has jurisdietion to carry into ef- 
fect its own orders, decrees, and judgments, which remain unreversed, when 
the subject-matter and the parties are the same in both proceedings. The 
gênerai raie upon the subject is thus stated in Story's Equity Pleading (9th 
Ed.) § 338: 'A supplemental bill may also be filed, as well after as before a 
decree ; and the bill, if after a decree, may be either in aid of the decree, that 
it may be carried fully into exécution; or that proper directions may be given 
upon some matter omitted in the original bill, or not put in issue by it, or by 
the défense made to it ; or to bring f orward parties before the court ; or it may 
be used to impeach the decree, which is the peculiar case of a supplemental 
bill in the nature of a bill of review, of whieh we shall treat hereafter. But 
where a supplemental bill is brought in aid of a decree, it is merely to carry 
out and to give fuller efCect to that decree, and not to obtain relief of a dif- 
férent kind on a différent principie ; the latter being the province of a supple- 
mentary bill in the nature of a bill of review, which cannot be flled without 
the leave of the court' " 

And again, in French, Trustée, v. Hay, 22 Wall. 250, 22 L. Ed. 857, 
Mr. Justice Swayne, speaking for the court : 

"It (the bill then pending) is auxiliary and dépendent in its character, as 
much so as if it were a bill of review. The c»urt having jurisdietion in per- 
sonam had power to require the défendant to do or to refrain from doing any- 
thing beyond the limits of its territorial jurisdietion whieh it might hâve re- 
quired to be done or omitted within the limits of such territory. Having the 
possession and jurisdietion of the case, that jurisdietion embraeed everything 
in the case, and every question arising which eould be determined in it until 
it reached its termination and the jurisdietion was exhausted. While the 
jurisdietion lasted it was exclusive, and could not be trenched upon by any 
other tribunal." 

The case relied upon by counsel for appellant — Oliver v. Parlin &: 
Orendorff Co., 105 Fed. 272, 45 C. C. A. 200— is in harmony with 
thèse authorities ; but there the fédéral court had not acquired previous 
jurisdietion over the person of the Groesbeck National Bank, which 
it was sought to enjoin. 

The doctrine being thus established, and the jurisdietion of the 
fédéral court in the présent case having first attached, section 720, 
Rev. St. [U. S. Comp. St. 1901, p. 581], is without appHcation. As 
is well known, this section inhibits the granting of a writ of injunction 
by a fédéral court to stay the proceedings of a state court. 



20 _^152 FEDERAL lîErOKTEU. 

"Tt Is wcll settled," sàys Mr. Bâtes, in bis work on Fédéral Equity Proco- 
îluro, § 541, "upon both reason and nutliority, tliat tlie prolMbition contained 
in tliis stiitute 'does not apply wliere tlie fédéral court bas first obtained juris- 
diction, or wlicre, the state court bavini,' first obtained .lurisdietion, tbo case 
bas beeu removed to the fédéral court. In sucli cases tbe fédéral court may 
restraiu ail proceediugs in a state court wbieh would bave tbe efCect of 
fiefeating or inipairing its jurisdiction. It extends only to cases in wbicb tbe 
jui'isdictiou lias first attacbed.' If tbe rnlo were otberwise, 'after suit brought 
in a fédéral court, a party défendant could, by resorting to a suit in a state 
court, defeat, in niauy ways. tbe efl'ective jurisdiction and action of tbe fed- 
oral court, after it bad obtained full jurisdiction of person and subjeet-inat- 
tcr.' " 

Tlie appellant, the Rickey Land & Cattle Company, lias succeeded 
to ail the interest of Rickey, in so far as such iiitercst affects and per- 
tains to the subject-matter of the controversy in the casg of Miller & 
Lux V. Rickey et al (C. C.) 146 Fed. ,')74. The position is so apparent 
from Rickey 's own affidavit as to put at rest ail contention about it. 
He says : ■ 

"Tbat tbe said Rickey Land & Oattle Company acquired by conveyance from 
said Tbonias B. Ricltey ail bis right. tltle, and interest to certain water rigbts, 
and rigbts to the use of water; and said water rigbts, and rigbts to tbe 
Use of water, are in part tbe Water riglits, and rigbts to the use of water, de- 
seribed and mentioned in the said com))laints in said actions commenced in 
Mono county ; but tbe said water riglits so acquired by tbe said Rickey Land 
& Cattle Company from tbo said Tbonias B. Rickey are not the same rigbts to 
water, and rigbts to tbe use of water, alleged in said complaints in said Mono 
county in this : tbat since tbe conveyance of said lands by Thomas B. Rickey, 
and paid water rigbts, and tbe right to tbe use of water to said Rickey Land 
& Cattle Company, wbich tonveyance was niade, executed, and delivered ou 
the 6th day of August, 1902, the Rickey Land & Cattle Company bas at ail 
finies appropriated and divertëd the water described in tbe said complaints 
in said actions commenced in said Mono county for a bénéficiai purpose, and 
has used tlie same for a bénéficiai purpose, and bas divertëd, appropriated, 
and used such water adversely to ail tbe world, and under a elaim of rigbt 
so to do, and has so divertëd, appropriated, and used such water continuously, 
uninterruptedly, notoriously, adversely, exclusively, and peaceably." 

The affiant attempts to show wherein the rights that the Rickey Land 
& Cattle Company now claim are différent from those which were 
conveyed and transferred to it by Rickey himself, and in that attempt 
it is significant that he shows that whatever différence exists at the 
présent time between the two rights is the resuit of what the company 
has donc since its acquirement from Rickey, that is, in the way of 
continuing and increasing Rickey's alleged original appropriations of 
water, but not to the extent of acquiring any new or différent rights. 
by adverse holding and possession, or otberwise. In other words, 
the company has merely builded upon the rights obtained from Rickey, 
withont acquiring any new or additional rights. Thèse are the rights 
that the Rickey I-,and & Cattle Company is seeking to establish in the 
superior court of Mono county, Cal., against which it is maintained 
that the rights of the appellee are adverse and subordinate, and the 
same rights which the appellee asserts are subordinate to those that it 
has acquired and is possessed of and owns ; so that the issues must 
needs be the same, and the controversy the same, whether Miller & 
Lux, the appellee, goes into the Mono county superior court, or the 
Rickey Land & Cattle Company makes défense in the United States 



KICKET LAND & CATTLE CO. V. MILLEE & LUX. 21 

Circuit Court for the District of Nevada. The Nevada court, there- 
fore, having first acquired jurisdiction, may maintain and exercise it 
to the end, to the exclusion of the state court in Mono county. 

The next and final question relates to the doctrine of lis pendens, 
and its application hère. As to this, there necd be but little said. In 
the case of Mellen v. Moline Iron Works, 131 U. S. 3-52, 371, 9 Sup. 
Ct. 781, 787, 33 L. Ed. 178, the court says: 

"Purcliasers of projierty involvetl in a pendins suit m.'iy be admitted as par- 
ties, in tlie discrétion of tlie court ; but tliey cannot demand, as of absolute 
riglit, to be niade parties, nor can they eornplain if they are eonipellcd to abide 
by whatever decreo the court may render, within the limits of its power, in 
respect to the interest their vendor had in the property purciiased by theni 
pendente lite. Eyster v. Gaff. 91 U. S. ô21, 524. 2;î L. Ed. 403 ; Union Trust 
C'o. V. Inland Xavi'^ation & Iniprovoment Co., VM IJ. S. Ô0.5, 9 Sup. Ct. 60G, .32 
L. Ed. 1043; 1 Story's Eq. Jur. S 400; Murray v. Ballou, 1 Johns. Ch. (N. Y.) 
566. As said by Sir William Grant, in Bishop of Winchester v. Paine, 11 Ves. 
194, 197: 'The litigating parties are exempted from the necessity of taking 
any notice of a title so acquired. As to them, it is as if no such title existed. 
Otherwise, such suits would be Indéterminable ; or, which would be the same 
in effect, it would be in the pleasure of one party at what period the suit should 
be determined.' The présent proceeding is an attempt, upon the part of a 
purchaser pendente lite to relitigate in an original, indépendant suit the mat- 
ters determined in the suit to which his vendor was a party. That cannot be 
permitted consistently with the settled rules of equity practice." 

The text of 2 Black on Judgments, § 5.50, seems authoritative. It 
is as follows : 

"It is a gênerai rule that a purchaser of property, * * * wlio buys poud- 
ing a litigation concerning it, couics into privity with his vendor, so as to h'? 
bound by the judgment in that suit the same as if made a party of record. 
* * * 'We ajiprehend it is well settled that he who purchases property pend- 
Ing a suit in which the title to it is Involved takes it subject to the judg- 
ment or decree that may be passed in such suit against the person from whom 
he purchases. That he purchased hona fide, and paid a full considération for 
it, will not ayail against such judgment or decree. Nor will he be permitted 
to prove that he had no notice of the suit. The law infers that ail persons 
hâve notice of the proceedings of courts of record. The law is that he who 
intermeddles with property in litigation does It at his péril, and is as conclu- 
sively bound by the results of the litigation, whatever they may be. as if he 
had been a party to it from the outset.' * * * In a late case it is said 
that the purpose of the l'ule is to keep the subject-matter of the litigation 
within the power of the court until judgment or decree shall be entercd, since, 
otherwise, by sxicccssive aliénations pendiiig the suit, the .ludgmcnt or decree 
could be rendered abortive and impossible of exécution. It is also said that 
two things seem to be indisr)ensable to give effect to the doctrine of lis 
pendens : (1) That the litigation must be about sonie spécifie thing which 
must nccessarily be affected by the termination of the suit, and (2) that the 
particular property involved in the suit must be so definite in the description 
that any one reading it can learu thercby what property is intended to be 
made the subject of litigation." 

The conditions présent meet every requisite of thèse authorities. 
As is apparent from the record the Rickey Land & Cattle Company 
came into the property and rights of Thomas B. Rickey after the suit 
to quiet title was begun in the Circuit Court for the District of Nevada, 
and after Rickey had answered therein, and the court had acquired 
full and complète jurisdiction both over the subject-matter of the 
suit and over the person of Rickey. So that the Rickey Land & Cat- 



22 152 FEDEEAL RBPORTEH. 

tle Company stands in privity of title with Rickey, and can claîm noth- 
ing beyond what Rickey could hâve claimed in the original suit. The 
Company is bound as Rickey would hâve been bound, and must abide 
the termination of such suit for the adjustment of the adverse rights 
claimed to the appropriation of water from Walker river. 

Thèse considérations lead to the affirmance of the decree of the Cir- 
cuit Court, and it is so ordered. 



RICKEY liAND & CATTLB CO. r. WOOB et al.» 

(Circuit Court of Appeals, Nlnth Circuit March 4, 1007.) 

No. 1,365. 

Waters and Water Courses— iBniaATioN— Appropriation— Quietinq Title 
— Cboss-Bili/— When Alix>wkd. 

In a suit to quiet title to an alleged prior appropriation of water for 
Irrigation purposes In Nevada agalnst appellant, an ai)propriator on tlie 
sanie streaœ in Californla, appellees, who were also appropriators from 
the same stream In Nevada, were made codefendants and flied a cross- 
bill, in whlch tliey did not deny complalnant's prlority, but claimed a prior 
appropriation as against appellant, and prayed that their rigbt be set- 
tled and deternilned. Hdd, tbat such cross-bill opernted defensively on 
behalf of apiiellees, and vvas not tberefore objectiouable as not gerniaue to 
the original bill. 

Appeal from the Circuit Court of the United States for the District 
of Nevada. 
For opinion below, see 146 Fed. 574. 

The facts of this case differ from those upon which the case of Rlelcey Land 
& Cattle CowpMiiy v. Miller & Lux (iust de<-ided) iri2 Fed. 11, i)roppe<led, 
only in that, In tbe original suit of Miller & Lux v. Ricltey et al., tbe présent 
appellees, being codefeutiaiits witli Itickey in tbat suit, tiled cross-bills tbere- 
In, whereby they claimed to be eiititled to certain appropriations of water 
from Waliier river for use upon tbeir lands — tbe divert^ions being made and 
the iands being situflted In the stiite of Nevada ; and it was alleged tbat Rickey 
bad been and was then diverting the wnter from the stream «bove, which de- 
prived the cross-coni|)lainants of tbe auiouut to which they vi'ere entitled un- 
der tbeir appropriations. Sudi crtiss-bills were Hled Deceiulier 20, 1904, and 
writs of subp<i?navvere issufd ibei-oon. and served ui)ou itiikey tbe same day. 
And it is furtlier sUown tliat tbe summonses issued in the causes iustituted in 
the superior court of Mono couiity, Cal., were served u[)on up|>ellees December 
20, 1904. The apiieilees olitained, after notice and heariiig. an order of court 
temporariiy restraiiiiug tUe appellant from making auy diversions of water 
from Walker river to their detrlmcut, froui which order this appeai la prose- 
cuted. 

James F. Peck and Charles C. Boynton, for appellant. 
W. C. Van Fleet and W. B. Treadwell (Frohman & Jacobs and 
Frank H. Short, of counsel), for appellees. 

Before GILBERT and ROSS, Circuit Judges, and WOLVERTON, 
District Judge. 

WOLVERTON, District Judge (after stating the facts). The sin- 
gle question urged hère, in addition to those determined in the case of 
Rickey Land & Cattle Company v. Miller & Lux, 162 Fed. 11, is 

♦Eehearing denied May 20, 1907. 



RICKET LAND & CATTLE CO. V. WOOD. 23 

whether the appellees hâve a standing in court whereby to maintain 
their cross-bills as against tlie appellant. The appellant and the appel- 
lees are ail codefendants in the cause of Miller & Lux v. Rickey et al., 
and ail citizens oi the state of Nevada; and in their cross-bills, it vi'ill 
be seen, the appellees do not dispute the rip^ht of diversion by Miller & 
Lux, nor claim that its diversions are in any way subordinate to theirs, 
but they do allège that the appropriations of Rickey, whatever they may 
be, are subject and subordinate to theirs, and pray that the Rickey Land 
& Cattle Company may be enjoined from diverting- the waters of Walk- 
er river in any nianner to their détriment or injury. 

The nature and purpose of a cross-bill in equity bave been clearly de- 
termined. Says Mr. Justice Nelson, in Ayres v. Carver, 17 How. 591, 
595, 15 L. Ed. 179 : 

"A croi5S-bl!l is broiight by a défendant in a suit asainst the plaintifC In the 
same suit, or against other défendants in the same suit, or af^ainst both, touch- 
ing the matters in question in the original bill. It is brouglit either to obtain 
a discovery of facts, in aid of the deîense to the original bill, or to obtain full 
and complète relief to ail parties as to the matters eharged in the original bill. 
It should not introduee new and distinct matters not embraced in the original 
bill, as they eannot be properly examiued in that suit, but constitute the sub- 
ject-matter of an original, independent suit. The cross-bill is auxiiiarj' to the 
proceeding In the original suit, and a de])endency upon it. It is said by Lord 
Hardwicke that both the original and cross-bill coustitute but ouc suit, so in- 
timately are they couuected together." 

To the same purpose is Ex parte Railroad Co., 95 U. S. 321, 225, 24 
L. Ed. 355, where it is said : 

"A cross-bill mnst grow out of the matters alleged in the original bill, and 
is tised to bring the whole dispute before the court, so that there may be a 
complète decree touching the subject-matter of the action." 

So Sanborn, Circuit Judge, says in Stuart v. Hayden, 72 Fed. 402, 
■410, 18 C. C. A. 618 : 

"A cross-bill is brought either to aid In the défense of the original suit, or 
to obtain a complète détermination of the controversies between the original 
complainant and the cross-oomplainant over the subject-matter of the original 
bill. If its purpose is différent from this, it is not a cross-bill, although it 
may hâve a connection with the gênerai subject of the original bill. It may 
not interijose ne^v controversies between codefendants to the original bill, 
the décision of which is unnecessary to a complète détermination of the con- 
troversies between the complainant and the défendants over the subject-matter 
of the original bill. If it does so, it becomes an original bill, and must be dis- 
inissed, because there eannot be two original bills in the same case." 

Cross V. De Valle, 1 Wall. 1, 17 L- Ed. 515; Rubber Co. v. Goodvear, 
9 Wall. 807, 19 L. Ed. 587 ; Young v. Coït, 2 Blatchf. 373, Fed. Cas. 
No, 18,155; Stonemetz Printers' Mach. Co. v. Brown Folding-Mach. 
Co. (C. C.) 46 Fed. 851. 

Counsel for appellant expressly admit that, if the cross-bills are an- 
cillary in purpose and character, they should be entertained regardless 
of the citizenship of the parties défendant. This reduces the inquiry 
simply to whether such cross-bills are, in légal contemplation, anciUary 
to the original bill, or whether they introduee matter foreign to, and dis- 
connected with, the subject-matter of the original suit. 

In the light of the foregoing authorities, it may well be premised that, 



24 152 FEDERAL EErOKTER. 

if the cross-bills operate defensively in behalf of tlie appellees in some 
substantial way, then they are pertinent, and afford appellees a stand- 
ing whereby to assert such rights as will protect them against the suit 
of complainant in such cause, and this although they might impinge up- 
on the alleged rights of the appellant. A suit respecting water appro- 
priations from a stream is sui generis, and it may, and does f requently,' 
happen that, in order fully to protect the rights of one appropriator 
against those of another, it is necessary to détermine also the rights of 
the former, not only with référence to those of that other, but also with 
référence to those of still others upon the same stream. We can adduce 
no better illustration than that suggested by counsel for appellees. 
Suppose that A., B., and C. are appropriators of 10 cubic feet of water 
each from the same stream, within which is running but 30 cubic feet. 
A., the lower appropriator, sues, and procures a decree and injunction 
against B, and C. from diverting more water than will allow A. 's 10 
cubic feet to come down to him. B. might divert 20 feet, and C. 
but 10, the amount only to which the latter is entitled, and yet both B. 
and C. would be guilty of a violation of the injunctive decree, becausc 
A. has been deprived of his 10 feet of water. Now, does it not scem 
perfectly clear that if C. had set up, by cross-bill to A. 's original bill, 
his interest in the stream, the decree would bave been différent, and 
would hâve gone against B. and C. severally, and not jointly, so that a 
violation of the injunction by B. would not hâve been also a violation 
by C, who was' innocent of any wrong ? Is there not hère matter for 
substantial défense to sustain such a cross-bill ? The answer is obvions. 
The cross-bill in such a case would be germane to the subject-matter of 
the original bill, and would operate defensively in behalf of the défend- 
ant interposing it. So it would be a matter of défense for C. to bave his 
appropriation fixed as against B. The identical question has received 
careful considération, in the case of Ames Realty Co. v. Big Indian Min- 
ing Co. (C. C.) 146 Fed. 166, at the hands of Hunt, District Judge, 
whose reasoning is so able, lucid, and cogent as to scarcely admit of any 
further controversy. He concludes, after making apt illustration of the 
case in hand, as follows : 

"Will not a court of equity take jurisdiction with respect to tliis property 
riglit as fiiicillary to its .iurïsdiction over the case between complainant and 
flrst défendant, and, having jurisdiction of the whole proceeding, will it not 
proeeed to do justioe hetween ail the parties? Keflection leads me to an- 
swer the questions in the affirmative. It is ti'ue that, if complainant can se- 
eure protection of Its own riglit, .junior ajipropriators might be left to figlit 
out their relative rights among themselves ; but, as conditions f requently ex- 
ist in litigation over usufruct of water, where it is practically impossible to 
make a just decree between complainant and one défendant without ascer- 
taining rights of défendants as against one another, the court will permit 
cross-complaints to stand, to the end that a multiplicity of suits may be 
avoided, so that tedious, expensive, and unnecessary litigation may be saved." 

In Union Mill & Mining Co. v. Dangberg (C. C.) 81 Fed. 73, as 
against the objection that the défendants, of whom there were about 
125, were not ail jointly interested in their appropriations to the injury 
of complainant, and therefore shoukl not hâve been niade parties, Judge 
Hawley has this to say : 



UNITED STATES V. CHANDLEK-DUKBAR WATF.U FOWKK c O. J.J 

"Thèse eonflicting rights, whatevei' they may be, eau be (U'Icr'iniiH;-; In oiu" 
suit. Complainant miglit not be able to maintaiii its suit n;:caiiisi tbem siiiL'iy. 
l'or it may be that no one of tbe respondents acting iudividually lias (iriirived 
complainant of ail the water to whieb it is entitled. Complainant is only en- 
titlfid, if at ail, to a certain amoxmt of tlie water of tbe river, and it is by tlii- 
action of ail tbe respondents that it lias been deprived of tlio water to wliicb 
it elainis to be entitled. Each respondeut clainis the rigbt to divert a givou 
quantity of water. The aggregate thns claimed so reduces the volume of tbe 
water in the river as to deprive complainant of tho amount to wUich it is en- 
titled. To this extent, even if tliere is no such unity or concert of action or 
common design in the use of the water to injure complainant, tbere is ccr- 
tainly such a resuit in the use of tlie water by the respondents as authorizes 
complainant to maintain this suit, upon the ground that tlie action of ail the 
respondents bas produced and brought about the injuiy of wbicb it comj)lains. 
l'^lvery one who contributes to such injury is properly made a party respond- 
eut." 

The reasoning is cogent in démonstration of tlie interdependent rela- 
tions tliat exist among différent appropriators from the same stream, 
and of the condition that one appropriator cannot always be fuUy pro- 
tected against the injunctive process of another, unless at the same time 
he has his own rights ascertained and determined with relation to still 
others who are also subject to the same process. And so we conclude 
that the order appealed from should be affirmed, and it is so ordered. 



UNITED STATES v. CHANDLEU-DUXBAR WATER POWER CO 

(Circuit Court of Appeals, Sixtli Circuit. Marcb 2, 1907.) 

No. l,r>é'i. 

Attorney GeneraIj — OcTsiuE CouNSKL — Emi>loy5ient— Unued States— Ac- 
tions BY. 

The question of employing tlie attorney for a private party to assist in 
tbe iirostîciition of a suit by tbe United Siates iu the publie interest is 
ouo addressed to tbe .ludgiiiont and discrétion of tbe Attorney General, 
and suuh emjiloyment sbould not inlluence tlu; action of the court if the 
object of tbe private party and that of the United States are oue and tho 
same. 

|Ed. Note. — Eor cases in jioint, see Cent. Dig. vol. û, Attorney General. 
§§ 2, 5.] 

Public Land.s— Siit for Cascei.i.ation of Patent — LisirrATioN. 

Under Act Màrcli 3. 18!n, c. ."ir,(>, 20 St.-it. 10!).'{ |U. S. Conip. St. 1901. 
p. 1521], which provides that "snits b.y tlie United States to vacate and 
annul any patent heretofore issucd sball only lie bronglit witliiu tive years 
from the passage of this act," possession by the gi'antee is not necessary 
to the running of the limitation; and, wliile the limitation would not 
apply to patents for lands wbicb were not publie lands subject to disposi- 
tion by the United States, it will proteet a iiatcnt for public iaiids re- 
served fi'om sale for a temjiofary purpo"-;^' which was aecomplisbed long 
prior to the issuance of tbe patent, altbbiigh tecbnically the réservation 
had not been witlidrawn. 

Same— "Valiwty op Patent— Sufficiency of Survey. 

Where tbe boundarics of a camp ground reserved to Indians by a 
treaty were flxod by a government survey of the adjoining lands and 
shown by the jilat returned, the tract containing less tban 40 acres, such 
survey was suliicient for the purpose of a subséquent coiivcyance of tlu' 
land by tbe land department after the réservation had been rolinquisbcd 
by the Indians. 



26 152 FEDERAL, EBPORTEK. 

4. Same— Réservation fbom Sale— Construction. 

In creating tLe Lake Superior land district in 1847, COngress reserved 
from the lands opened for sale certain lands for school purposes, and 
also sucli réservations as the Président should deem necessary for public 
purposes. Pursuant to tlie authority so given, tlie Président, iu order to 
hâve time to aseertain what lands were necessary for public purposes, re- 
served a number of tracts temporarily, one of which, consisting of half a 
township, included Fort Brady on St. Mary's river, together wlth the réser- 
vation on which It stood, and also a small tract previously reserved to the 
Indians by treaty for a camp, together with other lands. By a subsé- 
quent executive order in 1852 the réservations were more narrowly de- 
fined, and ail the remaining lands so temporarily reserved, "except the 
milltary réservation at Fort Brady," were released from réservation. 
The Indian right was extinguished by treaty in 1855. Held, (1) that nei- 
ther the réservation in the act of Congress nor in the executive orders had 
any référence to the Indian réservation, over which the goverument had 
no power of disposition; and (2) that the exception in the order of re- 
lease of the "military réservation at Fort Brady" included only the orig- 
inal réservation as deflned prior to 1847, and not the entire temporary 
réservation of that year, which was the eonteinporaneous construction of 
the order by the department, so that in any event the Indian réservation 
became public lands subjeet to disposition by the government after the 
treaty of 1855, and a patent subsequently issued therefor is valid. 

5, Navigable Watees— Ripaeian Rights— Title to Islands in St. Mary's 

KlVEB. 

The United States has no title to islands lylng in the St. Mary's river 
between the Michigan shore and the thread of the stream, which were 
not surveyed nor claimed at the time of its gênerai survey ; but such title, 
like that to the submerged land, remained in the state, and under the 
law of Michigan is surreiidered to and vests in the owner of the adjoining 
shore land. 

[Ed. Note. — For cases In point, see Cent. Dig. vol. 37, Navigable Waters, 
§§ 253-255.] 

Appeal from the Circuit Court of the United States for the Western 
District of Michigan. 

H. M. Hoyt and Duane E. Fox, for appellant. 
A. B. EIdredge and Moses Hooper, for appellee. 

Before LURTON, SEVERENS, and RICHARDS, Circuit Judges. 

SEVERENS, Circuit Judge. The bill in this cause was filed in be- 
half of the United States by the district attorney for the Western dis- 
trict of Michigan, under the direction of the Attorney General, for the 
purpose of removing a cloud upon the title which the United States 
claims to hâve in islands numbered 1 and 2, situated in the River St. 
Mary within the protracted Unes of the north half of section 6, in town- 
ship 47 north, of range 1 east, in the state of Michigan, and about 27 
rods north of the south shore of the river. The islands are small, both 
of them containing not more than I3/2 acres of rocks and bowlders pro- 
jecting a little above the surface of the water. The title which the 
United States Claims to hâve is one acquired by the cession of the 
Northwest Territory from the state of Virginia, and from the necessity 
imposed by the provision of the Constitution delegating to the United 
States the power to regulate commerce between the states and between 
the States and foreign countries. The cloud complained of consists in 
a patent for the land along the shore opposite to the islands granted by 



UNITED STATES V. CHANDLEE-DUNBAR WATEE POWEK CO. 27 

the United States on December 15, 1883, to one Chandler, from whom 
the défendant claims to dérive its title, and the assertion of tlie défend- 
ant that by virtue of the patent, Chandler, and the défendant by mesne 
conveyances from him, acquired the title to the islands. The pleadings 
raise thèse main controversies : First, the complainant contends that 
the patent to Chandler for the mainland was void because at the date of 
the patent it was under a réservation which excluded the authority of 
the land department to sell or convey it ; and, second, assuming the pat- 
ent to be valid, it did not carry the title to the submerged land adjacent 
and the islands situated therein. The défendant contests both thèse 
propositions. At the hearing in the court below upon pleadings and 
proofs, the bill was dismissed. 

In order to understand the grounds on which the decree was rested, 
and also for the purpose of disposing of an objection raised hère by the 
appellee and based on one of the grounds taken by the court below, it is 
necessary to make a preliminary statement of some spécial facts. There 
is a fall in the St. Mary's river along the front of the Chandler tract of 
about nine feet, the benefit of which the défendant wished to préserve. 
The Michigan-Lake Superior Power Company was proposing to divert 
the water of the river at a point above the Chandler tract, Jbut on the 
same shore, and carry it behind that tract for the purpose of using it for 
power. Sharp controversy on this subject was pending between those 
parties, when on November 26, 1901, one of the attorneys employed by 
the Michigan-Lake Superior Power Company made application to 
locate some scrip on thèse islands and a narrow strip of land along the 
adjacent margin of the river. This strip would separate the land de- 
scribed in the Chandler patent from the bed of the stream. In March, 
1902, the défendant brought suit by bill in equity against the Michigan- 
Lake Superior Power Company in the state circuit court to restrain the 
threatened diversion of the water. The défendant in that suit answered 
admitting the title to the mainland under the Chandler patent, but al- 
leging that the title to the bed of the river was in the state. Shortly 
thereafter, the Michigan-Lake Superior Power Company employed an 
attorney at Washington to promote the application of the before-men- 
tioned attorney to locate the islands and the marginal strip by virtue of 
the scrip as aforesaid. This was in December, 1902. In January fol- 
lowing, the Secretary of the Interior requested the Attorney General 
to bring a proper action to obtain a judicial détermination whether un- 
surveyed islands in the Connecting waters of the Great Lakes passed by 
grants of the riparian tracts. In February foUowing, the Washington 
attorney of the Michigan-Lake Superior Power Company was employed 
as spécial assistant to the United States attorney at a nominal considéra- 
tion to be thereafter determined by the Attorney General. In April 
following, a bill was filed by the district attorney in behalf of the Unit- 
ed States against the défendant in the court below to settle the ques- 
tion which the Secretary of the Interior had proposed. It assumed the 
validity of the Chandler patent, but complained that the défendant as- 
serted title thereunder to the islands. This bill was subsequently with- 
drawn. On September 2, 1903, the présent bill was fîled, bearing the 
signature of the United States attorneys and of the spécial assistant 
employed in behalf of the United States as before stated. On the fol- 



& 



28 152 FEDERAL REPOETER. 

lowing day tlie Michigan-Lake Superior Power Company nioved in the 
State court for leave to withdraw the admission it had made in its 
answer of title to tlie mainland in tlie complainant (the défendant liere) 
on an affidavit that, from investigations at Washington made by its 
counsel, it had learned that the complainant (in that suit) had no title 
therein. The learned judge in the court below, the late Judgc Wanty, 
after referring in his opinion to the présence of the représentative of a 
private party in the promotion of the suit, refused to consider the valid- 
ity of the Chandler patent, saying : 

•'Tlie patent to tlie sliore or uplaud, issued Decomlier 15, 18S3, to the (le- 
fendant's grantor, is attaeked in the biU for tlie purpose of defeating auy 
daim of the défendants to thèse islands ; but those allégations will not l)e 
considered by the court, as they ralse no questions whicU the United States 
bas any interest iii having deternnned in this suit. If iu this case it sliouid 
be held that the patent to the upland is invalid, then the title to thèse islands 
for that reason would be in the United States, and tho only question for the 
détermination of which this suit was authorized would be entirely eliminated, 
as any expression of opinion as to what the status of thèse islands would 
bave been if the patent had been valid instead of invalid would be ol)iter dîc- 
tuin. The complainant does not liere ask to bave this patent set aside, and If 
it serlously questioned Its valldity for any reason set up in the bill of com- 
plaint its officers would undoubtedly take steps to aunul the patent and ré- 
sume title and possession of the vahiable laud on the sliore as well as to thèse 
insignifleant islands, whose only value to the comiilaiiiant, if it does not own 
the upland, seems to lie in their position to forin tlie subject-matter of a 
cause for the détermination of the question for the adjudication of which. this 
suit was authorized to be instituted in the iiame of the United States." 

Thereupon he passed to the other question, that of the effect of the 
grant upon the title to the bed of the river, upon which question he held 
with the défendant. It is contended that the présence of the représen- 
tative of a private interest to promote a private advantage vitiates the 
proceeding. We think, however, that the question of the propriety of 
employing an attorney for a private party to assist in the prosecution of 
a suit by the United States in the public interest is one addressed to the 
judgment and discrétion of the Attorney General who is charged with 
the responsibility for the conduct of the suit. If the object of the pri- 
vate party and that of the United States are one and the saine, there 
would seem to be no sound objection. If, however, the name and au- 
thority of the United States were likely to be perverted to the promotion 
of a merely private object, one in which the public has no interest, such 
facts would indicate the impropriety of such a course, and might in 
some circumstances rightly influence the judgment in the cttse. For the 
reason that in the présent case we find no ground for entertaining this 
objection as a foundation for judicial action in the disposition of the 
case upon its merits, we overrule it. But of course there will remain to 
us the duty of considering and determining what results ought to foUow 
from the particular facts exhibited by the record, and from the man- 
ner and occasion in which those facts are presented to the court for 
judgment. 

The first question which we shall consider is whether the défendant 
does not bave title to this land bv virtue of the statute of limitation of 
March 3, 1891, c. 559, 36 Stat. 1093 [U. S. Comp. St. 1901, p. 1521], 
which déclares "that suits by the United States to vacatc and annul any 



UNITED STATES V. CHANDLER-DUNBAR WATBR TOWER CO. 29 

patent heretofore issued, shall only be brought within five years from 
the passage of this act," and the adverse possession held for that period 
by the défendant after the passage of the act, if indeed possession is 
necessary to its opération as a limitation. Counsel for complainant 
raise two objections to the apphcation of this statute. One is that this 
suit is not a suit to annul the Chandler patent, but only to maintain the 
title to thèse isJands, and that they attack the validity of the patent only 
for the purpose of maintaining the title to the islands. This amounts 
to a contention that although the patent could not be attacked directly, 
after the time prescribed, yet it may be done indirectly, for the purpose 
of controlling an incident, the right to which fîlows from the patent it- 
self. The proposition is too plainly untenable for argument. But we 
add that the gênerai rule is that possession of land under a claim of 
title for the period prescribed by a statute of limitation vests the title 
in him for whose protection the statute créâtes the limitation ; and if, 
as we think, possession is not necessary under this statute, the lapse of 
time is of itself sufFicient to efifcct the same resuit. The right of action 
of the United States, assuming it to bave had any, was complète at the 
date of the passage of the act. and the lapse of five years without ac- 
tion to annul the grant resultcd in the confirmation of it. 

The other objection to the apphcation of this statute is that if, as 
contended, the Chandler patent is absolutely void, the statute cannot 
apply, "because," quoting from the brief, "in légal effect no such patent 
ever existed. Statutes of limitation may protect a voidable title from 
any question as to its validity, but no statute of limitations can operate 
upon a thing that never existed." This statement of statutory limita- 
tions is open to criticism. But it is suiïïcient now to say that the stat- 
ute in question is gênerai and contains in itself no exception. When it 
speaks of vacating or annulling patents, of course it means the grants of 
title which the patents purport to make, and which the United States 
had lawful right to make. Doubtless this would not extend to lands 
reserved by treaty, and probably not to lands which had at the date of 
the statute been taken out of its power of disposition in favor of other 
parties who had acquired contingent interests therein, though the pros- 
jjective pjrt of the statute, not quoted above, might perhaps cover such 
lands if they shovdd fall back into its absolute control. Having regard 
to the objects of the statute, we cannot doubt that it was intended to 
reach and cover, after the lapse of the prescribed period, any such mis- 
take of the land department (assuming it to be such) as the holding that 
the temporary réservation of the lands in question by the President's 
order of 1847 was discharged by bis releasing order of December 9, 
1853. This temporary réservation by the Président and his releasing 
order are stated and explained in a subséquent part of this opinion, Vo 
which we must hère make référence. Such questions are continuall}- 
occurring in the land department, and it would be intolérable if mis- 
takes in such matters should be visited upon purchasers buying in good 
faith, and cannot be curable by lapse of time. It is contrary to the 
policy of the United States that the validity of its patents should be 
doubted and distrustcd, and that they should for ail time continue so. 
And it was as well for its own interest and crédit, as for giving the 
securitj due from the government to its purchasers, that the act of 



30 162 FEDERAL RBPOETEB. 

1891 was passed. We can scarcely doubt that it îs applicable to the 
case before us. Counsel for the United States refer us to the language 
of Mr. Justice Brewer in the opinion of the court in United States v. 
Winona, etc., Railroad, 165 U. S. 463, wherein, at page 476, 17 Sup. 
Ct. 368, 371, 41 L. Ed. 789, he says, "Under the benign influence of this 
statute it would matter net what the mistake or error of the land de- 
partment was, what the frauds and misrepresentations of the patentée 
were, the patent would become conclusive as a transfer of the title, 
providing only that the land was public land of the United States and 
■ open to sale and conveyance through the land department ;" and reli- 
ance is placed upon the proviso that the land be open to sale and con- 
veyance through the land department. And it is claimed that this land 
was not open to sale, because of the President's réservation under the 
act of 1847. But we think that this is a narrower construction of the 
language used than the learned justice intended. This land was, in a 
larger sensé, open to sale by the United States. There had been no ab- 
solute réservation of it. There was only a temporary réservation of 
it which operated only as a temporary suspension of sales by order of 
the Président, for bis own convenience, until he should be prepared to 
make the réservations intended by Congress. And the purpose of the 
suspension had been accomplished more than 30 years before the is- 
sue of the patent to Chandler. Even if the réservation of 1847 had 
survived the release of 1852 and continued to bave its exhausted hold 
upon ail the lands originally reserved, the sale of this land in 1883 would 
amount to nothing more than a technical error or mistake of the land 
department, which, if it needed curing, the statute would cure. But as 
it is possible that we may be mistaken about this, and the principal ob- 
ject of the suit would not be fully accomplished by its disposition upon 
this ground, we shall consider the merits of the case without regard to 
the statute of limitations. 

We are much impressed by the contention of the appellee that the 
court below was right in holding, as it did, that upon this bill the ques- 
tion of the validity of the Chandler patent is not a legitimate subject of 
inquiry. It is not a direct attack. There is no prayer that the patent 
be declared void. Nevertheless such a decree as is asked in favor of 
the complainant, if it were rested upon the ground of the invalidity of 
the patent, would, as we suppose, operate as an estoppel in favor of the 
United States and of any grantee to whom it niight convey. But there 
are cases in which it bas been held that a patent which is utterly void, 
a patent issued without authority, may be collaterally attacked by any 
person whose interests are injuriously aflfected thereby; and such dé- 
cisions lead us to doubt whether the reasons which we hâve stated 
would justify us in declining to pass upon the question of the validity 
of the patent. We therefore proceed to the solution of it. 

The validity of the Chandler patent is questioned upon two grounds : 
First, because the land was at that time embraced in a réservation for 
public uses; and, second, because it had never been legally surveyed. 
On June 16, 1820, while Michigan was yet a territory, the United States 
entered into a treaty with the Chippewa tribe of Indians whereby, in 
considération of the cession by the Indians of 16 square miles of land 
lying south of the river, and which included the lands now in question, 



TJNITBD STATES V. CHANDLER-DUNBAB WATEB POWEK CO. 31 

the United States agreed to secure to them a perpétuai right of fishing 
at the Falls of St. Mary, "and also a place of encampment upon the 
tract hereby ceded, convenient to the fîshing ground." 7 Stat. 206. 
This "place" was not specified by the treaty. But the locality upon 
which the Indians had been accustomed to make their encampment was 
on the south shore of the river at the place where this land is located, 
and extended back for an indefinite space. The Indians continued to 
occupy this place for many years with the consent of the government, 
and a practical location was thus established. The southern boundary 
remained indefinite for a considérable time, but that and the eastern 
and western boundaries were at length fixed, by surve3'S and the as- 
sent of the Indians, on lines which included 36.50 acres adjacent to the 
river, and in which what we hère call the "Chandler tract" was in- 
cluded. This réservation, as thus finally located, came to be called 
and known as the "Indian Reserve." It may be hère stated that the 
right of occupancy by the Indians under the treaty of 1820 was re- 
leased by them by treaty with the United States on August 3, 1855. 
11 Stat. 631. But meantime, on August 26, 1852, Congress, whether 
with or without the consent of the Indians does not appear, passed an 
act, 10 Stat. 35, c. 92, granting to the state of Michigan, for the pur- 
pose of building a canal, a strip of land 400 feet wide, extending near- 
ly parallel with the gênerai trend of the south shore of the river, across 
the Indian Reserve, and which, when located, divided it into three 
distinct parcels, of which the Chandler tract is one. In the act making 
the "Canal Grant," as it is called, the premises through which the canal 
was intended to pass was described as "the Military Réservation at the 
Falls of St. Mary's River," a désignation which will be explained later 
on. The canal grant of the strip through the Indian Reserve was not 
intended as a substantial invasion of the rights of the Indians. They 
were already greatly diminished in numbers at that place. As the set- 
tlement of that région by the whites progressed, the Indians receded in- 
to remoter régions, and, while there were 40 wigwams at the time of the 
treaty, but 6 remained. Besides, the land was unfit for cultivation. 
And it was doubtless expected that before the canal would be built the 
réservation would be extinguished, and this was what happened. 

The original survey of that région was made in 1845 by James H. 
MuUett under the direction of the Surveyor General. In his instruc- 
tions to the surveyor the Surveyor General stated that in the territory 
to be surveyed by him there was an Indian réservation at Sault Ste. 
Marie as a place of encampment and for fishing, which was reported 
to hâve been surveyed and "located by the War Department in 1823," 
as to which he instructed the surveyor as foUows: "This reserve you 
will exclude from the survey, and return a survey of its boundaries to 
this office." The meaning of this was that he was not to run the cus- 
tomary survey Hnes through the reserve, but simply survey it out in a 
lump. This the surveyor did. From this survey of the boundaries the 
Surveyor General computed the area included therein at 36.50 acres. 
And the surveyed boundaries and the area of the réservation were en- 
tered in the plat. This survey by Mullett having been made by the au- 
thority of the government, which directed the survey of the boundaries 
of the Indian Reserve, and having been approved and made as it was. 



32 152 FEDERAL REPORTER. 

the basis of governmental action in dealing with tlie lands in that lo- 
cality, is convincing évidence that this reserve had been located and its 
boundaries established as above stated. And the resuit was that notli- 
ing short of an act of Congress or a treaty could interfère with the right 
of the Indians to its occupancy. Such action by Congress would hâve 
been a breach of faith witli the Indians, and its intention to do, 
or to authorize, any act which would bave that conséquence, ought 
only to be inferred from clear and explicit language which could not 
reasonably be interpreted in any other way. The canal grant whcn ap- 
plied to its subject-matter was not susceptible of any other construction 
than that it vi'as an invasion of the treaty, though in the circumstances, 
as we think, it was not realized to be more than a technical and practical- 
ly harmless one. However that may be, it did not affect the réservation 
to any extent beyond the limits of, or further than, the plain language 
of the grant requircd. We postpone for the moment the considération 
of the question of the sufficiency of the Mullett survey to justify a sale 
or other disposition of the land without a further survey. 

The settlement at the Sault had increased to the extent that in 1849 
it was incorporated as a village under the laws of Michip-an. It was 
laid out in squares, blocks, and lots. Its bounds included the Indian 
Reserve as well as the réservation at Ft. Brady. Congress, having in 
mind apparently the desirability of a more accurate and detailed sur- 
vey of the locality than the original survey, which waS, as expérience 
has shown, often inaccurate or defective, passed the act of September 
2G, 1850, providing for a new survey, which, however, was to be found- 
ed on the original survey, with proper corrections nnd extensions into 
greater détail. 9 Stat. 471, c. 71. By the sevcnth section it was di- 
rected that the "deputy shall prépare a plat exhibiting in connection 
with the lines of the public survey s, the exterior lines of the whole vil- 
lage, also the squares, individual lots, and the public lots, and also the 
outlots, designating the lots reserved for military or other purposes ac- 
cording to the extent and limits of the same, as iixed by the proper mil- 
itary officer, pursuant to the rec[uirements of the second section of this 
act." This of course included the Indian Reserve, and required that its 
extent and limits should be exhibitcd by the plat. But after this act of 
1850 was passed the canal grant was located, and the new survey was 
made subsequently to the location. The surveyor, one Whclnley, when 
he came to survey the Indian Reserve, found it eut into three parcels by 
the canal grant, which he naturally assumed excluded the strip within 
its limits. He therefore surveyed the separated parcels, and exhibited 
in his plat "the extent and limits" of each. This was manifestly the 
proper course to pursue. What Congress wanted was a plat which 
when adopted would exhibit the needful information of the conditions 
existing at its date. That one of thèse three parcels which became the 
subject of the Chandler patent was shown by this survey and plat to 
contain 9.10J4 acres, and, as already stated, described its bounds. The 
Whelpley survey was adopted by the department, and has since been act- 
ed upon as the final public survey. We may hère conclude what we pro- 
pose to say aboutthe objection that the Chandler patent is void because 
there then had never l:)een any survey of the land. It is true there has 
never been any survey of the land upon lines of sections and subdivi- 



UNITED STATES V. CHANDLER-DUXBAR WATER POWER CO. 33 

sions, as when such method of surveying is practicable. There are 
many instances where the pubàc lands, if sold at ail, must be surveyed 
in a différent way from the more common method em]3lo)ed in a wide 
expense of territory. The object of a survey is as fuUy atta ned. If 
the land was at the time subject to the control and di^posit-on of the 
department, we cannot think that its disposai upon the existing surveys 
could be assailed, certainly not in this collatéral way. 

But it is said that the land was undcr a réservation which excluded 
the power of the Land Office to dispose of the land. The réservation 
for the Indians was extinguished by the trcatv of 18ô.j. There was an- 
other réservation lying to the east of this which had bcen reserved for 
military purposes, on which was locatcd Ft. iîrady. This had been 
gradually reduced to a tract of somewhat less than 40 acres. It had 
never included the Indian Reserve, and was scparated from it by inter- 
vening lands. Officers of the War Department had, as the record 
shovv'S, kept an eye on this part of the Indian Reserve as a place upon 
which the government might at some time désire to erect fortifications 
and other érections for défense, and had been in communication with 
the Treasury and Interior Departments on that subject. But no réser- 
vation was made nor could there be so long as the réservation for the 
Indians continued, without a breach of the treaty. By the act of March 
1, 1847, the Lake Superior land district was created, a land office es- 
tablished, and the whole région was opened for sale in like manner as 
other public lands of the United States are sold. 9 Stat. 11G, c. 32. 
This act contained an exception, in the second section, of sections 16 
in each township for the use of schools, "and such réservations as the 
Président should deem necessary for public_purposes." On March 31st 
following, the Commissioncr of the Land Office addressed the Secretary 
of the Treasury suggesting that réservations by the Président should 
be made at a number of specified places on the Sault Ste. Marie and 
along the south shore of Lake Superior of so much of the lands desig- 
nated by a list from the fifth auditor as might be found necessary for 
lighthouse purposes or other public structures until further investiga- 
tions could be made. This communication was transmitted to the Prés- 
ident Vi'ith the Secretary's recommendation that such réservations be 
made "until the requisite investigation can be had," as he said. The 
Président on April 3, 1847, ordered that the lands be reserved accord- 
ing to the recommendation. This réservation included a number of 
tracts in the land district of Lake Superior. The tract at the St. 
Mary's River included, though not by name, the Indian Reserve, but 
was more extensive than that, being of the whole north half of the 
township. This was reduced by executive order msde September 2, 
1847, but still retained a much larger tract than the Indian Reserve. 
By subséquent désignations it was still further narrowed. But it still 
contained within its limits the réservation on which Ft. Brady was sit- 
uated, and also the Indian Reserve. In April. 1858, several prominent 
citizens of Michigan, among theni the Scnators from that state, ad- 
dressed a mémorial to the Commissioncr of the Land Office represetit- 
ing that it was highly important to the peace and prosperity of the com- 
munity at Sault Ste. Marie that the locations of the réservations should 
152 F.— 3 



34 152 FEDERAL EBPOETEE. 

be definitely fixed. It is worth wliile to copy a paragraph of this mémo- 
rial as indicating what was then the common understanding of what 
was considered as the "Military Réservation at Fort Brady" : 

"If we are correctly Informed the Une O. D., or westerly line of the military 
réservation, as marlied on the land office survey or inap, includes withiu said 
réservation a town house and several isrivate buildings long occupied by cit- 
izens, and that if the westerly line of the présent picl^ets of Fort Brady, or a 
line so lar west of said pickets as not to include any private clainis or build- 
ings, can be ruade the westerly line of the military réservation, without préj- 
udice to the interest of the government, it wouid rçmove ail cause of com- 
plaint and be of great advantage to the village in enlargiug the now very 
limited water front and would, in our opinion, give gênerai satisfaction to 
the citizens of the place." 

The line C, D, was the western botmdary of the Ft. Brady Réserva- 
tion. This mémorial was transmitted to the Secretary of the Interior 
by a letter in which the Commissioner stated as foUows : 

"This ofBce is of the opinion that the time bas arrived when the réservations 
alluded to may be circumscribed within the limits of public utility for Light 
House, Military, Naval or other public purposes. If such opinion be eoncurred 
in by the proper authorities, and in order to facilitate action in the promises, 
diagrams exhibitiug the bodies of land, so reserved, are herewith submitted, 
and after the Treasury, War, Navy & Interior Departments shall hâve desig- 
nated ail the permanent sites and circunijaceut areas of land ueeded for Light 
House, Military, Naval and Indian purposes, the residue may be ordered by 
the Executive to be brought into market as desired by the memorialists." 

Prior to December 9, 1852, Col. Abert of the Topographical Engi- 
neers in the War Department, to whom the question of the necessities of 
that department in the land still reserved was referred, had reported 
in substance that none of the lands west of the Ft. Brady Réservation 
were required. And no other réservation at SaUlt St. Marie was pro- 
posed by any other of the departments to which the Commissioner re- 
fers. Then, on December 9, 1852, a list of lands at several points on 
Lake Superior, exhibiting in green the areas therein which had been 
reserved at those points for lighthouse purposes, was laid before the 
Président, and at the foot lie made the following order: 

"Let ail the lands described in the above list and designated by the green 
shades on the annexed maps, be reserved for light house purposes ; and ail 
the remaining lands situated in the tracts which were temporarily reserved 
for 'public uses' in the year J847, (except the military reser\'ation at Fort 
Brady) be and the same are hereby released frora réservation. 

"Washington, December 9th, 1852. "By the Président: 

"Millard Fillmore." 

Thereupon the Commissioner of the Land Oiïïce, in directions to the 
register and the receiver of the district, said: "You will perceive that 
the President's order releases ail the balance of the réservation of 1847, 
(except the existing reserve for Fort Brady) and you will so note 
them in )'Our books and plats." And the department has ever since 
ioUowed that interprétation in disposing of the lands once contained 
in the réservation of 1847. It is now contended that by the "military 
réservation at Fort Brady" was intended the réservation of 1847 which 
was for "public purposes," and which was sometimes called a military 
réservation, though for no other reason that we can see except that 
the War Department was the original promoter of it, and because it 



UNITED STATES V. CHANDLEK-DTJNBAE WATEK POWER CO. 33 

was understood to hâve been made in the anticipation that it might 
be required for military purposes. The further réservation for such 
purposes was, as we hâve seen, abandoned by the War Department 
when it was consulted upon the question as to what réservations it 
needed. 

Now upon thèse facts we are of opinion ; 

First. That Congress did not intend by the act of 1847 that it should 
hâve any application to the Indian Réservation. That was already 
withdrawn from the sale by a treaty which Congress was bound to 
respect. The subject of its législation was to reserve land which would 
otherwise be sold. The réservation made by the Président was only 
precautionary, and covered large areas. It was gradually relinquished 
and was never made absolute. The exception by the Président in his 
order of December 9, 1852, of the Ft. Brady Réservation was made to 
prevent the opération upon it of the gênerai release. Nor is there any- 
thing whatever in the record to show that the Président pretended to 
hâve any authority over the lands in the Indian Réservation. See the 
opinion by Mr. Justice White in Spalding v. Chandler, 160 U. S. 394, 
16 Sup. Ct. 360, 40 L. Ed. 469. The gênerai language of the act and 
of the President's orders thereunder should be interpreted to be limited 
to the subject to which they could properly apply. 

Second. We hâve no doubt that by "the military réservation at Fort 
Brady" he intended the Ft. Brady Réservation, and it was suitably de- 
scribed. For, as we hâve said, he had no authority to deal with the 
Indian Réservation except to préserve its integrity, and it is to be pre- 
sumed he did not intend to exceed his authority; further, if he had 
intended to except two réservations, he would hâve said so. As the 
Ft. Brady Réservation had been made for the government's own 
uses and had not been excluded by treaty with another party, it was 
prudent for the Président, who by the statute was given power to make 
réservations in a territory which covered the Ft. Brady Réservation 
and which it was proposed to open for sale, to except it. As we hâve 
said, the contemporaneous construction of the President's order was 
that the only exception made thereby was the Ft. Brady Réservation, 
and that construction was subsequently followed by those who were 
charged with the carrying the order into effect. Counsel for appellant, 
however, point to an exception. This consists of a letter written by the 
Commissioner of the Land Office, Wilson, to the register and receiver 
of the district, June 9, 1853, in which, referring to certain lands about 
which they had written him, included in the fîrst or precautionary 
réservation, but not in the Indian Reserve, he said : 

"Thèse lands are within the réservation for Fort Brady and are, In con- 
séquence, not liable to entry, by pre-emption or otlierwise. The réservation, 
as made by order of the Président of the United States on the 2nd day of 
September, 1847, embraces Sects. 4, 5 and 6 of T. 4T N., R. 1 B. & Sect. 1 and 
2 of T. 47 N., R. 1 W. and your office was informed, in the letter of the 2Gth 
Feby. last of the réservation for Fort Brady, without however designating the 
tracts." 

But in the letter of February 26, 1853, the same Commissioner had, 
as above stated, informed them that the President's order had released 
ail the balance of the réservation of 1847 except the existing reserve 



36 152 FEDERAL EErOETER. 

for Ft. Brady, and directed to so note them (the lands released) in 
their tractbooks and plats. It seems probable that the Commissioner, 
in writing his letter of June 9, 1853, vvas laboring under the misap- 
prehension that the lands he was writing about lay in the Ft. Brady 
Réservation. Otherwise there is such a conflict in his statements as to 
render them without value as évidence of contemporaneous construc- 
tion. 

The Chandler tract was therefore open to the location of the scrip, 
and had been adequately surveyed. The location of the scrip was per- 
missible, and the patent was and is valid. 

We corne, then, to the question which is of more gênerai interest to 
the United States, and the one which constitutes the direct object of 
the bill, and this is whether the ownership of the mainland carries with 
it the title to the islands lying between it and the thread of the stream. 
At this point it seems proper to note an aspect of the case which other- 
wise it might be thought we had overlooked. It will be seen from what 
follows that we are of the opinion that the United States lias neither 
the légal or équitable title in the bed of the stream or in thèse islands, 
and consequently has not such an interest in the land as is required to 
support a bill to remove a cloud upon a title. In short, we think the 
title is in the state of Michigan, if the state has not yielded it to the 
riparian Owner. But this défense, if it be one, has not been raised or 
discussed by counsel, who hâve preferred to. ignore it. And, as there 
is a colorable case for the présentation of the merits of the principal 
question, we bave concluded to examine and décide it. But the prin- 
ciples upon which pur décision must rest were long since settled, and 
it seems, to us singular that the Department of the Interior requires 
any fresh judicial déclaration of them. The relevant propositions es- 
tablished by the décisions of the Suprême Court of the United States, 
as we understand them to be, are: 

(1) The original states which united under the Constitution owned 
the land submerged by the navigable waters within their respective 
boundaries in right of their sovereignty. 

(2) This ownership was not surrendered by their iniion, and re- 
mained unafïected thereby except to the extent that they might be af- 
fected by the; exercise of the power delegated to the United States to 
regulate commerce between the states and between the states and for- 
eign countries. 

(3) Upon the acquisition of territory by the United States, such 
new territory was hekl, the terra iirina as well as the submerged lands, 
in trust for the several new states which should thereafter be formed 
of such territory, subject, however, to the right retained by the United 
States on parting with it to sell the land for revenue, and this doubtless 
included lands in islands as well as elsewhere, which the United States 
should regard as valuable and claim for itself. 

(4) This trust was executed by the United States, and the ownership 
of the submerged lands relinquished when any state thus formed should 
be admitted into the Union, for upon such admission the new state was 
entitled to the same rights of sovereignty and be upon an equal footing 
"in ail respects" with the original states. And this was one of the ex- 
press conditions of the deed of cession executed March 1, 1784, by the 



UNITED STATKS V. CHANDLER-DUNBAK WATER POWER CO. 37 

State of Virginia to the United States, of the Northwest Territory, 
out of which the state of Michigan was formed. 

(5) In the case of the state of Michigan, the condition was per- 
formed by the act of Congress of June 16, 1836, by which it was ad- 
mitted with its northern a.id eastern boundaries on the international 
boundary, the new state to be "on an equal footing with the original 
States in ail respects whatever." iVnd thereupon the title to the lands 
submerged by the navigable waters of the state was transferred to 
the state. But the title to the mainland and of such islands as it should 
claim was as in other cases expressly reserved to the United States by 
the act of admission, to be sold for the benefit of ail the states. 

(6) The title to unsurveyed and unclaimed islands in submerging 
waters is of the same character with that of the bed of the stream or 
other navigable waters. 

(7) The ownership by the state of lands submerged by navigable 
waters is in ail the states, and equally in them ail, subject to such con- 
trol by the United States as is necessary to the exercise of the power 
to regulate commerce. To this extent only is the complète title im- 
paired. 

(8) The United States has therefore in its several departments, légis- 
lative, executive, and judicial, recognized the right of the state in which 
such submerged lands and unclaimed islands are situated to make such 
disposition of them as it pleased. 

(9) The state of Michigan, as hâve other states, has relinquished 
them to the riparian owner. 

The leading case of Pollard's Lessee v. Hagan, 3 How. 212, 11 L. 
Ed. 565, presented nearly ail of thèse questions, and the gênerai princi- 
ples there discussed and adjudged hâve ever since been accepted and 
applied. In that case the plaintiff sought to recover in ejectment lands 
which had been patented to him by the United States, and which at 
the date of the patent laid belovv high-water mark in the Mobile river 
at the city of Mobile. If the United States had any title, its grantee 
could recover upon it. And so the case presented tire very questions 
which are presented upon this branch of the case before us. It was 
held that the plaintiff could not recover, because the United States had 
no title to convey. The whole subject was fully and ably discussed by 
Mr. Justice McKinley, in the opinion of the court. The subséquent 
décisions involving it are too numerous to be separately canvassed. 
It was examined afresh by Mr. Justice Grav in Shively v. Bowlby, 152 
U. S. 1, 14 Sup. Ct. 548, 38 h. Ed. 331. The doctrines of the case of 
Pollard's Lessee v. Hagan were confirmed on ail the questions involved 
in the présent case. The only criticism made was of so niuch of the 
opinion in the earlier case as implied that Congress had not the power 
while Alabama was a territory, and had not yet been admittcd as a state, 
to dispose of the land below high-water mark. This was obiter in Pol- 
lard's Lessee v. Hagan, for the grant in that case was made after Ala- 
bama became a state. As we infer, this criticism was founded upon the 
theory that, as the United States held the title to the land during the 
territorial status, Congress had the power to disappoint the expecta- 
tion by diverting it to another purpose, whatever might be thought of 
the propriety of its action. But no such question ariscs hère. We pass 



38 152 FEDERAL RErOKTBR. 

by the numerous cases which hâve followed the cases of PoUard's 
Lessee v. Hagan, and Shively v. Bowlby, until we corne to the récent 
case of Whitaker v. McBride, 197 U. S. 513, 25 Sup. Ct. 530, 49 L. 
Ed. 857. A spécial reason for citing this case exists in the facts that 
it arose in Nebraska, where the local law in regard to the title to land 
between high-water mark and the thread of rivers is the same as that 
of Michigan, and the case involved the title to an island in the river 
between those lines. In the opinion of the court, delivered by Mr. 
Justice Brewer, the opinion of Mr. Justice Bradley in Hardin v. Jordan, 
140 U. S. 371, 11 Sup. Ct. 808, 35 L. Ed. 428, was cited as authority 
for the doctrine that "the grants of the government for lands bounded 
on streams and other waters, without any réservation or restriction in 
tenns, are to be construed, as to their effect, according to the law of the 
State in which the lands lie." Then, as to the circumstance that the 
lands in suit were an unsurveyed island of some 20 or more acres, the 
learned justice pointed out that the omission to include the island in the 
gênerai survey of that locality was évidence that it was not claimed by 
the government, and referred to the case of the Grand Rapids & Indi- 
ana Railroad Company v. Butler, 159 U. S. 87, 15 Sup. Ct. 991, 40 
L. Ed. 85, which was also a case involving an island, for authority, 
said: 

"TJpon thèse surveys (of 1831 and 1837) tbe adjacent laud and the islands 
(not the island of that suit) were sold and patented to private parties. In 
1855 a parcel of ground in the river was, under instructions from the Surveyor 
General, surveyed and marked 'Island No. ô,' and for that island a patent 
was issued to the railroad company. We held that the patent to the riparian 
owner, issued before the date of tbe last survey, conveyed to him the title to 
the island." 

The case of Grand Rapids & Indiana Railroad Company v. Butler 
was one in which the question of the title to the fundus or bed of navi- 
gable rivers in Michigan was directly involved, as well as that of is- 
lands in such rivers which remained derelict, so far as the claims of the 
United States were concerned, by their omission from the original sur- 
veys of the locality. There are numerous décisions of the Suprême 
Court of the United States in which dépendent questions were involved. 
But there are none which run counter to the gênerai doctrines we hâve 
stated. Perhaps the most serions difficulties hâve been encountered in 
cases which involved the circumstances, or the extent and manner, of 
the exercise of the power of Congress to regulate commerce. Of such 
was the case of Scranton v. Wheeler, which cam* before this court 
and again before the Suprême Court. 6 C. C. A. 585, 57 Fed. 803; 
Id., 163 U. S. 703, 16 Sup. Ct. 1206, 41 L. Ed. 318. 

In Michigan the state has never claimed such islands. Differing in 
this regard from some of the other states, that state has relinquished 
them to the adjacent proprietors. In the early case of La Plaisance 
Bay Harbor Co. v. City of Monroe, Walk. Ch. 155, Chancelier Man- 
ning held that the complainant, which had erected wharves, piers, and 
warehouses on the banks and in the waters of a bay which was a part 
of Lake Erie, under charter from the state, had no title to the bed of 
the lake on the front of the land occupied by it. In his opinion he lînk- 
ed in his statement of the rule the bed of the rivers in the state. But 



TJNITED STATES V. CHANDLER-DUNBAR WATER POWER CO. 39 

that was obiter. The complainants were not the owners of any land 
on the banks of the River Raisin, the diversion of which river was the 
matter complained of. Whether the décision paid a due regard to the 
rights of the complainant as a riparian owner on the bay in the circum- 
stances of that case is not now material. The case was authority for 
the contention that the riparian owner on the shore of the Great Lakes 
had no title to the bed of the adjacent waters. But in the case of Lor- 
man v. Benson, 8 Mich. 18, 77 Am. Dec. 435, the question was pre- 
sented to the Suprême Court of the state in regard to the riparian own- 
ers' title to the bed of the Détroit river. The action was for obstruct- 
ing the plaintiff's right to get the ice on the river ; and one of the ques- 
tions reserved by the trial judge for the opinion of the Suprême Court 
was, "Hâve riparian proprietors on the Détroit river a right of prop- 
erty in the soil under the water, or in the ice, or the exclusive right of 
taking the same in front of the premises to the middle of the stream?" 
The answer of the court is thus stated in the headnote by the reporter, 
Cooley, afterwards a distinguished member of the court: "The com- 
mon-law principle that the soil under such tideless public rivers is in 
the owner of the adjacent bank prevails in this state, and is applicable 
to the Détroit river." The case in Walker's Chancery Reports was 
cited in the briefs, but is not mentioned in the opinion. The former 
chancellor, Manning, had become a member of the Suprême Court and 
concurred in the opinion. This décision has been followed in the later 
cases decided by that court. Rice v. Ruddiman, 10 Mich. 135 ; Ryan 
V. Brown, 18 Mich. 196, 100 Am. Dec. 154; Bay City Gas Light Co. v. 
Industrial Works, 38 Mich. 183 ; Turner v. Holland, 65 Mich. 453, 33 
N. W. 283 ; Grand Rapids v. Powers, 89 Mich. 94, 50 N. W. 661, 14 
L. R. A. 498, 28 Am. St. Rep. 376. And later on the same rule has been 
recognized by the Suprême Court of Michigan in People v. Silberwood, 
110 Mich. 103, 67 N. W. 1087, 33 L. R. A. 694, in regard to rivers. 
But in this later case the court drew a distinction between the land in 
the bed of rivers and that in the bed of the Great Lakes, and in regard 
to the latter reverted to the rule in La Plaisance Bay Harbor Co. v. 
City of Monroe, supra. 

In behalf of the complainant it is contended that there is a différence 
between the land in the bed of the inland rivers of a state and those on 
its boundary, especially where the boundary is an international boun- 
dary ; but no substantial ground for such a distinction has been sug- 
gested, nor can we find any. The Michigan rule has been applied in- 
discriminately to the inland waters of the state and those on its inter- 
national border. Lorman v. Benson and Backus v. Détroit, 49 Mich. 
110, 13 N. W. 380, 43 Am. Rep. 447 related to the Détroit river, and 
Ryan v. Brown related to the St. Mary's river. 

The brief of counsel for the appellant discloses that upon a search 
in the early archives of the government it appears that the St. Mary's 
river was sometimes, indeed often, called a "strait," and it is likened by 
counsel to the Bosphorus and other like great Connecting waters. Much 
industry is shown to bave been given to this endeavor, and the object is 
to show that the St. Mary's river ought to be classed with the Great 
Lakes upon the distinction taken by the Suprême Court of Michigan in 
People v. Silberwood, 110 Mich. 103, 67 N. W. 1087, 33 L. R. A. 694, 



40 152 FEDERAL EErOETER. 

between rivers and Iakes. We hâve preferred to call the stream a river, 
not only because it seems the more proper appellation, but also because 
it bas in récent times been se called. But it is a small niatter to difïer 
about. It is the same stream, by whatever name called, as was the sub- 
ject of the décision in Ryàn v. Brown, and it bas a much smaller title 
to be called a strait than lias the Détroit river, which bas a much more 
even current and carries several times the volume of water, and wh'ch 
was the sûbject of décisions in two, at least, of the Michigan cases. 

The complainant says tbat it needs thèse islands in order to fulfiU its 
treaty with Great Britain that the Great Lakes and Connecting waters 
should forever remain free and open to the commerce of the coutract- 
ing parties. But it is not stated that thèse isîands are a menace to the 
commerce of Great Britain, or that that country bas made any com- 
plaint or requirement about tbëm. But aside from this, the United 
States did not, by the treaty, stipulate to make improvements in thèse 
waters. It stipulated that it would interpose no obstacle to tbeir nav- 
igation in the commerce of the other country. It inight bave left them 
ail in their natural state without any violation of the treaty. A great 
number of cases are cited in the brieî of appellee from the states wbere 
the Michigan rule prevails, and wbere the river is on the border line be- 
tween states, and there are a number of cases from such states in the 
reports of the Suprême Court of the United States wbere the rule has 
been applied without regard to the fact that the river was a state bound- 
ary. 

Again, it is said that the United States needs thèse islands for its con- 
venience in its commerce on' the river. But for what particular purpose 
of thaf sort is not stated. No action has been taken by Congress for 
the construction of any works or the rcmoval of any obstructions at 
tbis place which woidd be affected by the existence of the islands. If 
the Congress shall at any time require them in order to properly reg- 
ulate commerce, which in view of tbeir location would seem a rather 
remote probability, the défendant will not be ousted of its title, but it 
will become subject to an easement for a public use which may more 
or less impair its value. But that was a liability to which it vi'as exposed 
wdien it acquired the title. 

Thus far we hâve considered tbis question on its strictly légal aspects. 
The éléments of equity in the attack on the Cbandler patent are scant. 
His application was made May 17, 1881. The Land Office had it under 
advisement until December 1.5, 1883, whcn it granted the patent. It 
does not appear that the particular objection now made was presented 
to the Commissioner. But the matter of the réservations in the lo- 
cality, including the land applied for, must bave been under bis ob- 
servation, and the issuance of the patent is at least prima facie évidence 
that no valid objection to its issuance was deemcd to exist. The Land 
Office then had, and has continued to bave in its possession, the same 
data for raising the question of the validity of the patent that are made 
the basis for the contention now made. Upon the faith of the grant, 
the patentée and his grantee bave made permanent improvements upon 
the land costing from $i;),"),0(»() to $1.")0,0(IO. Following tbe ancient 
common-law maxim, ''nullum teminis occurrit régi," it bas been settled 
as tbe rule bere that the United States is not affected in respect to its 



COOK V. FOLEY. 41 

pursuit of remédies by mère delay or gênerai statutes of limitation. 
But when it sues in equity as a private suitor on a cause of action relat- 
ing to its proprietary interests, it is held to be affected by those equities 
which are recognized as fundamental in controversies between private 
parties. And why should this net be so ? It derogates f rom the dignity 
and character of the government to suppose that, formed as it is to se- 
cure impartial justice between individuals, it may nevertheless in the 
conduct of its own afïairs, without regard to the principles it represents, 
perpetrate upon its citizens wrongs which it would promptly condemn 
if practiced by one of them upon another, 

The argument in this case took a very wide range. But we hâve en- 
deavored to keep as nearly as we could within the limits of the control- 
ling facts in the controversy and the principles which we think applica- 
ble to them. 

We are of the opinion that the decree of the court below should be 
afRrmed. 



COOK et al. v. FOLET et al.» 
(Circuit Court of Appeals, Eighth Circuit February 13, 1907.) 

No. 2,224. 

1. Appeal and ERnoR — Review— Harmless Eseoe. 

While it is the rule of the fédéral courts that If there be error appar- 
ent on the face of the record a presiimption of préjudice arises wliich can- 
not be disrefrarded uniess the record iifJirrnatively diseloses that the error 
was not prejudicial, it is equally well established in such courts that 
no judgment will be reversed for error when it is clear that such error 
did not and couid not hâve prejudlced the rights of the party against 
whom the ruiing was made. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 3, Appeal and. Error, 
§§ 4029-4037.] 

2. CoNTRAors— Rui.es of Construction. 

It is a well-recognized canon of construction that the situation of the par- 
ties to a contract at the time it was entered into shouid be considered. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 11, Contraets, § 752.1 
S. Same — Peactioal Construction by Parties. 

Where the parties to an executory contract hâve given It a particular 
construction, such construction will generally be adopted by the court in 
giving efl'ect to its provisions. 

[Ed. Note.— For cases In point, see Cent Dig. vol. 11, Contraets, S 753. 

Practical construction of contraets by parties, see note to Davis v. 
Alpha Portlaud Cément Co., 73 C. C. A. 392.] 
4. Same. 

Défendants took the contract to construct a railroad in accordance with 
spécifications which by their terras were made a part thereof, and which 
provided. inter alla, for monthly payments based on approximate esti- 
mâtes made by the engineers of the railroad company, a certain percentage 
being reserved, and for a final estimate and payment after the worlc was 
completed. They also provided that "the engineers' measurements and 
classifications shall be final and conclusive." Plaintiffs submitted to de- 
fendants a proposai for a subcontract after having been given a copy 
of such spécifications, which proposai stated "ail worli to be done ac- 
cord ing to the spécifications of the • * * railroad company and to 
the satisfa ction of their engineers." The proposai was accepted, and 

•Rehearing denied May 23, 1907. 



i2 152 FBDEEAL KEPOETBB. 

plaintiffs did the work. They received moiithly payments on estimâtes 
made hy tlie compaiiy's engineers, and on completion of the work received 
final payment on measurenients and elassiflcarions so niade witliout ob- 
jection. Tliey at no time liad toeasurements or classifications made t'or 
themselves until a year after sueh linal payment. Ueld, tliat while the 
provision of the speeifleations making the measurements and classifica- 
tions of the company's engineers final and conclusive vi^as not In terms 
made a part of the subcontract, yet in view of the situation of the par- 
ties when it was made, and their acts in making and receiving payments 
based solely on tUo estimâtes, measurements, and classification of such en- 
gineers, it was cleariy intended that the spécifications should be a part 
thereof, and that the rights of the parties thereto were govemed by such 
provision. 

[Ed. Note. — For cases In point, see Cent. Dig. vol. 11, Oontracts, §§ 
884^889.] 

6. Same— Provision for Estimâtes bt Engineers— Conclusiveness op Es- 
timâtes. 

Final measurements and classification of work made by engineers un- 
der a eontract providing that they shall be final and conclusive between 
the parties are in légal effect an award made by arbitrators, and are 
final and conclusive, in the absence of fraud or such gross mistakes as 
Imply bad faith or a failure to exercise an honest judgment. 

fEd. Note. — For cases in point, see Cent. Dig. vol. 11, Contracts, §§ 
1326-1351.] 

6. Same— Impeachment fob Feaud oh Mistake. 

Final estimâtes made by engineers in pursuance of a eontract between 
the parties malving such estimâtes final and conclusive when made the 
foundation of an action at law, or when interposed as a défense to an 
action at law, caunot be impeached for fraud, such gross mistakes as 
imply bad faith, or a failure to exercise an houest judgment ou the 
part of the engineers if timely objection is made, but for such relief re- 
sort must be had to a court of equity. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 11, Oontracts, § 1343.] 

7. Courts— -rBocEDUBE in Fédéral Courts— Mingling oir Légal akd Equi- 

table Causes or Défenses. 

In the fédéral courts there can be no blendiug of légal and équitable 
causes of action or défenses. 

8. Same— Issues— Objections— Waivee. 

ïhe objection that an issue- raised by the pleadings in an action at law 
is cognizable in equity is waived by a failure to interpose it in apt time 
in the trial court. 

9. Conteacts-Estimates or Railroad Work by En gineee— Impeachment 

POB Fbaud. 

A very high degree of proof is required to impeach the décision of a 
railroad engineer as to amount and classification of the work done by 
a contractor on the ground of fraud or bad faitli, where by the eontract 
such décision ia made conclusive between the iiarties. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 11, Oontracts, § 
1347.] 

Carland, District Jùdge, dissenting. 

In Error to the Circuit Court of the United States for the District 
of Minnesota. 

H. V. Mercer (George P. Wilson and George C. Greene, on the 
brief), for plaintiffs in error. 

Harris Richardson, for défendants in error. 

Before VAN DEVANTER, Circuit Judge, and CARLAND and 
POLLOCK, District Judges. 



COOK V. FOLET. 43 

POIvLOCK, District Judge. The important and controlling factg 
in this case, as gleaned from the record, are: 

Défendants in error (hereinafter called "défendants") were the origi- 
nal contractors with the Algoma Central Railway Company (herein- 
after called the "railway company") for the grading of a line of road 
in Canada. On the 30th day of'September, 1901, the défendants re- 
ceived from plaintifïs in error (hereinafter called "plaintififs"), the fol- 
lowing proposition to grade a portion of the road. 

"St. Paul, Sept. 30, 1901. 
"Messrs. Foley Bros., Porters & Wh.ilen, Contractors. 

"Gentlemen: We propose to do ail the work on rlie Main Line near Batche- 
wana of the Algoma Central Ry. from Station 88S to Station 1005 at the fol- 
lowing priées: 

Earth excavation, hauled 500 feet and under, per eu. yd $ 25 

Loose rock excavation, hauled 500 feet and under, per eu. yd 40 

Solid rock excavation, hauled 500 feet and under, per eu. yd. 1 45 

Hard pan excavation, hauled 500 feet and under, per eu. yd. 40 

Materlal hauled beyond 50O feet 01 

Clearing per acre 38 00 

Close cutting per acre 35 00 

Grubbing per acre 75 00 

Cedar Box Culverts, $10.00 per M. ft. B. M. 

"Ail work to be done according to the spécifications of the Aleoma Central 
Railway Company and to the satisfaction of their engineers, and to be com- 
pleted by June 30, 1902. If, at any time in your opinion, or that of the en- 
gineers of the Algoma Central Ry. Co. there is not sufKcient force on the work 
to complète the same within the time specifled, we agrée that you may put 
on what force you consider necessary and charge same to our account. 

"Yours truly, Cook Bros." 

To this proposition défendants replied: 
"Messrs. Cook Bros., Contractors : 

"Gentlemen: We aecept the above proposition and authorize you to com- 
mence at once. 

"Yours truly, Foley Bros., Porters & Whalen, 

"By W. D. Barclay." 

In accordance with the contract so made, plaintiffs did perform 
the work of grading the road between the sections named in the con- 
tract, and before the commencement of this action received therefor 
the sum of $70,639.74 for work done by them under the contract, 
based on estimâtes made by the engineers of the railway company. 
Plaintiffs also received the further sum of $8,542.30 for extra labor 
performed, materials furnished, and money expended for varions pur- 
poses. Thereafter plaintifïs commenced this action at law to recover 
a balance of $31,965.78 claimed by them to be due on the contract price 
for work done under the terms of the contract, and the further sum of 
$3,306.52 as balance claimed by them to be due for extra work done, 
materials and money furnished and expended for défendants. The 
amount thus claimed by plaintiffs for work done in pursuance of the 
contract was based upon measurements and classifications of the work 
made by engineers, at their request, more than a year after the com- 
pletion of their contract. 

The pétition is in three counts. The first, for balance due under 
the terms of the contract; second, for the same amount based upon 



44 152 FEDERAL REPORTER. 

the common (quantum memit) count; third, for balance claimed for 
extras furnished, extra work done, materials furnished, and money 
expended for the benefit of défendants. To this pétition défendants 
answered, admitting the making of a contract with plaintifïs and the 
performance of the work and labor by plaintifïs under the contract, but 
alleged at the time of the mal-cing of the contract there was in exist- 
ence certain spécifications for the doing of the worl< which formed a 
part of the original contract between défendants and the railvvay Com- 
pany, and that by référence thereto in the contract made with plain- 
tifïs said spécifications M^ere adopted and became a part of the sub- 
contract between plaintifïs and défendants. Thèse spécifications were 
set out in the answer in full. 

Paragraph 4 of the gênerai provisions applicable to ail work done 
under the spécifications provides as follows: , , 

"An approximate estimate will be made at the enà of every mowth durSng 
the cnrrent month as provided for in the contract, reserving to the coiitractor 
the right to inquire into the correctness of the estimate. 15 per cent, of the 
monthly estimâtes will hé reserved as a réserve fuud until final completion 
of the worij as provided for in the contract." 

Paragraph 5 provides : 

"Final estimâtes will be made for the work with reasonable diligence when 
eompletely performed, and the engineer reserves the right to reject the whole 
or anv portion of tlie said worl^, sliould It be found to be inconsistent with the 
spécifications. The engineer's measurements and classifications sliall be final 
and conclusive." 

Paragraph 19 provides: 

"Thèse spécifications are hereby acknowledged, accepted and made a part 
of this contract." 

The afiswer further alleged that the engineers of the railway Com- 
pany made a final estimate of the amount of work done by plaintifïs 
under the terms of their contract and ifs classification, and in accord- 
ance therewith défendants had made full payment to plaintifïs accord- 
ing to the terms of the contract. 

As to the third count in plaintifïs' pétition, the défendants in their 
answer pleaded full payment. In reply to this answer plaintifïs plead- 
ed as follows: In the 'third paragraph admitted the railway company 
provided spécifications substantially as set out by the défendants. In 
the second paragraph denied thèse spécifications were a part of the 
contract made by plaintiffs with the défendants, and in the fourth and 
fifth paragraphs of the reply pleaded as follows : 

"Dénies that either the said engineer or engineers ever either made or 
caused to be made measurements of the said work according to the methods 
and at the times alleged in said answer, or at ail; dénies that either the 
said engineer or engineers ever made any estimâtes of said work except ap- 
proximate estimâtes and measurements occasionally made of parts of said 
work, and allèges that said occasional and approximate estimâtes and meas- 
urements were not made every month or as often as every month, and were 
never made for the whole ofsaid work, and not made after said work was 
completed: that nelther of the plaintilfs ever had any notice or knowledge 
of either the time or place of either any estimate or measurenient of said work, 
either approximate, preliminary or final, or otherwise, by either the said 
engineer or' engineers; that neither of the plaintiffs were ever either présent 



COOK V. FOLEY. i-j 

or representetl at sueh estimnta or meiisureineiit; that noitlu'i- of tbcin (■ver 
had any opportunity to inquire iuto tlie eorrectuess of any sucli estimate or 
lueasurement, or kuow whether it was made eitlier faii'iy or correctly ; tliat 
the plaintiffs vvere informed that said approximate aud occasioual estimâtes 
and measurements had been made of parts of said worli from time to time, 
and requested aud demanded of the said défendants, and the said englaeer and 
('n,!rineers in charge of said work and railway company, that plaintitïs be per- 
uiitted to hâve tlie riglit to examine such estimâtes as might be made by said 
eugineer or engineers, and might bave eojiies tliereof ; that said request was ai- 
ways refusod to eitlier examine or see either or any sueh reports or estimâtes; 
tliat plaintiffs are informed and believe, and upon that information and belief 
furtber allège, that, when said approximate and oecasional estimâtes and 
îoeasurements were made, they were for much less than the work actually 
l)erformed, and were greatly erroneous as to the classifications ; that after 
the work had been actually performed and said oecasional measurements had 
been made, in so far as they were made, tbe resuit of said measurements and 
the classifications thereon and the estimâtes based upon said measurements 
and classifications were, from t -ne to time, by the procurement of the said 
défendants, willfully and fraudulently manipnlated and changea to decrease 
the apparent amount of work perfornied by thèse plaintiffs, and with a view 
and with a purpose and with the intention of so combining, manipulating, 
and cbanging the results of said estimâtes as to greatly reduee tbe amount 
of said work, and to falsely and erroneously classify the same so as to 
greatly reduce the amount owing from said défendants to thèse plaintiiïs. 

'•'And plaintiffs further allège that within and at a reasonable time after 
the i'xnt iision of said work j)laintiffs d.uly demanded of said engineers and 
said défendants that they measure or cause to be measured the said work 
for a final estimate tbereof, and offered to pay one-half of the ex])ense of such 
measurements, but said défendants refused to do so; deny that said engineer 
ever either measured or classifled said work, eitber in accordance with the 
allégations of said answer, or at ail ; but allège that if said engineer ever 
either measured or attempted to measure, or ever either elassitied or at- 
tempted to classify, said work, or ever either found, or attemjited to find, ad- 
Judge, or détermine the same, or the rights of thèse plaintiffs, or the liability 
of tlie '-^fendants therefor, that the same was done without either the knowl- 
edge or consent of plaintiffs, aud without any agreement upon the part of 
plaintiffs ther or, and without any hearing or opportunity given to plaintiffs 
to be heard thereon ; that such measurements and classifications or attempted 
measurements and classifications, if made or attempted to be made by said 
engineer, were wholly without authority as to thèse plaintiffs, and of no 
binding force or effect on them or tbcir rights therein ; that if the said 
engineer did mako in fact such measurements, and did in fact attoini)t to clas- 
sify said work and adjudge said work. that be could not, and did not, arrive 
at the amounts and classifications set forth in défendants' answer, if the same 
were done inte!ligently and honestly, and that if he did arrive at the said 
respec'|fve amounts and classifications, that bis said measurements ,and classifi- 
cation!? and each of them, in so far as they differ from the respective amounts 
set forth in the complaint herein, were, and are, incorrect and false, and 
wliolly erroneous, and made so with tbe knowledge and consent and under the 
direction of the said défendants." 

At the beginning of the trial on motion made by défendants' counsel 
to require the plaintiffs to elect whether they woukl proceed on the 
contract as set out in the first cause of action, or on the common 
count, as set forth in the second, the court ruled the plaintiffs to pro- 
ceed on its first cause of action based on the contract; and further 
ruied, on the face of the pleadings as presented, the gênerai provisions 
of the spécifications applicable to ail work done under them, making 
the engineers' measurements and classifications of the work done 
final and conclusive between the parties, did not form a part of the 
contract and was not binding upon plaintiffs. 



46 152 FEDERAL EEPORXER. 

At the conclusion of plaintiffs' testimony the court denied a mo- 
tion for peremptory instruction in favor of défendants, and held the 
question of the amount due plaintiffs, in addition to that which it was 
admitted they had received, to be open for the détermination of the 
jury. 

Among other things, the trial court charged the jury with référence 
to the weight to be gîven to the measurements and classifications 
made by the engineers of the raiiway company, as foUows: 

"Now, it is for you, gentlemen of tbe jury, to détermine in the case what the 
amount of tbese différent materials was, and what the différent classifications 
were. If you are satisfled tliat this worlc of measurement and of classification 
was honestly perfcrmed by thèse engineers, Mr. Anderson and Mr. Oonnell, 
and by Mr. Garden as far as he acted in the matter; that it was honestly 
performed by them, and they appear to hâve no interest In the matter ; then 
it follows that they had better opportunities to ascertain the exact amount, 
not only of the entire amount of material that was removed, but of the dif- 
férent classifications of this material, than the engineers who went there 
afterwards, a year or more later, and had not the conformation of the ground 
to view, had nothing but the places from which the material was taken, fre- 
quently, and generally perhaps, not showing what the original surface of the 
ground was, or how high it might extend, exeept in some cases on the highest 
side of the eut; If you are satisfled that thèse men did this work honestly, 
it is quite apparent that they had a better opportunity to reach correct con- 
clusions than could hâve been the case with the engineers who went on there 
afterwards at the Instance of the plaintiffs ; and, if you should come to that 
conclusion, it would substantiaily end the case. 

"But if there is anything in the évidence which satisfies the Jury that thèse 
measurements or classifications were not made honestly by the engineers of 
the raiiroad company, according to which Foley Bros, were paid, as well as 
the Cook Bros., then it wlll be for the Jury to ascertain what the amount of 
the material really was, and its proper classification, 

"In that case you hâve the testimony of the two engineers who made the 
latter measurements, the testimony of Mr. Spaulding, and the testimony of 
Mr. Bellamy. You hâve heard what they did. They went there after the 
work was ail done; you bave heard what measurements they took, and how 
they were taken ; how that work was done by them ; and if upon the whole 
évidence you are satisfled that the measurements were not made honestly 
by the engineers of the raiiroad company, and that thereby the plaintiffs were 
not paid fuily such an amount as they ought to hâve been paid — ;lf you are 
satisfled of that from tbe testimony — then it will be your duty to détermine the 
facts and render a verdict for the plaintiffs for the balance which they ought to 
hâve." 

It appears from the uncontradicted évidence found in the record 
the eng'neers of the raiiway company made measurements and classi- 
fications of the work done by plaintiffs tmder their contract, and that 
plaintiffs were paid and received payment for work done by them 
based on such estimâtes. It further appears the plaintiiïs made no 
measurenrients and classifications of the work done by them as the 
work progressed, and caused none to be made until more than a year 
after their contract was completed. There is no évidence found in 
the record tending in the slightest degree to impeach the estimâtes made 
by the engineers of the raiiway company for fraud, nor is there any 
évidence found in the record tending to show such gross mistakes on 
the part of the engineers of the raiiway company in the making of 
their estimâtes as would imply bad faith or a failure to exercise an 
honest judgment on their part. The utmost that may be said of the 
évidence is, a dispute was raised as to the accuracy of the measurements 



COOK V. FOLET. 47 

and classifications of the enginoers as shown from theîr estimâtes. As 
to the third count, there was no sufficient évidence offered by plaintiffs 
to permit a recovery thereon. The trial resulted in a verdict and judg- 
ment for the défendants. Plaintiffs bring error. 

In the view we hâve taken of this case, derived from a reading of 
the entire record and the briefs of counsel, we deem a separate con- 
sidération of the many errors assigned unnecessary. Ail of substantial 
merit are so related that a référence to and décision of one ground 
of error relied upon will show ail to be untenable. As seen from the 
above statement, the trial court at the outset of the trial, on the face 
of the pleadings, tentatively ruled that provision of the spécifications 
for the doing of the work furnished by the railway company, which 
formed a part of the contract between the railway company and de- 
fendants, and which made the measurements and classifications of the 
work donc, as shown by the estimâtes of the engineers of the railway 
company, final and conclusive between it and the défendants, formed 
no part of the contract between the parties to this litigation. And, al- 
though, as clearly appears from the record, the parties proceeded to the 
trial of the case on ail the issues joined as though this question had not 
been raised or decided, the court seems to hâve entertained this view 
of the contract throughout the trial, for while it does not appear from 
the record how the question was raised, or what called forth the ruling 
at the time it was made, the trial court in the charge to the jury, among 
other things, states he had so ruled and expresses satisfaction with the 
correctness of such ruling. Proceeding further on the assumption of 
the correctness of the ruling made in this respect, that plaintifïs were 
not bound or concluded by the measurements and classifications of the 
work donc by them, as shown by the estimâtes of the engineers of 
the railway company, but that the true amount of the measurements 
and classification of their work was open for the détermination of the 
jury as a basis for its verdict, on ail the évidence, the court charged 
the jury as to the weight to be given such estimâtes, as above quoted 
from the charge given. If the trial proceeded from a correct view of 
the plaintifif's contract, this portion of the charge was erroneous, for 
that it accorded to the testimony of the engineers of the railway com- 
pany and the estimâtes made by them of the work donc by plaintifïs 
undue probative force and weight. In effect it charged the jury, if 
the estimâtes were honestly made by the engineers of the railway com- 
pany, as shown by their testimony, that ended plaintifïs' case. In 
other words, it made the accuracy of the estimâtes of measurements 
and classifications of the engineers of no moment, but their honesty the 
sole test. However, it is the insistence of counsel for défendants that 
the arbitration clause found in the spécifications furnished by the rail- 
way company does form a part of plaintiffs' contract, and by reason 
thereof the estimâtes made by the engineers o.f the railway company 
of measurements and classifications of the work done by plaintifïs for 
défendants are final, conclusive, and binding upon plaintifïs, as a 
matter of law, until set aside and annuUed for fraud or such gross 
mistakes on the part of the engineers making them as would imply 
bad faith on their part, and as there is no testimony found in the rec- 
ord tending to impeach the validity of the estimâtes made, and as the 



48 152 FEDERAL RErORTBK. 

verdict and judgment is for défendants, and is riglit as a matter of 
law, the error committed, if any, in tlie giving of this portion of tlie 
charge is immaterial. 

In view of this contention it becomes material to a décision of the 
case to inquire whetlier upon the whole record; as a matter of law, the 
trial court rightfully held the arbitration clause fornied no part of the 
contract of plaintiffs, not for the purpose of reviewing or correcting- 
the ruling so made in this respect, for, as the défendants had judgment 
in their favor, it is manifest this may not be done hère on this record. 
Guarantee Co. of North America v. Phénix Ins. Co., 124 Fed. 170, .iD 
C. C. A. 376, and cases cited. Yet, as the judgment belo\y was for 
the défendants, if on the whole record such arbitration clause was, as 
a matter of law, a part of plaintiffs' contract, and it be true, as stated, 
such estimâtes of measurements and classifications of the work done 
by plaintiffs under their contract as are provided by the spécifications 
were in fact made by the engineers of the railway company, and pay- 
aient was made by défendants to plaintiffs in accordance with such 
estimâtes, and the record contains no évidence tending to impeach and 
avoid such estimâtes upon any gfoUTid for which they might be avoided, 
it then follows, of necessity, the judgment below is right and must be 
affîrmed, because at another trial no other judgment than that com- 
plained of could rightfully be entered. Therefore the error commit- 
ted in the charge given is without préjudice. 

While it is the rule of the fédéral courts, if there be error apparent 
on the face of the record, a presumption of préjudice arises which 
cannot be disregarded unless the record afïïrmatively discloses the er- 
ror was not prejudicial (Mexia v. Oliver, 148 U. S. 664, 13 Sup. 
Ct. 754, 37 L. Ed. 602; Vicksburg & Meridian Railroad v. O'Brien, 
119 U. S. 99, 7 Sup. Ct. 172, 30 h. Ed. 299), yet it is equally as well 
established by the décisions of the fédéral courts that no judgment 
vvill be reversed for error when it is clear such error did not préjudice 
and could not hâve prejudiced the rights of the party against whom 
the ruling was made. (Lancaster v. Collins, 115 U. S. 222, 6 Sup. 
Ct. 33, 29 E. Ed. 373; Smith v. Shoemaker, 17 Wall. 630, 21 E. Ed. 
717 ; Decatur Bank v. St. Eouis Bank, 21 Wall. 294, 22 L. Ed. 560 ; 
Railroad Co. v. Pratt, 22 Wall. 123, 22 L. Ed. 827; North v. Mc- 
Donald, 1 Biss. 57, Fed. Cas. No. 10,312). 

Was the view taken by the trial court of the contract existing be- 
tween plaintiffs and défendants the correct one? The détermination 
of this question dépends upon whether or not those provisions of the 
spécifications of the railway company making the admeasurements 
and classifications of the engineers of the railway company final and 
conclusive as to the work done under the spécifications became a part 
of the contract between plaintiiïs and défendants. The express lan- 
guage of the contract is, "ail work to be done according to the spécifi- 
cations of the Algoma Central Railway Company and to the satisfac- 
tion of their engineers." From this language it is manifest plaintifl^s 
must hâve advised themselves as to what the requirements of the 
spécifications were as to the manner of performing the work to be 
done under their contract, and at least to this extent the spécifications 
were made a part of their contract. The précise question, however, 



COOK V. FOLET. 49 

is, did plaintiffs, by this référence to the spécifications of tlie railwa}- 
Company made in their contract, adopt the provisions made therein 
for the admeasurement and classification of tlie work to be done b}- 
them ? Having in mind only tlie language employed in tlie proposition 
submitted by plaintiffs and its acceptance by défendants, it is not en- 
tirely certain whether it includes the arbitration clause of the spécifi- 
cations, making the measurements and classifications of the engineers 
of the railway company final, conclusive, and binding upon plaintiffs 
as to the work agreed to be done by them nnder their contract. Wood- 
ruff et al. v. Irlough et al., 91 U. S. 596, 33 L. Ed. 332. But a dtie 
regard for the established rules for the construction of exectitory 
contracts, in the light of the undisputed facts found in the record, 
leaves no room for doubt as to its true construction in this case, for 
the following reasons : 

It is a well-recognized canon of construction that the situation of the 
parties to the contract at the time it was entered into should be con- 
sidered. as was said by Judge Sanborn in Rockefeller v. Merritt, 7(i 
Fed. 909, 22 C. C. A. 608, SbX. R. A. 633 : 

"One of the most satisfactory tests to ascertain the true meaninîï of a 
eontraet is made by piitting ourselves in tho plane of the eontraetinf; parties 
when it was made, and then coiisideriiifr. in view of ail the facts and circum- 
stanees surrounding them at the time of its exécution, whnt the parties iu- 
tend by tlie terms of their agreement. Wiien their intention is tiras made 
clear, it must prevail in the interprétation of the instrument, regardless of 
inapt expressions or careless récitals." AccumuUitor Co. v. Dnbnque St. Kv. 
Co.. 12 C. C. .\. 37, 64 Fed. 70: United States v. Gibbons, 109 U. S. 200, :$ 
Sup. et. 117, 27 L. Ed. 900; Rock Island Ky. v. Rio Grande Ry., 143 U. S. 
596, 12 Sup. et. 479, 36 L. Ed. 277. 

Applying this rule to the facts shown by the record, what was the 
situation of the parties at the time this contract was made? The de- 
fendants were under contract with the railway company to perform 
the work hère subcontracted to be done by plaintiffs. The spécifica- 
tions referred to in the contract under considération formed a part 
of that contract. Thèse spécifications were submitted to and in the 
possession of plaintiffs before they made the proposition to contract 
with défendants. By the express terms of their contract plaintiffs 
agreed to do their work in accordance with thèse spécifications. The 
spécifications referred to were one paper, and an entirety, and con- 
tained gênerai provisions applicable to ail work done under the spécifi- 
cations, and under them is found the provisions for measurements and 
classification of the work by the engineers of the railway company. 
Hence plaintiffs knevif they must examine the spécifications in order to 
détermine the manner of doing the work. Having examined them, 
they knew the défendants were bound by the measurements and classifi- 
cations of the engineers of the railway company, and that the railway 
company would pay the défendants for the work done by plaintift's only 
in accordance with the measurements and classifications of the en- 
gineers of the raihvay company, and they had no reason to suspect or 
believe that défendants were binding themselves to pay the plaintift's 
for work done in accordance with différent measurements or classifica- 
tions than those made by the engineers of the railway company. 
152 F.— 4 



50 152 FEDBKAL EEPOETER. 

Again, there is another well-recognized and perfectly just rule of con- 
struction of executory contracts, vvhich is: 

"Where the parties to a eontract hâve given it a particular constraction, 
such coustruetion will generally be adopted by the court in giving effect to its 
provisions." 9 Cyc, siiliject "Contracts," p. 588. 

As said by Judge Thayer in Central Trust Co. of New York v. 
Wabash, St. L. & P. Ry. Co. (C. C.) 34 Fed. 254: 

"The agreement being executory, the practical construction adopted by the 
parties thereto, and by their successors, during a period of several years, Is 
entitled to great, if not controlling, influence in determining vs'hat is the 
proper interprétation of the same, as was held in ToplifC v. Toplifif, 122 U. S. 
121. 7 Sup. et. 1057, 30 L. Ed. 1110, and Chicago v. Sheldon, 9 Wall, 54, 19 
L. Ed. 594. It is well understood that the practical construction of a eontract 
adopted by the parties thereto will not control or override language that is so 
plain as to admit of no controversy as to its meaning. In ail such cases the 
iutent of the parties must be determined by the language employed rather 
thaT! by their acts ; but if the language employed is of doubtful import, or if 
the eontract contains no provisions on a given point, or if it fails to deflne 
with certainty the duties of the parties with respect to a particular matter 
or in a given emergency, then beyond ail question it is proper to consider how 
the parties hâve construed the instrument with respect to such debatable 
points. If both parties to an agreement for a considérable period, and while 
free to act, treat a eontract as imposing certain duties or obligations, such 
conduct ought to settle the construction of the instrument if its provisions 
with référence to such matters are to any extent uncertain, obscure, or in- 
comnlete. 'A construction of a eontract adopted and acted upon by both 
parties will be regarded as worked into the eontract,' if such construction 
does not conflict with its express provisions. The manner in which a con- 
struction of a eontract adopted and acted upon by both parties may, so to 
speak, be worked into a eontract, is well illustrated in Topliflf v. Topliff, above 
cited, and also in the case of Robinson v. U. S., 13 Wall. 363, 20 L. Ed. 653. 
In the latter case Robinson had contracted to deliver a certain quantity of 
barle •. but whether the deliverj' should be made in bulk or in sacks vi-as not 
specifled. For a period of six months the barley was delivered in sacks. The 
court refers to this faet as a proper reason for construing the eontract as 
requiring a delivery in sacks, rather than in bulk. It will rarely be found, 
we apprehend, that a court will go far astray in arriving at the actual intent 
of the parties to a eontract (which, after ail, is the purpose of ail rules of 
construction) by adopting that interprétation which the parties, without com- 
pulsion, hâve themselves adopted and acted upon." 

To like effect, see Merriam v. U. S., 107 U. S. 437, 3 Sup. Ct. 536, 
27 h. Ed. 531; Uinta Tunnel, Min. & Transp. Co. v. Ajax Gold Min. 
Co., 141 Fed. 563, 73 C. C. A. 35 ; District of Columbia v. Gallaher, 
124 U. S. 505, 8 Sup. Ct. 585, 31 L. Ed. 526 ; Michigan Home Colony 
Co. V. Tabor, 141 Fed. 332, 72 C. C. A. 480 ; and the many cases cited 
in 9 Cyc, subject "Contracts," p. 589. 

What was the conduct of the plaintiffs during the time this work 
was being performed by them? As shown by the record, they em- 
ployed no engineers to measure or classify the work done by them 
under this eontract, and made no such measurements or classifications 
of the work themselves. The engineers of the railway company 
were présent on the work, and did make such measurements and 
classifications as the work progressed. Plaintiffs received part pay- 
ments for work done by them as the work advanced, based alone on 
estimâtes made by the engineers of the railway company. And after 
the completion of their work called for a final estimate of the work done 



COOK. V. FOLET. 51 

by them and received payment, not in a round sum, but in odd dollars 
and cents, based on such final estimâtes, as made by the engineers of 
the railway company, and not until more than a year after the com- 
pletion of their work, and after receiving payment based on the final 
estimate of the engineers of the railway company, without protest, did 
they take any steps to make an independent measurement and classi- 
fication of the work donc by them. 

The entire record considered, we are of the opinion, even if it 
might be said the part of the spécifications making the estimâtes of 
the engineers of the railway company final and conclusive was not 
in the express terms made a part of plaintiffs' contract, yet the situa- 
tion and knowledge of the parties at the time the contract was made, 
and their conduct during the progress of the work, ail clearly show 
their intent to be bound by the stipulation in question, and that 
such stipulation was worked into and became as fuUy a part of the 
contract as though in express terms incorporated therein when made. 

Such being the contract between the parties, and the évidence found 
in the record being as above stated, a brief référence to a few well- 
settled and fundamental principles governing the efifect and the manner 
of avoidance of such estimâtes renders entirely clear the rights of the 
parties to this litigation. Final estimâtes made by engineers in pur- 
suance of such a contract are in légal efifect an award made by arbitra- 
tors, and are final and conclusive in the absence of f raud or such gross 
mistakes as imply bad faith or a failure to exercise an honest judg- 
ment. Kihlberg v. United States, 97 U. S. 398, 24 L. Ed. 1106; 
Sweeney v. United States, 109 U. S. 618, 3 Sup. Ct. 344, 37 L. Ed. 
1053 ; Martinsburg & Potomac R. R. Co. v. March, 114 U. S. 549, 5 
Sup. Ct. 1035, 29 L. Ed. 355 ; Chicago & Santa Fé R. R. Co. v. Price, 
138 U. S. 185, 11 Sup. Ct. 290. 34 L. Ed. 917 ; Wood v. Chicago, S. 
F. & C. Ry. Co. (C. C.) 39 Fed. 52; Elliott v. Missouri, K. & T. 
Ry. Co., 74 Fed. 707, 21 C. C. A. 3 ; Guild v. Andrews, 137 Fed. 369, 

70 C. C. A. 49; Choctaw & M. R. R. Co. v. Newton, 140 Fed. 225, 

71 C. C. A. 655 ; Fruin-Bambrick Const. Co. v. Ft. Smith & W. R. 
Co. (C. C.) 140 Fed. 465; Hartford F. Ins. Co. v. Bonner Mer- 
cantile Co. (C. C.) 44 Fed. 151, 11 L. R. A. 623 ; Republic of Columbia 
v. Cauca Co. (C. C.) 106 Fed. 337. 

Again, final estimâtes made by engineers in pursuance of a con- 
tract between the parties making such estimâtes final and conclu- 
sive when made the foundation of an action at law, or when inter- 
posed as a défense to an action at law, cannot be assailed in such 
action for fraud, such gross mistakes as imply bad faith, or a failure 
to exercise an honest judgment on the part of the arbitrators, or 
other like extrinsic matters, if objection to such method of attack 
be timely made ; but for such relief resort must be had to a court of 
equity. 2 Story's Eq. Jur. § 1452 ; 3 Cyc. p. 750 ; Hartshorn et al. 
v. Day, 19 How. 211, 15 L. Ed. 605; George v. Tate, 102 U. S. 564, 
26 L. Ed. 232; Emmet v. Hoyt, 17 Wend. (N. Y.) 410; Truesdale 
V. Straw, 58 N. H. 207; Hartford Pire Ins. Co. v. Bonner Mer- 
cantile Co. (C. C.) 44 Fed. 151, 11 L. R. A. 623; Missouri, K. & T. 
Ry. Co. v. Elliott (C. C.) 56 Fed. 772; Vandervelden v. Chicago & 
N. W. Ry. Co. (C. C.) 61 Fed. 54; Stephenson v. Suprême Council 



52 152 FEDERAL KEPORTEU. 

A. L. H. (C. C.) 130 Fed. 491; Levin v. Northwestern Nat. Ins. 
Co. (C. C.) 146 Fed. 76; Wood v. Chicago, S. F. & C. R. Co. (C. C.) 
r59 Fed. 52; Hcrrick v. Railroad Company, 27 Vt. G73; Kidwell v. 
BaUimore & Ohio Railroad Co., 11 Grat. (Va.) 676; Mansfield & 
Sandnsky R. R. Co. v. Veeder & Co., 17 Ohio, 396; Grant v. Rail- 
road Co., 51 Ga. 3 



Not only has this précise question been ruled, but the vcry fact 
that courts of equity hâve invariably assumed jurisdiction to déter- 
mine the validity of estimâtes made by engineers in pursuance of 
contracts making their findings final, conclusive, and binding between 
the parties when sought to be impeached for fraud or other extrin- 
sic matters, is conclusive évidence that a court of law has no juris- 
diction over such matters if objection thereto be timely made, for, 
of necessity, if a court of law possesses such jurisdiction a court of 
equity does not, for in fédéral courts the distinction between actions 
at law and suits in equity, and between légal and équitable défenses, 
is fundamental and jurisdictional. An aquitable défense is not ad- 
missible in an action at law. In the national courts a case cannot 
be part law and part equity; there can be no blending of légal and 
équitable causes of action and défenses. Anglo-American Land, M. 
& A. Co. V. Lombard, 132 Fed. 731, 68 C. C. A. 89, and cases therein 
cited; Bagnell v. Broderick, 13 Pet. 436, 10 L. Ed. 235; Bennett v. 
Butterworth, 11 How. 669, 13 L. Ed. 859; Thompson v. Railroad 
Companies, ,6 Wall. 134, 18 L. Ed. -765 ; Foster v. Mora, 98 U. S. 
435, 25 L. Ed. 191; Northern Pacific Railroad v. Paine, 119 U. S. 
561, 7 Sup. Ct. 333, 30 E- Ed. 513 ; Scott v. Neely, 140 U. S. 106, 
11 Sup. Ct. 712, 35 L. Ed. 358 : Scott v. Armstrong, U6 U. S. 499, 
512, 13 Sup. Ct. 148. 36 L. Ed. 1059; Eindsav v. First Nat. Bank, 156 
U. S. 485, 493, 15 Sup. Ct. 473, 39 E. Ed. 505 ; Davis v. Davis, 18 
C. C. A. 438, 73 Fed. 81 ; Schoolfield v. Rhodes, 37 C. C. A. 95, 82 
Fed. 153 ; Highland Boy Gold Min. Co. v. Stricklev, 54 C. C. A. 186, 
116 Fed. 8.53 ; Crissev v. Morrill, 60 C. C. A; 460, 135 Fed. 878, 886 ; 
Platt V. Earter (C. C.) 94 Fed. 610. 

It follows, therefore, of necessity, if plaintiffs, not content to rely on 
that part of the reply denying estimâtes of the work dona, by them 
under their contract to hâve been made by the engineers of tne railway 
Company, and denying the arbitration clause of the speciiications fur- 
nished by the railway company to be a part of their contract, desired 
to avoid estimâtes which had been made by the engineers of the rail- 
wa}^ Company in pursuance of the contract for reasons set forth in the 
reply, they must hâve resort to a ce art of equity, and could not inter- 
pose such défense to the estimâtes made by the engineers in this action 
at law if timely objection had been made thereto by the défendants. 
But, as défendants failed to interpose such objection in the court be- 
low, they must be held to hâve waived it and to hâve acquiesced in the 
trial of such équitable issues in this law action, for, it has been held 
by this court in such cases as this, the objection that an action or any 
material issue therein raised by the pleadings is cognizable in equity 
or vice versa is waived by a failure to interpose it in apt time in the 
trial court. Union Pac. Rv. Co. v. Harris, 63 Fed. 800, 12 C. C. A. 
598; Highland Boy Gold Mining Co. v. Strickley, 116 Fed. 852, 54 



COOK V. rOLEY. &.J 

C. C. A. 186. Hence, while défendants must be held to hâve consented 
to the trial of both the légal and équitable issues raised by the reply 
in this law action because they did not object tbereto, yet this waiver 
did not change the character of proofs required to impeach the validity 
of the estimâtes actually inade by the engineers of the railway com- 
pany in pursuance of the contract. 

The character of évidence required to overcome the estimâtes of en- 
gineers made in pursuance of a contract between the parties making 
such estimâtes final and conclusive as to the measurements and classifi- 
cations of work done under the contract bas very often received the 
considération of the courts. The rules as stated by Mr. Justice Red- 
field in Vandewerker et al. v. Vermont Cent. R. Co., 27 Vt. 130, is 
as follows : 

"After an estimnte by the ensinefr, no recovery could be liad boyond that 
sum, unless upon the most irréfragable proof of mistake in fact, or positive- 
fraud in tlie opposite party in procuring an under estiuiate, or corruption ir 
the engineer." 

Or as said bv this court in Choctaw & M. R. Co. v. Newton, 140 
Fed. 225, 71 C. C. A. G.55 : 

"Hence it lias become tlie settled doctrine of tlie law that to give the con- 
tractor auy standing in a court of equity to vacate the final award of the en- 
gineer, and give him jndgnient for a greatcr sum than that allowed in the 
final estimate, the contracter must show by an overvvhelniing weiglit of tho 
évidence that the engineer was guilty of fraud, 'or exhibited such an arbi- 
trary and wanton disregard of the complainant's plain rights under the con- 
tract as to be the équivalent of fraud, or committed errors and raistakes to 
the C'oniplainant's prejiidice so gross and palpable as to leave no donbt in 
the mind of the court that grave injustice was thereby done him, * * «= it is 
not material how the weight of the évidence may be upon this point, unless it 
shall appear reasons for thinking that the chief engineor's judgmeut was 
biased. partial, and consciouslv unjust.' " Jlundv v. Tjouisville & >■'. 1'". Co.. 
07 Fed. (!33. 038, 14 C. O. A. 583 : Elliott v. M., K. & T. R. Co., 74 Fed. 707, 21 
C. G. A. 3. 

Measured by this rule, we are convinced, from a careful examination 
of the évidence found in the record, it falls far short of that high 
standard required to impeach the estimâtes made by the engineers of 
the railway company, as that issue was tendered by the reply in this 
action at law, or had it been adduced by plaintiffs in a proper suit 
brought to set aside such estimâtes. For although, as appears from 
the record, plaintifïs, without objection from défendants or interposi- 
tion on the part of the court, were permitted to fully try ont this issue 
and bring forward ail the proofs they had, yet in ail the évidence there 
is found no suggestion even of fraudulent conduct or unfairness on 
the part of the engineers making the estimâtes. The évidence o'"fercd 
by plaintifïs for the purpose of showing the estimâtes of the engineers 
to be erroneous is enîirely consistent with the good faith of the en- 
gineers who made them. In brief, there is an absohite want of any 
évidence found in the record of the character required to impeach the 
validity of the estimâtes made by the engineers of the railway companv. 

Therefore, as the contract between the parties, as found from a con- 
sidération of the entire record, must be held to inchide the arbitration 
clause found in the spécifications for the doing of the work, and as the 



54 152 FEDERAL EEPORTER. 

undisputed évidence shows the engineers of the railway company did 
make estimâtes of the woi-k done by plaintiffs in pursuance of their 
contract, and plaintiffs did receive payment for their work based on 
such estimâtes, and as there is not even a semblance of évidence to be 
found in the record of that character required to impeach the vaHdity 
of the estimâtes made by the engineers of the railway company in 
pursuance of the contract under which plaintiffs performed their work, 
it follows, as a matter of law, the judgment sought to be reversed is 
right, that plaintiffs were not prejudiced by the errors of which they 
complain, and the judgment must therefore be affirmed. 

CARLAND, District Judge (dissenting). If the court has the right 
and authority to try the issues between the parties de novo, the resuit 
rpached by the majority of the court may be justified. The record, 
however, was brought hère by writ of error sued out by the plain- 
tiffs below to review errors of law which occurred at the trial. Eighty- 
four errors are assigned to the rulings of the trial court. I under- 
stand that on writ of error the court is limited to a review of thèse 
rulings, and that it will reverse or affirm as it finds prejudicial error 
or not in the making of the same. That the trial court erred in its 
charge to the jury is conceded in the majority opinion. But it is therein 
held that the error was without préjudice, not in relation to the theory 
on which the case was actually tried, but in relation to a theory up- 
on which a majority of the court thinks it ought to hâve been tried, 
Without the défendants in error having any power or authority to 
complain of any ruling of the trial court against them on this writ of 
error, the judgment in their favor is affirmed, for the reason that on 
the theory on which the case ought to hâve been tried the judgment 
is right. 

The majority opinion says that the court is not attempting to review 
errors committed at the trial against défendants in error, but that as 
it appears as matter of law that the trial court erred in holding that 
the umpire and arbitration clause did not apply to the contract between 
the parties, and as it appears to the majority that the umpire and arbi- 
traîion clause did apply, and as it also appears to the majority that 
there was no compétent évidence to impeach the award of the en- 
gineers of the Algoma Central Railway, therefore the judgment must 
be affirmed. 

The trial in the court below was had on the theory that the arbi- 
tration and umpire clause did not apply. The majority of this court 
hâve tried the case hère as if the arbitration and umpire clause did 
apply. In so doing, I believe the court has deprived the plaintiffs in 
error of a substantial right. This court will not allow litigants to try 
a case below on one theory, and when the case is brought hère try 
it on another. Does not the décision of the court herein accomplish 
the same resuit? It is certainly true that the plaintiiïs in error hâve 
never tried their case on the theory that the arbitration and umpire 
clause did apply, and yet the judgment against them is affirmed on 
that theory alone. On the theory on which the case was tried below, 
there was confessedly prejudicial error in the charge of the court, 
saymg nothing about the other errors assigned. 



BEATJMONT V. BEAUMONT. 55 

I think the judgment below should be reversed and a new trîal or- 
dered, so tliat a fair opportunity may be given to the plaintiffs to présent 
such case as they may hâve. 



BEAUMONT v. BEAUMONT (two cases). 

(Circuit Court of Apyeals, Third Circuit. March 1, 1907.) 

Nos. 66, 67. 

1. Gins— Girrs Inteb Vivos— Beliveey— Necks.sitt. 

It is essential to a completed gitt tliat the donee sbould hâve such con- 
trol, and sucli coiitrol only, of the subject-matter of the gift, as is con- 
sistent with the owiierahip purported to be transferred to him. 

[Ed. Note.— For cases in point, see Cent. Dig. vol. 24, Gifts, §§ 31, 34.] 

,2. Same. 

Where delivery of property as a glft bas once been made, and posses- 
sion transferred, the gift is irrévocable, and is not alïected by the fact 
that tbe donor Immediately thereafter cornes into physical possession and 
control of the property without any retransfer of the ownershlp by the 
donee. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 24, Gifts, § 20.] 

5. Same— Conditions. 

A donor may attach a condition to a gift in presenti, if that condition 
be not inconsistent with possession or control by the donee of the thing 
given. 

[Ed. Note.— For cases in point, see Cent. Dig. vol. 24, Gifts, § 6S.] 

4. Samè— Joint Access to Pbopekty by Donoe and Donee. 

If a donor, with the clearly expressed intention of malilng a gift, make 
an actual delivery into the hands of the donee, the fact that the donor 
bas lawful access to the depository of the thing given does not Invalidate 
the gift, if the donee bas also the same access to said depository, and has 
such control over the thing given that he may remove it at any time he 
chooses to do so. 

•5. Same. 

The owner of 50 bonds rented a box of a safety deposit company In 
the name of hlmself and bis two brothers, whom he took to the company, 
introduced them, and had them sign the contract of renting, and then re- 
tired with them to a room, taking the box and tbe bonds. He then handed 
one-half the bonds to each brother, stating that they were a gift, but 
that he desired the brothers to give him the coupons therefrom which 
should mature during his lifetime. After some conversation, they eut ofC 
some of the coupons next maturing, and gave them to him. They then 
placed the bonds and the coupons in the box, which was put in the 
vault ; he taking one key, and giving them the other. Held, that the fact 
that he retained a key, and that he afterward visited the vault and took 
coupons from the box was not such a rétention of control over the bonds 
as to invalidate the gift. 

6. Teial— Instructions— Cbedibility of Testimony. 

An instruction held erroneous, in that it intimated to the jury that the 
testimony of a witness which was uncontradicted was inherently improb- 
able, and was dlscredited by the cross-examination, which inferences were 
not warranted. 

[Ed. Note. — For cases in point, see Cent, Dig. vol. 46, Trial. §§ 414- 
419.] 



56 152 FEDERAL EEPOKTEK. 

In Error to the Circuit Court of the United States for the District 
of New Jersey. 
See 144 Fed. 288. 

Wm. Findley Brown and Gilbert Collins, for planitifï in error. 
John B. Leavitt, for défendant in error. 

Before DALLAS and GRAY, Circuit Judges, 

GRAY, Circuit Judge. The writs of error in thèse cases are to 
judgments in two separate actions of replevin, brought in the court 
below by the same plaintiff, who is the défendant in error in each. 
Botli cases depended upon the same material tacts, although in one, 
there was some testimony additional to that adduced in the other. Se- 
ing so related as to both the facts and the law applicable thereto, they 
hâve been so argued, and may now be considered together. 
The facts in évidence common to the two cases are as foHows : 
It appears that one Jacob A. Bostwick died about 1893 or 1894. For 
many years prior to his death, Lucius S. Beaumont, the intestate of 
the plaintifif below, had been Mr. Bostwick's confidential agent. From 
the date of the. latter's death until October 23rd, 1901, Lucius S. Beau- 
mont was the confidential agent of Mr. Bostwick's widow. On the 
last mentioned date, Mrs. Bostwick .presented to I^ucius S. Beaumont, 
then about sixty years of âge and about to leave lier employment, the 
sum of $50,000. On October 24th, 1901, Lucius S. Beaumont pur- 
chased fîfty bonds of the New York Gas, Electric Light, Heat & Power 
Co., of the par value of one thousand dollars each, and made a partial 
payment thereon. On the same day, he also rented a box in the safety 
vault of the Lincoln Safe Deposit Company of New York (a différent 
deposit Company from that in which he kept his other valuables), in 
the names of himself and his two brothers, John and Charles. On 
October 25th, 1901, he paid the balance due on the bonds, secured pos- 
session of them, met his two brothers by previous arrangement, at 
the Grand Central Station in New York, took them to the office of 
the Lincoln Safe Deposit Company, introduced them to an employé 
of that Company, had them sign the card containing the contract of 
renting, which he had signed on the previous day, and retired with 
them and the box to a small room. Fie then put his hand in his coat 
pocket, and, taking out a package, said: "Hère, John, is 25 bonds, 
$1,000 each, I give to you," and handed them over to John. He then 
took out of his other pocket another package, and said : "Flere, Charley, 
is 25 bonds, which I give to you. What I want you to do, is to give 
me the coupons, — eut off the coupons and give me the coupons of thèse 
bonds as long as I live." "He then said we were to go there once in 
six months eut them off, and then it was decided, as he was going to 
leave New York and going West, it would be inconvénient for us to 
get away from our work; that we had better eut off two or three 
years' coupons ; we then eut off the coupons for two and a half years 
and gave them to him." He then put an elastic band around each six 
months' coupons and put them in an envelope. The next coupon was 
due February, 1903, and the coupons from February to February were 
eut off, which included February, 1904. He also said: "Sit down and 
take the numbcrs of the bonds and see if they are ail right. Count 



BEAUMOKT V. BEAUHONÏ. Oi 

them and see if they are there," and this was done, John taklng the 
numbers down as Charles called them off. John then put his bonds 
into the box and Charles, his, and Lucius put his coupons in. Charles 
then took up the box and carried it to the vault, where it was locked 
in its réceptacle. One key was given to Charles for both the brothers, 
and the number of the box and the pass-word were communicated to 
them, Lucius telling them that they had access to the box when they 
pleased, but that he trnsted them (presumably about the coupons). 
The otiier key was kept by Lucius. On being asked by one of his 
brothers whether his wife knew anything of the transaction, he said 
that she did not ; that he did not want her to know ; that she was 
otherwise provided for. He said: "She thinks Mrs. Bostwick has 
given me a pension, and I want her to think so, and on my death it 
ceases." 

Thèse, in the main, are the facts testified to in each suit by the 
brother of the défendant, the défendant himsclf being incapable, by 
rcason of section 858 of the Revised Statutes of the United States [U. 
S. Comp. St. 1901, p. 659], of testifying in his own behalf. 

In the case against Charles Beaurnont, there was some additional tes- 
timony in corroboration of that given by his brother John. The custo- 
dian of the vault of the Lincoln Safe Deposit Company testified that he 
knew Lucius in his lifetime, and that when he applied to him for a box 
in the safe deposit vault, Lucius told him, as explaining why he wanted 
it, of his gift from Mrs. Bostwick, and that he was going to présent 
•$25,000 to each of his brothers; that he spoke of it as an "absolute" 
or "otitright" gift, and that he wanted to bring them there to sign 
for the box that he was about to rent. Ide also told him that he had 
provided for his wife, and hovv he had done so, and witness testified 
that he provided him, at his request, with a box of dimensions just 
sufiicient to hold the two packages of bonds. Other minor facts and 
incidents were testified to by this witness, or were otherwise in évi- 
dence, which arguably corroborate the story of the brothers as to the 
gift of the bonds ; but it is unnecessary to recite them hère. The testi- 
mony of this witness (Carter) is criticised by counsel for défendant 
in errer, as being confused and inconsistent with itself, and there- 
fore unreliable. A careful examination, however, of this testimony, 
as it appears in the record, only discloses the fact that, upon cross- 
examination, the witness failed to appreciate the distinction betwecn a 
gift outright of the bonds, and a gift to take en^ect at the death of the 
donor. This confusion does not seem to bave been other than what 
was tO: be expected in the mind of a layman, subjected to a cross-ex- 
amination on a distinction between gifts inter vivos and those which 
are intended to be testamentary in their character. His corroboration, 
however, of the testimony of the brothers, that Lucius intended in 
some way to givc them thèse bonds, and had provided a box in a safe 
deposit vault, of which he gave tliem the key and in which they were 
to be deposited, is full and unecjuivocal. None of the witnesses were 
contradicted, discredited or impeachcd, otherwise than by the sugges- 
tion of the improbability of their story, in view of what was called tlie 
common expérience of human nature under such circumstances, and 
the assignments of error raise a question as to the propriety of sonie 



58 152 FEDERAL REPORTER. 

one or more of such suggestions as dealt with by the learned judge 
of the court below in his charge to the jury. 

In both of thèse cases, there was a verdict for the plaintifï, a motion 
for a new trial, which was refused, and a judgment entered in pur- 
suance of the verdict. In the case against Cliarles Beaumont, there 
are twenty-six assignments of errer. We shall only discuss those 
which we think controlhng and upon which our judgment is rested. 
In both cases, there was a motion that the court should charge the 
jury that, under ail the évidence, their verdict should be for the de- 
fendant. Notwithstanding the fact that the testimony on behalf of the 
défendants was uncontradicted and unimpeached, we do not think, after 
a careful examination of the whole testimony, as disclosed in the rec- 
ord, that the court erred in refusing to so charge. It was for the jury 
to détermine the weight of the évidence, and where there is any bona 
fide ground upon which it is assailed, the credibility of the testimony. 
There was also some question, which the court thought right to sub- 
rait to the jury, touching the character of the control over the bonds 
conferred by Lucius on his brothers at the time of the alleged gift. 
We are not disposed to say that such a question should not hâve been 
submitted, though the manner of its submission may be open to criti- 
cism. 

Turning to the record in the case against Charles Beaumont, we 
find twenty-six assignments of error. In the view we take, however, 
it is only necessary to now consider the 18th and 19th assignments. 
They are as follows: 

"Eighteenth. — Because the court instructed the jury as follows: 
'I hâve said to you and I again repeat that, If the testiiiioiiy as to what took 
place In that llttle room leaves you in any uncertainty of mind, then you 
hâve the rlght to look at the subséquent conduct of the parties, and see if it 
is consistent wlth a gift on October 25, 1901 ; and I refer, therefore, to the 
fact that Mr. Carter says that Lucius came from Butler on one occasion and 
told hlm he was llving on thèse coupons which came from the bonds he had 
given to his brothers.' " 
"Nineteenth. — Because the court instructed the jury as follows: 
'Well, furthermore, it appears that Lucius came from Butler on one occa- 
sion at least and went to the box and took some coupons out. What was his 
object? A¥liat dïd that act indicate or suggest? Did he reserve in himself a 
power and control over the bonds that were in that box? Did he reserve in 
himself the right to go there and eut off coupons from the bonds? If he did, 
then he reserved a control over the bonds and did not give up ail control 
over them and consequently did not make a gift.' " 

The underlying question of thèse assignments is, what are the es- 
sentials required by the law to constitute a valid gift of personal prop- 
erty inter vivos, in a case like the présent? Undoubtedly, there must 
be shown an intention to give ; that is, an expressed purpose to divest 
the donor of title in and ownership of the thing given, carried into 
efïect and evidenced by a delivery of possession to the donee, and ac- 
ceptance by him. It, of course, inheres in the conception of the posses- 
sion essential to a completed gift, that the donee should hâve such con- 
trol, and such control only, of the subject matter of the gift, as is con- 
sistent with the ownership purported to be transferred to him. What 
shall constitute the essential delivery, possession or control, must dé- 
pend always on the circumstances of each case and the environment 



BEAtJMONT V. BEAUMONT. 5Ô 

of the parties. Where delivery of the property has once been made 
and possession transferred, the gift is irrévocable, and is not affected 
by the f act that the donor immediately thereafter cornes into the physi- 
càl possession and control of the property, without any retransfer of 
the ownership by the donee. Corle v. Monkhouse, 50 N. J. Eq. 537, 
546, 35 Atl. 157; Matthews v. Hoagland, 48 N. J. Eq. 455, 485, 31 
Atl. 1054. This being so, we see no reason why a gift should not be 
affected by a condition requiring temporary or partial control of the 
thing given by the donor, where the intention to transfer the owner- 
ship is made clear, and a possession comme.nsurate with that owner- 
ship conferred upon the donee. 

In Industrial Trust Co. v. Scanlan, 58 Atl. 786, 36 R. I. 338, decided 
in 1904, it appears that one Patricia Scanlan went to the bank and asked 
if a deposit could be made payable there to him or his brother, Dennis, 
so that if either of them should die, it would then be payable to the 
survivor. The treasurer of the bank explained to him that in that way 
either could draw it if he had the book. Subsequently Patrick opened 
the account in the names of himself and brother, Dennis Scanlan, pay- 
able to either or the survivor of them, and Dennis, though not présent 
at the time, went soon after to the bank and signed the signature book. 
Patrick gave the book* to Dennis on the day of transfer, saying that 
it was his, to do as he pleased with, and that he could draw the whole 
or any part as he wished. Dennis continued to hâve possession of the 
book, except on two occasions wlien Patrick made withdrawals of dif- 
férent sums for his own use, returning the book after the withdrawals 
to Dennis. The court held it clear, that a gift from Patrick to Dennis 
was both intended and completed. In the course of its opinion, the 
court says: 

"The argument against the vesting of a joint title in a donee is that, be- 
cause the donor eau defeat the gift by drawiug the deposit, control of tlie 
deposit is thereby retained, and so the gift is not absolute and complète. To 
this, it may be replied that the donee has the same power, if he has fiosses- 
sion of the book. Both parties cannot hold the book at the same time, and 
the mère fact that one has possession of It, ought not to be conclusive against 
the rights of the other. » * • Some cases go so far as to hold that the 
entry on the book of joint title, is self-operative, and that delivery of the 
book is not necessary (McElroy v. Natl. Sav. Bk., 8 App. Dlv. 192, 40 N. Y. 
Supp. 340), and that the rétention of the right to draw the money deposited, 
does not affect the validity of the gift (Dennin v. Hilton [N. J. Eq.] 50 Atl. 
600)." 

It is true that, in the case just cited, the book, possession of which 
was necessary to enable either of the joint depositors to draw the 
money, had been delivered by the donor to his brother, but that, delivery 
once being made, completed the gift of the joint ownership intended by 
Patrick to Dennis, and thereafter, it mattered not who had possession 
of the book. The gift was complète by the expressed intention of 
Patrick and the delivery of the book and its having been returned by 
Dennis to Patrick without intention to retransfer his joint ownership, 
did not afïect the validity of the gift, the Suprême Court saying, by 
Mr. Chief Justice Stiness: — "There can be no doubt that the owner 
of Personal property has the right to give it away in whole or in part. 
Consequently, he can give a joint ownership to another." The court, 



60 152 IfEDEEAL REl'OUTEB, 

however, evidently would hâve been wiUing to go to the extent of tîie 
cases it cited, if the facts of the case at bar had made it necessary. In 
one of thèse cases, Dentiin v. Hilton (N. J. Eq.) 50 Atl. GOO, the donor 
deposited a certain amount of money in lier own name and that of the 
donee, jointly, vvith the understanding stamped upon the account, that 
"This account and ail money to be credited to it belongs to us as joint 
tenants, and will be the absolute property of the survivor of us, either 
and the survivor to draw." Afterwards, the donor delivered the deposit 
passbook to the donee. It was held by Vice Chancellor Pitney, that 
though the donor retained the right to draw the money deposited, lier 
delivery of the depositor's passbook to the donee constituted an abso- 
lute delivery of the deposits to him, mak'ng the gift valid. 

In Matthews v. Hoagland, supra, a father sent for his son and daugh- 
ter. They went to his old home and were told to corne up stairs, as 
lie had something for theni. They went up stairs with him, into his 
bedroom. He took his box ont and took certain papers out of the box 
and handed them to them, saying: "Hicre, take thèse. Life is uncer- 
tain and they are yours." The papers consisted of certain mortgages 
he held against the daughter ; also railroad stocks and bonds. The chil- 
dren then said they did not want to use the things given them then, 
and asked their father to keep them, and han'ded the papers back to 
him, and he replaced them in the box, putting the box back in his 
secretary. After this, the father coUected the interest and dividends 
on thèse securities. It vi'as held by Vice Chancellor Green that this 
constituted a valid gift to the children, saying in the course of his opin- 
ion (page 485 of 48 N. J. Eq., page 1065 of 21 Atl.) : 

"If the gift is complète, tlie wliole title of tlie douoi- lias passed from him 
to the donee and the subRe(iuent redelivery of the subject mattor of the gift 
to the donor, to keep for the donee, will not disturb the title of the latter in 
the thing given." 

There is uncontradicted testimony in this case, that Lucius Beauniont 
not only intended to give and transfer the ownership of the bonds in 
question to his two brothers, but that he.actually delivered the posses- 
sion thereof to his brothers in the private room of the Safe Deposit Com- 
pany, stating in substance that the bonds were theirs, although he in- 
tended to retain his property in the interest coupons during his life. 
If it be contcnded, as it is, that the rétention of a key to the deposit 
box by Tucius, with the right to resort to it for the purpose of getting 
the coupons, was such a rétention of control and possession as would 
enable him to carry the' bonds away, and was therefore inconsistent 
with the idea of a gift of the sanie, it may be replied that the donee 
had the same possession and control and the same power of taking 
away the subject niatter of the gift, and not only so, they had the right- 
ful power to do so, as well as the physical opportunity. By the giv- 
ing of the key of the box to his brothers, lie evidenced his intention 
of niaking a gift in presenti of the bonds themselves, and gave them 
immédiate possession and control. There is évidence that he did more 
than give the bonds and transfer the possession thereof, retaining his 
property and right to possession of the coupons. It is the testimony 
of the only person présent compétent to testify, that he gave the bonds 
and delivered the possession of the same, with the coupons attached. 



BEAUMONT V. BEAL'MONT. Gl 

to his brothers, intending that they shoulcl hâve posscssory control of 
both, though coupled with a promise from them that they would eut 
off and deUver the interest coupons as they became due, to him during 
his life, and that in pursuance of that understanding, they actually did 
eut off and deUver to him ail the coupons that were ever used by him, 
and also those that came due in the February after his death. We do 
not think, however, that it is necessary to so narrow the ground upon 
which such a gift, if gift it be, may rest, but that a donor may attach 
a condition to a gift in presenti, if that condition be not inconsistent 
with possession or control by the donee of the thing given. Why may 
not a father make a valid gift of a horse to his son, delivering posses- 
sion and control thereof, on condition that the donor shall still hâve 
a limited use of the horse, with such control as is evidenced by a key 
to the stable? The control, incident to the possession given by Lucius 
Beaumont to his brothers, of thèse bonds, was complète. Their physi- 
cal possession was such, that they could hâve carried them away from 
their place of deposit at any time, and the donor would hâve had no 
légal right to complain, so long as he was allowed to enjoy the interest 
as it accrued thereof. The possession and control of the bonds was ex- 
clusive, and not the less so in légal contemplation that the donor had 
also a key to their place of deposit, and could, in violation of their 
rights accruing from his gift, hâve carried them away. Such an act 
on his part, however, would bave been a tort, if not a crime, and the 
physical opportunity of committing it, no more derogates from the 
complète right of ownership and possession in the donees, than would 
such an act committed by one who had no la w fui access to the property. 
That the possession and control of the brothers was thus complète, was 
practically demonstrated by the fact that, after the death of Lucius 
Beaumont, they removed the bonds to depositories of their own sé- 
lection. , . 

It is sufficient for the facts of this case to say, if the donor, with the 
clearly expressed intention of making a gift, make an actual delivery 
into the hands of the donee, the fact that the donor lias lawful access 
to the depository of the thing given. does not invalidate the gift, if 
the donee bas also the same access to said depository, and bas such 
control over the thing given, that he may remove it at any time he 
choGses to do so. The intention of the donor to give, and the once 
Vesting physical control in the donee, are, we think, the crucial points 
in this case. So thinking, we must hold that the parts of the charge 
oi the learned judge of the court below, covered by the 18th and 19th 
assignments, above quoted, were calculated to misicad the jury, as to 
the essential characteristics of a gift inter vivos, to the préjudice of 
the plaintiff in error. With great respect for the learned trial judge, 
we cannot agrée that the fact that Mr. Carter said that Lucius came 
from Butler on one occasion, and told him that he was living on thèse 
coupons, which came from the bonds which he had given to his broth- 
ers. is inconsistent with a valid gift of thèse bonds to them, and yet 
the intimation is clearly given to the jury, by the languagc quoted in 
the 18th assignment. that such was the case. It may be that this in- 
timation was not intended to be given, but the language used was 
clearly calculated to give the impression that any claim by Lucius, of 



62 152 FEDERAL REPORTER. 

a right to take the coupons of thèse bonds from the safe deposit box, 
to which he had secured access by having a key with the consent of 
his brothers, was an exercise of control over the bonds which invali- 
dated the gift. For the reasons stated, we think that, in the use ci 
this language, there was error. 

More direct and unequivocal still, is the language used in the charge, 
covered by the 19th ass'gnment of error. After saying, categorically, 
that Lucius came from Butler on one occasion at least, and went to the 
box and took some coupons out, the jury is told, in effect, though it 
is put interrogatively, that that act indicated a control over the bonds 
reserved to himself, and that, consequently, he did not make a gift. 
It is hard to believe that this language, coming from the learned trial 
judge, did not absolutely control the action of the jury, and, as we 
think, to the préjudice of the plaintiff in error. We hâve examined, 
not only the context of the parts of the charge recited in the assign- 
ments above referred to, but, the whole charge, to see whether the 
language hère criticised has been qualified or explained. We find, 
liowever, and are not surprised to find, that the charge of the learned 
trial judge is consistent throughout, and that the language excepted 
to must be attributed to a view of what is required to make a valid 
gift inter vivos, that differs from what we conceive to be the true one. 
We know of no rule of law by which the dissociation of the interest or 
coupons on thèse bonds, and their réservation to the donor for the 
purposes of the gift, would invalidate a gift of the bonds themselves 
to the donees, as testified to by the brother of the plaintifï in error, We 
do not think it is necessary to review the many cases cited by the 
learned counsel for the plaintiff in error -(most of which we hâve ex- 
amined), which support the conclusion at which we hâve arrived, 

Finding error in the respects stated, the judgment below is reversed, 
with"instructions to award a venire de novo. 

In the case against John L,. Beaumont, there are seven assignments 
of error, It will only be necessary to consider the fîrst and second. 
They are as foUows: 

"Pirst. Because the court Instructed tlie jury, with référence to the testi- 
uiony of Charles Beaumont as to what Lucius S. Beaumont said and did at 
the time of the alleged gift, as follows : 

'You hâve no right to reject except for good reasons — reasons perfectly sat- 
Isf actory to you' ; adding the followlng words on that subject : 'You hâve no 
right, as counsel for défendant argued In this case, to ignore crédible, unim- 
peached and uncontradicted testimony adduced by the défendant and if you 
regard Charles' testimony or any other testimony produced by the défendant in 
relation to the alleged gift as crédible, unimpeached and uncontradicted testi- 
mony, why, of course, you cannot ignore it or disregard it, but the facts of 
this case are such that I feel very sure I would not be justified in saying 
to you that you were bound to accept as absolute truth ail that Charles has 
testified to. Testimony must be crédible in its nature to be influential and 
must corne from a crédible source. You are bound, I repeat, to consider verj- 
earefully the testimony given by Charles. It is testimony of a most vital 
character in this case, but as was said by the Suprême Court of New Jersey 
in the case which I hâve referred to — I refer to the case of Cooley v. Barcroft, 
in 43 N. J. Law, 363: "The character of a witness or a number of witnesses 
inay be so impeached, or their story so shattered by cross-examlnation or ren- 
dered so doubtful by inhérent improbabilities, that their testimony, standing 
unopposed by direct counter testimony, would be fairly subjected to suspicion. 



BEAUMONT V. BEAUMONT. 63 

No court upon revJew could say, as a légal conclusion, that, under «web clr- 
cumstances, a judgment whleh ignored such testimony was illégal." ' " 

"Second. Because the court Instructed the jury that: 

'If, however, you are of the opinion that the transaction was ons which 
Ducius intended to reserve a control over thèse bonds, durlng hls lifetlme, 
and that that accounts for the fact that this box was rented, not only in the 
names of his two brothers, but In his own as well — If you are of opinion 
that he intended to retain a control over thèse bonds durlng his lifetinie and 
to assert the right of cutting off thèse coupons from time to time diiriug his 
lifetime, as tliey matured, then Lueius did not part with ail control over 
them and he did not make a valid gift. It may be that he intended that the 
bonds should go to John after his death, and if that is what he iuteiuled then 
the gift is void, and your verdict should be for the plaintiff, because he could 
not give the bonds in that way except by will.' " 

We think the language used by the learned trial judge, as recited in 
the first assignment, while quite accurately stat'ng, as an abstract propo- 
sition, the rights and duty of the jury in regard to crédible, unim- 
peached and uncontradicted testimony, was on the whole, whcn taken 
in connection with the allusions made to the testimony of Charles 
Beaumont, calculated to préjudice the jury unduly against the plain- 
tiff in error. \¥e do not think that any inference could hâve been 
drawn by the jury from this part of the charge, other tlian that, in 
the opinion of the learned trial judge, the testimony of Charles Beau- 
mont should be considered as inherently improbable, and that the 
truth of his story had been shattered by cross-examiration, and that 
they were justified in rejecting it. A careful reading of this testimony 
has not disclosed to us any ground for such an inference. We do not 
discover that there is inhérent improbability in the story of Char'es. 
or that that story has been shattered by cross-examination. Although 
the trial judge does not directlv assert thèse thi'g;,, it seems to be 
suggested by the manner in which the instruction is franied. 

The part of the charge recited in the second assignment, is open 
to the criticism we hâve already made in the other case, of the vievv 
apparently taken by the learned trial judge, of what is rec|uisite te 
a gift inter vivos. We do not think that, even if there was évidence 
that Lueius intended to reserve such a control over thèse bonds during 
his lifetime, as would enable him to assert his right of cutting otï the 
coupons for interest from time to time, he thereby invalidated the gift 
of the bonds which he evidently intended to make to his brothers. We 
need not again discuss what we consider as essential or noncssential 
to the niaking of such a gift as was intended to be made by Lueius 
to his brothers, according to their testimony. It suffices to say that 
we think that the instruction excepted to was calculated to give the 
jury the erroneous impression that, if Lueius Beaumont asserted the 
right of cutting ofï thèse coupons from time to time, during his life- 
time, and for that purpose had reserved to himself the right of access 
to the box in which they were placed, under the circimistances sliown 
by the évidence, there was no valid gift of the bonds. It is true that 
the instruction is prefaced with the assumption that the jury should be 
of the opinion that the transaction was one in which "Lueius intended 
to reserve a control over thèse bonds," but the évidence of that con- 
trol, as put by the learned trial judge, was made to appear to the jury 
to be the right asserted by Lueius (which was not denied by the douées 



C4 152 FEDERAL ItEPOUTEK. 

of the bonds) to take the coupons out of the box froni time to time, 
whether they were those vvhich were eut off by the brothers and handed 
to him after the gift, or those which were still attached to the boncts. 

The last sentence of the part of the charge recited in this second 
assignment, was also, we think, Hkely to unduly influence the jury 
against the défendants. The line of démarcation between gifts in 
presenti and inter vivos, and tliose which are intended to take effect 
at the death of the donor, and which are invalid by reason of their 
testamentary character, is often so shifting and uncertain, tliat it 
would seem tliat a jury, if they wanted the plaintiiï in this case to suc- 
ceed, could easily avail themselves of tliis alternative presented by the 
trial judge, however far that might bave been froni his purpose. We 
do not think the testimony in the case justified the suggestion, and if 
it had, the différence between the two transactions should hâve been 
more clearly distinguished and guarded. It is not without significance 
that the trial judge did not himself seem to bave been able to escape 
the conclusion, that there was an intention on the part of Lucius that 
his brothers should hâve the ownership of thèse bonds, if he could 
hâve the interest thereon for his life. We do not think that this clear 
intention on the part of Lucius Beaumont should be or can be de- 
feated by the technical suggestion of so construing the gift intended to 
be made, as that it should be void as an attempted testamentary disposi- 
tion of the bonds. There is no testimony as to what occurred be- 
tween the three brothers in relation to thèse bonds, except that of the 
two brothers, who undeniably had possession of them at the death 
of Lucius, and the important corroborating testimony of Carter, the 
custodian of the safe deposit vault, in the suit against Charles. If 
the story of the two brothers is to be accepted, there was a valid gift 
in presenti to them, by Lucius, of the bonds in question, reserving to 
himself, by condition subséquent, the right to the interest coupons 
thereon during his life, or stipulating with his brothers, after the gift, 
that they shoukl, from time to time during his life, detach thèse coupons 
and deliver them to him. But if this story is not to be accepted. as 
told, it seems to us it must be rejected in toto, as it is not susceptible 
of a différent interprétation from that above given. 

The judgment below in each of thèse cases is therefore reversed, 
with instructions for the award of a venire de novo. 



In re PTRSï NAT. BANK OF BELLE FOURCHE et al. 

(Circuit Court of Appeals, Eiglith Circuit. Mardi 19, 1907.) 

No. C9. 

Bankepptot — Manufactuking Corporation — Buildee op Concrète Aucii- 
Es AND Bridges is. 

A corporation wliicli is i)riucipally eugaged in building concrète arches 
and bridges and dressing stone is a mauufactnring corporation, and may 
bo adjndged a bnnl;rupt under section 4b of tlie hankruptuy law (Act Juiv 
1, 1898. c. .jll, 30 Stat. 547 |U. S. Coinp. St. 1901, p. 3423J as amendeil 
by Act Fob. û, 1903, c. 487, § 3, 32 Stat. 798 [U. S. Conip. St. Supp. 1905, 
p. GS:!J). 

[Ed. Note. — What persons are sulj.i'ect to bankruptcy law, see note to 
Mattoon Xiit. Bank v. First Nat. Bank, 42 C. C. A, 4.] 



IN EE FIUSÏ NAT. BANK. 65 

2. SaME— Pl.EADING— DEFECTIVE PETITION GOOD IN SUBSTANCE, ImPBEGNABLE 

AFTER .TrUGMENT. 

After verdict or judgment, an objection tliat tlie pétition fails to state 
facts suiticieiit to constitute a cause of action is teuable only vvhen the 
pleadiiig fails to allège the substance or foundation of a cause of action, 
and it is impregnable to attack beeause it is otherwise defeetive, informai, 
indefinite or incomplète, and was demurrable before auswer or judgment. 

The avermeut that the alleged bankrupt was a corporation "engaged in 
the business of manufacturing concrète arches and bridges, manufacturing 
and dressing stone and se'ling the sarae, and railroad and ditcli contract- 
ing," was demurrable, and ameudable before, and invulnérable after, ad- 
judication. 

[Ed. Note.- — For cases in point, see Cent. Pig. vol. 39, Pleading, §§ 1451, 
1459.] 

3. SaME— JURISDICTIONAL FaCTS— W.IIAT ARE— WlîAT ARE NOT— TlIOSE OF TjAT- 

TER Class Concluded by Judgment— OccvrATiON OF Corporation of 
Tins Class. 

Jnrisdictional facts are those which condition the power of the court 
to décide sonie of the issues in tlie case, like the nature of the sul)ject- 
matter and the service of process. Other facts, which condition the 
character of the decree or the nature of the relief that should be grant- 
ed or denied, are not jnrisdictional, and flnal adjudications of issues 
relating to them conclusively estop the parties to the proceedings from 
again litigating them. 

The issue whether or not a corporation is sniyect to adjudication as a 
bankrupt is not jurisdietional, and Is concluded by the adjudication. 

4. Judgment — Fédéral Courts— .Tudoments of Fédéral Courts Conclusive 

— Absence of Appearance of Jurisdictional Facts on Tjieir Records 
Immaterial. 

While tlie jurisdiction of tlie national courts is limited, they are not 
inferior courts, and their judgments posscss every attribute of final ity 
and estoppel appertaining to tbose of courts of gênerai jurisdiction. The 
absence from tlieir records of ail appearance of jurisdictional facts is im- 
material. 

5. Same— Motion to Vacate ADjcnicATiON- Abuse or Discrétion. 

There was no abuse of discrétion in a déniai by a bankiaiiitcy court oC 
1 motion by creditors to vacate the adjudication of the banlîruptcy of ii 
corporation and to permit them to answer and litigate the qu<>sti )n whetli- 
er or not the corporation was r>rincipally engaged in such a pursuit that it 
was subject to be adjudged a bankrupt, where the motion was fli-.st niade 
7 weelîs after the pétition was filed and receivers were aiipointcd, and 5 
weeks after the adjudication, when tlie creditors were aware of tlie 
flling of the pétition witliin 4S hours tbereafter, and the administration 
of the estate had jn-oceeded w^itiiout objection lueanwhilo. 
(Syllabus by the Court.) 

On Pétition for Review. 

Arnold L. Guesmer (Rome G. P.rown, Charles S. Albert, and T. W. 
La Fleiche, on the brief), for petitioners. 

liarrison L. Schmitt (John W. Schmitt, William A. Kerr, and 
Charles R. Fowler, on the brief), for respondents. 

Before SANBORN, HOOK, and ADAMS, Circuit Judges. 

SANBORN, Circuit Judge. This is a pétition of creditors to revise 
in matter of law the proceeding-.s of the District Court which resulted in 
a déniai of their motion to vacate the order of adjudication of the bank- 
rtiptcy of tlie Widell-Finley Company, a corjioration, and to permit them 
to file an answer and to litigate the issue whether or not that corporation 
152 F.— 5 



66 152 FEDERAL REPORTER. 

was principally engaged in any pursuit which subjected it to adjudica- 
tion as a bankrupt. On February 14, 1906, certain creditors of the 
Widell Company filed a pétition against it for such an adjudication, 
and on February 26, 1906, it was adjudged a bankrupt by default upon 
this pétition. On the day the pétition was filed receivers of its property 
were appointed, and thereafter proceeded to manage its estate, until 
on March 17, 1906, at the first meeting of creditors, a trustée was ap- 
pointed. On April 9, 1906, the petitioners filed their motion. There 
was a hearing upon it on April 16, 1906, it was denied on May 11, 
1906, and the order of déniai is assailed by the pétition for revision. 
Between the date of the filing of the pétition and the date of the filing 
of the motion of the petitioners to vacate the adjudication, the receivers 
made agreements with certain parties, with whom the Widell Company 
had contracts, relative to the completion of unfinished work, which 
were approved by the court on February 19, 1906. The trustée was 
appointed and with the approval of the référée he sold and delivered to 
the purchasers the office furniture and stationery of the bankrupt in 
its main office. 

On February 15, 1906, the petitioners knew that a pétition in bank- 
ruptcy had been filed against the Widell Company, and before the 26th 
day of February, 1906, the day of the adjudication, they were aware 
that receivers had been appointed. But none of them took any steps 
to challenge or answer the pétition in bankruptcy, or to oppose or avoid 
the adjudication, until the 9th day of April, 1906. They were creditors 
of the Widell-Finley Company. They knew, the next day after the 
14th of February, that a pétition in bankruptcy had been filed against 
it. The bankruptcy law prescribed the time within which they were 
permitted to challenge that pétition for insufficiency in law or for 
misstatements of facts. Section 18b, 30 Stat. 551, c. 541 [U. S. Comp. 
St. 1901, p. 3429], as amended by Act Feb. 5, 1903, c. 487, § 6b, 32 
Stat. 798 [U. S. Comp. St. Supp. 1905, p. 685]. That time expired 
on February 25th. They filed neither demurrer nor answer, and on 
the next day the corporation was adjudged a bankrupt. Their right 
to demur or answer to the pétition then ceased, and their motion for 
a removal of their default and for leave to answer demanded the 
enforcement of no right, but merely invoked the judicial discrétion 
of the District Court. The pétition for revision does not invite the 
exercise of the discrétion of this court; for the discrétion to grant or 
refuse the motion was not intrusted to us, but to the court below, and 
in the absence of a manifest abuse of its exercise of that discrétion it 
is not reviewable hère. 

Counsel for the petitioners insist that the court below abused this 
discrétion (1) because the pétition for the adjudication failed to show 
that the Widell Company was one of the class of corporations judicable 
in bankruptcy, but disclosed the fact that it was not so and hence they 
insist that the court was without jurisdiction ; (2) because the record 
after the adjudication disclosed the same state of facts, and hence, as 
they contend, that the judgment was vulnérable to collatéral attack 
and everywhere void; and (3) because the answer alleged that the 
Widell Company was not judicable in bankruptcy, and hence, as they 
insist, that the court was without jurisdiction. "Any corporation en- 



IN RE FIRST NAT. BANK. 67 

gaged principally în manufacturing, trading, printing, publisliing, min- 
ing or mercantile pursuits, owing debts to tiie amount of one thousand 
dollars or over may be adjudged an involuntary bankrupt upon default." 
Bankr. Act July 1, 1898, c. 541, § 4b, 30 Stat. 547 [U. S. Comp. St. 
1901, p. 3433], as amended by Act Feb. 5, 1903, c. 487, § 3, 32 Stat. 
797 [U. S. Comp. St. Supp. 1905, p. 683]. 

The pertinent averment of the pétition for the adjudication was that 
the Widell Company "is, and during ail said time bas been, engaged 
in the business of manufacturing concrète arches and bridges, manu- 
facturing and dressing stone and selling the same, and railroad and 
ditch contracting." The word "manufacturing" is a generic term of 
broad significance, advisedly used by Congress to include many species 
of corporations, and its comprehensive meaning ought not to be whittled 
away by fine distinctions. Derivatively meaning making with the 
hand, its ordinary significance is producing a new article of use or orna- 
ment by the application of skill and labor to the raw materials of whicli 
it is composed. Pin makers, pen makers, shoe makers, f urniture makers, 
lumber makers, steel makers, boot makers, rail makers, engine makers, 
cément makers, are undoubtedly engaged in manufacturing, and the co- 
gency of the argument that a corporation which makes a pin is manu- 
facturing, while one which makes a bridge is not, fails to appeal to our 
judgment with convincing force. The latter may make the cernent or 
the steel it uses in its structure. If so, it is engaged in manufacturing 
the cément or the steel, and, whether it makes them or not, it produces a 
new and useful article, a bridge, when by the application of skill and 
labor to the materials of which it is composed it constructs it. 

As usual in respect to every question which involves the construction 
or opération of the bankruptcy lavv, there is a conflict of authority. 
Butt V. C. F. MacNichol Const. Co., 140 Fed. 840, 72 C. C. A. 252 ; 
In re Minnesota & A. Const. Co., 60 Pac. 881, 7 Ariz. 137; In re 
Smith, 2 Lowell, 69, Fed. Cas. No. 12,981 ; In re Tontine Surety Co. 
(D. C.) 116 Fed. 401 . But the more persuasive reasons and the weight 
of the décisions support the view, and our conclusion is, that a corpora- 
tion principally engaged in constructing concrète arches and bridges 
and in dressing and selh'ng stone is engaged in a manufactming pur- 
suit and subject to adjudication in bankruptcy upon an involuntary 
pétition. Columbia Iron Works v. National Lead Co., 127 Fed. 99, 
102, 62 C. C. A. 99, 102, 64 L. R. A. 645 ; In re Niagara Contracting 
Co. (D. C.) 127 Fed. 782 ; In re Marine Const., etc., Co., 130 Fed. 
446, 64 C. C. A. 648; In re Matthews Consolidated Slate Co., 144 
Fed. 737, 738, 75 C. C. A. 603 ; In re Quincy Granité Quarries Co. 
(D. C.) 147 Fed. 279 ; In re H. R. Leighton & Co. (D. C.) 147 Fed. 
311, 313; In re Troy Steam Laundering Co. (D. C.) 132 Fed. 266; 
White Mountain Paper Co. v. Morse & Co., 127 Fed. 643, 644, 62 
C. C. A. 369, 370. 

The concession is freely made that a demurrer or an objection to 
évidence, before the adjudication, upon the gênerai ground that the 
pétition for it did not contain a clear averment that the corporation 
was principally engaged in manufacturing concrète arches and bridges 
and dressing stone, would hâve been well taken. But, if either of them 
had been made and sustained, the pétition would hâve been immediately 



G8 152 FEDERAL REPOKTEB. 

amendable. In re Plymouth Cordage Co., 135 Fed. 1000, 1003, 68 C. 
C. A. 434, 437. The creditors who now complain filed no demurrer 
and made no objection. In that way they waived this defect as fuHy 
as they would hâve donc if they had been présent at the adjudication 
and had permitted the introduction of évidence and the décision with- 
out objection. Can there be any doubt that the admission of the évi- 
dence and the judgment in bankruptcy would hâve been permissible 
and conclusive upon them under such circumstances ? The purpose 
of a pleading is to advise the opposing parties and the court of the 
facts constituting the cause of action. The pétition in this case prayed 
that the Widell Company might be adjudged a bankrupt. Thèse credit- 
ors knew the law, and hence they knew that the fact that the corpora- 
tion was principally engaged in manufacturing or trading was essen- 
tial to the adjudication. The pétition contained the allégation that 
the corporation was engaged in manufacturing concrète arches and 
bridges, in manufacturing, dressing, and selling stone, and in railroad 
and ditch contracting; and no one could bave read it in the Hght of 
the bankruptcy law without notice that it contained a substantial, 
though incomplète, statement that the corporation was principally en- 
gaged in a manufacturing pursuit. The sufficiency of this pleading 
was not challenged until more than a month after the adjudication upon 
it, and after verdict or judgment an objection that the pétition fails 
to State facts sufiicient to constitute a cause of action is tenable only 
when the pleading fails to allège the substance or foundation of a good 
cause of action, and the fact that it is otherwise defective, informai, 
indefinite, or incomplète is no longer material. Less v. English, 83 
Fed. 471, 476, 29 C. C. A. 275, 280 ; Laithe v. McDonald, 7 Kan. 254, 
261; Rush v. Newman, 58 Fed. 158, 160, 7 C. C. A. 136, 138; City of 
Plankinton v. Gray, 63 Fed. 415, 11 C. C. A. 268. The pétition con- 
tained no' statement that the Widell corporation was not engagea 
principally in a manufacturing pursuit, anrl no showing that the court 
was without jurisdiction of the case ; but it set forth the substance of a 
good cause of action, and it was impregnable to attack after the ad- 
judication. 

The argument of counsel that it was the duty of the court below to 
avoid the adjudication, and to allow their clients to answer, upon the 
.ground that the court was without jurisdiction to render the adjudica- 
tion, because it was not true that the bankrupt was principally engaged 
in a manufacturing pursuit, and because the record did not show that 
it was, but that it was not thus engaged, overlooks the effect of the ad- 
judication. 

The contention that the fact that the Widell Company was principally 
engaged in manufacturing couditioned the jurisdiction of the court and 
the validity of the adjudication, that the judgment is a nullity because 
this fact did not exist, and that its invalidity may be shovk'n at any 
time by collatéral attack, or otherwise by proof that the Widell Com- 
pany was not engaged in any pursuit which subjected it to adjudication 
in bankruptcy, disregards the fundamental distinction between the facts 
essential to the jurisdiction of a court over the subject-matter and the 
parties and those requisite to establish the cause of action. Jurisdiction 
of the subject-matter and of the parties is the right to hear and deter- 



m EE FIEST NAT. BANK. 69 

mine the suit or proceeding in favor of or against the respective par- 
ties to it. The facts essential to invol<e this jurisdiction differ material- 
ly from those essential to constitute a good cause of action for the relief 
sought, A defective pétition in bankruptcy, or an insufficient complaint 
at law, accompanied by proper service of process iipon the défendants, 
gives jurisdiction to the court to détermine the questions involved in the 
suit, although it may not contain averments which entitle the complain- 
ant to any relief ; and it may be the duty of the court to détermine ei- 
ther the question of its jurisdiction or the merits of the controversy 
against the petitioner or plaintiff. Facts indispensable to a favorable 
adjudication or decree include ail those requisite to state a good cause 
of action, and they comprehend many that are not essential to the juris- 
diction of the suit or proceeding. The fact that the Widell Company 
was engaged in a manufacturing pursuit was not of the former, but of 
the latter, class. It was not essential to invoke the jurisdiction of the 
court over the parties to the proceeding and the property it involved, 
because the act of Congress gave that court, upon the filing of the pé- 
tition of the creditors, jurisdiction to hear and détermine the questions 
it presented, upon proper service of the subpœna upon the défendant. 
The facts which conditioned the jurisdiction of the court were the filing 
of the pétition and the service of the subpœna. In re Plymouth Cord- 
age Co., 135 Fed. 1000, 1004, 68 C. C. A. 434, 438. 

Concède, for we do not stop to consider or décide, that the nonexist- 
ence of either of thèse facts might be shovvn at any timc, by collatéral 
attack or otherwise, to destroy the validity of the adjudication, and this 
is the extent of the effect of many of the authorities cited by counsel 
hère. Williamson v. Berry, 8 How. 495, 540, 12 L. Ed. 1170; Adams 
V. Terrell (C. C.) 4 Fed. 796, 800. Neverdieless, the fact that the Wid- 
ell Company was, or that it was not, principally engaged in manufactur- 
ing, was not of this class. It did not condition the jurisdiction of the 
court, but the judgment which it ought to render, only. The court 
had the same jurisdiction to décide the issues between the parties, 
whether the Widell Company was or was not principally engaged in a 
manufacturing pursuit. The only différence the détermination of that 
issue made was that if it was so engaged the court should hâve given 
judgment for the petitioners, and if it was not thus occupied it should 
hâve rendered judgment against them. The jurisdiction and the duty 
to décide remained in the court, whichever way it was its duty to déter- 
mine the issue. The jurisdiction of a court is not limited to tire power 
to render correct décisions. It is the power to décide the issues accord- 
ing to its view of the law and the évidence, and its wrong décisions are 
as conclusive as its right ones. It empowers the court to détermine 
every issue within the scope of its authority, whether its décision is 
right or wrong, and every judgment or décision so rendered is final and 
conclusive upon the parties, unless reversed by writ of error or appeal 
or vacated by some direct proceeding. The filing of the pétition for the 
adjudication and the service of the order to show cause upon the Widell 
Company conferred plenary jurisdiction of this proceeding upon the 
court below. The power was thereby vested in, and the duty was im- 
jiosed upon, it to décide whether or not the Widell Company was prin- 
cipally engaged in a manufacturing pursuit, because the détermination 



70 152 FEDERAL REPORTER. 

of that issue was indispensable to the adjudication in bankruptcy. The 
adjudication is therefore a démonstration that the court below adjudged 
that tlie Widell Company was thus engaged, since it could not hâve law- 
fully made the adjudication without such a décision. That judgment, 
therefore, conclusively estops the complaining creditors hère and every- 
where from proving the contrary to avoid the adjudication in bank- 
ruptcy until the latter is reversed or vacated in some direct proceeding. 
Dowell V. Applegate, 152 U. S. 337, 340, 14 Sup. Ct. 611, 38 L. Ed. 
463; Fohz V. St. Louis & S. F. R. Co., 8 C. C. A. 635, 637, 60 Fed. 
317, 319 ; Board of Commissioners v. Platt, 25 C. C. A. 87, 90, 79 Fed. 
567, 570. 

This conclusion has not been reached without a thoughtful perusal 
of the opinion of the référée, adopted by the court, to the contrarv, in 
Re Elmira Steel Co. (D. C.) 109 Fed. 456, 479; but that portion of 
the opinion which relates to this question does not commend itself to 
our judgment. The only showing upon the face of the record regard- 
ing the occupation of the Widell Company is the averment in the 
original pétition which has been set forth. 

The argument of counsel for the creditors that the adjudication is 
void, because the fact appears upon the face of the record that the 
Widell Company was not engaged principally in a manufacturing pur- 
suit, and because the fact does not appear upon the face of the record 
that it was so engaged, is untenable (1) because the record does not 
sustain the position that it shows that the corporation was not thus en- 
gaged ; (2) because the adjudication was a conclusive judgment that 
it was so employed, since the pétition contained a sufficient averment of 
that fact, after judgment; (3) because that fact was not jurisdictional ; 
and (4) because, if it had been, its absence from the record would not 
hâve destroyed the estoppel of the adjudication. While the jurisdic- 
tion of the national courts is limited, they are not inferior courts, and 
their judgments possess every attribute of finality and estoppel which 
pertains to those of courts of gênerai jurisdiction. McCormick v. 
Sullivant, 10 Wheat. 192, 199, 6 L. Ed. 300 ; Ex parte Watkins, 3 Pet. 
193, 207, 7 L. Ed. 650 ; Des Moines Nav. & R. Co., v. lowa Homestead 
Co., 123 U. S. 552, 557, 559, 8 Sup. Ct. 217, 31 L. Ed. 202; Edelstein 
V. U. S. (C. C. A.) 149 Fed. 636. Thus in McCormick v. Sullivant 
diversity of citizenship was indispensable to the jurisdiction of a féd- 
éral court which had rendered a judgment, and it nowhere appeared 
in the record. But the judgment was held to be conclusive, in the 
absence of any writ of error to reverse it. And in Des Moines Nav. 
& R. Co. V. lowa Homestead Co., 123 U. S. 552, 557, 559, 8 Sup. Ct. 
217, 31 L. Ed. 202, the Suprême Court said: 

"Although the judgments and dœrees of the Circuit Courts might be er- 
roneous, if the records failed to show the facts on which the iurisdiction 
of the court rested, such as that the plaintiffs were citizeus of ditïerent 
States from the défendants, yet they were not nullities, and would bind the 
parties until reversed or otherwise set aside." 

The adjudication in bankruptcy in this case, therefore, vmtil reversed 
or vacated in some direct proceeding, conclusively estopped ail the par- 
ties to this proceeding, including the petitioning creditors hère, from 
claiming from the record or upon évidence aliunde that the Widell Com- 



IN RE FIRST NAT. BANK. 71 

pany was not principally engagée! in a manufacturing pursuit and was 
not rightly adjudicated a bankrupt. 

A single question remains. A proceeding in bankruptcy is a contin- 
uons suit. Tliere are no terms of the bankruptcy court. It is ahvays 
open, and until tlie termination of the pending suit that court bas the 
power to re-examine its orders therein upon a timely application in an 
appropriate form. Sandusky v. National Bank, 90 U. S. 289, 293, 23 
Iv. Ed. 155 ; Lockman v. Lang, 132 Fed. 1, 4, 65 C. C. A. 621,_ 624. 
Was the court below guilty of any abuse of its discrétion in that it de- 
nied the motion of the petitioners hère to vacate the adjudication and to 
permit them to answer and litigate the question whether or not the 
Widell Company was principally engaged in manufacturing? The 
creditors who complain had been aware of the fîling of the pétition in 
ample time for them to demur to it, or to interpose an answer and pré- 
sent the question they now seek to litigate. They had known that re- 
ceivers of the bankrupt's estate had been appointed, and that they were 
making agreements about the contracts of the bankrupt, many week» 
before their motion was presented, and they took no action to assail the 
adjudication or to stay the proceeding in the administration of the estate 
until nearly two months after the pétition was filed. The theory of the 
bankruptcy law is that estâtes should be converted into money and dis- 
tributed among the creditors as speedily as practicable. After a pro- 
ceeding under it is commenced, the relations of the parties and the na- 
ture of the property involved are subject to fréquent and rapid changes. 
Hence creditors who would assail the adjudication or the other orders 
of the court, and would thereby stop the transformation of the prop- 
erty of the bankrupt and its distribution among bis creditors, should act 
with reasonable promptness after they receive notice of the proceeding 
and of the reasons for their objection. In view of the delay and neg- 
lect of the petitioners, and the changes in the condition of the property 
and in the relations of the parties interested in this estate, between the 
filing of the pétition and the présentation of their motion, the record 
fails to persuade that the court below was guilty of any abuse of its 
discrétion when it denied it. 

The question whether or not the pétition for revision was filed in 
proper time bas not been considered, and no opinion is expressed upon 
it, because the same resuit bas been reached upon a considération of the 
merits of the case that would bave followed if the motion to dismiss the 
pétition had been granted. 

The pétition must be dismissed in any event ; and it is se ordered. 



72 152 FEDERAL REPORTER. 

WIIITEHOUSE V. EDWARDS. 

(Circuit Court of Appeals, Xinth Circuit. February 11, 1907.) 

No. 1,351. 

1. Négligence— When Question foe Juey— Ookfliotino Testimont. 

An action to recover for a personal injury, allcged to liave resultcd froni 
defendant's négligence, was properly submitted to tlie jury, wbere, al- 
though tliere was direct and positive testimony to a faet \Yliicli would tend 
to acquit défendant of négligence, tliere was otiier testimony and eircuni- 
stances tending to discrédit it, and to inake it proper for tlie jurj' to dé- 
termine its credibility. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 37, Négligence, § 
298.] 

2. Same— Instructions—Refusai- of Requests. 

The action of a trial court in griving and rcfusing- instructions, In an ac- 
tion for Personal injury, hcld witliout error. 

In Error to the District Court of the United States for the Second 
Division of the District of Alasl<a. 

Henry M. Hoyt, James W. Bell, and Edward W. Rice, for plaintiff 
in error. 

George D. Scliofield and Albert H. EHiot, for défendant in error. 

Before GILBERT and ROSS, Circuit Judges, and WOEVERTON, 
District Judge. 

WOLVERTON, District Judge. On September 17, 1904, the John- 
ston Lighterage Company was under contract with the Nome Fuel 
Company to transport fuel oil froni the ship Rosencranz to the shore at 
Nome, Alaska. Its engagement was to bring the lighters or barges used 
for carrying the oil from the ship's side to the beach, and to furnish men 
for the crafts. In pursuance thereof, it employed the défendant, being 
the plaintifï in error, to do the towing with Iiis tugs ; and the Nome 
Euel Company, the consignée, also employed défendant to convey the 
oil from the barges to shore. The plaintiff was the employé of the 
lighterage Company upon the barges. The défendant used a pump for 
conveying the oil to shore, which was operated through means of an 
engine, and a derrick erected for handling a large iron pipe, 6 inches 
in diameter, and about 60 feet in length, extending from the shore 
seaward to the barges, with an elbow at right angles at the outer end, 
and a further extension of 6 feet. The derrick was adjusted to. a 
stationary post, or mast, as it is termed, set in the ground, on the beach 
near the water's edge, and the engine was stationed farther in shore, 
so as to make its distance from the barges, while being discharged, 
about l.TO feet; the mast being about (JO feet, or the length of the pipe, 
from the hatches of such crafts. The défendant had charge of the 
opération of the engine and derrick for lowcring the outer end of the 
pipe into the holds of the barges, and, when discharged of the oil, for 
raising it again in place ; his place of duty being at the engine. He had 
in his employ a man at the winch, and another for firing the engine. 
The duties of plaintiff wcrc to see that the piiie when lowered was con- 
ducted into the holds of the barges, and, when being raised, that the 



WHITEHOUSE V. EDWAEDS. 73 

valve thereof did not come in contact with the coamings o£ the hatch. 
At the time of the accident of which plaintiff complains, the défendant 
liad hoisted the pipe at a signal from the barge, and, while the plain- 
tiff was replacing the cover upon the hatch, the pipe fell upon him. 
In this relation, the complaint states that: 

"Plaintiff was engaged in the performance of liis dutles as longshoreman 
on board one of said oil barges, exereising care and discrétion in his work, 
wlien withont any warning wbatever. and in the absence of the watchman, 
said défendant, wlio tben and tbere had charge of the hoisting englne, then 
and there carelessly, negligeiiily, luid in a giossly uuskillful manner oper- 
ated said hoisting enginc and raised said conduit and suction pipe in sueh 
a way as to cause the parting of tho lines susi)ending said conduit and suction 
pipe, wherein and \Ylieroby said pipe was precipitated upon plaintiff and 
across said barge, thereby inflictiug upon plaintiff a painful and dangerous 
wound," etc. 

By the further and separate answer, it is alleged, as a défense, that 
it was one of the duties of plaintiff to signal to the engineer to hoist 
the pipe or conduit, and, after the giving of the signal, it was one of 
his duties also to signal to the engineer to stop hoisting, when, in his 
judgment, the said pipe or conduit had been raised to a suffîcient height, . 
and that the défendant relied solely and acted only upon the signais 
as given from said plaintiff and his co-employés ; that, at the time of 
the alleged accident, the signal was given by the plaintiff, or one of 
his fellow servants on the barge, to défendant to hoist the pipe or con- 
duit ; that, upon receiving tlîe signal, défendant started the engine, 
and began hoisting, and continued until the défendant believed he had 
raised the pipe to a suffîcient height, then slowed the engine down al- 
most to a stop, expecting to receive a signal from plaintiff, or his 
fellow servants, to cease hoisting; that none such was given, but, on 
the contrary, défendant was given a signal by plaintiff, or his fellow 
servants, to hoist said pipe still higher, which défendant began to do, 
when the alleged accident occurred, and before any signal was given 
to stop hoisting. 

Replying, plaintiff avers that it was his duty to give the signal to 
défendant to raise or lower the pipe, but that lie gave no such signal 
at the time of receiving the injury, and that the injury was caused by 
défendant operating the hoisting engine without a signal from plain- 
tiff, and without giving plaintiff any warning whatever of his inten- 
tion to raise the pipe. 

This reduces the issue to concise and narrow limits. There was a 
motion by défendant, at the close of the évidence, for a directed ver- 
dict in his favor, which was overruled. The first question, therefore, 
for décision, is whether the court erred in this disposition of the mo- 
tion. The spécial reason urged by counsel for défendant in support 
of the motion is that the évidence shows, beyond rational controversy, 
that a signal, consisting of the words "Hoist higher," uttered, or as 
is otherwise expressed, "sung eut," by one Charles L. Johnson, was 
thus given from the shore or beach in the direction of the barge, and 
that, défendant having acted upon such signal, supposing that it came 
from proper authority, his conduct in continuing to hoist the pipe, 
which caused the parting of the line and the précipitation of the pipe 
upon the plaintiff, was not such as to render him liable for négligence. 



74 152 FEDERAL EEPORTEB. 

The principal witness for plaintiff, aside from himself, was R. G. 
Healy, who was under die employ of the lighterage company at the 
time, and engaged with plaintiff on the barge. His duty was to see that 
the_ barge was made iast, and to assist plaintiff in managing the pipe 
while being lifted and lowered. Both men were on the barge at the 
time. Healy states that it had been usual to hâve a man on shore whose 
duty it was to make the beat fast and to attend to the surf line, and to 
give the signal to the engineer when to start the engine for hoisting the 
pipe, also the signal when to lower it ; but that, owing to a shortage in 
help on the barge at the time, he was discharging that duty in connec- 
tion with assisting plaintiff in lifting' and lowering the pipe. He fur- 
ther testifies that, when the oil had been pumped from the barge, he 
gave the signal to the engineer (meaning the défendant) to hoist the 
pipe ; that the défendant hoisted it to its accustomed height, and left it 
there, and walked away from the winch, but that, from three to five 
minutes afterwards, he started to hoist again, and without giving any 
signal that lie intended to do se; that, in the meantime, plaintiff had 
returned to the hatch, and was putting the cover upon it, when the pipe 
fell, and he was injured ; that both the witness and the plaintiff stepped 
away to the outside of the boat while the pipe was being hoisted; but, 
that after the engineer had stopped hoisting, the plaintiff returned to his 
vvork at the hatch, and that there was no signal given by any one to hoist 
the second time, after the pipe had been made fast. 

The plaintiff testities that he gave the signal to hoist the pipe by sing- 
ing out to the défendant that the barge was pumped out, and for him to 
hoist, in the accustomed manner ; that défendant hoisted the pipe to the 
usual height, and sang out, "Ail right," meaning that the pipe had been 
made fast; that défendant then stepped down, away from the platform 
where the engine sat, and diat plaintiff started to put on the hatch cover. 
He says f urther : 

"Rly bu.siness while hoisting the pipe out was to try and keep It clear of 
the hatchway while they were hoisting tlie pipe out of the hatch, and see 
that tlie coiinis ot the hatch didn't catch the foot of the valve, and it was my 
business to keep the suction pipe elear of the hatch until she got up so 
as to clenr the hatch, and then it was my business to get out of the road. 
On this day I naturally gets the pipe out and clear of the coam of the 
hatch, and, after she has cleared the hatch, 1 talves my accustomed side. 
after she is clear of ail obstacles. Then the pipe is entirely in the englneer's 
hands to hoist the pipe up. I generally watclied him uutil he stops the engine 
and she is fully out up out of the way. ïhe next thing I did I steps to one 
side on the barge, where I gênera lly holds on while tlie pipe is being hoisted, 
which I did on that day. Of eour.se, when they had the pipe out,. and it Is 
entirely out of my hiinds, then the next thing Is to cover up the hatch, and, 
on account of the decif being oily and slippery on account of the oil over the 
decks, I holds onto the hatch, and gets up alongside to put the cover onto 
the hatch, and, while I was rloing that, the pipe come down on top of me. 
* * * After the pipe was hoisted to its accustomed and reguiar height 
and made fast, I did not signal to the engineer to hoist the pipe up higher, 
and I don't think Mr. Healy did. * ♦ ♦ It was my duty to place the 
barge in position on the beach for pumping, to see that the suction pipe 
was properly lowered Info the hatch, and that it cleared the hatch lu hoist- 
ing. The nien on the barge gave the signal when to hoist." 

The défendant testifies that he was given the signal to hoist the pipe, 
and obeyed it, and that, while hoisting it, thinking tliat it had reached 



■WHITEHOCSE V. EDWARDS. 75 

the proper heiglit, he was given the signal, "Jtoist liigher," and in obédi- 
ence thereto he continued with the engine in motion ; and that, before 
any further signal had been given him to stop hoisting, the line broke, 
and the pipe fell upon the plaintiff ; and that both signais came from the 
direction of the barge. He produced also three other witnesses, each 
of whom testified that he heard the signal, "Hoist higher," given. One 
of thèse was Gifford, who was at the winch managing the rope ; another 
was Adams, who was firing for the boiler at the time, and was standing 
alongside or near it, being about two f eet back of the winch ; and one 
Charles L. Johnson, who says that he not only beard the signal, but 
gave it himself . He testifies, on cross-examination : 

"I gave the signa!. I was kind of looking after the Nome Fuel Com- 
pany to see that noue of the oil was being wasted. Capt. Whitehouse had 
the contract from the Nome Fuel Company to pump this oil. I thought the 
men on the barge heard the signal, and I dldn't see that they were there. 
They were through with the pumplng and with the pipe at the time, and at 
that time they were not doing auythlng with it. It miglit be hard for the men 
to retain their footing on the barge when it was rough. I claim no author- 
ity at that time either through Mr. Whitehouse's employ or under bis con- 
tract with référence to the discharge of this oil. I was practically a étran- 
ger, the same as any other bystander." 

He further testifies that, at the time he was on the lower side of the 
dock, towards the beach, between the mast and the boom, on the west 
side in front of the dock, 75 or 80 or 100 feet from the pump, about 
halfway between the beach and the pump. 

The plaintiff produced two other witnesses. One was W. H. Smith, 
who testified that he was working for Johnston, and was down on the 
beach at the time, about 40 or 50 feet westward from the barge ; that 
he was acting in the capacity of timekeeper, keeping note of the number 
of barges that were towed in and out ; that he saw the pipe when it fell, 
but that he did not hear the signal given to hoist higher. And Charles 
A. McArthur testified that he was about 60 feet from the barge, on the 
beach on the west side, and that he did not hear any one give the signal 
to hoist higher. 

There was some testimony introduced by défendant that the view 
upon the barge was obstructed somewhat by reason of the derrick and 
stationary mast an-d other fixtures, and that it was necessary to dépend 
entirely upon the signais for determining when to hoist or lower the 
pipe ; but the plaintifï's testimony in the case is that the barge was in 
plain view of the engineer, and that the pipe while being raised, and the 
men on the barge, and their actions, could ail be observed readily by the 
engineer from bis station. So that thèse are matters also about which 
the witnesses do not agrée. 

The rule of the Suprême Court touching the question of fact as to 
négligence is that it "is one of law for the court only where the facts 
are such that ail reasonable men must draw the same conclusion from 
them, or, in other words, a case should not be withdrawn from the jury 
unless the conclusion follows as matter of law that no recovery can 
be had upon any view which can be properly taken of the facts the 
évidence tends to establish." Gardner v. Michigan Central Railroad, 
150 U. S. 349, 3G1, 14 Sup. Ct. 140, 144, 37 L. Ed. 1107. And, again. 



76 102 FEDERAL REPORTER. 

it is held, in Grand Trunk Railway Co. v. Ives, 144 U. S. 408, 417, 
13 Sup. Ct. 679, 683, 36 L. Ed. 485, that: 

"When a given state of facts is such tliat reasonable men may fairly 
differ upon the question as to wlietiier tliere was négligence or not, the dé- 
termination of the matter is for tlie jury. It is only wliere the facts aro 
such that ail reasonable men mnst draw tlie sanie conclusion from theni that 
the question of négligence is ever considered as one of law for the court." 

Now, in the light of the testimony as it has been briefly outlined, it 
seems clear that there is room for reasonable men to differ touching 
the fact which counsel make the turning point as to their motion for 
a directed verdict. Both the plaintiff and Mr. Healy, who was with 
'him on the barge, say positively that they gave no signal after the 
first to hoist the pipe. Two men who were standing near, and who 
haxl eqttal opportunities with the engineer and the men at the winch 
or the fireman for hearing such signal, if it was given at ail, say that 
they did not hear it. The testimony of the défendant, it must be con- 
ceded, is strong that such a signal was given ; four men coinciding and 
concurring in the statement that they heard the words "Hoist higher" 
uttered, and Johnson afhrming that he gave the signal himself. It is 
signiiicant, however, that thèse men ail testify to having heard a signal 
consisting of exactly the same words, and that Johnson apparentl}' 
studiously avoided stating as to who gave it until he was cross-ex- 
amined. From Johnson's own testimony, it appears that he was solely 
an officious meddler, who was not engaged for WhitehouSe, or in his 
employ ; nor was he in the employ of the lighterage Company, but 
simply an outside party, with authority from no one. And it is alto- 
gether unlikely that a person of this sort would be giving the sigr^als 
for conducting the work to the parties concerned. There is, as be- 
tween this évidence and that of plaintiff, a direct conflict, and the jury 
are the exclusive judges of the weight of the évidence. It is for 
them to détermine whether witnesses speak the truth, or whether they 
are worthy of belief, and, it being altogether clear that reasonable men 
might differ as to the resuit, it was the proper function of the jury in 
the présent controversy to détermine the fact as to whetKer this signal, 
"Hoist higher," was ever given or not, and as to whether the action 
of the défendant was controlled thereby. If there was no such sig- 
nal given, and he continued to hoist the pipe without one, which caused 
the breaking of the line, then he was guilty of négligence. We think 
that the case was properly left to the jury for their détermination. 
It may be questionable whether the especial point urged is within the 
pleadings, it having been alleged that défendant was given a signal by 
plaintiff, or his fellow servants, to hoist the pipe or conduit higher; 
but it has been so treated by counsel upon both sides, and we hâve, 
accordingly, so considered it. 

Référence is made by counsel to the allégation of the complaint 
that, in operating said conduit or suction pipe, it was necessary or 
customary to station a man between the derrick and the hoisting engine 
to watch the running of the lines, and to give warning in case of 
danger. The only proof as to the custom which prevailed in that re- 
gard is' the évidence of Healy, who testifies that theretofore his duty 
was on the beach, to make the surf line fast, and that the man on the 



WIIITEHOUSE V. EDWAEDS. 77 

beach gave the signais for raising and lowering the pipe. It appears, 
however, that on tliis occasion the lighterage company was short of 
help, and that Healy was not only discharging the duty of making the 
line fast, hut was assisting the plaintifï on the barge, and that the 
signais to hoist the pipe were ail being given from the barge. It 
is not improbable that Whitehouse knew of this condition, by reason 
of the fact that he could see the barge a part, if not ail, of the time 
from where he was employed, and was in a position to observe who was 
assisting there, and in what manner the men were discharging their 
duty. So that, while this allégation is contained in the complaint, 
it is surplusage merely, and it was not necessary that it should bave 
been in there. There exists a good cause of action without it, and it 
was a thing for the jury to détermine, as we bave seen, whether the 
défendant was guilty of négligence as otherwise charged. The mo- 
tion for an instructed verdict was therefore properly denied. 

The next ground of error is based upon the refusai of the trial 
court to give instructions which were requested by the défendant. 
Thèse are contained in three clauses. As to the first two, it is ver\' 
clear, from a reading of the instructions given by the court, that 
they were fully and fairly covered by the gênerai charge. The third 
clause is as follows : 

"The plaintifï was also bound to «se ordinary care and rirecaiition not 
to expose hiniself in any uunecessary danger, and to keep in a safe place 
in case of danger ; and in doing so he should exercise ail bis faoïilties of 
seeîng and hearing. And If. by sa exercising bis faeulties of seeing and 
bearing, lie could hâve anticipa ted the danger in time to escape to a place 
of safety, it was bis duty so to do, and a failurc in such cases to use 
ordinary care, as iritimated, would be fatal to his recovery." 

While this instruction may not be so fully covered, it was not nec- 
essary that it should be given, as the case, under the pleadings and évi- 
dence, does not call for it. The answer does not set up any contribu- 
tory négligence on the part of the plaintifï ; nor does the évidence any- 
where tend to show that plaintifï was injured because he did not use 
due care in seeking a place of safety. So that the instruction was 
abstract and irrelevant. 

The third ground of error consists of an exception to an instruc- 
tion given, as follows : 

"You are instructed that pain and suffering are naturally connected with 
ail pbysical injuries, and may be considered as tbe direct and proximate 
resuits tbereof, and, when physical injury résulta from tbe négligent or 
willful act of another, a recovery may be bad for tbe pain and suffer- 
ing connected with sucb injury. both at tbe time of its occurrence aud sub- 
sequently ; sucb recovery being in law in the nature of au award of com- 
IJensatory damages." 

It is urged that there is no allégation in the pleadings as to any will- 
ful act or wrong donc by the défendant, and that the natural tendency 
of the use of the term "willful" in the instruction was to suggest to 
the jury that the défendant knowingly or purposely inflicted the in- 
jury. Eut it is entirely manifest that the jury could not bave been 
misled by the use of the word, and elsewhere the court instructed es- 
pecially that compensation should be the measure of damages. - The 



78 152 FEDERAL REPORTER. 

trial court committed no error, therefore, touching the instructions 
either given or refused. 

Thèse considérations lead to the affirmation of the judgment ren- 
dered, and it is so ordered. 



INTERNATIONAL TRUST CO. y. DECKER BROS, et al. 

(Circuit Court of Appeals, Ninth Circuit. February 11, 1907.) 

No. 1,335. 

1. RECEIVEES— AUTHOBITT TO APPOINT— GROUNDS OF APPOINTMENT. 

To warrant tlie appointment of a receiver by a court of equity, It Is as 
a gênerai rule essential that tlie plaintiff sliould show tliat the property 
constitutes a spécial fund to which he has a right to resort for the satis- 
faction of bis claim, and that the property itself or the income arising 
therefrom is in danger of loss from neglect, waste, misconduct, or insol- 
vency of the défendant 

[VA. Note.— For cases in point, see Cent. Dig. vol. 42, Receivers, §§ 21- 
31.] 

2. Same— Receivers' Certificates — Powbh of Court to Authorizb. 

The practice of issuing receivers' certificates to continue the business 
and giving them priority of lien is peculiar to cases of insolvent rallroad 
companies or other public sen'ice corporations, and flnds its reason in the 
necesslty of keeping the business a going concern both for the conven- 
ience of the public and the préservation of the security, but neither the 
practice nor the reasons supporting it apply to corporations engaged in a 
strictly prlvate business, and, in case of such corporations, the court has 
not the power to authorize a receiver to incur indebteduess for carrying on 
the business and to malie the same a paramount lien upon the corpus of 
the property, to the displacement of prior contract liens, without the con- 
sent of the holders of such liens. In such cases the power to authorize 
the issuance of receivers' certificates extends only to the necessary expendi- 
tures incident to the administration and préservation of the property un- 
til the business can be wound up and the receivershîp ended. 

[Ed. Note.— For cases in point, see Cent Dig. vol. 42. Receivers, §§ 204r- 
223.] 

3. Same— SuiTS Against Insolvent Corporation— Oedkr for Sale of Prop- 

erty. 

At suit of a simple contract créditer for a comparatively small sum a 
receiver vvas appointed for the property of certain mining companies, and 
was continued in possession for eight years, during whicli he Issued, under 
authority given by the court, receivers' certificates for some $400,000, 
which were by the orders made flrst liens on tlie property, and the proceeds 
of which were for the most part expended in operating and developing 
the property. The property was subject to a prior mortgage for a large 
sum securing bonds, but the mortgagee was not a party to the suit at the 
time such certificates were issued. Being subsequently brought in, it flled 
a cross-bill for foreclosure, and also asked that new parties be broiight in 
and certain adverse claims affiecting the property be adjudicated and the 
priority of liens determined, to the end that the property might be sold for 
the highest possible priée. Held, that it was an abuse of discrétion for 
the court to order a sale of the property without first determining sucli 
matters ; it clearly appearing that they would largely affect the sale ôf 
the property and prevent its bringing its full value. 

Appeal from the District Court of the United States for Division No. 
1 of the District of Alaska. 



INTERNATIONAL TRUST CO. V. DECKER BROS. 79 

On July 1, 1896, the Berners Bay Mining & Milllng Company, a corpora- 
tion existing under the laws of the state of Maine, but doing business in 
Alaslca, mortgaged its properties, consisting of mines, mining claims, mill 
sites, and water rights, and the appurtenances thereto, comprising mills, 
buildings, railroads, tramways, machinery, and equipment, ail situated in 
Alaska, to the International Trust Company, of the eommonweaith of Massa- 
chusetts, to secure the payment of certain bonds aggregating the suni of 
li^ôOO.OOO, ail issued and disposed of for the beneflt of the mining eompany. 
Subsequently, on December 15, 1897, Decker Bros. Instituted an action agaiust 
the Berners Bay Mining & Milling Company, the Seward Gold Mining Com- 
pany, the Northern Belle Gold Mining Company, and the Ophir Gold Mining 
Company as parties défendant, the three last-named corporations having 
succeeded on November 1, 1897, to ail the property, rights, and iuterests, and 
assumed ail the obligations, indebtedness, and liabilities, of the first. From 
the complaint it appears that the défendants were indebted to the plaintiffs 
în the sum of $154.65 for goods and wares sold and delivered ; that latterly 
the companies had employed many men, at an expense of from $12,000 to 
$15,000 per month ; that the output of the mines was insufHcient with whieh 
to meet the running expenses for the six months preceding the commence- 
ment of the action ; that an indebtedness of about $500,000 was outstanding ; 
that many of the creditors were threatening suit, and the property of the de- 
fendant companies was in danger of being wasted and exhausted ; that said 
companies were in imminent danger of beeoming insolvent; that, if a re- 
ceiver were appointed to manage their business under the direction of the 
court, they would be able to discharge ail of their indebtedness, but that 
otherwise they would not ; that plaintiffs had previously cashed a large num- 
ber of ehecks issued by défendants, amounting to from $3,000 to .$,^,500, which 
were yet outstanding and unpaid; and that, according to the belief of plain- 
tiffs, if the property of défendants were put up at forced sale, there would 
not be realized a sum sufiicient to meet their liabilities, wherefore, plaintiffs 
prayed the appointment of a suitable person to take charge of the property 
and effects, and to manage the business of the défendant corporations, and for 
the payment of their demands during the course of such receiversbip. Noth- 
ing further appears from the record to hâve been done until July 13, 1905. 
when the défendants in the action joined in a pétition to the court, praying 
that the International Trust Company be made a party to the proceeding; 
that such Company, and ail persons înterested, be required to appear and show 
cause why the properties of the défendant companies should not be sold ; 
and that upon such hearing a master be appointed to dispose of the same. 
The pétition shows, among other things, that the "receiversbip was mado 
necessary by reason of the fact that the sàid properties were undeveloped, 
and the expenses of development necessary to put them upon a paying basis 
exceeded the means available for that purpose" ; that the receiver had since 
his appointment borrowed a large amount of money on receiver's certificates, 
aggregating between $385,000 and -$390,000, under the orders of the court, made 
with the consent of the holders of the bonded indebtedness of the défendants, 
and by means thereof had developed the properties and inereased their in- 
trinsic value to an amount largely in excess of the amount of such indebted- 
ness; that, in addition to the said liabilities of the receiver, the defendnnts 
were indebted In the sum of $500,000, with interest aggregating about $700.- 
000, evidenced by bonds securod by trust deed to the International Trust Com- 
pany ; that, in order to make the property productive, it was necessary to erect 
a larger réduction plant and to continue the develo]Miient work already done. 
and that about $150,000 would be required for that purpose : that the de- 
fendants were wholly insolvent and unable to pay such indebtedness, or tv> 
operate the property ; that for several years previous the parties interested 
in the property, including the bondholders and holders of the receiver's certif- 
icates, had been endeavoring to reorganizo, but ail without avail ; and that 
the indebtedness of the défendant companies was rapidly increasing. 

Subsequently, on December 9, 1905, défendants in said action flled an an- 
swer and cross-c-omplaint, which alleged that the claim of the plaintiffs had 
been paid by the receiver; that in the month of December, 1897, the défend- 
ants were largely indebted for wages and salaries of employés, and for sup- 



80 1Û2 FEDERAL UErORTEll. 

plies and other expansés for operatins tlie inining proporties of tbe défendants, 
aggregating $100,000 or more; and tliat they were, and ever since had been. 
insolvent and unable to pay their debts in due conrse of business. It then 
recited tbe fact of tbe appointment of tbe receiver, tbe exécution and dclivery 
of tbe mortgage deed of trust to tbe International Trust Company (setting ont 
a copy), tbe disposai of tbe bonds upon tbe markot. and that none of tbe de- 
fpiidants had been able to pay anytbing upon the principal or interest tliereof ; 
tliat subséquent to bis appointment tbe receiver bad been acting at tbe in- 
stance of tbe bondbolders, liad obtained orders from tbe court in pursuance 
wbereof be bad borrowed large sums of money upon receiver's cortiflcates, 
and otberwise incurred indebtedness in tbe administration and betternient of 
tbe properties, wbicb indebtedness was in equity a primary lien against said 
properties, superior and prior to said bonded indebtedness, and tbat by renson 
of the accumulation of such liabilities tbere was a necessity for the sale of 
ail of tbe proporties of tbe défendant corporations, and a distribution of the 
proceeds arising tberefrom. so tbat tbe business niigbt be wound un and tbe 
affairs settled. The défendants demanded that the International Trust Com- 
pany be raade a party défendant, tbat the court sbould decree a sale of tlie 
pro)T:^T-tiPs. and tliat tbe iiroceeds tbereof sbould be applied to tlie Indebtedness 
according to priority and rank. 

On Februai-j- 28, 1900, F. D. Nowell. tbe receiver, raoved tbe court for an 
order direeting the sale of ail the properties of tbe défendants in his liands, 
tbat tbe same might be converted into nioney, and paid out under the orders 
of the court to parties entitled thereto. He averred that tbe receivershi]) had 
(fontinned for a long period of more thau eight years; tbat in tbe meanwbile 
the parties eoncerned had made repeated efforts to reorganize ; that for tbe 
payment of the eurrent and necessary expenses of the receivership he bad 
borrowed large sums of money, aggregating ,$400,000, on receiver's certificates, 
ail of whieh indelitedness was a jirior and paraniount lien against the prop- 
erties in his bands ; that such indebtedness was coustantly increasing ; and 
that he believed a reconciliation and agreement aniong tbe parties conoerned 
was impossible. Subsequently, on March 5, 1906, tbe International Trust Com- 
nany ainieared and answered tbe cross-coniplaint of défendants. It admitted 
tbe exécution of tbe mortgage deed of trust, and further alleged tbat it at no 
time ever conseuted, acquiesced in, approved, or ratifled any action of the 
receiver in bcrrnwing nioney or incurring hidebtedness, on receiver's certif- 
icates or otberwise, in tbe administration of the estate, and that none of the 
monev borrowed l>y tbe receiver was ever used or went toward the better- 
ment of the properties, or was necessary to préserve tbe status tbereof, but 
that whatever moneys were expended were iniprovidently and illegally ap- 
plied to exploiting and developing a number of contingent, spéculative, and 
uncertain mining prospects and locations, and in tlie promotion of a spécu- 
lative, uncertain, and contingent mining business : tbat the indebtedness in- 
curred by tbe receiver was not in equity a primary lien against said prop- 
erties, and tbat any orders of court bad autboriKing the borrowing of such 
funds were made and entered ex parte, without notice to the défendant the 
International Trust Company, and that it had never had its day in court with 
référence thereto; that it at no time consented or agreed to any subordina- 
tion of its rigbts xiiider said mortgage deed of trust to any of the rigbts 
nrising from the issuanco of such receiver's certificates, or any of thein, where- 
fore, it prayed tbat tbe receiver sbouîd account and tbe court ad.iudicate upon 
the orders previously made permitting receiver's certificates to issue, and 
that the relative rank of such receiver's certificates sbould be establisbed by 
an order and decree of tbe court, and that tbe mortgage deed of trust of the 
défendant trust company sbould be declared a valid subsisting flrst lien upon 
the j>ro]ierty in the hands of the receiver, and that tbe same sbould be fore- 
closed and the property sold in accordance witb the prayer of its cross-com- 
plaint then flled. 

On the same day tbe International Trust Company flled a pétition, praying 
leave to be permitted to file a cross-eomplaint for the foreclosure of its mort- 
gage, and to bring in iiew parties, who, it was alleged, had or claimed some 
interest in the properties in the bands of the receivers, F. T>. Nowell and W. 
B. Xloggatt. The pétition sbowed, ainong otber thiiigs, tbat tbe property could 



i>;teiî;satiokal trust co. v. deçkee bros. 81 

he sold to the greatest advaiitage as a whole, tbat its valu? ditl not exepecî 
the principal due upou tlie trust company's uiort^âge, and tlmt it would l)e 
ino|'i)ortiuie to jilace the same upon tlie iiiarl;et luitil the title tliereto was 
settlcd, and the raiik of tbe various elainis aseertained and deterniined. 

An order of tlie court was accordingly entered March ].3, 1000, grantins 
leave as pi-a,Y<Ml and anotlier j)enriittiniî suit to be instituted against the re- 
ceivers. It ajipears liy the former order that W. B. Iloggatt was on January 
r>, lOOO, aiii)oiiited ref-eiver for sjiecial pnrposcs. The cross-com])laint wtin 
filed concurreutly with the eiitry of thèse orders, and, after reciting the In- 
stitution of the action l)y Decl;er Brns. and tlie appointment of the reeeivei'S. 
it sets up a cause for foreclosure of tlie trust company's mortgage. and prays 
tliat it be declarcd a paramount lien to ail othor daims, and that the prop- 
erties in litigation be sold for its satisfaction. On the same day of tbe entry 
of sucli ordei's and the filin;? of tliis cross-complaint, iianielj'. Mardi i;>, ISXKÎ, 
the court made and entered an order of sale directing that the entire proper- 
ties of the mining companies be sold as an entirety liy a spécial master, but 
that no bids sbould be received for a less suni than $400,000, tliat t!ie master 
convey to the purchaser ail of the title of tbe mining companies, freed and 
discliarged of ail claims and incumbrances of every kind and nature, and that 
ail liens existing against the properties should foUow and attach to the pro- 
ceeds of sale, provided, however, that if the liens, easements. and rights of 
way claimed upon said properties by tbe Alaska Nowell Gold Mining Company, 
the Nowell Mining and Milling Company. Willis l'I Nowell, and Thomas S. 
Nowell, or any otlier cloud upon the title to tlie projierties ordered sold. 
should not be i-eleased. discharged, and satisfactorily cloared 10 days jirior to 
the day of sale, then that the court would revoke or extend the order as mîght 
appear just and proper. Thereafter, but on tbe same day and before the 
order was entered. tbe trust company filed its olijections to such enlvy, assign- 
ing nunierous grounds therefor, among whidi are tliat the priorities between 
the différent lienholders h,ad not been determined ; that certain issues be- 
tween the mining companies and the trust comiia.ny on tbe cross-complaint of 
the former remained unsettled, no reply baving then been interposed ; that a 
certain easement referred to in the cross-complaint of the trust company was 
a cloud upon the title; and that tbe properties would be sacriflced if sold 
prier to the détermination of priorities and the settlement of the title. Tbe 
appeal to this court is prosecuted from the order of sale made and entered 
as indicated. 

Several orders of the court are eontained in the record authorizing the issu- 
anee of receiver's certificates. ïlie flrst bears date March 7, 18!)S, and grants 
leave to tbe receiver "to borrow money to pay off the claims for labor acainst 
the défendants." iuthe aggregate sum of Çfi.OOO, for the Berners Bay Jlinlng 
& Milling Comiiany. and $4,000 each for the Northern Belle Gold Mining Com- 
p.any and tbe Seward Gold Mining Comiiany, and authorizes him to issiie bis 
certificates therefor. It was further declared that such certificates, wben 
Issued, should be a first lien upon the ineoine and corpus of the property of 
eacli of said companies, resiiectively, in the hands of the receiver. This order 
was made urion a v>etition of the receiver; no aiiiicarance of any other parties 
bein? uoted. Tbe second order was entered Seiitemher 2?,, 18.98, also upon tbe 
pétition of the receiver; both the plaintifïs and défendants appearing. This 
granted leave to borrow money upon receiver's certificates for the purpose of 
developing and preserving the property of the défendants Northern Belle Gold 
Minhig Companr and the Seward Gold Mining Company. The amouut au- 
thorized was ,$37,,")00 for each of said companies. It was alike declared, as 
in the former order, that the certificates should be a flrst lien upon the income 
and corpus of the properties of such companies. The tliird order was a modi- 
fication of the second. 'ITiis was made November 21, 1808. 'l'he fourth oriier 
was entered December 28, ]8!)8, and authorized tlie receiver to borrow $;>5,- 
000 for temporary purjioses, peuding the uegotiation of receiver's certif- 
icates under the préviens- order. The fifth was made December 1.3, 1000, ujion 
the pétition of the receiver — no appearance being noted of the parties to tlie 
suit — and granted authority to borrow $iri0.0f)0 on receiver's certificates "to 
pay the présent indebtedness of the receiver, and to make up any deflciency 
that uiay arise in developing and operatlng the Kensington mine and mill over 

102 F.— 6 



82 152 FEDERAL REPOETEE. 

the gToss eamings f rom sueh opération." A like déclaration îs made, as In pre- 
Tlous orders, relative to the priority of the lien of such certiflcates over the 
lien of ail mortgages and trust deeds affecting the property. The order 
spécifies that eut of the proceeds of the loan there shall be paid, flrst, the 
outstanding reeeiver's certiflcates, amounting to $40,000; second, the floating 
indebtedness of $60,000; and, third, for development purposes, $50,000. And 
the sixth order was entered October 29, 1901, authorizing the receiver to bor- 
row $190,000 for purposes of like nature as of the next preceding issue, and 
with like déclarations as to priority of liens over other incumbrances. 

John J. Boyce, Shackleford & Layons, and Pillsbury, Madison & 
Sutro, for appellant. 

Curtis H. lyindley and Henry Eickhoff, for appellees. 

Before GILBERT and ROSS, Circuit Judges, and WOLVERTON, 
District Judge. 

WOLVERTON, District Judge, after stating the facts, delivered the 
opinion of the court. 

The essential and ultimate inquiry is whether the court erred in 
decreeing a sale of the mining properties, in view of the proceedings 
theretofore had and the administration of the affairs of the défendant 
corporations under the receivership, and it is important to a clear un- 
derstanding and solution of the principal question that certain légal 
principles be first ascertained and determined. As a gênerai rule, "to 
warrant the interposition of a court of equity by the aid of a receiver, 
it is essential that plaintifï should show, first, either a clear, légal right 
in himself to the property in controversy, or that he has some lien upon 
it, or that it constitutes a spécial fund out of which he is entitled to 
satisfaction of his demand; and, secondly, it must appear that pos- 
session of the property was obtained by défendant through fraud, or 
that the property itself, or the income from it, is in danger of loss from 
the neglect, waste, misconduct, or insolvency of the défendant." High 
on Receivers (2d Ed.) § 11. Sec, also, 23 Am. & Eng. Enc. of Law, 
1036. 

The receiver being an arm of the court, his authority for taking 
over the properties of the concerns involved, for administering their 
business affairs, and for issuing reeeiver's certificates, with a view to 
obtaining funds for discharging liabilities and obligations incident to the 
receivership, is but another expression for the authority of the court, 
without whose orders and directions the receiver is powerless to do 
anything. A practice has grown up incident to railroad receiverships, 
which, indeed, has become firmly established by judicial sanction, 
whereby the receiver is considère d to be legally compétent under con- 
ditions of insolvency, and perhaps for other causes peculiar to the busi- 
ness of public service corporations, to issue reeeiver's certificates for 
the purpose of paying labor claims, within prescribed limits as to time, 
and other incidental and necessary expansés for carrying forward 
the business of the corporation, so that it may continue a going concern, 
and thereby to supplant or supersede the liens of mortgage claimants. 
The reasons, however, for the authority are peculiar to railroad cor- 
porations, and to the enterprises in which they engage, the most 
salient of which are that railroads are quasi public concerns, through 
which the public interests and convenience, as well as private owner- 



INTERNATIONAL TRUST CO. V. DECKER BROS. 83 

ship, are largely subserved, and that a maintenance of the roadway and 
equipment, and a continuation of the business and opération of the 
road, are essential to the préservation of the mortgage security. Any 
person or corporation, in taking and accepting a mortgage upon the 
property of a railroad, therefore, does so with référence to the law 
governing such corporations, and with knowledge, presumably, of the 
légal condition that, for the purpose of keeping the enterprise a go- 
ing concern, receivers may be appointed and receiver's certificates is- 
sued in appropriate cases, which, in their force and effect, will sup- 
plant the mortgage, and hence with the understanding that the mort- 
gage lien may be superseded by the necessary expenses for continuing 
the business and thereby preserving the security of the mortgage. 
Thèse principles hâve been established by numerous adjudications in 
the Suprême Court of the United States. Fosdick v. Schall, 99 U. S. 
235, 25 L. Ed. 339 ; Barton v. Barbour, 104 U. S. 126, 26 L. Ed. 672 ; 
Miltenberger v. Logansport Raiiway Co., 106 0. S. 286, 1 Sup. Ct. 140, 
27 L. Ed. 117; Burnham v. Bowen, 111 U. S. 776, 4 Sup. Ct. 675, 28 L. 
Ed. 596 ; Union Trust Co. v. Illinois Midland Co., 117 U. S. 434, 6 Sup. 
Ct. 809, 29 L. Ed. 963; Wood v. Guarantee Trust Co., 128 U. S. 416. 
9 Sup. Ct. 131, 33 L. Ed. 472 ; Kneeland v. American Loan Co., 136 U. 
S. 89, 10 Sup. Ct. 950, 34 L. Ed. 379. Neither the rule, nor the reasons 
which go to its support, hâve application to corporations engaged in 
strictly private enterprise. The Suprême Court of the United States 
has not as yet expressly said this, but it has so strongly observed tlu 
distinction in that relation between the two characters of corpora- 
tions that there is left but little room for conjecture as to what its 
détermination in a case calling for a décision in the premises would be 
It is said in Wood v. Guarantee Trust Co., supra, that : 

"Tlie doctrine of Fosdick r. Scli.ill htis never yet been applied In nny ci pp. pt 
cept that of a railroad. The case lays great empliasis on the consideriitioi) 
that a railroad is a peculiar property, of a pnblic nature, and disclinrf-'ing « 
great public work. There is a broad distinction betTs-een .«ncli a c.nse anri 
that of a purely private conoern. We do not undertake to décide the ques 
tion hère, but only point it out." 

And so in Kneeland v. American Loan Co., supra: 

"It is the exception, and not the rnle. that snch priority of lien" can h- 
displaced. We emphasize this fact of the sacnnlness of contrnot liens, for 
the reason that there soems to be prowinîr an idesi tliat the ohanfpDnr. In th' 
exercise of hls équitable powers, has unlimited discrétion in this luatter o! 
the displacement of vested liens." 

The fédéral courts, in both the circuit and district, hnve, however 
passed upon the question, and are uniform in holding that a receive- 
of a private corporation has no such latitude in légal contemplation a 
it respects the issuance of receiver's certificates as do tho.se of a rail 
road or public-service corporation, and that his aiithority for displacin 
mortgage liens, unless by the consent of the mortgagee, extentls onl_ 
to the necessary expenditures incident to administering the assets ani: 
preserving the property from détérioration pending the winding u] 
of the business and the settlement of the receivership. This was held 
in Farmers' Loan & Trust Co. v. Grape Creek Coal Co. (C. C.) 50 Fed. 
481, 16 h. R. A, 603. We quote from the headnote: 



84 152 FEDERAL REPORTER. 

"In a suit to foreclose a mortgage on tlie propevty of a coal-mining company 
the court lias no power, as ajj'iiinst tlio objection of even a small minority of 
the liolders of tJie mortgage bouds, to authorize a receiver appointed in tlie 
suit to issue certificates wliich sball be a flrst lien on tbe mortgaged property, 
in ordei- to euable him to continue the opération of the mines." 

So in Fidelity Insurance, Trust & Safe Deposit Co. v. Roanoke 
Iron Co. (C. C.) 68 Fed. 623: 

"A court of equity has no power, without the consent of ail lien ered- 
itors, to authorize the receiver of an insolvent privato corporation, whose 
business is not affected with any public interest, to issue certificates which. 
vvil! be a paramount lion upon its property for the pnrpose of carrying on ita 
business, uiilcss it be neeessary to do so in order to préserve the existence of 
the property or franchises." 

The same doctrine was enunciated in the case of Hanna v. State 
Trust Co., 70 Fed. 2, 16 C. C. A. 586, 30 L. R. A. 201, wherein it 
was sought to issue receiver's certificates for the pnrpose of raising 
funds whereby to carry out certain contracts of sale of real property 
witli purchasers. And in Newton v. Eagle & Phœnix Manufacturing 
Co. (C. C.) 76 Fed. 418, it was determined that the court would not 
order receiver's certificates to issue for tlie ptirpose of raising money 
to pay interest on the bonds of the company, and thus di.splace existing 
hens. To the same pnrpose is Baltimore Building & Loan Association 
V. Alderson, 90 Fed. 142, 32 C. C. A. 542, wherein the court says: 

"In the case of private corporations the court cannot' avithorize the issue of 
receiver's certificates for the purpose of improving, adding to, or carrying 
on the business of the company, without flrst haviug the consent of cred- 
itors whose liens would be afCected thereby." 

The State courts are quite as uniform in their enunciation of and ad- 
hérence to the doctrine. In Merriam v. Victory Mining Co., 37 Or. 
321, 56 Pac. 75, 58 Pac. 37, 60 Pac. 997, which involved the opération 
of mining property, the same as in the case at bar, Mr. Justice Bean, 
after a review of the adjudications of the courts of the United States 
touching the authority of the receiver in railroad matters to issue cer- 
tificates in displacement of mortgage liens, says: 

"It will thus be seen that the right of a court nppointing a receiver to 
give priority of paymeut to unseciired debts over the lien of a mortgage is 
restricted to creditors of railroada which are public concerns, and Is only 
exercised as to them under spécial circumstances, and in favor of a particu- 
lar class of claims." 

See, also, Investment Corp. v. Hospital, 40 Or. 523, 64 Pac. 644, 
67 Pac. 194, 56 L. R. A. 627. 

In the case of Raht v. Attrill et al., 106 N. Y. 423, 13 N. E. 282, 
60 Am. Rep. 456, it is held, in efifect, that the court, in administering 
assets through the receiver, is not empowered to displace a mortgage 
lien by receiver's certificates, except for "expenses of realization, and 
also certain expenses, which are called expenses of préservation," which 
may be incurred under the order of the court on the crédit of the prop- 
erty. That was a case wherein it was sought to bave issued receiver's 
certificates by which to raise the neeessary funds for completing a 
hôtel then in course of construction. A latcr case is that of Interna- 
tional Trust Co. V. United Coal Co., 27 Colo. 246, 60 Pac. 621, 83 Am. 



INTERNATIONAL TRUST CO. V. DECKER BROS. 85 

St. Rep. o9. The court there, after having examinée! many aiithori- 
ties, some of which we hâve cited, says : 

"We are of opinion that, in administering tlie affairs of au ordiuary 
insolvent private business corporation for wtiicli a receiyer has Iseeu ap- 
pointed, a court of equity has not the power to autliorize tlie receiver to incur 
indeVttedness for carrying on the business, and to make the same a flrst and 
paramount lien upon the corpus of the property, superior to that of prior 
liennolders, without their consent. While it may, in a proper action, and 
with thp proper parties présent, tlirougli tlie instrumentality of a receiver, 
carry on the business of private corporations or individuals temporarily, 
and incur obligations tlierefor that inay be rnade a paramount lien on the 
corpus of the property, such obligations must hâve been contvacted for, and 
must relate strictly to, the préservation of the status of the property at the 
time of the apiiointment of the receiver." 

This is the clearest enunciation of the rule that we hâve foimd. In 
a very late and well-considered case from Idaho the same conclusion 
is reached. Dalliba v. Winschell, 82 Pac. 107, 11 Idaho, 364. 

So that, in the light of thèse authorities, tliere can remain no ques- 
tion as to the rule as it relates to private corporations. The court is 
without authority, except by the consent of the mortgage lienholders, 
to supplant their liens by receiver's certificates issued for any obliga- 
tions other than those arising by way of expenditures for realization 
and for preserving the property while the business is in course of 
administration under the receivership. It cannot, by its edict, make any 
debt or obligation a prior lien, unless appropriately entitled thereto 
under the law governing receiverships. 

Now, to the order of sale. From an inspection of the complaint of 
Decker Bros, it is extremely doubtful whether it states a cause en- 
titling the plaintiflfs to the appointment of a receiver. Under the rule 
above first noted the plaintiffs were required to show that the property 
of the mining companies constituted a spécial fund to which they had 
a right to resort for the satisfaction of their claims, and that the prop- 
erty itself, or the income arising therefrom, was in danger of loss 
from neglect, waste, misconduct, or insolvency of the défendant 
companies. Being simple contract creditors only, the property of 
the mining companies could not be regarded as a spécial fund for their 
peculiar protection, and they had a right to resort to it only as other 
creditors had the right ; that is, to reach it through the process of law, 
by way of attachment or exécution, or, in case of insolvency, through 
a creditors' bill. But there was no insolvency in the présent case at 
the time. At most, there was only danger of the companies becoming 
insolvent, and this because it was feared that a large number of suits 
would be instituted, whereby the assets would be wasted and exhausted. 
This, it must be conceded, was séant cause for the appointment ot a 
receiver. Further than this, it is apparent that the purpose of the ap- 
pointment was not that the assets of the mining company should be 
disposed of for the payment of indebtedness and liabilities, but that 
the properties might be operated as mines, and, presumably, that the 
claims should be discharged out of the earnings of such opération. 
Not only does the complaint indicate as much by very strong im- 
plication, but the subséquent management and conduct of the parties 
proves it. The first order obtained, whereby leave was granted for 



86 152 FEDERAL REPORTER. 

issuing receiver's certificates, extended no further than to enable the 
receiver to borrow money for the payment of labor claims without 
spécification as to any particular claim. But the second, fifth, and 
sixth orders clearly contemplated the development of the mines, as 
well as their opération. Clearly the court was without authority of 
law to permit the receiver to conduct the business of the défendant 
companies in this way, even if the complaint was sufficient to warrant 
his appointment in the first instance. Thèse orders were probably 
ail entered by the consent and sanction of the défendant conîpanies 
(although the record is not explicit as to that), which would estop 
them to deny their validity. But the thing of peculiar moment is that 
they were made and entered without the appearance or consent of the 
International Trust Company, although they purport to subordinate 
its mortgage lien to the lien of the receiver's certificates. This would 
be the conclusion from the record up to the time of filing the pétition 
of the défendants with a view to having the trust company brought in 
and made a party to the suit or proceeding. By this pétition, and 
by the answer and cross-complaint subsequently filed by the défendant 
companies, it is alleged that ail such orders were made and entered 
with the consent and approval of the holders of the bonds. Thèse 
allégations, however, are specifically denied by the trust company, thus 
bringing into the record an issue as to the real fact. By the further 
pétition of the trust company for leave to sue the receiver, and its 
cross-complaint, it appears that the présence of other parties is neces- 
sary to a complète détermination of the matters at issue; it being 
shown that such parties are claiming such an interest as beclouds the 
title to some of the properties. Now, without settling thèse matters, 
or determining priorities in an>' way, the court made and entered the 
order of sale complained of. The order is one resting in the sound dis- 
crétion of the court — a judicial discrétion, however, not arbitrary, but 
impartial, to be exercised in obédience to the rules of law. 

It is inévitable that ail thèse properties must be sold to satisfy the 
various demands existing against them, and it is most important that 
they bring the very highest price in the market. To our minds the 
questionable irregularity attending the appointment of the receiver, 
the clear want of authority in the court, first, to authorize the receiver 
to develop the properties or to operate them for any purposes except 
for those of realization for the payment of creditors; and, second, 
to subordinate, without the assent of the mortgage claimants, the lien 
of tlie mortgage to that of the receiver's certificates, and the alleged 
existence o± adverse claims undetermined — wiil stand largely in the 
way of realizing full value at the sale, and that such value cannot 
be obtained except under the foreclosure of the trust company's mort- 
gage, which may be required in the original suit, or may be had under 
the cross-bill of that company filed by leave first granted. 

We quite agrée with the trial judge (who, it should be said, was not 
on the bench when the suit was instituted or the orders authorizing the 
issuance of the receiver's certificates were made and entered) that 
"eight years is too long for a court to hold a mining property in its 
custody." The main trouble is, however, that it ever assumed custody 
in the first instance, and attempted to subordinate the mortgage lien 



ANDEKSON V. UNITED STATES. 87 

of the trust company, without its assent, to the supposée! lien of rc- 
ceiver's certificates issued wholly without warrant or authority of law. 
It is manifest that such patent irregularities must necessarily detract 
largely from the realization of a fuU or fair value of the properties 
under a sale had in pursuance thereof . 

The decree of the trial court will therefore be reversed, and the cause 
remanded for such other proceedings as may seem proper. 



ANDERSON et al. t. UNITED STATES. 

(Circuit Court o£ Appeals, Ninth Circuit. February, 1907.) 

No. 1,334. 

1. Public Lands — Timiîeb Déprédations — Actions — Evidence. 

"VVliere, lu au action to rucover for timber alleged to hâve becn wroiig- 
fully eut from the public domain, deieiulants claimed tlie rigiit to eut 
under the minéral land acts, évidence as to the steps a wituesK had talveu 
to procure certain minerai land outside the area of the lands on whicU 
the timber was eut and by whàt method he Intended. to work such land 
was immaterlal. 

2. Same— OooD Paitu— Evidence. 

Where It was claimed that défendants B. and A. had unlawfully eut 
timber sued for from the public domain and sold the same to G., évidence 
that about the time they made such contract they located a number of 
placer minlng claims, etc., at another point, and then, without doing 
any work on such claims except the necessary assessment work, pro 
ceeded to eut timber from such claims and from adjoining lands without 
référence to the boundaries thereof, was admissible oa the issue of their 
good faith. 

3. Same. 

Where certain of the défendants located unsurveyed government land 
by scrip, and immediately proceeded to eut timber therefrom and from ad- 
joining lands without référence to boundary Unes, and the timber eut 
from the adjoining lands exeeeded that eut on the land located, It would 
be presumed that the eutting from such adjoining landg was unlawful. 

4. Evidence— Self-Servixg Deolabations. 

Where a t'ontract for eutting timber provided that the logs should 
be eut from lands owned by défendants B. and A., and the United States 
claimed that the timber was, in fact, eut from the unsurveyed public do- 
main, évidence as to conversations between the coutracting parties at the 
time the contract was executed concerning the particular lands on which 
the timber was to be eut was inadmissible as self-serving. 

[Ed. Note. — For cases Ui point, see Cent. Dig. vol. 20, Evidence, §§ 1008- 
1075.] 

5. Public Lands— Eight io Oui Timbeb— Minbbal Lands— Evidence— Ex- 

rEBTS. 

Where, in an action by the United States for timber alleged to bave 
been wrongfully eut from the publie domain, défendants claimed the 
right to eut the timber under the minerai land acts, the government was 
entitled to show by an expert miner that, in his opinion, the grouud 
where the timber was eut was not worth locating for placer minlng pur- 
poses. 

6. Same— Damages. 

Where a corporation became the owner of a contract for the deliverj' 
of logs which were, in fact, unlawfully eut from the public domain, and 
the contract, though declaring that the buyer should hâve title to the 



88 152 FEDERAL EErORTER. 

logs wtien eut, also requircHl tlie sellprs to deliver tlie logs at a particiilar 
point, there was uo conversion of tlie logs by the corporation prior to 
such delivery so tliat the court in action to recover for logs wrougfully 
eut from the public domain properly refused to charge thnt the measure of 
damages was the value of tlie logs on tlie ground, provided the transac- 
tion, so far as the corporation was concerned, was an innocent one. 

7. Same~-Mtneral La nos— Instructions. 

AVliere, in an action to recover for logs wrougfully eut froni the public 
domain, défendants clainiod the riglit to eut uiider the minerai land acts, 
instructions tliat the niere a])pearaiice of minerai was not sufflcient to con- 
stitute tlie land minerai, but tliat there must be sufliciont minerai to in- 
duce niining uieii of expérience to go on the land and talce and worli it 
witli the cxpectation of fludiug minerai, etc., were not erroneous. 

8. Same— TjTabti.tty of Pubcitasek. 

Where défendant corporation purehased tiinber whicli had been wroiig- 
fully eut from the jmblic domain, tlie corporation ac(]uired no better title 
than the sellers, and could not défend au action by the United States to 
recover the value of the logs on the ground that it was actiug in good 
faith. 

In Error to the Circuit Court of the United States for the Central 
Division of the District of Idaho. 

ïhe défendant in error brouglit an action against the plaintitîs in error 
chargiiig the nnlawful cntting and removal of 2,218,974 feet of timber from 
tlie imblic laiuls of the TJiiited States, and convertiug tlie same into saw logs, 
wliich were of the value of .|8 per thousand feet. and of the total value of 
817,751.79. The case was tried before a jury, and a verdict was returncd in 
favor of the défendant in error in the sum of .SU,t02.18. In the complaint it 
was alleged that Andersen, Baker, and Sandlin as copartners unlawfully and 
willfully entered upon certain tracts and pareels of vacant, puliiic, unsurveyed 
lands of the United States lying on and along both banks of the South Boise 
river, ia what will be, when surveyed, township 3 N., ranges 10 and 11 E., 
Boise meridian; that the timber so eut was by said copartners converted into 
saw logs and by them conveyed to a pond near Boise Olty, Idalio, where they 
unlawfully and willfnlly sold and delivered the saine to the Page-Mott Lum- 
ber Company, Limited, a corporation ; that said corporation then and there 
unlawfully and wrongfullj' received said logs into its possession and con- 
verted the same to its own use, to the damage of the défendant in error lu 
the sum of $17,7.51.79. The auswer of the plaintifCs in error admitted that the 
United States was the owner of the lands from wliich tlie timber was eut, 
but denied tliat the cutting was nnlawful, and justified the cutting and re- 
moval of the timber under the act of Congress approved ,Tune 3, 1878, entitled 
"An act entitling the citizens of Colorado, Nevada, and tlie Territories to fell 
and remove timber on the public domain for mining and domestic purposes" 
(Act June 3, 1878, 20 Stat. 88, c. LTO [U. S. Comp. St. 1901, p. 1528]), and alleged 
that the said lands upon which such timber was eut were public minerai lauds 
of the United States not subject to eiiti-j- except for minerai entry ; that said 
timber was eut by the said Baker, Andersoii, and Sandlin at the instance and 
request of the Page-Mott Lumber Company, Limited, for the purpose of niaiiu- 
facturing the same into lumber by said corporation, the lumber to be used for 
gênerai agrieultural, domestic, miniiig, and building uses In tlie vicinity of 
Boise City, Idaho, and that noue tliereof bas been exported or was intended 
for export from the stato of Idalio; that the plaintiffs in error observed ail 
rules and régulations then and there in force and iironmlgated by the Secre- 
tary of the Iiiteiùor for the protection of timber and undergrowth gi'owiiig 
upon said lands, and that the stumpage value of said timber did not exceed 
the sum of 30 cents per 1,000 feet, board measure. On the trial the contract 
lietween Baker, Ajiderson, and Sandlin, as parties of the first part, and N. II. 
(îoodwin, who was the predecessor iu interest of the Page-Mott Lumber Com- 
pany, Limited, as party of the second part, was admitted in évidence. That 
contract provided that Baker, Anderson, and Sandlin should eut from 2,500,000 
to 3,500,000 feet of merchantable timber (saw legs), and deliver the same to 



ANDERSON V. TJNITED STATES. 89 

the saîd Goodwin at Boise City, Idaho, in the summer of 1904, "the logs to be 
eut on lands owned by said lirst parties in tlie vicinity of the Soutli Boise 
river, Elmore county, state of Idalio." It furtlier provided that tlie title 
of tiie logs sliould be in tlie party of the second part as soon as eut, but 
payment should be made only for the amount of timber delivered at the 
pond. (The pond hère referred to was at Boise). The contraet provided for 
the payment of $9 per 1,000 feet for the logs. It was shown in the évidence 
that the I*age-Mott Luinber Company became the assignée of Goodwin in 
the contraet. It vv'as also shown that before the commencement of the prés- 
ent action, and while the logs were still npon the bank of the river near where 
they were eut, an injunetion suit was commeneed by the TJnited States against 
Baker, Anderson, and Sandlin to prevent the removal of the logs from the 
place where they were banked ; that prior to the commencement of that suit 
a spécial agent of the General I^and Office had taken possession of sald logs 
and placed the brand of the United States thereon, and had left a person Itt 
charge thereof ; and that after the issuance of a restraining order, an addi- 
tional order was entered by the court permitting the défendants in that suit 
to remove said logs and convey the same to Boise City, upon giving a bond 
for their value as fixed by the court, which was done. 

S. H. Hays and Fremont Wood, for plaintiffs in error. 
N. M. Ruick, U. S. Dist. Atty. 

Before GILBERT, ROSS, and MORROW, Circuit Judges. 

GILBERT, Circuit Judge, after stating the facts, delivered tlie opin- 
ion of the court. 

On the trial the plaintiffs in error introduced évidence for the purpose 
of showing that the land from which the timber was eut was minerai 
land. The record contains numerous assignments of error rclating to 
the admission and exclusion of évidence upon that branch of the case. 
It is not necessary to consider them ail in détail. It is assigned as error 
that, after a certain witness had test'fied that he owned mining claims 
on Feather river, he was not permitted to tell the jury by what method 
he proposed to work them, and that, when he had testified about a cer- 
tain minerai Iode on Marsh Creek, objection was sustained to the ques- 
tion : "Did you take any steps or were you taking any steps toward pro- 
curing it?" Both thèse questions related to mining claims entirely 
outside the area of the lands on which the timber was eut, and, in any 
view of it, the évidence so excluded was wholly immaterial. The same 
is true of the exclusion of évidence concerning the extent of the work- 
ing of the Bonaparte mine. That mine was several miles distant from 
the lands on which the timber was eut. 

A séries of assignments of error relate to the admission of évidence 
as to the cutting of timber by Baker and Anderson prior to the time 
of the contraet which is involved in the présent action. It was shown 
that about the time of making the contraet with Goodwin, Baker and 
Anderson located a number of placer mining claims on the South Fork 
of Boise River, both above and below Junction bar, and elsewhere 
within the area of lands on which the timber in question in the présent 
action was eut, and that the timber was removed from thèse placer 
claims and the land immediately adjoining the same. It was the theory 
of the government that the placer mining locations were not made by 
Baker and Anderson in good faith but as a blind to cover their contem- 
plated timber cutting. As tending to sustain that theory, the court 
permitted tlie défendant in error to show tlie former timber opérations 



90 152 FEDERAL UBPORTEK. 

of Baker and Anderson at Long Gulch on and in the vicinity of land 
on which they had located lieu land scrip, and to show that tliey had eut 
a considérable tract of unsurveyed government timber land iminediately 
adjoining the land so located by them. This testimony, the court 
was careful to say, was admitted only for its bearing upon the question 
of the good faith of Baker and Anderson, and we think that for that 
purpose it was admissible. In this connection it is assigned as error 
that the, court refused to instruct the jury, as requested by the plain- 
tifts in error, that the cutting of timber upon vacant public lands on 
Long Gulch by Baker and Anderson should not be considered by the 
jury, unless it was foUowed by other évidence showing that such cutting 
was unlawful, and that having refused that instruction, the court pro- 
ceeded to charge the jury as to the évidence so admitted as foUows: 

"That évidence was introduced for the purpose of showing that they had 
located scrip upon certain lands, and then, regardless of the Unes of that 
Kcrip location, they eut timber upon lands outside of Its boundaries, using 
the location as a blind for the purpose of givlng them a liceuse to eut where 
they pleased. One of the witnesses, Mr. Baker, said he did not knovv where 
the Unes wrre. That makes no différence. He was bound by it just the same. 
It was hls duty to know where the Unes were, and he had no right to eut until 
he did know, and if he eut beyond those Unes he is just as guilty without 
knowledge as if he had known. Now, If he eut in bad faith in that instance, 
you may Infor that he eut in bad faith in this. That is the only reason that 
that évidence was introduced." 

Plaintiffs in error contend that there are several laws under which 
timber may be eut from unsurveyed public lands, that under a railway 
right of way, for instance, timber may be eut for right of way pur- 
poses, and also under the law of June 3, 1878, timber may be eut from 
minerai lands for gênerai local and domestic purposes, etc., and argue 
that while if the plaintiffs in error were defending an action for cutting 
timber from the land in Long Gulch they would be called upon to show 
tlieir right so to do, the rule does not apply hère, because, first, the 
cutting and removal of timber in Long Gulch could hâve no bearing 
upon the issues involved in the présent case, and, second, if admissible 
for any purpose it must be shown that the timber was unlawfuUy eut. 
But the plaintiffs in error made no attempt to justify their action under 
any law, and it having been shown that they eut timber, as much timber, 
if not more, from adjoining unsurveyed government land as upon the 
land so located by scrip, the presumption at once attached that the cut- 
ting upon the former was unlawful. It was for them to show that it was 
not. They were in the possession of the facts. 

It is contended that the court erred in excluding testimony offered by 
the plaintiffs in error as to conversations between Baker, Anderson, and 
Sandlin and Goodwin, at the time of the exécution of the contract, con- 
cerning the particular lands upon which the timber was to be eut. The 
contract itself provided that the logs were to be eut on the lands owned 
by Baker and Anderson. There was no error in excluding the con- 
versations between the parties, since at most they were self-serving, 
and nothing that was said could excuse a trespass thereafter committed 
by Baker, Anderson, and Sandlin in cutting timber on public lands. 
The questions for the jury to détermine were whether the logs were?. 



ANDEESON V. DNITED STATES. 91 

eut on the public lands of the United States, and, if so, whether there 
was authority from the United States so to do. 

It is assigned as error that the court permitted a witness, an expert 
miner of long expérience, to express the opinion that the ground where 
the timber was eut was not worth locating for placer mining purposes. 
We find no error in admitting such testimony. One of the issues of 
the case was whether the land on which the timber was eut was minerai 
land. The évidence was that Baker and Anderson located between 
1,100 and 1,200 acres of land as placer mining claims, in the names of 
their friends and members of their familles, that the land was covered 
with valuable timber, and that no work was done on thèse placer claims 
except the assessment work necessary to hold them. The court in 
reviewing the testimony alluded to the fact that there was not a pay- 
ing mine, either placer or quartz, in the whole section of country in 
the région in which the timber was eut, that the ledge mines had been 
located and abandoned and thereafter relocated and abandoned again, 
and that in the last 15 or 20 years there had not been $1,000 worth 
of ore taken out or shipped from that country, and said : 

"There is virtually nobody at work there now. Tliere Is not a paying mine, 
either placer or quartz, in that section of country." 

Error is assigned to the refusai of the court to instruct the jury that 
if they found that the property was converted by the Page-Mott Lum- 
ber Company, Limited, at the time when it took title, to wit, as soon as 
it was converted into saw logs, then the measure of damages is the val- 
ue of the logs on the ground, provided that the transaction, so far as the 
corporation was concerned, was an innocent one. This requested in- 
struction was not applicable to the facts. There was no proof that the 
corporation had converted the logs prier to their delivery. By the con- 
tract, the logs were to be delivered at the company's pond at Boise City. 
It was there that they were delivered, and it was there that thev were 
converted by the corporation. The provision in the contract that the 
title to the logs "should be in the second party as soon as eut" did not 
amount to a conversion. There could be no conversion until there was 
an appropriation to thecorporat'on's own use. Nor does the décision in 
Wooden-Ware Co. v. United States, 106 U. S. 432, 1 Sup. Ct. 398, 27 
L. Ed. 230, sustain a différent conclusion. In that case the sale and 
delivery were coincident. The court held that the right to recover 
against the vendee was just what it was against his vendor "the mo- 
ment before he interfered and acquired possession." 

But the contention principally relied upon is that the court erred in 
its instructions to the jury on the gênerai question of what constitutes 
minerai land within the meaning of the act of June 3, 1878. This court 
fuUy considered that question in United States v. Basic Co., 121 Fed. 
507, 57 C. C. A. 624, and United States v. Rossi, 133 Fed. 380, 66 C. C. 
A. 442. But the plaintiff in error contends that the instructions given 
by the court in the présent case were not in harmony with those déci- 
sions. On a careful considération of the charge, we are convinced that 
the contention cannot be sustained. In those cases we held, it is true, 
that in determining the right to remove timber from minerai lands it 
is not necessary to establish the présence of minerai in paying quantities 



92 152 FEDERAL EEPORTEB. 

în the particular îand from which timber was eut, but that tlie présence 
of adjacent Iand valuable for minerai may be shown for the purpose of 
determining the minerai or nonmineral character of the lanrl from 
which the timber was eut. But the plaintiffs in error complain that the 
court below in the présent case instructed the jury that before they 
could reasonably find Iand to be minerai country it must be proven to 
contain minerais in fact, and that timber could be eut only from lands 
in mining districts or in a country that was substantially a mining dis- 
trict, which meant that the mining intcrest must be an important inter- 
est. When the whole of the charge is considered, it will be seen that 
the court did not so instruct. The court said that the mère appearance 
of minerai, the mère appearance of colors hère and there, as in a placer 
claim, is not sufficient to constitute Iand minerai ; that there must be at 
least sufficient minerai to induce mining men of expérience to go upon 
the ground and take and work it with the expectation of finding miner- 
ai. It should be borne in mind that the instruction was given with réf- 
érence to a country that had, during a long séries of years, been thor- 
oughly explored and prospected. It was not a case of newly discovered 
minerai country. We do not see that the instructions were inappro- 
priate to the facts. 

It is urged that the court charged the jury in substance that the lo- 
cator of a mining claim must, in order to show the good faith of his lo- 
cation, do more than the assessment work on his claim. But that is not 
what was said or implied in the instruction. The court did not an- 
nounce as a rule that the failure to do more than the assessment work 
was to be taken as évidence of bad faith on the part of the locator, but 
that the jury, in view of ail the facts disclosed in the présent case, might 
take that fact into considération in determining whether the locations 
were made in good faith or merely as a blind to cover timber dépréda- 
tions. 

It is contended that the court erred in instructing the jury in sub- 
stance that the Page-Mott Lumber Company cannot protect itself by 
the défense that it was acting in good faith. But the instruction given 
was clearly within the authority of the Wooden-Ware Case, in which 
the court said : 

"It is also plain that by purchase from the wrongdoer, défendant did not 
acquire any better title to the property than his said vcndor had. It Is not 
a case where an innocent purchaser can défend liimself under that plea. If 
It were, ho would be liable to no damages at ail, and no recovery could be 
had. On the contrary, it is a case to which the doctrine of caveat emptor ap- 
plies, and hence the right of recovery in plalntifC." 

We find no error for which the judgment should be reversed. It is 
accordingly affirmed. 



HEADKICK V. LAESO». $3 



HBADEICK et al. t. LARSON et al 

(Clreuît Court of Appeals, Ninth Circuit. February 11, 1907.) 

No. 1,249. 

1. Appeai.— ScoPE or Review — Stipulations. 

Certain proceedings relating to the condemnation of a mining tunnel 
were not Consolidated in tbe trial court, but, on appeal from an order 
sustainiug a demurrer to the bill in one of tbe cases, a stipulation was 
entered into for the consolidation of ail of tbe proceedings and for the 
submission to tbe Court of Appeals of tbe questions involved therein. 
Tbis stipulation was not signed by tbe counsel vvho appearedfor appel- 
lees on the appeal, and they objected to the court's jurisdiction to review 
any question not directly involved in the appeal. HeU, that sueh ob- 
jection was rightfully made, and that the court's jurisdiction was con- 
flned to a review of errors committed in the case brought up by the ap- 
peal. 

2. EQUITT— MULTIPLICITT OF SUITS— JUBISDIOTION. 

Compiainants cannot maintain a separate suit In equity for the sole pur- 
pose of preventing a multiplicity of their own suits, which are still 
pending. 

3. Bminent Domain— Tunnel Rights— Mines— Title and Rights Acquieed. 

Rev. St. Idaho 1887, § 5212, provides that property approprlated to 
public use shall not be taken unless for a more necessary publie use 
tban that to wbich It bas already been approprlated. Beld, that where 
défendants acquired a right to drive a tunnel through compiainants' 
mining claims, which divided compiainants' veins, compiainants did not 
thereby acquire the right to use such tunnel to work their veins, on the 
theory that défendants' condemnation had been made for a public use; 
tbere being neitber allégation nor proof of necesslty for such common 
use, nor that compiainants could not proceed to condemn a right of 
■way for a tunnel to be used for their own purposea. 

[Ed. Note. — Nature of estate or Interest acquired in condemnation 
proceedings, see note to Newton v. Manufacturera' Ey. Co., 53 C. O. A. 
604.] 

Appeal from the Circuit Court of the United States for the Northern 
Division of the District of Idaho. 

The appellants, as compiainants, filed a blll in equity against the appellees 
alleging that tbe appellants were tbe owners of the Hawk Eye Iode miniug 
daim, the Black Havrk Iode mining claim, the Black Hawk Fraction Iode 
mining claim and the Alvy Iode mining claim, by patents from the United 
States. That in each of said claims there is the apex of a vein of mineral- 
bearing rock in place which extends on its downward course to a deptb of 
more than 1,700 feet That by reason of the conformation of the surface of 
tbe mountain whereon said claims are situated and the existence of the pat- 
ented mining claims of the appellees and otber valid mining claims on either 
side, every approach to tbe property of the appellants is eut off, so that it is 
Impossible through the means of any tunnel which they might désire to run, to 
reasonably and economically reach the ores in their said claims. That the 
appellees hâve construeted a tunnel which is so run as to penetrate the Black 
Hawk mining claim and pass through the same to other claims owned by 
the appellants. That said tunnel has encountered and passed through, at a 
depth below the surface of about 1,700 feet, a ledge of mineral-bearing rock in 
place, the apex of which lies within the Blaek Hawk claim. That it is prac- 
ticable now to enter upon the work of developlng said ledge at the point 
where the same is intersected by the tunnel, through and by means of said 
tunnel, without interfering in an unreasonable degree or manner with the work 
of tlie appellei^s in said tunnel, or with their use thereof. That, after passing- 
through the Black Hawk claim, the tunnel entered the Alvy claim at a depti» 



94 152 FEDERAL EErORTBE. 

of 1,750 feet below the surface, aud there encountered a ledge, which apexes 
within said Alvy claim, which is about 15 feet wide and contains sllver, lead, 
iron, and other valuable substances. ïhat it Is practlcable to enter upon the 
work of developiug the ledge at such point of intersection by means of said 
tunnel without interfering in an unreasonable degree with the work of the 
appellees. That said Blaclc Hawl? and Alv,\ claims bave, and will bave, great 
value because of their production of ores and metals, tliereby contrlbuting to 
the development of the minerai resources of the United States and of tbe state 
of Idaho, and that such work will constitute a public benefit and public use. 
That the appellees are constructing said tunnel on the ground that it will 
enable them to develop and operate their claims and will be a public use 
for and on behalf of which they may exercise the right of eminent domain. 
That in pursuance tbereof they "are now proceeding in this court in the suit 
No. 346 of Peter Larson and Thomas L. Greenough v. A. A. Headrick and 
Charles M. Baillie to condemn a right of way through the Black Hawk and 
Alvy mining claims," elaiming in their complaint that such use is a public 
use for whieh they may condemn such right of way. That the court bas 
made an order declaring the taking to be for public use, and has appointed 
commissioners to assess damages resulting therefrom. Thit thereafter, on 
May 13, 1905, the appellants eommenced in the same court a suit against the 
appellees to enjoin the construction of said tunnel through the appellants' 
ground; that thereafter the court denied their application for a tempo^ary in- 
junction and sustained the right of the appellees to construct and use said 
tunnel under their condemnation proceedlngs. That said court having over- 
ruled the appellants' demurrer to the complaint in the condemnation suit, and 
having refused to grant the appellants protection against the trespass of the 
appellees, the appellants bring the présent suit for the purpose of obtaining, 
through a decree of the court, the right to proceed In the use of the tunnel 
for the purpose of developing and mining t'^eir ledges intersected by the 
same, provided such taking by the appellees is lawful. That the tunnel is 
of : ifKcient size to render its use by the appellants in conjunetion with the 
appellees entirely practlcable, and that such use is a reasonable use, and would 
constitute the participation in a public use which would develop the minerai 
resource of the United States and of Idaho. That said ledges are of great 
width and value and cannot be successfuUy, completely, or profltably worked, 
prospected, or developed at the depth of said tunnel by any other means than 
by said tunnel, and that there exists a necessity for the appropriation by the 
appellants of the joint use of said tunnel. That they bave made application 
for a reasonable joint use of said tunnel, but their application has been re- 
jected by the appellees. That, before filing their bill, the appellants tendered 
to the appellees the sum of $500 as compensation for any damages resulting 
from the granting of such right of common use. 

The bill then prays for the consolidation of the action and the suits involving 
the right to use said tunnel and the right to condemn a right of way for its 
construction, allèges that the appellants are elther entitled to a joint user of 
ssaid tunnel or to a decree adjudging that said tunnel is uot for a public i\se, and 
l^rays that the api,ellees be enjoined from appropriating their property there- 
for, and ofCers on behalf of the appellants to do and abide by such terms and 
conditions in regard to sharing in the said public use of the tunnel for the 
purpose of mining and operatlng their mining claims as may seem équitable 
and just in the way of compensation, restrictions, and régulations to be flxed 
and determlned by the court. 

The appellees interposed a demurrer to the bill on the grounds: First, 
for want of equity ; second, for want of jurlsdictlon ; and third, that there ie 
another action pending in the same court, between the same parties for the 
same cause. The court sustained the demurrer, and, the appellants electing 
to stand upon their bill, a decree was entered dismissing the same. After the 
appeal was taken, the parties thereto on October 24, 1905, filed in this court 
a stipulation reciting. In substance, that there were pending in the court be- 
low, in addition to the présent case, three other actions between the same 
parties, namely, cause No. 343, an action of ejectment brought by the appel- 
lants herein against the appellees ; cause No. 344, the suit for an injunction 



HEADEICK V. LAESON. 95 

referred to In the bill !n the présent case; and cause No. 346, tlie condemna- 
tioii suit brought by the appellees against the appellants, which is referred to 
m the bill. That said suits involve, in substance, the issues which are pre- 
sented in the bill in the présent suit, and that the appellants submit to this 
court the pleadings in the said several suits, together with the plendin,<;s in 
this suit, to the end that this court may detennine the propriety of cousolidat- 
ing said actions for the purpose of determining the several issues coiumon 
thereto, and thus avoid a multiplicity of suits. The stipulation recites that: 
Whereas, in the bill In the présent case it is stated that the court below he!d 
in said case No. 340 that the ajipellees might be given the exclusive use of 
the tunnel and the right of way therein, which was sought to be comlemned for 
publie use, and thus disregarded the rights of the appellants undcr the fifth 
and fourteenth amendments to the Constitution of the United States; and 
that, whereas, said suit 34G Involves the right of the appellees to condenin 
for their exclusive use a right of way throiïgh the appellants' mining claims, 
and said suit has been continued in the court below to await the décision of 
this court as to the right of the said appellees to thus exercise the right of 
public domain ; that, whereas, the pleadings and issues upon the présent appeal 
présent the question of the right of the appellees to condemn said right of 
way, notwithstanding said question is pending in said suit No. 346: "Now, 
therefore, it is hereb.y stipuiated and agreed by and between the respective 
parties, acting through their respective couusel, that the United States Cir- 
cuit Court of Appeals for the Niuth Circuit, having jurisdiction of this cause 
on appeal in the case No. 1,240, may tabe under considération and détermine 
upon the appeal in this cause the right of the appellees in this cause, who are 
the plaintiffs in said suit No. 3-10, * • * to condcmn a right of way for 
their said tunnel No. 6 through the said Black Hawk and Alvy mining 
claims, as the right so to do is elaimed in their complaint in said suit No. 340, 
so pending as aforesaid, notwithstanding any objection that may be raised 
or urged against the considération and détermination of said action by rea- 
son of the pending of the said cause No. 34G. or by reason of the demurrer to 
the bill on the ground of a prier action pending." 

ïhe stipulation further provided th-at the records in said cause so referred 
to be filed as an additional transeript on the appeal, and that the stipulation 
was made in considération of the postponenient of the trial of said cause No. 
340, which postponenient was requested by the appellees. "The object and 
purpose of this stipulation is that, notwithstanding the record or any objec- 
tions that may be urged upon said record to the considération and détermina- 
tion by this court of the question of the right of the appellees to condemn their 
right of way as by them elaimed in their complaint in said cause No. 340, 
such question may be determined and adjudicated as a part of and in connec- 
tion with the détermination of the appeal in this case In this court." 

See, 138 Fed. 177. 

W. B. Heyburn and W. H. Batting, for appellants. 
John P. Gray, F. T. Post, Walter A. Jones, and George Turner, 
for appellees. 

Before GILBERT, ROSS, and MORROW, Circuit Judges. 

GILBERT, Circuit Judge, after stating the case as above, delivered 
the opinion of the court. 

The bill is so framed as to présent two questions: First, whether 
the appellees could lawfully condemn the right of way for a tunnel ; 
and, second, whether, sustaining such right, the appellants can be de- 
creed to hâve the use of the tunnel in common with the appellees. 
The bill shows that the first of the questions had been decided in the 
affirmative by the court below in two causes pend'ng therein, one the 
action to condemn the right of way, and the other a suit in equity 
brought by the appellants to enjoin the appellees from extending the 



96 152 FEDERAL KEPORTBR. 

tunnel througli their mining property. One of tlie grounds of the de- 
murrer to the bill in the présent case was the pendency of thèse prior 
causes and the décisions therein rendered. The judgment on the de- 
murrer spécifies no particular ground on which it was sustained in the 
court below. It may be assumed that it was sustained on the ground 
just indicated, as well as for want of equity. The stipulation for the 
consolidation of ail thèse proceedings and for the submission to this 
court of the questions invoived therein is filed in this court. There 
was no stipulation in the court bclow, nor were the causes there con- 
solidated. The jurisdiction of this court is confined to the review of 
error committed in the court below in the cause which is brought be- 
fore us upon appeal. It does not extend to errors committed in other 
causes. The counsel who appcar for the appellees in this court were 
not the counsel who signed the stipulation, and they now object to the 
jurisdiction of this court to review any question which is not directly 
invoived in this appeal. This they hâve the right to do. It is not 
alleged in the bill, nor is it contended, that the appellants cannot ob- 
tain as full, complète, and adéquate relief as to the appellees' assertion 
of right to condemn the right of way for a tunnel in the prior causes 
so pending as they could in this. It is sought to maintain the présent 
suit, so far as it concerns the matters invoived in the prior suits, on 
the équitable ground of the prévention of a multiplicity of suits; but 
it is obvious that the appellants cannot maintain a separate suit for the 
sole purpose of preveuting a multiplicity of their own suits, suits which 
they hâve brought and which are still pending. The parties cannot by 
their stipulation inject into the présent appeal matters not determined in 
the cause in which the decree which is appealed from was rendered, or 
give to this court jurisdiction to consider the same. Hoe v. Wilson, 
9 Wall. 501, 19 L. Ed. 762 ; Washington County v. Durant, 131 U. S. 
Append. Ixxx; Montgomery et al. v. Anderson et al., 31 How. 386, 
16 L. Ed. 160; Mills v. Brown, 16 Pet. 525, 10 L. Ed. 1055; South 
Carolina v. Wesley, 155 U. S. 542, 15 Sup. Ct. 230, 39 L. Ed. 254. 

The bill allèges that the tunnel has been constructed from the place 
of its outlet to and through the mining claims of the appellants. As- 
suming, as we must on this appeal, but not deciding, that the appellees 
were authorized to condemn the right of way for that tunnel, the 
single question prcsented for our décision is whether or not the ap- 
pellants can be decreed to bave a use thereof in common with the ap- 
pellees. The appellants contend that the right to such common use 
is implied in the very fact that the right of vi'ay for the tunnel has 
been condemned by judicial proceedings in the exercise of eminent 
domain, and that such right of way can bave been condemned only for 
a public use. They cite Clark v. Nash, 198 U. S. 361, 25 Sup. Ct. 676, 
49 E. Ed. 1085, as authority for that contention. That was a case in 
which it was sought to condemn a right of way, so-called, by en- 
larging a ditch which had been made to convey water across the land 
of the défendant under a statute of the state of Utah, permitting con- 
demnation by an individual for the purpose of obtaining water for his 
land or for mining purposes. The court sustained the right, in view of 
spécial conditions obtaining in the state of Utah as to agricultural and 
mining industries, and held that a statute of that state permitting an 



HEADEICK V. LAESON. 97 

individual to enlarge the ditch of another, and thereby obtain water for 
his own land, is within the législative power of the state, and does not 
violate any provision of the fédéral Constitution. Said the court: 

"We siniply say that in this particular case, and upon the facts stated In 
the findiiigs of the court, and having référence to the conditions already stated, 
we are of opinion that the use is a public one, although the taliing of the right 
of way is for the purposc simply of thereby obtainiug the water l'or an in- 
dividual where it is absolutely neeessary to enabie him to malce any use 
whatever of his land, and which will be valuable and fertile only if water can 
be obtained. Other landowners adjoining the défendant in error, if any there 
are, might sbare in the use of the water by themselves taking the same pro- 
ceedings to obtain It." 

In Strickley v. Highland Boy Min. Co., 200 U. S. 527, 26 Sup. Ct. 
301, 50 L. Ed. 581, the court said of the décision in Clark v. Nash: 

"In discussing what constitutes a public use, it recognized the inadequacy 
of use by the gênerai public as a universal test." 

If the appellants were hère seeking to condemn a right of way to 
widen the tunnel of the appellees, and showing a necessity therefor for 
the purpose of laying their own tracks in the widened portion thereof 
for working their mines and extracting ores from their subterranean 
ledges, tlie doctrine of Clark v. Nash would be pertinent; but the 
purpose of the bill is to obtain the right to use a tunnel which has been 
made by the appellees at their own expense for their own purposes, with 
track and facilities, it may be assumed, no more than sufficient for their 
own use. We find no statutory authority, no précèdent, and no rec- 
ognized principle of law or of equity upon which to base such a right. 
In section 2ô7a, of Lewis on Eminent Domain, it is said: 

"It would seem clear that, under the gênerai rule already stated, nothing 
but an express authority or absolute necessity created by the Législature itself 
could justify one railroad company in taking the tracks of another Company, 
or even the joint use of such tracks." 

There is no législative provision in Idaho which authorizes the 
granting to one of the right to use a tunnel acquired by another under 
condemnation proceedings. Section 5213 of the Revised Statutes of 
1887 of that state provides that property appropriated to public use 
"shall not be taken unless for a more neeessary public use than that to 
which it has already been appropriated." 

But the présent suit is not a suit to condemn a right of way over 
the tunnel. It is a suit in equity to compel the joint use of a right 
of way already condemned by another, and to obtain the right to par- 
ticipate in the benefits thereof, on the theory that the condemnation 
has been made for a public use, and that the appellants are members 
of the public for whom such condemnation has been adjudged. There 
is no allégation showing the necessity for such common use, and noth- 
ing to show that the appellants cannot proceed and condemn a right 
of way for a tunnel, as was done by the appellees. 

The decree of the Circuit Court is affirmed. 
152 F.— 7 



98 152 FEDERAL EErOHTER. 

FEUGIISON V. BLOOD. 
(Circoiit Court of Appeals, Nintla Circuit. Marcli 11, 1907.) 

1. Vbndob and Puechaser—Contracts—Execdtiok— Evidence. 

Défendant, having agreed to purcliase an interest in certain mining 
claims, at a mcethig of ail tlie iiarties statcd to plaintiiî tliat lie wouid 
sign tlie contract on its reccipt froni liis agent, L. Défendant proceeded 
under the contract as though it iiad been signed by ail tlie parties, made 
payments vmder it, weut into possession of the property, ijarticipated in 
its developnient as though the contract had been executed, and on the trial 
refused to produce the original on notice. Ilcld to warrant an inferencc, 
in the absence of évidence to the eontrary, that défendant in fact signed 
the contract. 

2. Fkauds, Statute oe— Rigitt to Uege— Estoppel. 

Where défendant led plaintiff to believe that he had signed a written 
contract for an interest in certain mining claims, and induced plaintiff to 
purchase claims on which he had options, and to otherwise expend money 
and time to earry out the provisions of the agreement, défendant could 
not assert that the contract was void under the Idaho statute of frauds 
because he did not in fact sign the same, under Rev. St Idaho 1887, 
§ 3225, declaring that, where a contract which is required by law to 
be in writing is prevented from being put in writing by the fraud of a 
party thereto, any other party who is by such fraud led to believe that it 
Is in writing, and acts on such belief to his préjudice, may enforce it 
against the fraudulent party. 

3. Same— Part Performance. 

Where a contract for the purchase of an interest in certain mining 
claims was wholly performed by the vendor, and almost eompletely per- 
formed by the purchaser, prior to the latter's répudiation thereof, such 
performance was effective to take It out of the statute of frauds. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 23, Frauds, Statute 
of, §§ 293, 294.] 

4. Vendor and Purchaser— Vendor's Lien— Foreclosuee— Deficienct Judg- 

MENT. 

Wliere a seller of an interest in certain mining claims retained title to 
the buyer's interest to secure payment of the price, the vendor was en- 
titled to foreclose the lien so retained on the purdiaser's default, as pro- 
vided by Rev. St. Idaho 1887, §§ 3440, 4520, and 4521, and to recover a 
a deficiency judgment against the purchaser on the failure of his inter- 
est to sell for euough to satisfy the debt. 

[pjd. Note. — For cases in point, see Cent. Dig. vol. 48, Vendor and Pur- 
chaser, §§ 822, 823.1 

Appeal from the Circuit Court of tlie United States for the Central 
Division of the District of Idaho. 

Hawley, Puclcett & Hawley, for appellant. 
Richards & Haga, for appellee. 

Before GILBERT, ROSS, and MORROW, Circuit Judges. 

ROSS, Circuit Judge. The appellee was plaintiff in the court below, 
the suit being brought by him against the appellant and one S. C. Fui- 
ton, based upon an alleged written contract entered into between the 
appellant, Ferguson, as party of the fîrst part, and Blood and Fulton, as 
parties of the second part, concerning certain placer ground in Boise 
county, Idaho. The plaintiff below in his complaint set out a descrip- 



FEEGUSON V. BLOOD. 99 

tion of the property alleged to be included and intended to be included 
in the contract, and charged that one-half of the amount to be paid by 
the appellant, Ferguson, under its terms, was to belong to Blood, and 
the other one-half thereof to Fulton ; that pursuant to the terms of the 
contract the appellant, Ferguson, paid to^ Blood and Fulton $19,500 
each, but defaulted in the payment of the last $11,000 due, and refused 
to pay the same, or any part thereof, after deniand made for such pay- 
ment ; that Blood and Fulton "fully kept and performed ail and every 
of the terms of said agreement by them and each of them to be kept 
and performed"; that Fulton refused to join as plaintiff in the suit, 
for which reason he was made a défendant thereto ; and that there re- 
mains due and owing the plaintifif, Blood, from Ferguson, under the 
terms of the contract, the sum of $5,500, with interest thereon from the 
15th day of August, 1902 — the plaintifï's prayer being for judgment 
against Ferguson for that sum, with interest, and that a decree be made 
for the sale of ail of his interest in and to the described premises, the 
proceeds of which sale to be applied in the payment of the amount due 
the plaintiff and the costs and expenses of the suit, and that the défend- 
ant, Ferguson, and ail persons claiming under him, be barred and fore- 
closed of ail rights and equities in the premises, and for gênerai relief. 
The alleged written contract was annexed to the complaint and made 
a part thereof. It bears date July 26, 1901, and purports to hâve been 
made by and between Ferguson as party of the first part, and Blood 
and Fulton as parties of the second part, by which the parties of the sec- 
ond part agreed to convey and deliver to the party of the first part an 
undivided one-half interest in certain described mining ground situated 
in Boise county, Idaho, "to ail of which properties the said parties of 
the second part hereby agrée to secure undisputed titles before any con- 
sidération shall be given by the party of the first part," and by which 
the parties of the second part further agrée to convey to the party of 
the first part an undivided one-half interest in ail the personal property 
on the premises described, consisting of cabins, ditches, water rights, 
flumes, piping, Hotchkiss giants, and other tools and implements used 
in working the property ; in considération of which grant and the other 
considérations mentioned in the contract, the party of the first part 
agrées to pay the parties of the second part the sum of $50,000, in man- 
ner following, to wit : 

"Seventeen thousand dollars ($37,000) at or before the signing of this agree- 
ment; ten thousand dollars ($10,000) in three months from the date hereof ; 
seven thousand dollars ($7,000) in flve months from the date hereof, or at 
a later date (it being hereby stipulated and agreed by the parties of the sec- 
ond part that they wlll eamestly endeavor to secure an extension of payment 
on the options now held by them and which the aforesaid seven thousand 
dollars Is intended to liquidate, which wlll permit deferring this iatter pay- 
ment of seven thousand dollars to a date three months later than alwve stat- 
ed). Three thousand dollars ($3,000) in eight months from the date hereof, 
and the remalnder or thirteen thousand dollars (!!>33,000) on the luth day of 
August, A. D. 1902; and should the party of the first part default or be un- 
able to make thèse Iatter two payments at the time specified it is agreed by 
the parties of the second part that he shall hâve further time to malîe such 
payments, and shall not forfeit any right or interest lie may bave acquired 
in the said property by reason thereof." 



100 152 FEDKRAL REPOIITEK. 

The alleged written contract further provides that out of the first 
payment of $17,000 the parties of the second part would erect, build 
and equip a first-class dredging plant of the Morris pattern, or some 
similar pattern, to be mutually agreed upon by the parties to the agree- 
ment, and place the same upon a boat 30 feet wide and 75 feet long on 
the mining ground described, together with a force pump having a noz- 
zle pressure of 100 pounds to the square inch, one tubular boiler of 75 
horse power, and one engine of "70 horse power, with ail necessary con- 
nections, including shafting, pulleys, belts, derricks, head box, double 
sluice boxes, and riffling, and ail other auxiliaries, tools, etc., requisite 
in a first class dredging plant of the kind, the pump tO' be equipped with 
a suction pipe not smaller than 10 inches in dianieter. 

The alleged written contract contains thèse further stipulations : 

"It is further agreed by the parties of the second part that if a certain 
tract of land of about flve hundred acres of land lying west of the Lippineott 
I)roperty, as described above, shall be available, they will loeate the same 
and add it to the lauds above described wliich are to be the joint property of 
the parties liereto under this agreement, and that tlie expense of locating, 
recording and doing assessment work on tlie said lands sliall be borne by the 
Ijarties hereto jointly. 

"It is also agreed that if a certain placer property comprising flfteen hun- 
dred acres more or less, loeated on Kanley Creeli adjacent to the properties 
above described and owned and controlled by the Gdd Sand Mining and 
Milling Company, of which Messrs. Blood and Fulton, parties of the second 
part, are parties in interest, shall become available and can be purcliased, the 
parties of the second part agrée to acquire the same aud consolidate it with 
the property first described herein on, .conditious bereafter to be agreed upon 
by the parties hereto, provided a mutual aud satisfactory agreement cati be 
reached relating thereto. 

"It is further agreed that upon the completion of the dredge above referred 
to and described, and when the same shall be ready for opération, a siniving 
fund of one thousaud dollars (.$1,000) shall be created to pay the expenses of 
opération until the plant shall be self-snstaining, by each of the parties liereto 
oontributing flve hundred dollars (.$.500). tlie residue or remainder of whicli 
sh.all be covered Into the treasury of the corporation, which it is the purpose 
of the parties hereto to ineorporato, with ail other moueys and earnings ac- 
cruing to the said corporation." 

The answer of the appellant, Ferguson, put in issue the exécution 
by him of the alleged contract, and also denied that the property de- 
scribed in the complaint is the property included and intended to be 
included in that or any other contract entered into between the parties. 
In his answer Ferguson admitted the payment by him to Blood and 
Fulton of $19,500 each, but denied that such payments were made 
under or in pursuance of the alleged contract, and dénies that anything 
remains due from him under said contract, or at ail, or that any demand 
bas been made upon him for such balance, and dénies the performance 
by Blood and Fulton of their part of the alleged contract. 

On the trial the défendant Ferguson introduced no évidence, so 
that the case rests solely upon the plaintiff's proof. By that it appears 
that in the spring of 1901 the appellee began negotiations with the 
appellant for the purchase by him of an undivided half interest in cer- 
tain placer ground owned by the appellee and Fulton, and upon some 
of which they held options from others. The negotiations culminated 



FERGUSOX V. BLOOD. 101 

in a telcgram of date April 18, 1901, from the appellant to the appellee, 
notifying the latter that in a few days one M. J. Lawlor would arrive, 
clothed with full authority to act for the appellant in the matter con- 
cerning which they had been negotiating. Accordingly. Lawlor met 
the appellee and Kulton in Denver, and the three then went to Idaho 
to examine the ground ; and, after spcnding some time in such ex- 
amination, Lawlor, according to the only évidence in the case, said 
to Blood and Fulton : 

"There is no use prospecting any further ; I am satisflcd, and now we will 
go ont to Boise aud I will make iny report to Mr. Ferguson." 

He did se, and the three remained in Boise to hear from the appellant. 
On the 26th day of June, 1901, Lawlor received a telegram from the 
appellant stating that he would send $1,000 that day, $9,000 in 20 days, 
$7,000 in 30 days, and the balance in four months, and asking where 
he could buy machinery. This telegram was shown by Lawlor to the 
appellee, and $1,000 paid to the latter and Fulton. Lawlor then re- 
turned to Shenandoah, Pa., where the appellant resided, and on July 
18, 1901, the appellee received from Lawlor a telegram from Shenan- 
doah, Pa., saying: 

"Ferguson eaiinot leave until Tuesday or go fartlier than Buffalo. Want 
you to meet us Iroquois Hôtel ïucsday eyeniug. Xotify Fulton other matter 
arrangea, ans\ver." 

And two days later the appellee received from Lawlor another tele- 
gram sent from Shenandoah, reading: 

"Jleet us in Buffalo as requested in former message to sign papers. Hâve 
money for both paymeuts, auswer," 

In response to thèse telegrams, the appellee went to Buflfalo, where 
he met the appellant in the evening of July 25th, wlien and where they 
talked over the matter for some time. The next morning appellant, 
appellee, and Lawdor met and again went over the matter, when the ap- 
pellant told the appellee that he could not make the payments as stated 
in the telegram of June 2(;th, but that in addition to the $1,000 already 
paid he would pay $9,000 in 20 days, $7,000 in 30 days, $10,000 in 
3 months, and the balance of $13,000 August 15, 1902. The appellee 
consented to this, and thereupon the appellant dictated the terms of 
the agreement to be formerly prepared by Lawdor and appellant, say- 
ing to his représentative, Lawlor : 

"You people are compétent to draw up this agreement. Hâve Mr. Blood 
sign it and acknowledge it, and forward it to my home iu Shenandoah, Penn- 
sylvania, and I will sign it and acknowledge it there." 

Accordingly, the agreement was drawn up by Lawlor, and signed 
and acknowledged by the appellee and delivered to Lawlor, who said 
that he would send it to the appellant for exécution — at the same time 
giving to the appellee a compared copy of the agreement. Later Law- 
lor vi'Cnt to Idaho, and, vi'ith the appellee, examined the county records 
to ascertain the title of the property that was to be transferred, and, 
after having some defects cured, expressed himself as satisfied with 
the title, and thereupon delivered to the appellee two checks signed bv 
the appellant, one for $9,000 and the other for $7,000. Ail of the 



102 152 FEDERAL REPORTER. 

other payments provided for by the contract were subsequently made by 
the appellant except the last, on which he also paid $2,000, leaving a 
balance unpaid of $11,000. 

Blood and Fulton built the dredge provided for by the contract, 
equipped it, and commenced working the property, the appellant being 
represented on the ground by Lawlor, and personally spending some 
time there in the summer of 1902, watching the opérations, and making 
suggestions as to equipment and the place to work. At that time he 
had paid $37,000 under the contract, and there discussed with the ap- 
pellee the last payment to be made by him, saying that he was not cer- 
tain that he could make that payment promptly, but would advise the 
appellee as soon as he returned to his home. At no time did he intimate 
that he had not signed the written agreement, and the uncontradicted 
testimony of the appellee is to the efïect that both the appellant, and 
Ivawlor told him that appellant had signed it, and, furthermore, after 
notice to him to produce the original instrument, the appellant failed to 
do so at the trial. Under such circumstances he should not be heard to 
say that the contract was void under the Idaho statute of frauds (Rev. 
St. 1887) the provisions of which are as follows: 

"Sec. 6007. No estate or Interest in real property, other than for leases for 
a term not exceedlng one year, nor any trust or power over or concerning it, 
or in any manner relating tliercto, can be created, granted, assigued, sur- 
rendered, or declared, otherwise tlian by opération of law, or a couveyance 
or other instrument in writing, subscribed by the party creatlng, granting, as- 
Kigning, surrendering or declariug the same, or by his lawful agent thereunto 
anthorized by writing. 

'"Sec. 6008. The preceding section must not be construed to affeet the power 
of a testator in the disposition of his real property by a last will and testa- 
ment, nor to prevent any trust from arising or being extinguished by implica- 
tion or opération of law, nor to abridge the power of any court to compel the 
Hpeeific performance of an agreement, in case of part performance thereof. 

"Sec. 6009. In the following cases the agreement is invalid, uniess the same 
or some note or mémorandum thereof be in writing and subscribed by the 
jiarty chargea, or by his agent. Evidence, therefore, of the agreement cannot 
do received without the writing or secondary évidence of its contents: * * * 
(5) An agreement for the leasing for a longer period than one year, or for 
tlie sale of real property, or of an interest therein, and such agreement, if 
made by an agent of the party sought to be chargea, is invalid, uniess the 
authority of the agent be in writing, subscribed by the party sought to be 
charged." 

There are several reasons why this contention on the part of the 
appellant is whoUy untenable. In the first place, in view of the ap- 
pellant's statement to the appellee at Buffalo that he would sign the 
contract upon its receipt ; that the written contract was sent to him by 
his agent, Lawlor ; that he proceeded under the contract as though it had 
been signed by ail the parties thereto, making payments under it, go- 
ing into pos.session of the property under it, participating in the develop- 
ment of the property, and conducting himself in ail respects as though 
it was an executed contract, thus leading the appellee to believe that 
he had signed it, as he stated he would ; and considering the further 
fact that he failed to produce the original at the trial when notified to 
do so — we think the conclusion inévitable, in the absence of any évi- 
dence to the contrary, that he did in fact sign the paper. 



FERGUSON V. BLOOD. 103 

In the second place, if it be conceded that the statutes above quoted 
require that such contracts as are hère involved be signed by both gran- 
tor and grantee, the appellant cannot avail himself of such require- 
ment, in view of the facts hère shown, because of section 3325 of the 
Revised Statutes of 1887 of Idaho, which provides that: 

"Where a eontract, which is required by law to be in writing, is preveiited 
from being put into writing by the fraud of a party thereto, any other party 
who is by such fraud led to believe that it is in writing, and acts upon such 
belief to his préjudice, may enforce it against the fraudulent party." 

Certainly the appellant, by his conduct, led the appellee to believe 
that he had signed the eontract, and to purchase claims on which he 
had only options, and to otherwise expend money and time in carrying 
out the provisions of the agreement. Under such circumstances, to 
permit the appellant to repudiate the eontract on the ground that he 
did not in fact affix his signature to it, would manifestly be to permit 
him to practice fraud and déception upon the appellee. Moreover, part 
performance of a eontract takes it out of the statute of frauds. In 
this case not only was the eontract partîy, but it was almost completely, 
performed by the appellant. S6 Enc. of h^w, pp. 50-53 ; Townsend v. 
Vanderwerker, 160 U. S. 171, 16 Sup. Ct. 238, 40 L. Ed. 383 ; Brown 
v. Sutton, 129 U. S. 338, 9 Sup. Ct. 273, 33 L. Ed. 664; Riggles v. 
Erney, 154 U. S. 244, 14 Sup. Ct. 1083, 38 L. Ed. 976; Deeds v. 
Stephens, 69 Pac. 534, 8 Idaho, 514; Fleming v. Backer (Idaho) 85 
Pac. 1092 ; Barton v. Dunlap, 66 Pac. 832, 8 Idaho, 83 ; Francis v. 
Green, 65 Pac. 363, 7 Idaho, 668; Maie v. Leflang, 63 Pac. 108, 7 
Idaho, 348. 

Where one contracts to convey real estate to another upon the pay- 
ment of the agreed priée, retaining the title until payment is fuUy made, 
it is not very important, in our opinion, what the security so retained 
is called, whether a trust, a vendor's lien, an équitable mortgage, an 
équitable security, or any other kind of a lien. Like the Suprême Court 
of Tennessee: 

"We are not able to draw any sensible distinction between the cases of a 
légal title conveyed to secure the payjnent of a debt, and a légal title re- 
tained to secure the payment of a debt. In both cases, courts of chancery 
consider the estate only as security for the payment of the debt, upon a dis- 
charge of which the debtor is entitled to a conveyance in one instance, and a 
reconveyance in the other." Graham v. McCampbell, 19 Tenu. 52, 33 Am. Dec. 
126. 

Where the title is retained by the seller as security for the payment 
of the debt, the security is, in this country, very generally regarded as 
possessing ail the essential features of a mortgage, and the vendor as 
standing for ail practical purposes as mortgagee in relation to the Ven- 
dée. See 29 Cvc, pp. 770, 771, and notes; Hardin v. Boyd, 113 U. S. 
764, 5 Sup. Ct.' 771, 28 L- Ed. 1141 ; Lewis v. Hawkins, 90 U. S. 126, 
33 É. Ed. 113 ; Wheeling Bridge & T. Ry. Co. v. Reymann Brewing 
Co., 90 Fed. 189, 32 C. C. A. 571 ; Seattle L. S. & E. Ry. Co. v. Union 
Trust Co., 79 Fed. 179, 34 C. C. A. 513 ; White v. Ewing, 69 Fed. 
452, 16 C. C. A. 296. And as such, he seems to be regarded by statute 
in Idaho. Rev. St. Idaho 1887, §§ 3440, 4520, and 4531. So regarded, 
there can be no doubt of the power of the court to enter a deficiency 



104 152 incDERAL REPORTER. 

jùdgment, where, as in the présent case, the sale of the vendee's interest 
in the property fails to bring enough to satisfy his debt. Authorities 
supra. 

The jùdgment is affirmed. 



PENNSYLVANIA E. CO. T. GARCIA. 

(Circuit Court of Appeals, Second Circuit. Mardi 5, 1007.) 

No. 140. 

1. Appeal — Admission of Evidence— Préjudice. 

Wliere iu an action for injuries to a serv.nnt tlif .l'ury were correetly 
cliarged as to tlie acts and omissions of dcfenUant on wliicli fault miglit 
be predlcated, the failure to post ruies uot beinc amoiis tlieiu, défendant 
was not prejudiced by évidence that wituess liad never seen or read any 
ruies providing for tlie inspection or repair of tools iu tiie tooi sliop, 
objected to because tliere was no charge iu the couiplaint coveriug sucli 
question. 

FEd. Note.— For cases in point, see Cent. Dig. vol. 3, Appeal and Error, 
§§ 4178-4184.] 

2. Masteb and Servant— Injuries to Servant — Conteibutory Neqligence. 

PlaintifC, an ignorant laborer in a railroad shop, had been einployed by 
défendant for nine years to do low-grade worli. lie liad not been ein- 
ployed for flange woriv td any great extent, but was ordered by his fore- 
mau to hanimor tlie liead of a détective fuUer In making a flange on a 
sheet of hot Iron, tlie fuller being held by the forenian. Plaiutiff sa\v 
nothing dangerous about the fuller, aud proceeded to strike the same, 
vyhen a pi^ee of steel flew f roin the head tliereof Info plaintiff's ej^e, caus^ 
ing its loss. HcUl, that plaiutiff was not guilty of contributory negii- 
gence as a matter of law. 

[Ed. Note. — For cases iu point, see Cent. Dig. vol. 34, Master and Serv- 
ant, §§ 1098-110.").] 

3. Same — Fellow Servant. 

Plaintiff's forenian had been informed prior to the accident that a fuUer 
head by which plaintif!' was injured was détective and dangerous, but 
with knowledge of snch defoct lie!d the head agaitist a liot irou jilate aud 
directed plaintilï to strike the same for the pnrpose of making a flange, 
resultiug in plaintilf's injury by a pièce of steel flying from the head. It 
also appeared that défendantes System for rei}air of tools was too cumber- 
somo for iir.-ictical opération, the servant being required to get an order 
tUerefor and liave the same visaed by at least two dilTerent foremen be- 
fore tliey could be reiiaired. Held, that the négligence of plaintiff's fore- 
man a( ting as his fellow servant iu using siicli dangerous tool was not 
the sole cause of the accident, aud was therefore not sulHcient to prevent 
a recovery. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 34, Jlaster and 
Servant, §§ 515-534.] 

In Error to the Circuit Court of the United States for tlie Eastern 
District of New York. 

On writ of error to the Circuit Court for the lîastern District of New 
York to review a jùdgment entered upon the verdict of a jury in favor 
of the plaintifï for $1,500 damages for the loss of an eye while in the 
employ of the défendant in its shops at Jersey City, N. J. 



PENNSTLVANIA R. CO. V. GARCIA. 105 

H. G. Ward, Geo'. H. Emerson, and Robinson, Biddle & Ward, for 
plaintiff in error. 

Henry F. Dossenheim and Théodore Prince, for défendant in error. 

Before LACOMBE, TOWNSEND, and COXE, Circuit Judges. 

COXE, Circuit Judge. At the date of the accident — February 6, 
1900 — the plaintifï was in the defendant's employ as boilermaker's as- 
sistant. At that time Rooney, the gang boss, Finnigan, a boilermaker, 
and the plaintiiï were engaged in turning the flange around a square 
opening in a sheet of hot iron. Finnigan was holding the sheet on an 
iron block, Rooney was holding a heavy steel hammer, called a "fuller," 
against the heated iron sheet and the plaintiff was striking the fuller 
with a button-set hammer. While so engaged a spicula of steel flew 
off the flat end or liead of the fuller into the plaintifï's eye, causing its 
loss. The testimony is undisputed that the head of the fuller was worn 
down and cracked on its edges, the ragged portions extending around 
the four sides and being from an eighth of an inch to a quarter of an 
inch apart. Complaint as to the dangerous condition of the fuller had 
frequently been made to the gang boss, Rooney. 

The first assignment of error argued is based upon the ruling of the 
trial court in permitting the witness Finnigan to answer the following 
question : 

"AVere there any rules posted for the Inspection or repair of tools in tlie 
tool shop?" 

The question was objected to upon the sole ground— 
"That there is no charge in the complaint that covers tliis question." 

The answer was : 

"I never read any. I never saw any rules tliere ]iosted." 

It might be argued with considérable plausibility that the testimony 
was admissible under the pleadings and that the objection was not com- 
prehensive enough to présent the question whether the testimony was 
incompétent or immaterial, but we prêter to rest our décision upon the 
broader ground that the answer to the question was in no way prej- 
udicial to the défendant, for the reason that the jury were correctly in- 
structed as to the acts and omissions of the défendant of which fault 
might be predicated, the failure to post rules not being among them. 

In deciding defendant's motion to dismiss the complaint the court 
said : 

"I shall not submit the question to the Jury whether the défendant was 
négligent in not maintaining a rule; but of course I hâve allowed that évi- 
dence to corne in so tlrnt the jury shouid Ivnovv just what had been done or had 
not been done, and thereby hâve been able to détermine whether the System 
for the protection of the employés with regard to the use of this tool was in 
accordance with the duty which rested upon it." 

Subsequently the court refused the following request of the plain- 
tifï : 

"Eighth. In determining the question, therefore, of whether or not the de- 
fendant was négligent, the jury may take into (;onsideration the question of 
whether or not the plaintiff shouid hâve made rules for the inspection of tools 



106 152 FEDERAL EEPORTER. 

and whether or not the tools were inspected in the manner that the nature 
of tlie case required. 

"The C!ourt : The eighth I refuse to charge." 

In thèse circumstances we are convinced that the injurious effect of 
the answer, assuming it to hâve been improperly admitted, was negU- 
gible. The jury were, m effect, instructed to disregard it. 

It is argued that a verdict shouid hâve been directed for the défend- 
ant for the reasons, first, that the plaintiff knew or shouid hâve known 
of the dangerous condition of the fuller ; and, second, that the accident 
was occasioned by the négligence oî a fellow servant. 

We think the question of contributory négligence was properly sub- 
mitted to the jury. The plaintifï was not a man of superior intelli- 
gence; he understood English imperfectly and gave his testimony 
through an interpréter. He had been employed by the défendant for 
nine years previous to the accident, but always, apparently, in work of 
the lowest grade, such as breaking screws, niaking rivets and assisting 
in making the fires. He was employed on the flange work only a day 
and a half, although on previous occasions the foreman had sent for 
him to assist on similar work. He was a little near sighted. An oculist 
who examined the plaintiff's remaining eye testified that he found there 
a mascula of the cornea existing f rom childhood, "causing a great deal 
of obscurity of vision without total loss of sight." The plaintiff testi- 
fied that he did not notice anything about the fuller at the time of the 
accident; that when ordered to do flanging work he did it; otherwise 
not. On the morning in question he had been working on the flange 
but two hours when the accident happened. The défendant offered no 
testimony and there is no contradiction of the plaintiff's statement that 
he was entirely ignorant of the dangerous condition of the fuller. Hère 
was an ignorant laborer, ordered by his boss to hammer the head of a 
fuller, which was being held by the boss himself. Seeing nothing dan- 
gerous about the fuller and supposing that he might do so in safety he 
proceeded with the work and was injured. In thèse circumstances we 
think the court was not justified in saying as matter of law that the 
plaintiff was guilty of négligence. The question was for the jury. 
Hayward v. Key, 138 Fed. 34, 70 C. C. A. 402. 

The other contention of the défendant that the accident happened 
through the négligence of the plaintiff's fellow servants and particularly 
through the négligence of the gang boss, Rooney, présents a question 
of more difBculty. Rooney was actually holding the dangerous tool 
at the time of the accident and it is undisputed that his attention was 
frequently called to its condition, with the statement that someone would 
be injured if it were not repaired. Assuming the négligence of Rooney 
in using a tool which he knew to be dangerous, the défendant is not ex- 
culpated unless Rooney's fault was the sole cause of the injury. If the 
injury were due to the concurring négligence of Rooney and the de- 
fendant, the latter is liable. In short, if the défendant is shown to be 
at fault it must respond. In Flike v. B. & A. R. Co., 53 N. Y. 549, 13 
Am. Rep. 545, the court, at page 555, of 53 N. Y. (13 Am. Rep. 545),- 
says: 

"Nor is the company relleved, although négligence may be imputed to the 
defaulting brakeman. The only effect of that circumstance would be to malco 



AMERICAN BONDING CO. V. MILLS, 107 

the négligence contributory witli the brakeman, but would not afCect the lia- 
bility of the company." 

Was the défendant at fault? Upon the question of the defendant's 
duty to provide a suitable System of repair the court said : 

"The master ought aiso to provide some safe System for liaving tools re- 
paired. There are severa! ways. In other words, he should so conduct hit> 
business that there will be a practical scheme whereby thèse tools may, as 
they become détective from tinie to tinie, be either repaired, or other tools 
taken in their place. * * * It is for yon to say, as I look at it, whether 
there was a practice there for supplying tools, or for repairing tools, that 
showed that the master had used the ordinary care of a good business man, 
and whether it was maintained; whether it was kept in opération in such a 
way that the master continued to be a good master within the rules which I 
hâve stated; whether he was a master who was falthful to his contraet, as I 
hâve suggested the contraet to you. If you find that he was, there certainly 
is no cause of action hère." 

It is contended by the plaintiff that the defendant's repair systëm was 
so cumbersome, complicated and inadéquate as to be unworkable in 
practice. The fuller had been in a cracked and ragged condition for 
five months and was daily growing worse. The gang boss was repeat- 
edly notified and yet it was unrepaired. Why ? The testimony shows 
that a workman, employed in the gang in question, desiring to get a 
tool repaired would hâve to go first to the flange turner, Rooney, for 
an order upon Murphy, the foreman of the boiler shop. If Murphy ap- 
proved he would give an order for the repair and the tool was then tak- 
en to the blacksmith's shop for that purpose. The men worked only 
about 20 feet from the blacksmith and yet a workman could not take 
an injured tool to the shop and hâve it repaired. He could not even get 
the order from Murphy unless the request was visaed by Rooney. The 
déplorable accident which destroyed the plaintiff's eye was not an un- 
natural resuit of so complicated a scheme. It is not improbable that the 
workmen continued to use unsuitable tools rather than subject them- 
selves to ail the circumlocution necessary to secure their repair. We do 
not say that the defendant's System was inadéquate, but we think that 
sufficient appeared to warrant the submission of the testimony to the 
jury. 

We hâve examined the other assignments, with the resuit that we 
find no réversible error. 

The judgment is affirmed. 



AMERICAN BONDING CO. OF BALTIMORE v. MILLS, Sherifle. 

SAME V. FINNEY, Sheriff. 

(Circuit Court of Appeals, Ninth Circuit October 1, 190G.) 

Nos. 1,320, 1,321. 

Removai, op Causes— Time fob Removal. 

A fédéral court cannot acquire jurisdiction of a cause by removai, ou 
a pétition flled several months after the removing défendant had volun- 
tarily appeared in the state court both by demurrer and answer, and 
after the cause had been set for trial by that court without objection. 

[Ed. Note. — For cases in point, see Cent Dig. vol. 42, Removai of 
Causes, §§ 135, 13C, 141.] 



108 152 FEDERAL EEPOETEH. 

In Error to tlie Circuit Court of the United States for tlae Central 
Division of the District of Idaho. 

Neal & Kinyon, Morrison & Pence, and Jes3e W. Lilienthal, for 
plaintiff in error. 

H. L. Fisher, F. J. Smith, and W. E. Borah, for défendant in error. 

Before GILBERT and ROSS, Circuit Judges, and DE HAVEN, 
District Judge. 

ROSS, Circuit Judge. Thèse cases hâve been argued and submitted 
together. Each Of the actions was originally brought in a state court 
of Idaho, by a sheriff of one of the counties of that state, upon a bond 
of indemnity given to him by the Flato Commission Company, a Ke- 
braska corporation, as principal, and the American Bonding Company, 
a corporation of the state of Maryland, as surety. Each action in the 
state court was againsf thèse tvvo corporations. The American Bond- 
ing Company, the plaintiff in error in each of the cases, appeared in the 
state Court ând filed a gênerai demurrer to each complaint, at the same 
time,filing in each case a pétition for its removal to the court below, on 
the groùhd of the diverse citizensbip of the parties, and tendering the 
usual bond. AU of this was donc May 27, 1904. The cases were trans- 
ferred to the court below, but remanded by that court to the state court 
on the 22d of September, 1904, on the ground that both défendants did 
not jpin in the pétition for removal; it then appearing that the sum- 
moris issued in the actions had been served on one Charles F- Neal, as 
the résident agent of the Flato Commission Company in the state of 
Idaho. On the 26th of December, 1904, the plaintiff in error appeared 
in the state court and argued its demurrers, which were overruled, and 
thereupon it asked for and obtained a stipulation for time within which 
to answer the complaints, which it thereafter did. The cases were aft- 
erwards set for trial in the state court February 4, 1905. 

On. the Ist day of February, 1905, the Flato Commission Company 
moved the state court, supported by an affidavit of Charles P. Neal, to 
quash the service of the summons made upon him as its statutory agent, 
on the ground that he was not at the time of such service, and never 
was, such agent. This motion was sustained in each case, whereupon 
the counsel for the plaintiff in each case immediately directed that an 
alias summons be issued for service upon the Flato Commission Com- 
pany. Before such issuance, however, and on February 4, 1905, the 
American Bonding Company presented to the state court its second pé- 
tition and bond in each case for the removal thereof to the United 
States court, on the ground that the summons served upon Neal, as the 
statutory agent of the Flato Commission Company, had been quashed, 
and that it was the sole défendant and a citizen of the state of Mary- 
land. The state court "declined to rule on the motions for removal till 
some action is taken in the matter by the United States court" ; but 
action was there taken, and the causes were, on the 7th day of Febru- 
ary, 1905, for a second time remanded to the state court, "for the rea- 
son that the proceedings before that court show that there was process 
outstanding at the time of hearing as against the défendant the Flato 
Commission Company." The alias summons had been issued on the 



AMERICAN BONDING CO. V. MILLS. 109 

'4tli day of February, 1905, and on the 7th day of the same month was 
served upon the défendant Flato Commission Company by delivering a 
true copy thereof, together with a copy of the complaint, to the auditor 
of the county, pursuant to the provisions of section 4144 of the Re- 
vised Statutes of 1887, of the state. The Flato Commission Company 
did not plead to the complaints in the state court, but on the 16th of 
February, 1905, filed therein its pétition and bond for the removal of 
the cases to the court below, prior to which time, according to the affi- 
davit of the counsel for the plaintiff, filed in opposition to the pétition, 
the default of that company for failure to appear had been entered, and 
judgment taken against it in the state court. Meanwhile, to wit, in 
February, the cases came on for trial as against the plaintiff in error 
hère, the American Bonding Company ; the record reciting : 

"Counsel for the défendants at this time, before the jury was impaneled, 
but after the case was ealled for trial, objected to going to trial at this time, 
and flled a pétition and bond for removal to the fédéral court. Whereupon 
the court overruled the objection of tUe défendants and ordered that the trial 
of the cause be proceeded with. To which ruliag of the court couusel for 
défendants excepted." 

We do not sit to review or consider the validity or regnlarity of the 
proceedings of that court in respect to that trial. It is sufficient to say 
that the resuit of it was a verdict against the American Bonding Com- 
pany for $31,593.71, returned and recorded February 16, 1906. 

At the same time that the Flato Commission Company filed in the 
state court its pétition for removal of the cases to the fédéral court, to 
wit, February 16, 1905, the American Bonding Company filed therein 
its third pétition for such removal, and on the 83d of March, 1905, filed 
in the state court what it denominated "a supplemental pétition for re- 
moval." Thèse pétitions set up, in substance, the matters already al- 
luded to, and, in addition, the supplemental pétition set forth the fol- 
lowing : 

"That after the due filing of Its pétition and bond for removal on said 
ICth day of February, 1005, and after the due filing of the pétition and bond 
for removal filed hevein by the Flato Commission Company, the codefeudant 
herein with this petitioner, and the due calling of the attention of the said 
court, which was then and there in session, to said pétitions and bonds, and 
the request on the part of each of said défendants that said district court, 
in and for said Ada county, enter its order, that it proceed no fuftlier, and 
that it enter its order that this petitioner and its codefeudant, the said 
Flato Commission Company, had lawfully removed said cause to the Circxiit 
Court of the United States for the District of Idaho, the said co\irt did then 
and there refuse to enter said order, or any part thereof, and did. notwifh- 
standing said proceedings se as aforesaid talien by petitioner and its code- 
fendant, the Flato Commission Company, order that said cause proceed to im- 
médiate trial as to this petitioner only, whereupon this petitioner filed its 
objections thereto, on the ground that said cause had been on that date law- 
fully removed to this court, and further objected and protested against said 
court taking any proceedings whatever therein, and demanded that said 
cause be continued until such time as its codefeudant, the said Flato Conuiiis- 
sion Company, was by law required to plead and answer. That notwith- 
standing said objections and protests of this petitioner, said court, at the 
request of plaintiff In this cause, did proceed to impanel a jury and try 
this cause, notwithstanding the same was not at issue as to Its codefeudant, 
the Flato Coramissiou Company, and notwithstanding the said Flato Commis- 
sion Company had not answered or pleaded to said complaint, and notwith- 



ilO 152 IfEDERAL REPORTEE. 

Standing the time in which said Flato Commission Company was required by 
law to answer or plead had not expired, and did so try the same on the 17th 
day of February, 1905, over the said protest and objections of your petitioner 
as aforesaid, made and caused to be duly entered of record, and did submit 
said oiiuse tô said jury as aforesaid against the said protests and objections 
of this petitioner so as aforesaid made and caused to be entered of record, 
and caused said action to be tried and verdict found as to this défendant only. 
That then and thereby by the acts of the said plaintifC, done as aforesaid over 
the protests and objections of this petitioner so as aforesaid made and en- 
tered, and with full knowledge of the faet that as to the Flato Commission 
Company, défendant herein as aforesaid, the time to answer or plead had not 
expired, the said plaintifC eleeted to proceed against this défendant separate- 
ly, and then and thereby there was by the act of said plaintiff a severance 
of said cause of action as to thé said défendants, and each of them, and then 
and thereby for the first time this petitioner had a separate right of re- 
moval from the right of its codefendant herein, and said cause was for the 
first time removable as to this petitioner, without the joint and concurrent 
action of Its codefendant herein, which facts more fully appear by the records 
filed herein, as well as by the affidavits in support of petitioner flied by this 
petitioner herein." 

When the third and supplemental pétitions were brought before the 
court below, a motion to remand the cases was again made, and, after 
argument, denied ; the order of the court, under date of April 4, 1905, 
being : 

"On this day was announced the décision of the court upon the motion to 
remand this cause heretofore argued and submitted, to the effiect that said 
motion be denied ; to which ruling plaintiff by his counsel excepted." 

The court below having thus retained the cases, they afterwards came 
on for trial in that court, resulting in the judgments from which the 
présent writs of error are taken. 

Counsel for the plaintiff in error confine themselves wholly to the 
merits of the case. We think we are precluded from considering the 
merits by the total lack of jurisdiction of the court below over the cases. 
The court remanded them upon the first and second pétitions, and we 
are unable to understand upon what ground it entertained the juris- 
diction upon the third and supplemental pétitions. Whether or not 
the State court erred in proceeding with a trial against the American 
Bonding Company, before the cases were also at issue as to the Flato 
Commission Company, is a matter with which the fédéral courts hâve 
nothing whatever to do. The controUing fact hère is that at the time 
of the présentation of the pétition upon which the court below took 
jurisdiction, and long before, the plaintiff in error had voluntarily ap- 
peared in the state court both by demurrer and answer, and the cases 
as to it been, without objection on its part, actually set for trial in the 
state court. Manifestly it could not thereafter remove them into the 
fédéral court. The filing of the pétition for removal by the Flato Com- 
mission Company on the 16th of February, 1905, cannot aid the plain- 
tiff in error. That pétition was filed not only after the plaintifï in 
error had voluntarily appeared in the state court by demurrer and an- 
swer, and after the trial of the cases as to it had been, without objection 
on its part, actually set for trial in the state court, but also, according 
to the uncontradicted afiidavit of the counsel for the plaintiff in the 
cases, after judgment had been entered in the state court against the 
Flato Commission Company for its failure to appear therein. 



WALKER V. UNITED STATES. 111 

It results that in each case the judgment of the court below must 
be and is reversed, with directions to remand the cases to the state court, 
with costs to the défendant in error. 



WALKER V. UNITED STATES. 

(Circuit Court of Appeals, Ninth Circuit February 11, 1907.) 

No. 1,S2T. 

1. PosT Office— UsiNG Mails to Defbatjd— Indictment. 

Ttie concluding clause of Rev. St. § 5480 [U. S. Oomp. St. 1001, p. 3697], 
whlch provides that in prosecutions thereunder for using tiie mails to 
defraud, the Indictment may charge ofCenses to the number of three when 
committed within the same six calendar months, but the court thereupon 
shall give a single sentence, bas no relation to the offense which is fully 
deflned elsewhere in the section, but relates to the mode of procédure 
only ; and an indictment containing more than three counts, each char- 
ging a violation of the section, is not for that reason fatally détective, 
where no demurrer or other objection was taken thereto in tUe trial court 
and only a single sentence was given thereon. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 40, Post Office, § T2.] 

2. Same— Eléments of Offense— Scheme to Defeaud. 

The issuance of certificates in the name of a company by which the 
holder pald in $1 per month, and on maturity of his certiflcate in its 
turn was entitled to receive double the amount paid in from a "mutual 
beneflt crédit fund" created solely by the payment into it of less than 75 
per cent, of the amounts paid in, held to be a scheme to defraud, which 
when carried on by means of the post office department was in violation 
of Rev. St. § 5480 [U. S. Comp. St 1901, p. 3007]. 

3. Same— BviDKNCB— Letteks. 

On the trial of a défendant charged under Rev. St. § 5480 [U. S. Comp. 
St. 1901, p. 3697], with using the mails to carry out a scheme to defraud, 
letters shown to bave been mailed or received by défendant need not be 
effective to forward such scheme to render them admissible in évidence, 
but it Is sufflcient if It appears therefrom that they were intended to be 
utilized In some way in connection with it. 

[Ed. Note. — For cases In point, see Cent. Dig. vol. 40, Post Office, § 85.] 

4. Same — Pboof of Intent. 

In a prosecution under Rev. St § 5480 [U. S. Comp. St. 1901, p. 3097], 
for using the mails in conducting a scheme to defraud, it is not necessary 
to prove a spécifie intent to defraud, where such intent is manifest from 
the nature of the scheme itself. 

In Error to the District Court of the United States for the Northern 
Division of the Western District of Washington. 

The plaintiff in error (défendant below) was indieted for havlng knowing- 
ly, wiUfully, and falsely devised a scheme and artifice to defraud, which 
scheme and artifice was to be effected through and by means of the post office 
establishment of the United States, contrarj- to section 5480 of the Revised 
Statutes [U. S. Comp. St. 1901, p. 3697]. Tbe scheme consisted in the issu- 
ance of a certiflcate to the purchaser by the Cumulative Crédit Company, by 
which the holder agreed to pay and contribute the amount of $1 per week to 
the company, for the purpose of creating an expense crédit fund and a mutual 
beneflt crédit fund for the uses and purposes therein provided. By a stipula- 
tion of the certiflcate the company agreed to set aside 75 per cent of the 
slxth to tbe hundredth payments, inclusive, and 90 per cent, of ail payments 
thereafter, and to place the same in the mutual beneflt crédit fund, from 



112 1S2 FEDERAL EEPOKTEE. 

which were to be paid the amounts due on the certiflcates as ttiey sevcrally 
matured. It vvas provided that the certiflcates should be deemed to be ma- 
tured when, at any time after 50 weeks from the date thereof, ail like certif- 
lcates of prier date and number should hâve been matured and cauceled; 
that at its maturity the owner thereof, upoa présentation and surrender to 
the Company of the certificate, should be paid by the company from the 
mutual benefit crédit fund the sum designated in the maturity table on the 
back thereof aud in accordauce with the conditions contained in such table, 
provided tliere should be sufflcient money in the mutual benefit crédit fmid 
available for that purpose. By a further stipulation it was agreed that the 
sertiflcate wns one of a continuons séries of like certiflcates, in ail of which 
the obligations of and the beneflts to the several owners thereof vi^ere mutual 
with tlie owner of suoh certificate, and in which the compensation to and 
the duties of the company were identical with its compensation and duties 
therein provided ; that the certificate constituted a mutual agreement between 
the owner thereof and ail of the owners of like certiflcates ; and that the time 
and manner of payments therein and in such other certiflcates provided for 
was the essence of the agreement. The table referred to is styled "Maturity 
Table," and purports to show the amount returnable at maturity of the ctir- 
tifleate at différent weekly maturity periods, as follows: 

"If JJatured ia Amount Taid in. Maturity A'alue. 

ôO weeks $50.00 $100.00 

51 weeks 51.00 102.00" 

— and so on in uniform Increase to 

"09 weeks 90.00 308.00 

100 weeks or over 2uo.uo." 

As a part of the same scheme, It Is alleged that the défendant issued divers 
and suiidry circulars, whei'eby it was represented, in eft'ect, that money so 
Invested was without the possibility of loss, that the certiflcates had formerly 
matured in from 42 to 72 weeks, that they would mature in abotit GO weeks, 
that thoy had been maturing in less than a year, and that future maturities 
would be more rapid. 

The iudictment contains four eounts, by the flrst of which the défendant is 
accused of having, through and by means of said scheme and artifice, and 
through and by means of the post office establishment of the United States, 
received Iroui such i)ost office establishment a letter, contained in an envel- 
ope dirccted to 3Ir. T. P. Miller, and signed M. Langguth. The second count 
is for receiving, under like circumstances and conditions, a letter contained 
in an envelope directed as above, and signed Orlando IC Fitzsimmons; the 
third, for receiving a letter to the same address, and signed Paul J. Edmes- 
ton : a'' ' tiie fourth is for enuiloving a fictitious name and address, to wit, 
T. P. Miller, that not belng the true name of the défendant. 

After trial, a verdict was returned finding the défendant guilty as charged, 
and the court rendered a single judgment thereon. The case cornes hère on 
the bi'I of exceptions. 

Walter R. Bacon, for plaintiff in error. 
P. C. Sullivan, U. S. Atty. 

Before GILBERT and ROSS, Circuit Judges, and WOLVERTON, 

District Judge. 

WOLVERTON, District Judge (after stating the facts). The first 
error assigned relates to the trial under tlie indictment, by reason of 
its containing four eounts. It is provided by the last clause of section 
5480 [U. S. Comp. St. 1901, p. 3697], that: 

"The Indictment, Information, or complaint may severally charge offenses 
to the number of three when committed within the same six calendar months; 
but the court thereupon shall give a single sentence, and shall proportion the 
punishmeat cspecially to the degree in which the abuse of the post office es- 



WALKKR V. UNITED STATES. 11-5 

tablishment eiiters as au instniment into such fraudaient scluniie a;nî de- 
vice." 

And it is insisted that the injunction of the statute in this regard is 
jurisdictional. No demurrer was interposed to the indictment, and 
the question is now raised hère for the first time. By a survcy of tlic 
statute it will be seen that the oiïense denounced against is created 
and perfectiy and completely defined witiiout any référence to the 
clause above recited. In other words, the clause does not perform any 
part of the function of defining or prescribing what shall constitute 
the offense, and an élimination of the clause will allow the offense to 
remain intact. What, then, is the purpose of such provision? It can 
only be to prescribe the mode of procédure in such cases, so that there 
is a distinction to be held between the defining or creating of the 
offense and the prescribing of the procédure whereby it shall be prose- 
cuted. The contention, therefore, that the matter of combining more 
than three offenses in one indictment is jurisdictional, is without 
merit. This position has been judicially determined in the case of 
the United States v. Nye (C. C.) 4 Fed. 888. 

Later cases hâve been decided, not involving the identical question, 
but so closely analogous that they may be deemed authoritative. In 
the case of Ex parte Henry, 123 U. S. 3?2, 8 Sup. Ct. 142, 31 L. Ed. 
174, which came up on habeas corpus, the petitioner was indicted for 
a violation of this statute, charged by three separate and distinct 
counts of three offenses, and was convicted. At a subséquent term he 
was accused of three other and différent offenses by as many counts 
contained in one indictment. Ail thèse offenses were committed with- 
in the same six calendar months. He was convicted under the last 
indictment, and the habeas corpus proceeding was to détermine the le- 
gality of the conviction. It was contended that there could be but one 
punishment for ail the offenses committed within the six calendar 
months ; but the court ruled that they did not constitute a continuons 
and therefoxe a single offense, and that in gênerai effect the provision 
alluded to "is not materiallv différent from that of section 1024 of the 
Revised Statutes [U. S. Comp. St. 1901, p. 720], which allows the 
joinder in one indictment of charges against a person 'for two or more 
acts or transactions of the same class of crimes or offenses,' and the 
consolidation of two or more indictments found in such cases. Un- 
der the présent statute three separate offenses committed in the same 
six months may be joined, but not more, and when joined there is to 
be a single sentence for ail. That is the whole scope and meaning of 
the provision, and there is nothing whatever in it to indicate an in- 
tention to make a single continuons offense, and punishable only as 
such, out of what, without it, would hâve been several distinct offenses, 
each complète in itself." It will be borne in mind that hère v^^as a 
second indictment by three counts upon which the défendant was a 
second time convicted, thus permitting the indictment for six offenses 
committed within the six calendar months, but under two indictments 
containing three counts each. In another case in the Court of Ap- 
peals for the Sixth Circuit (Howard v. United States, 75 Fed. 980, 
21 C. C. A. 586, 34 L. R. A. 50!)) it is distinctly said: 
152 F.— 8 



L14 152 FEDERAL EEPOETEB. 

"It was entirely compétent, according to the Henry Case, to charge the 
petitioner with 24 separate offenses eommitted within the same six calendar 
months in eight separate indictments containing three counts each ; and 
upon conviction the court might pronounce eight sentences, one on each In- 
dietment, just as was done in the case at bar, and the judgments would 
he neither erroneous nor void." 

Thèse cases emphasize the idea that this clause in the statute îs only 
meant for the régulation of the practice, or to prescribe the mode of 
procédure. Being for that purpose, it was compétent, as was done 
in the case of United States v. Nye, supra, for the prosecuting at- 
torney to noUe one count out of four comprised in the indictment, 
and proceed to trial upon the other three. No exception having been 
taken to the form of the indictment in the court below, it is now too 
late to be heard with référence to it. The first error is, therefore, 
not well assigned. 

It is next insisted that the scheme shows upon its face that it was 
not one designed for defrauding. But we think that the certifîcate, 
when viewed in connection with the further allégations of the indict- 
ment, touching the représentations as to the investment and the time 
when it would mature, was well designed and calculated to entrap, 
and thereby to defraud, the unwary. The scheme is fairly well de- 
scribed by the défendant himself in his admissions to C. L,. Wayland, 
the post office inspector. That oiifàcer says that he (défendant) ex- 
plained that the Cumulative Crédit Company sold certificates at the 
cost of $1 a week to the certifîcate purchaser, and that they agreed 
at the maturity of the certificate, which he said had never exceeded at 
that time 42 weeks, to pay back twice the amount paid in; that they 
set aside after the first five payments 75 per cent, of the total amount 
received for maturity refunding, and 35 per cent, they retained for 
the expense fund ; that they did not invest the maturity fund, and had 
no income whatever except what they got from outsiders; and that 
they expected to make the money out of the people that lapsed pay- 
ment — forfeited what they had paid in. It should be further stated 
that the certificate contained a provision that the first five payments 
should be made weekly, and if any default occurred therein, the pay- 
ments should be forfeited, unless th,e purchaser complied with other 
conditions which would reinstate him. This is the only provision con- 
tained in the certificate for any forfeiture, and the only source from 
which it was expected that the company would be able to pay the 
large margin of profit as represented. That such a device or con- 
trivance is wholly impracticable is at once manifest. It must be true, 
therefore, in view of ail the conditions, that the défendant had no ex- 
pectation of repaying anything that should be paid in upon such cer- 
tificates, or that they should ever mature under the terms and con- 
ditions thereof, so as to entitle the purchaser to the payment of the 
amount stipulated to be returned. So we say that the scheme was, on 
its face and in the light of the charges of the indictment, a fraudulent 
one. See Durland v. United States, 161 U. S. 306, 16 Sup. Ct. 508, 
40 L. Ed. 709. 

The next assignment of error relates to the introduction of certain 
letters, one each under the first, second, and third counts. It is com- 



PEKRY V. TACOMA MILL 00. 115 

plained that none of thèse letters appear from their reading to hâve any 
référence to or connection with the scheme to defraud. AU the letters 
are addressed to Walker, and were conveyed in envelopes addressed 
"Mr. T. B. Miller." The first and last indicate that they hâve rela- 
tion with the scheme, although perhaps remotely. The second is very 
brief. It simply says: "I désire very much to get into communica- 
tion with Mr. Denham. Can you tell me how I can reach him by let- 
ter?" This text by itself shows nothing of a purpose of furthering 
the contrivance. The letter, however, appears to hâve been written 
upon paper containing a letter head representing the incorporation of 
the Cumulative Crédit Company,* giving the names of the président, 
secretary, and treasurer, and the attorney, and the home offices of the 
Company in Los Angeles and San Francisco. It would, therefore, 
seem that ail thèse letters were intended in some way to be utilized in 
connection with the scheme and artifice set up in the indictment. 
But it was not necessary that this purpose should be shown by the 
letters absolutely, and it was so held in the case of Durland v. United 
States, supra. Mr. Justice Brewer, in the course of his opinion in 
that case, has this to say upon the subject: 

"We do not wish to be understood as intimating that !n order to constitute 
the offense it must be shown that the letters so mailed were of a nature cal- 
culated to be effective in carrylng ont the fraudulent scheme. It is enough 
if, having devised a scheme to defraud, the défendant with a view to execut- 
ing it deposits in the post office letters which he thinks may assist in carry- 
lng It into effect, although In the judgment of the jury they may be absolutely 
Ineffective therefor." 

The letters were, therefore, compétent to go to the jury, and the 
ruling of the court complained against was not error. 

It is further insisted that there was no intent to defraud shown, 
looking throughout the whole testimony given in the case, which has 
been brought up in the record. It is entirely clear, however, that 
the intent is patent when the scheme itself is understood, and that it 
was unnecessary that it be further shown by the admissions, or the 
express assertions, of the défendant himself as to what his purpose 
was in devising the artifice or scheme, and in working in pursuance 
thereof. 

Thèse considérations lead to the affirmance of the judgment of the 
trial court, and it is so ordered. 



, PERRY et al. v. TACOMA MILL CO. 

(Circuit Court of Appeals, Ninth Circuit. March 11, 1907.) 

1. Appeal and Beror— Liability on Supeesedeas Bond— Défenses. 

A clalm that certain property was not that covered by a mortgage, as 
it -was adjudged to be by a decree of foreclosure, cannot be set up in 
défense to an action on a bond given to supersede said decree pending an 
appeal therefrom, that question having been concluded by the decree. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 3, Appeal and Error, 
§§ 4792^794.] 



116 152 FEDERAL REPORTEK. 

2. Eqi'iiy— Mastees in Ciiancebt— Liability Tob Acts— Mobtqage Foee- 

CLOSUEB— Weongflil Setzuiîe of Peopektt. 

lu case property not embraced in a decree foreelosing a mortgage la 
aeized for sale by the master appoiiited to sell, such oflieer Is liable to 
tlie owner In trespass, or tbe owner may pursue any otber appropriate 
roiîiedy in any proper court, subjeet to tbe limitation that wbile the 
property is in the actual or eonstractive possession of the court under 
wliose process It was talcen It cannot be interfered witli by any otber 
court. 

3. Appeal and Eiîbor— Supebsedeas Bond — Nattjrb— Bbeach— TjIabilitt. 

After the rendition of a decree foreclosing a mortgage certain property 
was seized thereunder for sale. No application was made to the court 
for the release of the property as 'not embraced in the mortgage and 
decree, but a défendant obtained possession of it by talîing an appeal 
from the decree and giving a supersedeas bond conditioned that he would 
hnid the property "subjeet to the proper order and decree that may be 
entered finally in said cause." The decree was afflrmed, but pending the 
appeal the property was destroyed by flre. Held, that such bond was a 
forthcoraing bond, and the obligors were liable thereon for the value of 
the property as therein stated. 

4. SAiriî— SuMMARY Entey op Judgment, 

The court has power to enter a summary juagment on a supersedeas 
bond giv^n on appeal from a decree foreclosing a mortgage on personal 
property for the value of such property, where, after aiiirmance of the 
decree, it is not produced. 

[Ed. Note. — For cases In point, see Cent Dig. vol. 3, Appeal and Error, 
§ 4778.] 

Appeal from the Circuit Court of the United States for the Western 
District of Washington. 

Vance & Mitchell, for appellants. 
James M. Ashton, for appellee. 

Before GILBERT and ROSS, Circuit Judges, and WOLVERTON. 
Disti'ict Judge. 



ROSS, Circuit Judge. A suit was brought in the court below by 
the Tacoma Mil! Company against George Lawler, George Lawler 
doing business under the name of Sunset Lumber Company, A. P. 
Perry, and others, to foreclose a mortgage executed by Lawler to 
the plaintiiï. A final decree of foreclosure was entered therein Octo- 
ber 3, 1904, in and by which judgment in the aggregate amount of 
$19, 8 G 5. 57 was given against George Lawler, and George Lawler 
doing business as the Sunset Lumber Company, and foreclosing the 
mortgage, which was thereby adjudged to cover: 

"One complète double circular sawmill plant, capacity 40,000 feet per diem, 
including ail englues, boilers, saws, head-blocks, carriages, jaclvworks, shafts, 
pulleys, belting, conveyors, trucks, dryhouses, buildings, and ail niachinery 
and Personal property of every kind, nature, and description used in and 
about said sawmill, including ail mill tools, trucks, platforms, and tramways; 
also ten small portable houses for workmen, and two cookhouses with outiits 
contained therein; also six horses, one cow, eight pigs, forty chickens. aiid 
nll cooking utensils, supplies of every kind and nature, togetlier with ail 
leases, rights, and equities from the Northern Pacific Kailway Conip.-iny or 
others to the ground and premises upon which said mill is loeated; two s;e:i:i> 
Jogging engines, built by the Washington Iron Worlis at Seattlo, Wnsli., :u;n 
now used in connection with the logging business of said miU in ll'c liiili: ■ 
adjacent to said mill; the planer In said mill, together with ail iu:.:'...i.\, 



PERRY V. TACOMA MILL CO. 117 

and porsoual property of every kind, niiture, ami description in nnd abont 
siiitl logging camp or in any manner connected tlierewith, and adjacent and 
tributary to said mill and operated in connection tlierewith, tbe said mill 
l>lant and ail tlie property therein mentioned being located at wliat is Ivnowu 
;!s 'Mackintosb Siding' on tbe shore of Clear Lake, and near or upon tbe riglit 
of way of tbe Nortbern Pacific Railway in Tlrarston county, state of 'Wash- 
ington, tbe same being situate in section 23, townsbip 16 north, range 1 west 
of Tlie Willamette nieridiaii, and ail property in connection witb said saw- 
miil and logging plant at or near its said location, save and fixcepting only 
ïhe nianufactured luuiber and logs, located at said mill and above named, be 
fortbwitb sold." 

The decree contained thèse further provisions : 

"That tbe sale be conducted hy and under tbe supervision of the lion. 
Warren A. Worden, niaster of tbis court, and witb bis apjirobation and in 
aceordance with tbis decree and the act of Congrcss and rnles of tbis court 
in such cases uiade and provided, aiid tbat upon tbe flling of the master's 
report of said sale and the confirmation thereof, and upon a proper instru- 
ment or bills of sale being executed and delivered by said master, tbe pur- 
chaser or piu'cbasers at said sale be lot unto (into) tbe immédiate possession 
of any property so purcbased, and said master is bereby directed to so place 
said purchaser or purchasers in possession, and in the event of possession 
being withheld by tbe said A. P. Perry, or any défendant berein, or tbeir 
]irivios, or any one coming into possession thereof sinee, or claiming same 
under a rigbt aecruing since the commencement of this suit, tbe cîerk of 
tbis court is bereby directed to issue a writ of iissistanec against any par- 
ties so withbolding possession, and tbe United States marshal for tbe 
District of Washington shall exécute said writ. 

"It is furtber ordered, adjudged. and decreed tbat the défendant A. P. 
Perry, and ail of tbe défendants berein, and ail persons wb(>msoever, are 
bereby, and eacb of them is bereby. together witb bis employés, attorneys, 
servants, and agents, restrained and enjoined from in any manner inter- 
fering witb tbe purchaser in tbe exercise of liis rigbt to tbe immédiate 
possession and use of said property as such purchaser; and, the ))laintiff 
baviug specially moved tberefor, tbis court dotb furtber order, adjudge, 
and decree tbat the said A. P. Perry, tbe défendant berein, and ail other 
persons and tbeir employés, agents, and servants be, and they are bereby, 
enjoined and restrained from destroying, veinoving, altering, changing, or in 
any manner taking away from tbe premises upon wbicb said iiroperty is 
now located any part of tbe same jjending tbe sale bereinbefoi'e directed and 
the delivery of said property to the purchaser or purchasers thereof, and if, 
in tbe opinion of said master, there is danger of said property or any of it 
being removed or injured pending said sale and the purchaser or purchasers 
being placed in possession thereof, lie is hereby autbori^ed to take and 
safely keep said property, or any iiart thereof (pending said sale, confirma- 
tion, and tbe taking of ]>ossession by the purchaser or purchasers), without 
further order from this court so to do. 

"ïhat tbe défendants berein, A. P. Perry, Charles E. Ilill, and National 
Bank of Commerce of Tacoma, and eacb and ail of them, and eacb and 
ail of tbeir attorneys, agents, employés, successors in interest, or assigus 
be, and they are hereby, forever barred and foreclosed from and out of ail 
rigbt. title, and interest of any kind or character whatsoever in and to or 
growing eut of tbe mortgaged property bereinbefore described." 

Perry was not a party to the mortgage, but set up in défense of the 
suit ownership in himself of a large part of the property adjudged by 
the court to be covered by the mortgage, and therefore appeaîed to 
this court from the decree, and gave a supersedeas bond in the sum of 
$13,000, with his présent co-appellant as surety, the condition of whicb 
bond is as follows: 



118 152 FEDERAL REPORTER. 

"The condition of tlie above obligation is such tbat whereas, on October 
3, 1904, a decree was entered and slgiied in above cause o-rdering and direct- 
ing a foreclosure of one certain mortgage described in the pleadings herein, 
and whereas, A. P. Perry, principal herein, and défendant in said cause, is 
desirous of prosecuting an appeal from said decree to the Circuit Court of 
Appeals of the United States from the said decree and bas on this 3rd day 
of October, 1904, given notice of appeal from the said decree and every part 
tbereof, and whereas, the said A. P. Perry, principal herein and défendant in 
above cause, is desirous of superseding, setting aside and vacatiug the said 
decree so entered pending said appeal to the Circuit Court of Appeals of the 
United States : 

"Now, therefore, if the said A. P. Perry, principal herein, sball well and 
truly prosecute the said appeal and shall pay ail costs and damages that 
may be adjudged against him by reason of the said appeal or the dismissal 
therecf, and if the said A. P. Perry, principal herein, shall hold ail of the 
property levled on and seized by the United States marshal and the master 
in chaneery under and pursuant to said decree subject to the proper order 
and decree that may be entered finally In said cause by said Circuit Court 
of Appeals of the United States, and shall not waste or destroy any part 
tbereof but shall hold the same as above said, subject to the order and 
disposition of thls court or of said Circuit Court of Appeals, then tbis 
obligation shall be null and void, otherwise it shall hâve fuU force and 
effect." 

Upon the giving of this bond the proceedings initiated for the sale 
of the property claimed by Perry were suspended, and the property 
left in his possession. His appeal was subsequently dismissed by this 
court, leaving the decree of October 3, 1904, in full force and effect. 
Upon the going down of the mandate from this court the complainant 
in the case moved the court below for summary judgment against 
Perry and his surety for the amount of the penalty stated in the bond. 
A rule to show cause why such judgment should not be entered was 
issued and served upon the obligors of the bond, to which rule both of 
them made return, by motion to quash and demurrer, and, after a déniai 
of the motion and the overruling of the demurrer, by answer to the 
merits, by which answer they alleged in effect that the only part of 
the mortgaged property held by Perry was one engine and one edger, 
which were held by him subject to the mortgage, and that upon the 
hearing of the foreclosure cause Perry "ofïered to prove and did prove 
that the articles described in the mortgage herein and the plaintiff's 
bill were not in his possession at any of said times, and had not been." 
The appellants, in their answer to the rule to show cause, further set 
up that immediately after the entry of the decree of foreclosure of Oc- 
tober 3, 1904, the master of the court below, "notwithstanding the 
testiniony introduced and uncontroverted in this court at the taking 
of testimony herein," under and by virtue of the decree of foreclosure 
took possession of a certain mill and ail of its contents, alleged by the 
appellants to hâve been the property of Perry, "claiming that the said 
mill, together , with ail of its contents and articles described in the said 
mortgage, and as well taking possession of ail shops, bunkhouses, 
stables, offices, and paraphernalia of any, every, and ail kind situated 
on the said premises of this défendant; and that the said commissioner, 
by procurement of plaintifî herein, and acting under the guise and 
color of the said described decree, did oust this answering défendant 
from possession of his said premises, did interfère with the opération 
of his said mill and close up and injuriously impede the conduct of his 



PEERT V. TACOMA MILL CO. 110 

said business at said time, notwithstanding the protest and déclaration 
of this défendant formally and lawfully made to said acts ; that at tlie 
time of the entry of tlie said commissioner upon the said premises and 
his doing of the acts immediately above described at and by the pro- 
curement of plaintiff herein, the plaintiff, its officers, agents and em- 
ployés well knew that the property so situated upon the premises of this 
answering défendant at said place and taken possession of by said com- 
missioner, as above described, was not the property described in the 
mortgage herein and that the said mortgaged property was not in the 
possession of this answering défendant, and had not been and was not 
at the time of the institution of thèse proceedings; that the acts of 
the said commissioner and master in chancery in so entering the 
premises of défendant and in doing the things above described were 
unlawful, and that the procurement to their so being donc by plaintifif 
herein was unlawful, was a trespass and was without warrant in îaw, 
ail of which things were well known to plaintiff at the time of their 
doing." The answer then states that to obtain a release of the prop- 
erty so seized by the master under and by virtue of the decree, for the 
purposes of sale in accordance with its provisions, the supersedeas bond 
in question was given, and that shortly after the property was returned 
to Perry it was totally destroyed by fire. 

We agrée with the court below that the matters set up in respect 
to the ownership and identity of the property, and as to whether it was 
covered by the mortgage, constitute no défense to the présent proceed- 
ing. It is admitted by the appellants that it was claimed by the plain- 
tif? in the suit to be embraced by the mortgage and the decree of fore- 
closure, and that it was seized by the master under and by virtue of 
the decree, for sale thereunder, and that to release it from such sale, 
and to secure its return to Perry, the supersedeas bond was given. 
Appellant Perry had an opportunity to contest, on the trial of the 
foreclosure suit, the question whether the property was covered b}' the 
mortgage, and apparently did so without success. And if any of his 
property, not embraced by the final decree of foreclosure, was seized 
by the court's officer thereunder, the latter was liable to such owner 
for such illégal seizure "in trespass, or to any other légal remedy, at 
the suit of the party injured, in any proper court, with this limitation : 
that no such court can be permitted to interfère with the property while 
it is in the actual or constructive possession of the court under whose 
process it was taken." St. Paul, M. & N. Railway Co. v. Drake, 72 
Fed. 945-948, 19 C. C. A. 252. 

In the présent case the property in question was seized and held for 
sale by an officer of the court below under and by virtue of its final de- 
cree of foreclosure. No application was made to the court for a re- 
lease of the property by Perry, but, instead, he undertook to supersede 
the decree, and to cause the return of the property to him, by a bond 
conditioned that he (the appellant Perry) would hold the property 
"subject to the proper order and decree that may be entered finally 
in said cause by said Circuit Court of Appeals of the United States, 
and shall not waste or destroy any part thereof, but shall hold the same 
.as above said, subject to the order and disposition of this court or of 
said Circuit Court of Appeals." We think the court below was clearly 



120 152 FEDERAL REPORTER. 

right in holding the obligation a forthcoming bond, and, the property 
having admittedly been totally destroyed by fire, in holding the obligors 
liable for its value as therein statcd. Omaha Hotel Co. v. Kountze, 
107 U. S. 378, 2 Sup. Ct. 911. 37 L. Ed. 609 ; Dexter v. Sayward 
,(C. C.) 79 Fed. 237; Mahlman v. Williams, 12 S. W. 335, 89 Ky. 
382; Hinkle v. Holmes, 85 Ind. 405. The power of the court, to enter 
summary judgment upon a similar bond given in a foreclosure suit 
was affirmed by the Circuit Court of Appeals of the Eighth Circuit, 
in the case of Brown v. Northwestern Mutual Life Ins. Co., 119 Fed. 
148, 55 C. C. A. 654, and in the same case by the Suprême Court under 
the title of "Woodworth v. Mutual Life Lis. Co.," 185 U. S. 354. 22 
Sup. Ct. 676, 46 L. Ed. 945. See, also, Johnson v. Elevator Co., 
119 U. S. 388, 7 Sup. Ct. 254, 30 L. Ed. 447: Moore v. Huntington, 
17 Wall. 417, 21 L. Ed. 642 ; Blossom v. R. R. Co., 1 Wall. 655, 17 
L. Ed. 673; Bank v. Gordon (C. C.) 53 Fed. 471; Gordon v. Bank, 
56 Fed. 790. 6 C. C. A. 125; Pullman Palace Car Co. v. Washburn 
(C. C.) 66 Fed. 790. 
The judgment is affirmed. 



KREIGII V. WESTINGHOUSE, CHURCII, KKUR & COMPANY. 

(Circuit Court of Appeals, Eigbth Circuit. Mardi 6, 1907.) 

No. 2,423. 

1. Masteb and Servant— Injuries to Servant— Négligence— Evidence. 

lloofers were ushig a derrick and bueket to hoist cernent from the 
ground and unload It on the roof. No one but thèse workineu had been 
at work or moving about on the roof for several da.vs. The brick walls 
had not reached the top of the building. ïhe plaintilï was the superin- 
tendeiit of the bricliwork. They were ail employés of the défendant 
The roofers swung the boom aud bueket in over the north wall by means 
of a rope attached to the end of the boom, and sent It back by a luish. 
Just as they puslied it back ou one of Its trips the plaintifC came up ou to 
a i>lauk .just heyoïid the north wall, stepped iuto the path of the bueket, 
and stood there looking north to direct the construction of a scafCold, 
and the bueket knocked Uim ofC and in.-jured liim. 

Held, the défendant was not guilty of négligence because it failed to 
establish a code of signais for tlie roofers to eaable theni to waru olher 
employés of the approach of the bueket, nor because the derrick was not 
provided with a lever nor the boom with a guy rope ou its north side to 
steady and control its movenients. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 34, Master and Serv- 
ant, §§ 954-977.] 

2. Négligence — Injuby not Probable Result of, Not Actionable, Not 

PROXiifATB Cause. 

An injury which could not bave been foreseen or reasonably anticl- 
pated as the natural and probable resuit of au act of négligence is not 
actionable, because it is not the proximate cause, but either the reniote 
cause or no cause whatever of the damage. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 37, Négligence, §§ 
G9-82.] 

3. Master and Servant— Wiiere AVokk Necessarily Changes Charactek as 

TO Safety, Duty of Care for Safety tue Subvaxt's akd Not the Mas- 
teb's. 

The duty of cnring for the safety of a place or of maehinery lu cases 
In whicli the work which the servants are eniployed to do necessarily 



KKEIGTI V. WESTINGIIOUSE, CHURCH, KEER & CO. 121 

ohiuifres thc cîiamcter of tlie pince or of tlio niacliinery ,is to «afcty, as 
tlie work pi'osi'esses. is tlK> rtiity of tlie servants to whoiii tlic work is 
iutrusted, ancT it is not tlie duty of tlie iiiaster. 

[Ed. Note. — l''or cases iu point, see Cent. Dig. vol. 34, Master and Serv- 
ant, §§ 171, 200.] 

4. Same— Duty to I'rotect fkom Danoeks of Negltoekt Opération Serv 

ANT'S AXl) XOT JIaSTEK'S. 

Tlie dnty of coustruftion and provision is tlie master's. Tlie duty of 
opération and of protection froni ucfrlifient use is tlie servant's. 

Tlie duty of so using a rciisoiial)ly sufe piaco;, and of so operatiiig a 
reasonably safe niacliiiie, Diat neitlier tlie place nor tlie macîiine sliuH 
become danucrous by tlieir négligent use or opération, is the duty of 
tbe servants to wlioni tlie use or oiieration is intrusted, and it is not any 
part of tlie jiositive duty of tlie niaster. 

[Ed. Xote. — I<'or cases in iioiiit, see Cent. Dig. vol. 34, Master and 
Servant, § 2(i7.1 

(Syllabus by tlie Court.) 

In Error to tlie Circuit Court of the United States for the District 
of Kansas. 

Rees Turpin and Robert E. Morris (Edward D. ElHson and John E. 
McFadden, on the brief), for plaintiff in error. 

J. H. Harkless (C. S. Crysler and Clifford Histed, on the brief), 
for défendant in error. 

Before SANBORN, HOOK, and ADAMS, Circuit Judges. 

SANBORN, Circuit Judge. The plaintiff, the foreman in charge 
of the brickwork, and certain roofers were engaged in constructing 
a building. The steel frame had been erected and was about 43 feet 
in height, the bricklayers were at work rais'ng the walls which had not 
reached the roof, and the roofers were laying cernent upon the top 
of the building and were using a stiff leg derrick and an engine to 
hoist the material. This derrick was near the northeast corner of the 
structure, and the cernent was on the north side of the building. To 
a rope which extended over a pully on the end of the boom a bucket 
was attached. This was the method of opération: This bucket was 
filled with cernent and raised by means of the enj^ine and rope to a point 
a little higher than the top of the building, and was then swung in 
over the roof by means of a guy rope attached to the end of the boom 
on its south side. The cernent was then dumped from the bucket, 
and the roofers pushed the empty bucket back with sufScient force to 
cause it to swing clear of the nortii wall, and it was then lowered to 
the ground for another load. The plaintiff had been at work on this 
building, and thc roofers had been raising the cernent in this way, 
for some days, so that the plaintiff' knew the location and the gênerai 
opération of the derrick. As the concrète was hoisted, the bucket 
swung in over the north wall at the same place and in the same path 
each time. No one but the roofers was or had been at work or moving 
about on the top of the building for several days. Under thèse cir- 
cumstances, when, upon one of its tri]js, the bucket had been hoisted, 
drawn in over the north wall, and dumped, the p'aintift' c'imbed upon a 
plank on the north side of the north wall to superintend the constrtic- 
tion of a scaft'old below, and stood there looking north at the exact 



122 152 FEDERAL REPORTER. 

place where the bucket swung over tlie wall at the exact tîme that the 
roofers pushed it back for another load. The bucket knocked the 
plaintiflf to the ground and severely injured him. At the time o£ the 
injury he had been above the top of the building from 50 seconds to 
3 minutes. There was no évidence that he attempted to notify the 
roofers of his présence or that they were aware of it. Upon this 
State of facts the plaintiff sought to recover of the défendant for his 
injuries, on the ground that they were caused by its négligence in 
that it did not establish a System of signais to be used by the roofers 
to wam employés when the bucket was to cross the wall, and in that it 
did not provide the derrick with a lever, or the boom with a guy rope 
on its north side to steady and control its movements, and the error 
assigned is that the court instructed the jury to return a verdict for 
the défendant. 

Négligence is a breach of duty. Where there is no duty or no 
breach, there is no négligence. An injury that is the natural and 
probable conséquence of an act of négligence is actionable. But an 
injury which could not bave been foreseen nor reasonably anticipated 
as the probable resuit of an act or omission is not actionable, and such 
an act or omission is either the remote cause or no cause whatever of 
the injury. Cole v. German Savings & Loan Society, 124 Fed. 113, 
115, 59 C. C. A. 593, 595, 63 L. R. A. 416. If the défendant had di- 
rected the plaintiff to work in the path of this bucket, if he could bave 
performed his service in no' other place, and if in the discharge of his 
duty he could not hâve foreseen or protected himself against its ap- 
proach, it might hâve been the duty of the défendant to establish a 
code of signais and to so construct the derrick that the bucket could 
not hâve struck him unawares, and this because his injury might bave 
been reasonably anticipated from a failure to exercise such care. 
Western Electric Co. v. Hanselmann, 69 C. C. A. 348, 136 Fed. 666, 
70 L. R. A. 765 ; The Magdaline, 91 Fed. 798, 800. But the plaintiff 
was free to discharge his duty of superintendence at any place on or 
about the building. He could bave performed it as efficiently without 
as within the track of this bucket. Neither he nor any one except the 
roofers had been at work or moving about upon the top of the build- 
ing for several days, and no one could bave reasonably anticipated 
that he would suddenly rise above the roof and station himself upon the 
plank in the path of the bucket without notice to its operators and 
without watching for its approach. His injury was not the natural 
or probable resuit of, it could not hâve been anticipated from, the lack 
of a code of signais when there had been no one on the building to 
signal to for days, nor from the lack of a lever on the derrick with 
which to swing the boom, nor of a guy rope on the north side to 
draw it across the wall. As the accident could not bave been fore- 
seen to be the natural or probable resuit of the failure to provide 
signais, lever, or guy rope, the défendant owed the plaintiff no duty 
to do so, and was guilty of no actionable négligence. Chicago, St. 
Paul, Minneapolis & Omaha R. Co. v. Elliott, 5 C. C. A. 347, 350, 55 
Fed. 949, 953, 20 L. R. A. 582 ; Railway Co. v. Kellogg, 94 U. S. 469, 
475, 24 L. Ed. 256; Hoag v. Railroad Co., 85 Pa. 293, 298, 299, 27 
Am. Rep. 653. 



IN RE GEEAT WESTEBN MFG. CO, 123 

The rule of safe place is inapplicable to this case. The duty of 
construction and provision is the master's. The duty of opération and 
protection from négligent use is the servant's. The duty of so using 
a reasonably safe place and of so operating a reasonably safe machine 
that neither the place nor the machine shall become dangerous by their 
négligent use or opération is the duty of the servants to whom the use 
or opération is intrusted, and it is not any part of the positive duty of 
the master. The duty of caring for the safety of a place or of ma- 
chinery in cases in which the work which the servants are employed 
to do necessarily changes the character of the place or of the ma- 
chinery as to safety as the work progresses is the duty of the servants 
to whom the work is intrusted, and it is not the duty of the master. 
American Bridge Co. v. Seeds, 75 C. C. A. 407, 144 Fed, 605, 611- 
613, and cases there cited. The plaintiff and the roofers were fellovt' 
servants engaged in the common undertaking of constructing the 
building for a common master. The place where the building was 
constructed, the materials, and the machinery were free from any de- 
fects which contributed to this injury. A lever on the derrick to swing 
the boom or a guy rope on the north side of the boom to pull it over 
the wall would not hâve prevented the injury if the plaintifï had given 
no notice of his présence and the operator of the lever or of the guy 
rope had not seen him or notified him of the approach of the bucket. 
In other words, if the plaintiff himself and his fellow servants had 
pursued the same course with the lever and the guy rope as they 
pursued without them, the same resuit would inevitably hâve followed. 
Moreover, the only purpose of the lever or of the guy rope upon the 
north side of the boom would be to control the movement of the boom 
so that the bucket would not strike the plaintifï. But their absence did 
not prevent such a control, because there was a guy rope on the south 
side of the boom the end of which lay upon the roof of the building 
with which the roofers might hâve effectively controUed the north- 
ern movement of the boom and the bucket. The truth is that if there 
was any négligence in this case it was the négligence of the opération 
of a reasonably safe machine in a reasonably safe place. It was the 
négligence of the fellow servants of the plaintifï or of the plaintifï 
himself, and the défendant was free from any act or omission from 
which the accident could hâve reasonably been anticipated, or from 
which it would hâve resulted had it not been for the subséquent in- 
terposition of other human agencies. 

There was no error in the ruling of the trial court, and the judg- 
ment below is affirmed. 



In re GREAT WESTERN MFG. CO, 

(Circuit Court of Appeals, Eightli Circuit. March 4, 1907.) 

No. 81. 

1. Bankruptoy— Teustee's Title That of Bankrupt in Absence of At- 

TACIIING OB JUDGMENT CBEDITORS OE FEAUD. 

A trustée in bankruptcy stands in the slioes of tlie bankrupt, and 
has no better title than he, in the absence of fraud, or of attaching or 
Judgment creditors at the time of the filing of the pétition. 



124 152 FEDERAL REI'OKÏER. 

2. Same— Umfiled Contkact of Cokdittonal Sale Retaining Title in Ven- 

DOE Valid Against Trustée in Nebraska. 

A eontract of eontlitional sîile wliereby tlie parties agrée tliat the titlo 
8liall remain in tlie vendor until tlie purchase price is fully pald is void- 
able, under tlie statutes of Nebraska, by purcliasers, attacblug crcditors, 
and judguient ereditors only, if iiot liled lu the ofliee of the eounty elei'lv. 

It is valid against ail other ereditors though uuflled, and hence against 
a trustée in baukruptey who représenta no attachiug or judgment ereditors. 

3. Same — Distribution — Siiabes of Peoceeds or Mixed Pkopertt Propok- 

TioNED To Values of Respective Ownees of Property Sold. 

One who acquiesces in a sale under an order of tbe court of bis prop- 
erty and the property of tlie estate of tbe bankrupt in one lot, and tliere- 
after prays for a préférence in payment out of tbe proceeds of the sale, is 
estopped from receiving a larger proportion of tlie proceeds than the 
value of bis property bore to tbe value of tbe lot sold at the time of tbe 
sale. 

4. Same— VoiDABLE Préférence— Coktract Pbior to Four Montiis will 

NoT Pkotect. 

A mortgage or transfer of his property by an insolvent debtor within 
four montbs of tbe flling of a jietition in baukruptey against iiini. whicb 
otherwise constitutes a voidable préférence, is not deprived of tliat char- 
acter or validated by the fact tbat it was executed, in tlie jierformance 
of a eontract to do so inade more than four montbs before tbe fillng of 
tbe pétition. 
(Syllabus by tbe Court.) 

On Pétition for Review. 

John H. Atwood (William W. Hooper, on the brief), for petitioner. 
W. J. Courtright (Geo. L. Loomis, on the brief), for respondent. 

Before SANBORN, HOOK, and ADAMS, Circuit Judges. 

SANBORN, Circuit Judge. The J. T. Royston Milling Company, 
a corporation, was adjudged a bankrupt upon a pétition filcd on fanu- 
ary 6, 1905. Prior to September 6, 1904, the Great Western Manu- 
facturing Company, a corporation, had sold, installed, and put in op- 
ération in the Royston Company's mill at Fremont, in the state of 
Nebraska, certain machinery and material, for which at the time of 
their final acceptance it gave its proinissory notes for $10,034.00 and 
an agreement that the title and the right to the possession of the ma- 
chiriery and material should remain in the vendor until the notes were 
paid, notwithstanding any agreement or security that was or might bc 
taken for the performance . of the agreement, and that the payment 
of the notes should be secured by a mortgage on the mill and its 
appartenances, or équivalent security, at the élection of the Great 
Western Company. This agreement was first filed in the proper 
eounty clerk's office on October 8, 1901. On October 10, 1901, the 
vendee made a mortgage on the mill and its appurtenances which was 
recorded in the office of the register of deeds of the proper count}' 
on the same day. The mill and its appurtenances, including the ma- 
chinery and material sold by the Great Western Manufacturing Com- 
pany, were sold by order of the court below for $16,400. The Great 
Western Company immediately thereafter filed its claim, and asked 
that it be paid in fuU out of the proceeds of the sale in préférence to 
the claims of other ereditors. The référée allowed the claim for $10,- 



IN RE GEKAT WESTERN JIÎ'G. CO. 125 

532.50, and denied it any préférence. The District Court reversed 
this order, held that tlie agreement was valid and the mortgage a 
voidable préférence, and directed that the vendor should be paid in 
préférence to the other creditors such a proportion of the $16,400 
as the value of the machinery and material it sold bore to the value of 
the mill and appurtenances at the time of the sale of the latter. It 
now présents its pétition to revise this order because the court below 
did not uphold the mortgage and sustain its claim for a préférence 
thereunder for the entire amount of the bankrupt's debt to it. The 
trustée moves to dismiss the pétition because it was filed more than 10 
days after the order assailed was made, and because it involves dis- 
puted questions of fact which it is alleged can only be determined by 
appeal, and the trustée prays that if the merits of the case are consid- 
ered the petitioner be denied any préférence whatever. 

While it is true that counsel do not agrée upon the facts, the record 
fairly establishes those which hâve been stated, and upon them the case 
will be determined. The agreement of conditional sale whereby the 
vendor retained the title to the machinery and material until its pur- 
chase priée was paùl did not create a préférence voidable under the 
bankruptcy law because it was given for a présent considération, for 
the machinery and material which were and continued to be the prop- 
erty of the vendor, and because it was made more than four months 
before the pétition in bankruptcy was filed. Agreements of this nature 
which are not fJed or recorded in the proper public office are voidable 
by purchasers, attaching creditors, and judgment creditors only, un- 
der the statutes of Nebraska (Comp. St. 1901, Neb. c. 32, § 26 ; Camp- 
bell Printing, etc., Co. v. Dyer, 46 Neb. 830, 8:î6, 65 N. W. 904 ; Mc- 
Cormick Harvesting Machine Co. v. Callen, 48 Neb. 849, 67 N. W. 
863), and there was none of either class when the pétition in bankruptcy 
was filed in this case. The contract was therefore valid and enforce- 
able against the bankrupt and against bis ordinary creditors, and hence 
against the trustée, for he had no better right or title to the property 
than they, and he suffered no préjudice from the order of the court. 
Hewit v. Berlin Machine Works, 194 U. S. 296, 297, 303, 24 Sup. 
Ct. 690, 48 L. Ed. 986; Thompson v. Fairbanks, 196 U. S. 516, 25 
Sup. Ct. 306, 49 L. Ed. 577 ; York Mfg. Co. v. Cassell, 201 U. S. 344, 
352, 26 Sup. Ct. 481, 50 h. Ed. 782. 

The Great Western Company insists, how-ever, that it was entitled 
to payment of the entire amount of its claim out of the proceeds of 
the trustee's sale of the mill and machinery, because the proportion of 
those proceeds which the value of the machinery and material bore to 
the value of the mill and its appurtenances was but one-third, and 
under the order of the court it will sustain a heavy loss, and because 
it had a mortgage upon the entire property given in exécution of an 
agreement made more than four months before the pétition in bank- 
ruptcy was filed. The vendor had the right to take the machinery 
and material out of the mill and dispose of it as it saw fit. If it had 
applied to the court to do so and its application had been denied, it 
would hâve been entitled to recover of the trustée the value of its 
right. But it presented no such claim and made no application of that 
nature. The proceedings in bankruptcy were pending from January 



126 152 FEDERAL REPORTER. 

6, 1905, until May 25, 1905, before the sale was made. It was ordered 
on May 13, 1905, and the first act of the Great Western Company was 
the filing of a claim for a préférence in payment out of the proceeds 
after the sale had been made. Its acquiescence in the sale of its prop- 
erty in the mill with that of the bankrupt estopped it from receiving 
out of the proceeds of the sale of the entire lot any larger proportion 
than the value of its property bore to the value of the entire property 
sold. 

The mortgage was executed and recorded on October 10, 1904, with- 
in the four months prior to the filing of the pétition in bankruptcy. 
The mortgagor was then hopelessly insolvent. The efïect of the en- 
forcement of the mortgage will be to enable the mortgagee to obtain a 
greater percentage of its debt than any of the bankrupt's other credit- 
ors of the same class can obtain, and the référée and the court were 
of the opinion, in which we concur, that the mortgagee had reasonable 
cause to believe when the mortgage was made that it was intended to 
give a préférence thereby. But counsel persuasively argue that this 
mortgage escapes the ban of section 60 of the bankruptcy law (Act 
July 1, 1898, c. 541, 30 Stat. 562 [U. S. Comp. St. 1901, p. 3445]), be- 
cause it was made in the performance of the provision of the agreement 
of conditional sale that the notes of the vendee should "be secured by 
first mortgage on said premises and appurtenances (the mill site and 
mill), or équivalent security, at the first party's (the vendor's) élec- 
tion," and the question arises, is a mortgage or other transfer of an 
insolvent's property within the four months which is otherwise voidable 
as a préférence protected by an agreement to make it executed prior 
to the four months? The statutes regarding the filing and recording 
of mortgages and transfers do not condition this issue in the case be- 
fore us, and their effect will not be farther noticed, because the statutes 
of Nebraska do not avoid mortgages as against the mortgagors and 
their ordinary creditors for failure to file or record them. They make 
them voidable against attaching and jûdgment creditors only. Comp. 
St. Neb. 1901, c. 32, § 14; Forrester v. Bank, 49 Neb. 655, 68 N. W. 
1059; Lancaster County Bank v. Gillilan, 49 Neb. 165, 68 N. W. 352. 

Argument by analogy in support of an affirmative ahswer to the 
question hère at issue may well be drawn from In re J. F. Grandy & 
Son (D. C.) 146 Fed. 318, Wilder v. Watts (D. C.) 138 Fed. 426, Mc- 
Donald v. Daskam, 53 C. C. A. 654, 116 Fed. 376, and In re Witten- 
berg Veneer & Panel Co. (D. C.) 108 Fed. 593, 595, in which assign- 
ments of policies of Insurance within the four months pursuant to 
agreements to make them, executed prior to the four months, were 
sustained under peculiar circumstances ; and from Sabin v. Camp 
(C. C.) 98 Fed. 974, in which a conveyance within the four months upon 
a payment of the balance of the purchase price was sustained where it 
had been made in performance of a contract executed prior to the four 
months to the effect that the creditor should advance money to pur- 
chase the property, should hâve a lien upon it, and the option, which 
he exercised, to buy it at a specified price for the amount of the money 
he had advanced and the cash balance requisite to aggregate the re- 
quired amount 



■^ IN RE GREAT WESTERN MFG. 00. 127 

But the theory and purpose of the bankruptcy act were to dis- 
tribute the unexempt property which the bankrupt owned four months 
before the filing of the pétition in bankruptcy against him, share and 
share ahke, among his creditors of the same class. To this end every 
judgment procured or sufïered against him, every transfer by an in- 
solvent of any of his property, every conceivable way of depleting it 
after the commencement of the four months the efifect of which is "to 
enable any one of his creditors to obtain a greater percentage of his 
debt than any other of such creditors of the same class," is declared to 
be a voidable préférence if the créditer has reason to beUeve that a 
préférence is intended therebv. Act July 1, 1898, c. 541, and Act Feb. 
5, 1903, c. 487, 30 Stat. 563^ 32 Stat. 799 [U. S. Comp. St. 1901, p. 
3445; U. S. Comp. St. Supp. 1905, p. 689] ; Swarts v. Fourth Na- 
tional Bank, 54 C. C. A. 387, 389, 117 Fed. 1, 3. An agreement to 
mortgage or to transfer is not a mortgage or a transfer. The title r«- 
mains in the owner unincumbered by the mortgage until the mortgage 
or transfer is effected. When the agreement is made before, and the 
mortgage or transfer within, the four months, the title stands unincum- 
bered by the latter at the commencement of the four months, and the 
proceeds of that title are pledged under the bankruptcy law for the bene- 
fit of ail the creditors pro rata. Any subséquent mortgage or transfer 
withdraws that title or a portion of its value from thèse creditors, and a 
just and fair interprétation and exécution of the act demands that 
such a mortgage or transfer should be adjudged voidable if it is other- 
wise so, and that the mortgagee or transférée should be remitted to his 
original agreement. In this way the property at the commencement 
of the four months and its value may be preserved for the gênerai 
creditors, and the mortgagee or transférée may retain every lawful 
advantage his earlier contract confers upon him. Any other course of 
décision opens a new and enticing way to secure préférences, nuUifies 
every provision of the law to prevent them, and invites fraud and per- 
jury. Hold that transfers within four months in performance of agree- 
ments to make them before that time do not constitute voidable préfér- 
ences, and honest debtors would agrée with their favored creditors 
before the four months that they would subsequently secure them 
by mortgages or transfers of their property, and just before the péti- 
tions in bankruptcy were fîled they would perform their agreements. 
Dishonest men who made no such contracts might falsely testify that 
they had done so and thus by fraud and perjury sustain preferential 
transfers and mortgages made within the four months to relatives or 
friends. The great body of the creditors would be left without share 
in the property of their debtor and without remedy, and a law con- 
ceived and enacted to secure a fair and equal distribution of the prop- 
erty of debtors among their creditors would fail to accomplish one of 
its chief objects. This court will hesitate long before it approves a 
rule so fatal to the most salutary provisions of the bankruptcy law, 
and our conclusion is: 

A mortgage or transfer of his property by an insolvent debtor within 
four months of the filing of a pétition in bankruptcy against him, which 
otherwise constitutes a voidable préférence, is not deprived of that 
character or made valid by the fact that it was executed in perform- 



128 152 FEDERAL REPORTER, 

ance of a contract to do so made more than four months before the 
filing of the pétition. Wilson v. Nelson, 183 U. S. 191, 198, 22 Sup. 
Ct. 74, 46 L. Ed. 147; In re Sheridan (D. C.) 98 Fed. 406; In re 
Dismal Swamp Co. (D. C.) 135 Fed. 415, 417, 418; In re Ronk (D. 
C.) 111 Fed. 154 ; Pollock v. Jones, 124 Fed. 163, 61 C. C. A. 555 ; 
Anniston Iron & Supply Co. v. Anniston Rolling Mill Co. (D. C.) 
125 Fed. 974; Johnston v. Huff, Andrews & Moyler Co., 133 Fed. 
704, 66 C. C. A. 534; In re Mandel (D. C.) 137 Fed. 863. In Wil- 
son V. Nelson, 183 U. S. 191, 198, 22 Sup. Ct. 74, 46 L. Ed. 147, the 
debtor had given an irrévocable power of attorney to the créditer to 
confess judgment many years before. Judgment was confessed under 
it within the four months, and the Suprême Court held it to be a void- 
able préférence. In Re Sheridan (D. C.) 98 Fed. 40G, in Re Ronk 
(D. C.) 111 Fed. 154, and in Re Dismal Swamp Co. (D. C.) 135 Fed. 
415, 417, 418, mortgages executed within the four months in per- 
formance of agreements to give them made more than four months 
before the filing of the pétitions in bankruptcy were held to be void- 
able préférences, and this view seems to be sustained by the terms of 
the bankruptcy act, by the more cogent reasons, and by the weight of 
authority. There was therefore no error in the décision below that the 
mortgage constituted a voidable préférence, and that the limit of the 
vendor's preferential right was to receive the proportion of the pro- 
ceeds of the sale justly attributable to the machinery and the material 
the ownership of which it retained. 

The motion to dismiss the pétition because it is alleged that it was 
filed too late, and because the questions in issue are not reviewable 
under a pétition to revise, bave not been considered or decided, be- 
cause the sanie resuit follows from this décision upon the merits that 
would be reached by granting the motion. The pétition must be dis- 
missed in any event, and it is so ordered. 



J. W. BISITOP CO. V. PODSON. 

(Circuit Court of Appeals, Fourth Circuit. Mardi 12, 1007.) 

No. CG8. 

1. Trial— IxsTEUCTioKS — Appltcability to Issues. 

A re(iuest to cliarge tliat (lofendnnt was aiiswpraiilo only for noirligMipe 
occuiTiug iirior to tlie accident, and not afterwards, was properly refused 
as not witliin tlie issues. 

[Ed. Mote. — For cases in point, see Cent. Dig. vol. 4G, Trial, §§ 587-.'j95.] 

2. Masteb and Servant— Ixjukies to Servant— Actions— Instructions— Is- 

sues. 

Where, in an action for injuries to a servant, tlie jury were to déter- 
mine wlietlier or not défendant liad failed eitlier to furnisli proper nia- 
terials for tlie constnietion of a walliway, or to provide a compétent tore- 
man, to the injury of plaintifC, a request to cliavge that if the jury were 
satisfied that the accident liaiipened either from the ineonipeteuey of the 
forenian or from defendant's failure to provide proper materials witli 
which to construct the wallvway, and were unable to décide from whicii 
cause the accident happened, then they should find for défendant, was 



J. W. BISHOP CO. V. DOUSON. 129 

properly refuscd as restricting tbe jury too narrowly in its dctenuination 
of the issues of fact. 

3. SaME— CONCURKING CAUSES. 

Wliere a servant's injury resulted botli from tlie neglect of tlie master to 
provide proper niaterials and also from négligence of Ihe foreman aeting 
as a fellow servant, so tbat tlie two causes were conimingled, tbe servant 
was still entitled to reeover. 

[Ed. Xote. — For cases in i)oint, see Cent. Dig. vol. 34, Master and Serv- 
ant, §§ 515-534. 

Concurrent négligence of^iaster and fellow servant, see note to Maupin 
V. Texas & P. Ry. Co., 40 C. C. A. 236.] 

In Error to the Circuit Court of the United States for the West- 
ern District of Virginia, at Banville. 

Eugène Withers (Green, Withers & Green, on the brief), for plain- 
tifï in error. 

B. H. Custer, for défendant in error. 

Before GOFF and PRITCHARD, Circuit Judges, and MORRIS, 
District Judge. 

MORRIS, District Judge. On July 20, 1903, William Dodson, the 
plaintiff below, an employé of the j. W. Bishop Company, the plaintif! 
in error in this court, wliile carrying two pails of cernent across a 
walkway consisting of 2 planks 10 inches wide, placed for the purpose 
between two parallel piers about 13J feet apart, fell to the ground be- 
low, a distance of 25 or 30 feet. He was seriously and permanently 
injured. He brought suit against the J. W. Bishop Company, and by 
the verdict of the jury was awarded $3,200. Judgment was entered 
against the défendant corporation for that amount, and it bas brought 
the case to this court by writ of error. 

The J. W. Bishop Company was engaged in constructing a con- 
crète dam across the Dan river, and Dodson was one of its employés. 
He had been vvorking for the company fîve or six weeks at work on 
the ground in the channel of the river, under a gang foreman named 
Aubin. The day of the accident a foreman named Monahan, who had 
charge of mixing the cément, took Dodson from where he was working 
and directed him to carry cément across the walkway to near where it 
was to be used. He had been carrying cément in two pails, one in each 
hand, across the walkway for about an hour, when, according to bis 
testimony and that of other witnesses, one of the two planks broke 
under his weight, and he was precipitated to the ground some 25 or 
30 feet below. There was évidence tending to show that the man 
whose place Monahan called Dodson to take had refused to work 
and complained to Monahan that the planks of the walk were unsafe, 
and that others had also complained of the unsafety of the walkway. 
There was évidence tending to show that Monahan was, to the knowl- 
edge of Craib, v^dio was the gênerai superintendent of the défendant 
company and in gênerai charge of the construction of the dam, a reck- 
less and incompétent man, unfit to act as foreman. There was évi- 
dence tending to show that the planks used for the vi'alkway had been 
used in constructing the forms in which to mold the concrète in build- 
ing the dam, and were weakened by nails, cuts, and knots, and Vk'ere 
152 F.— 9 



130 152 FEDERAL REPORTEE. 

covered with cernent wliich concealed the defects. A witness, Brown, 
a carpenter, testified that under the direction of Washburn, a foreman 
of the carpenters, and under the observation of Craib, the gênerai 
superintendent, he built the runway of the old secondhand lumber with 
nail holes in it, and that it was made of two such planks, not cleated 
together. 

The case was tried on the issues raised by the first and third counts 
of the plaintiff s second amended déclaration. The first count alleged 
that the runway was constructed of planks which were weak, unsafe, 
and unsuitable, containing knots and cracks, which was known to the 
défendant company, or could hâve been known to it by the exercise of 
reasonable care and diligence, and that by reason of the said insufh- 
ciency the runway suddenly broke under the plaintiff, without any 
fault on his part. The third count alleged that the défendant placed 
over the plaintiff an incompétent, careless, and inefficient foreman, 
one John Monahan, as the défendant knew, or by the exercise of or- 
dinary care could hâve known, and by the said toreman the plaintiff 
was directed to carry cernent over a walkway known to said foreman 
to be of improper construction and dangerous, and, obeying said fore- 
man, the plaintiff went upon the walkway, and it suddenly broke, 
carrying him with it to the bottom of the channel, to the injury of the 
plaintiff, without any fault on his part, and that said injury to the 
plaintiff resulted from incompetency of said foreman, which was known 
to the défendant company. Thèse two counts very fully set out the 
plaintiff's cause of action, and specified explicitly the particulars in 
which the plaintiff alleged that the défendant had failed in its légal 
obligations, viz., that it had caused to be constructed a runway for 
which it had provided lumber of a weak and unsuitable kind, and had 
put over the plaintiff an incompétent and reckless foreman, who was 
known to the défendant to be so. 

There was évidence which, if believed by the jury, fully sustained 
both thèse counts, and in the matter of pleading we find nothing as- 
signed as error which calls for comment. A very similar case against 
the same défendant, arising out of a quite similar injury, tried by the 
same learned judge and by the same counsel, came before this court in 
J. W. Bishop & Co. v. Shelhorse, reported in 141 Fed. 643, 72 C. C. A. 
337, in which similar questions of pleading were ruled upon. 

In its défense in the présent case the défendant corporation offered . 
évidence tending to prove that the walkway was well made, of good ma- 
terial, and did not break, but that the plaintiff by reason of his own 
want of care fell off the walkwa3\ 

The court instructed the jury at the request of the plaintiff: (1) 
That in furnishing materials for the construction of the walkway the 
défendant company was bound to use reasonable ordinary care to 
provide reasonably safe and suitable material for the purpose, and that 
if the jury believed that the material furnished was not sufficient in 
quantity or reasonably safe, and that such unsafeness and insufïiciency 
was known, or by reasonable care should bave been known, to the de- 
fendant, and that by reason of such unsafeness or insufficiency the 
walkway collapsed while the plaintiff was on it in the performance of 
his duty, and without fault on his part threw the plaintiff to the bottom 



J. W. BI8H0P CO, V. DODSON. 131 

of the wheel pit and injured him, then they should find for the plain- 
tiflf. At the instance of the plaintiff the court also instructed the jury 
that if they found that Monahan was the foreman or boss in charge of 
plaintifï at the time he was injured, and that said Monahan was in- 
compétent or unreasonably reckless and négligent, and that such fact 
was known, or should by ordinary care hâve been known, to the de- 
fendant Company prior to the injury, and that such incompétence or 
unreasonable recklessness and négligence was the proximate cause of 
the injury to the plaintiff, they should find for the plaintiff. 

At the request of the défendant company the court instructed the 
jury: 

"That If they believe from the évidence in this case that the platform or 
walkway in question did not break, but that the plaintiff, Dodson, fell there- 
from by reason of failure on his part to exercise ordinary care and caution 
■while crossing the same in the performance of the ordinary duties of his 
employment, then they must find for the défendant" 

The court at the request of the défendant further instructed the jury 
that the employer is not a guarantor of the safety of his employé, and 
is required to exercise only reasonable or ordinary care and diligence 
in providing safe and suitable materials for the construction of and 
érection of platforms and other instrumentalities with and upon which 
his employé is to work, and is required to exercise only reasonable or 
ordinary care and diligence in inspecting such instrumentalities, and is 
required to exercise only reasonable or ordinary care and diligence in 
providing reasonably safe, compétent, and efficient foremen and co- 
employés with whom his employé is to work. And at the request of 
the défendant further instructed the jury that if the jury believed from 
the évidence: (1) That the défendant exercised reasonable and ordi- 
nary care and diligence in the ordering, selecting, and providing ma- 
terials necessary for the walkway, and ordinary care and diligence in 
erecting and constructing it, and in examining the same after it had 
been constructed, se as to reasonably provide for the safety of the 
plaintiff; and if the jury further believe from the évidence that the de- 
fendant company exercised ordinary or reasonable care and diligence 
in providing safe, compétent, and efficient bosses or foremen under 
whom the plaintiff was put to work, and in providing reasonably safe, 
compétent, and efficient co-employés with whom to work — ^then the 
jury must find for the défendant company, even though they believe 
from the évidence that the said walkway broke from some hidden, con- 
cealed, or latent defect in the materials supplied for its construction, 
which said défendant company did not know, or could not hâve ascer- 
tained by the exercise of reasonable or ordinary care and diligence. 
The court at the request of the défendant company further instructed 
the jury that the défendant was not the guarantor of the safety of Dod- 
son, the plaintiff, and was not bound to provide only the best and 
safest instrumentalities, structures, and platforms, nor to exercise the 
highest skill and care in inspecting the same, nor to use the best method 
for their construction, nor to provide the best and safest place in which 
the plaintiff was to work, nor to provide the best and most efficient 
bosses and foremen, nor the best, most compétent, and most efficient 
co-employés with whom to work, but only to exercise reasonable or 



132 152 FEDEEAL KErOETBB. 

ofdinary care to furnish such structures and platforms as were reason- 
ably safe, and to exercise only reasonable or ordinary care in inspect- 
ing the sanie, and in providing a reasonably safe place and compétent 
and efficient bosses and foremen and co-employés under wbom and 
with whom to work, and that the plaintifï, Dodson, must bave also used 
reasonable or ordinary care to protect and save him,self froni injury; 
and that, to entitle the plaintiff to recover, the burden of proof was on 
the plaintiff to show (1) that the walkway was defective, or that the 
material therein was defective; or (2)' that the erecting and construct- 
ing of it was not donc with reasonable or ordinary care; (3) or that 
reasonable or ordinary care was not used in providing reasonably safe, 
compétent, or efficient bosses and foremen under whom to work, or 
reasonably safe, compétent, and efficient co-employés with whom to 
work ; and (4) that the plaintiff did not know that such ordinary care 
had not been exercised by the défendant company, and that the injury 
complained of happened in spite of ordinary care on Dodson's part. At 
the défendant company's request the court further instructed the jury 
that an employer is presumed to havc performed ail his duties to bis em- 
ployé, and that the négligence of the employer cannot be inferred from 
the mère occurrence of the accident, such as the fall of the walkway, and 
that fact alone did not raise even a prima facie presumption that the dé- 
fendant Company had been guilty of négligence or guilty of a breach of 
duty to the plaintiff, and it was incumbent on the plaintiff to show how 
and why the accident occurred, or some fact from which the jury could 
détermine how and why the accident occurred. And the court it the 
request of the défendant further instructed the jury that if they believed 
from the évidence that the plaintiff had gone upon the projecting end 
of the plank forming the first walkway, and by its tilting the plaintiff 
lost his balance and f ell, they must find for the défendant company al- 
though they believed from the évidence that the défendant failed to 
use ordinary or reasonable care in furnishing reasonably safe materials 
in sufficient quantifies out of which to construct said walkway. And 
the court, of its own motion, instructed the jury; 

"You cannot find for the plaintiff merely on the snpposition that two planks, 
(it Sound), made an insufflcient structure, that is, ou the idea that tlie walk- 
way should hâve been broader or shouid bave had haud railing. If the only 
(lefect was the want of greater width or want of a band rail the defect was 
open and obvlous and défendant is not llable for such defect." 

We bave recited the instructions given by the court with unusual 
fullness, that it may appear how explicitly the law favorable to the de- 
fendant was explained to the jury, and how carefully, by the granting 
of the instructions asked for by the défendant, the law protecting its 
rights was given to the jury. Other instructions asked for by de- 
fendant's counsel, but which were not given by the court, related in 
part to matters not in issue in the case, as that the défendant was an- 
swerable only for négligence occurring prior to the accident, and not 
afterwards. There was no basis in the case for a contention of that 
sort. That the défendant couîd not be held answerable in respect to a 
defect which was open and obvions ; this, although it was not an issue 
made on the pleadings or the évidence, was given by the court in its 
own instruction in the form most pertinent to the case. The défend- 



J. Vf. BISHOP CO. V. DODSON. 133 

ant contended tliat the walkway vvas made of plank which was sound 
and without discoverable defect. The plaintiff's witnesses asserted 
that it was old, weak, and unsuitable, and by prior use had been cov- 
ered with cernent so that the defects were hidden at the time the plain- 
tiff was injured. The foundation fact first to be found by the jury 
was, did the walkway break under the plaintiff's weight and let him 
fall, or did he fall ofif without its breaking? The jury were plainly 
told that, if they found that he fell off, the plaintifif could not recover. 

Another instruction asked by the défendant, but not given by the 
court, was to the effect that if the jury were satisfied that the accident 
happened either from the incompetency of the foreman, Monahan, 
or from the failure of the défendant to provide proper materials with 
which to construct the walkway, and the jury were unable to décide 
from which cause the accident happened, then they should find for the 
défendant. It seems to us that this instruction as asked for by the de- 
fendant limited the jury in its détermination of the issues of fact too 
narrowly. The jury were to détermine under the instructions given 
them whether or not the défendant had failed in its duty, either to fur- 
nish proper material or to provide a compétent foreman, to the injury of 
the plaintiff. Their verdict was to be a gênerai one. They had no spé- 
cifie questions propounded to them for their answer. Thcre was an 
abundance of testimony adduced by the plaintiff to support a finding in 
his favor on both the issues. If the jury, while obeying the instruc- 
tions given by the court, arrived at a verdict, they could not be re- 
stricted to arriving at the resuit by each agreeing to the same view of 
each item of testimony. Moreover, if the plaintiff's înjury resulted 
both from the neglect of the défendant to furhish proper materials 
and from some négligence of Monahan as a fellow servant, so that the 
two causes were commingled, then still the plaintiff was entitled to 
recover, for the reason that where the négligence of the master in not 
supplying proper material has a share in causing injuries to an em- 
ployé, the master is liable notwithstanding the négligence of a fellow 
servant may hâve contributed to the accident. Gila Valley R. R. Co. 
v. Lyon, 203 U. S. 46-5, 37 Sup. Ct. 145, 51 L. Ed. . 

There were exceptions by the défendants to the admission of certain 
questions and answers tending to show that the foreman, Monahan, 
was known to the défendant to be an unsafe, reckless foreman. We 
hâve examined them with care without finding in them any réversible 
error. 

The law of the case appears to hâve been very carefully given to the 
jury, and the distinction observed that as to temporary structures and 
appliances constructed by the workmen themselves for use during 
the progress of the work the rulc of safë place does not apply. This dis- 
tinction was pointed out in a récent case in this court, Phœnix Bridge 
Co. V. Castleberry, reported in 131 Fed. 175, 65 C. C. A. 481, in which 
the opinion was written by the learned judge who tried the présent 
case below. 

We find no error prejudicial to the défendant, and the judgment 
is affirmed. 



134 152 i'EDBUAL BKPOilTKU. 

LACEY V. LOUISVILLE & N. R. CO. 

(Circuit Court of Appeals, Flfth Circuit. Marcli 19, 1907.) 

No. 1,611. 

1. RAUBOADS — t>EA.TH AT CeOSSING — WANTONNESS — CONTBIBUTORY NEGLI- 

GENCE. 

Contributory négligence Is no défense to an action against a railroad 
Company for the willful or wanton killing of plaintiffs intestate at a 
railroad crossing. 

[Ed. Note. — ^For cases in point, see Cent. Dig. vol. 41, Rallroads, § 1085.1 

2. Same—Willfulness— Evidence— Question fob Jury. 

Where défendant railroad conipany kicked certain freight cars across a 
public crossing likely to be used by pedestrians or vehicles at any time, 
witliout any one to control their niovements or to give warning of tlieir 
approacli, and such cars came in contact with plaintiff's intestate as he 
was about to cross, vi^bether the railroad company's act vs^as willful or 
wanton was for tlie jury. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 41, Railroads, § 1192.] 

In Error to the Circuit Court of the United States for the Southern 
District of Alabama. 

The plaintifC in error, and plaintifC below, brought her action in the circuit 
court of Conecuh county, Ala., against the Louisville & Nashville Railroad 
Company for the homicide of her husband on a public crossing over the traek 
of the défendant railroad at Sparta, in Conecuh county, Ala. On motion of 
défendant the cause was removed to the Circuit Court of the United States 
for the Southern District of Alabama. 

Tlie facts connected with the occurrence resulting in the death of plaintiff's 
intestate and her husband were as follows: The railroad tracks at the point 
in question run nearly north and south, and the public crossing nearly east 
and west. The post ofHce, dépôt, and the dépôt platform were on the east 
side of the crossing, and deceased lived on the west side of the railroad track 
about 40 or 50 yards from the public road. On the 21st of April, 1905, at 
about 2 o'clock in the afternoon, the deceased started over the crossing on bis 
wny to the post office. A slag train had been standing for some time on the 
side track north of the crossing. As deceased started across he was followed 
by hts two daughters, who were some few feet behind him. Just at that time 
a freight train was coming up approaching the crossing from the south, and 
apparently very near the crossing. The deceased crossed swiftly in front of 
it and approached the side track, which was some eight or nine feet from the 
main line on which the freight train came from the south. As deceased 
stepped upon the side track he was struclt by some cars detached from the 
.slag train, consisting of a caboose and one or two slag cars which were being 
"kicked" over the crossing. Deceased was struck, knocked down, dragged for 
some distance, and killed. 

Ali the évidence seems to show that the deceased did not see the approach- 
ing loose cars before they struck him. So far as the évidence shows, there 
was no one upon the detached cars which were being "kicked" over the crossing 
to control their movements, or to give warning of their approach, and the 
évidence in the record ail tends to show that no warning of any kind was 
given. The évidence shows that the day on which this homicide oceurred was 
strawberry shipping day at Sparta, and that quite a number of people were 
there on that business ; in some parts of the évidence it is said from 25 to 
oO, and some other witiiesses put the number at from 25 to 50. The évidence 
also shows that the crossing was used that day to an unusual extent. The 
train on which the strawborries were to be shipped was due to arrive at 
Sparta about S o'clock in the afternoon, a short time after the homicide oc- 
eurred- 



LACET V. LOUISVILLE & N. E. CO. 135 

There was an amendment to plaintiff's déclaration whieJi alleged that the 
défendant"* agents and servants "wantonly ran one of said cars against 
plaintiff's intestate and thereby caused his death." The défendant pleaded 
contributory négligence in several forms, some of the pleas being npon the 
ground that the deceased was standing on the track at the crossing at the 
time he was strieken. There was a demurrer to the plea of contributory nég- 
ligence on the ground that it was no answer to paragraph C of the amended 
déclaration, which charged wantonness, and the demurrer was sustained. The 
case went to the jury, and upon the conclusion of plaintiff's évidence, embody- 
ing Rubstantially what has been briefly stated above, the court directed a 
verdict in favor of the défendant, and this action of the court is asslgned 
as error. 

D. M. Powell, Edward M. Robinson, and John W. McAlpine, for 
plaintiff in error. 

Gregory L. Smith and Harry T. Smith, for défendant in error. 

Before FARDEE and McCORMICK, Circuit Judges, and NEW- 
MAN, District Judge. 

NEWMAN, District Judge, after stating the facts, delivered the 
opinion of the court, as foUows : 

We think that this cause should hâve been submitted to the jury. 
We are not sure, under ail the facts and circumstances connected with 
the case as brought out by the plaintiff's évidence, that it should not 
hâve gone to the jury upon the question of négligence and contributory 
négligence, without référence to a further view of it, which is thought 
to be controlling. The learned judge who tried this case in the Circuit 
Court had sustained a demurrer to the pleas of contributory négligence 
in so far as thèse pleas operated against paragraph C of the amended 
déclaration, which charged that the act of the defendant's servants 
and agents in kicking the cars over a public crossing without any one 
to control their movements or to give warning of their approach was 
wanton. The effect of this was to hold that contributory négligence 
— that is, ordinary négligence — was no bar to wanton or willful mis- 
conduct. We agrée with this view of the law, and we think it also re- 
quired the submission of the case to the jury upon the question as to 
whether the acts of defendant's employés, in sending thèse cars over 
the crossing in the way they did, was wanton and willful, in that it 
was done in total disregard of the safety of persons using the crossing. 

The law with référence to wanton and willful misconduct on the 
part of a défendant, and contributory négligence on the part of the 
plaintiff, was stated by this court (Judge Pardee dissenting), in McGhee 
V. Campbell, 42 C. C. A. 94, 101 Fed. 936, as foUows : 

"There is another view of this case that shows the court did not err in re- 
fusing to direct a verdict for the défendants. The chief reason urged why the 
case should hâve been taken from the jury is that the plaintifï's intestate was 
guilty of contributory négligence. This reason, if well founded on fact, does 
not meet the entire case on trial, because in some of the counts the défendants 
were charged with committing the act complained of wantonly, recklessly, and 
negligently. To thèse counts the défense of contributory négligence was not 
good. They were at issue only on the plea of not guilty. In cases where the 
injury is wanton or willful, the doctrine of contributory négligence has no ap- 
plication. A demurrer was properly sustained to such plea to thèse counts. 
Now, If there was évidence before the jury tending to prove the allégation of 
thèse counts, and to show that the acts complained of were committed wan- 



136 152 FEDERAL EEPORTEK, 

tonly and recklessly, then the case could not proporly be taken from tbe jury 
even if the évidence, admitted under tlie pleas to tlie otlier couiits cliarpins 
simple négligence, as matter of law had shown contributory négligence. It is 
elear that one wlio commits a wrong willfully caniiot défend by saying that 
the injured person was guilty of négligence. Cooley, Torts (2d Ed.) p. 810; 
Beach, Contrib. Neg. (2d Ed.) § G4 ; Itailroad Co. v. Marlœe, 103 Ala. ICO, 15 
South. 511, 49 Am. St. Rep. 21. The évidence, vi-e think, to say the least. 
tended to show wanton négligence, or reclvless indifférence to the pr(ibal)le 
conséquences of the acts compîained of, which is construed to be the équiva- 
lent of intentional or willful." 

Judge Shelby, delivering- the opinion of the court in that case, also 
quotas from Electric Co. v. Bowers, 110 Ala. 328, 331, 20 South. 345, 
346, this language : 

"To constitute a willftil injm-y, there must be a design, purpose, intent to do 
wrong and inflict injur,y. Tlien tiiere is that reckless indifférence or disrcgard 
of the natural or probable conséquences of doiiig an act, or omission of an 
aet, designated, whether accurately or not, in our décisions, as 'wanton négli- 
gence,' to wliich is iniputed tiie sanie degree of culpability, and held to be 
équivalent to willful injury. A purjiose or intent to injure is not an ingrédient 
of wanton négligence. Where either of tliose exist, if damage ensues, the in- 
jury is willful. In wanton négligence, the parly doing the act or failing to 
act is conscious of bis conduct, and, without having the intent to injure, is 
conscious, from his knowledge of existing circumstances and conditions, that 
his conduct will likely or probably resuit in injury. Thèse are the distinc- 
tions between simple négligence, willful injury, and that wanton négligence 
which is the équivalent of willful iujury, drawn and applied iu our décisions." 

He also quotes from Railroad Co. v. Hill, 90 Ala. 71, 80, 8 South. 
90, 92, 9 L. R. A. 442, 24 Am. St. Rep. 7G4, to this effect : 

"We are satisfled that it tended to sliow a condition of the traek not to 
know and remedy which was such gross négligence on the part of tlie company 
as implled reeklessness and wantonness; such indifférence to the probable 
conséquences of its continuai use as is the équivalent of intentional wrong, 
or a willingness to i^iflict the injuries compîained of." 

He also cites to the same eftect from Railroad Co. v. Alarkee, 103 
Ala. 160, 15 South. '511, 49 Am. St. Rep. 21, and Railroad Co. v. Orr, 
121 Ala. 499, 26 South. 35. 

Thèse Alabama décisions, if based on a statute of Alabama, would 
be controlling ; ' and even if not based on a statute, would be highly 
persuasive authority in any L'nited States court held in that state. 
The cases hold substantially on the question involved hère that reckless 
disregard of what may be the probable conséquences of an act calcu- 
lated to cause injury is wanton négligence, and is the équivalent of 
willful misconduct. This doctrine seems to us to be entirely sound. 
To throw; cars over a public crossing likely to be used by pedestrians 
or vehicles at any time, without any one to control their movements 
or to give warning of their approach, is certainly reprehensible, and 
might, or might not, be found by the jury, according to the circumstan- 
ces surrounding the particular case, such a total disregard of the safe- 
ty of others as that it would amount to wanton and willful misconduct. 

The practice of making tiying switches, which we understand em- 
braces what is hère called "'kicking" cars over public crossings, is 
discussed by Beach on Contributory Négligence (3d Ed.) § 217, citing 
a large number of authorities supporting the text, as follows: 



IN KE A. B. BAXTEK & CO. 137 

"The method of switehing known as mnkiug a 'runiiiug' or 'flying' switch 
is constantly a fruitful source of accident to persons walking or being upon 
the tracks. It consists in detacliing tlie portion of tlie train to be switcbed 
ofî while the cars are in motion, the lorepart of the train advancing witii 
increased speed, while the rear portion, proceeding more slowly, is, at the prop- 
er time, switcbed olï upon the desired track ; or the eugine may push forward 
a car or part of a train with considérable speed, and then, giving It a strong 
propulsion, send it ofC alone on the desired switeb. This practice, in many 
courts, is condemned as négligent, eveu towards trespassers. And when the 
cars are sulïered to run over a crossing, after being detachod froni the train, 
in making a tlying switch, \vherel)y travelers are injured, it is held negligene<' 
of an aggravated nature, and the iJractice is not unfreauently sharply de- 
nounced by the judges." 

As there must be another trial of this case, it would be improper for 
the court to express any further opinion of the facts than is necessary 
to State the views entertained on the questions controlhng it. The de- 
fendant's évidence may change materialiy the aspect of the case, but in 
our opinion the plaintiff's évidence, as shown by this record, entitled 
her to go to the jury. 

The judgment of the court below is reversed, with directions to 
grant a new trial. 

PARDEE, Circuit Judge, does not concur. 



In re A. B. BAXTER & CO. 

In re BLITCII (two cases). 

(Circuit Court of Appeals, Second Circuit. January 9, 1907.) 

Nos. 104, 107, 242. 

1. Gaming— "Wageeixg Teans.vctions— Sales roK Future Deliveky. 

A transaction by which property is bought and sold for future delivery. 
and which is legitimate on its face, cannot be held void as a wagering 
contract because one of the parties understood and nieant it to be so, but 
the proof must go further and show that such understandlng was mutual. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 24, Gaming, § 22.] 

2. Same— Transactions with Bucket Siiop— Ukdekstanding of Parties. 

The probability that an intelligent and experienced business man who 
enters upon a course of spéculative dealings with a bucket shop does so 
with the understandlng that the purchases or sales are to be mercly color- 
able is so strong as to aniount to a presumption of fact, which is not 
overcome by bis testimony to the contrary given in bis own interest, nor 
by a récital in confirmation slips given on receipt of the orders that actual 
delivery was in ail cases understood, which in itself iridicated that it was 
inserted for some ulterior purpose. 

Pétition to Review Order of, and Appeal from, the District Court of 
the United States for the Southern District of New York. 

F. M. Czaki and Fried & Czaki, for petitioner. 
J. J. Adams, for bankrupt. 

Before WAEEACE, EACOMBE, and TOWNSEND, Circuit 
Judges. 



138 152 FEDERAL REPORTER. 

PER CURIAM. The executors of Blitch and the alleged banknipt 
hâve each appealed from an order of the court below allowing the 
claim of BHtch as a creditor, and adjudging the amount at $11,346. 
It is insisted on the part of the alleged bankrupt that the çlaim should 
hâve been disallowed in its entirety, and in behalf of the executors that 
a considerably larger sum should hâve been adjudged owing. The 
District Court referred it to a spécial commissioner to take the évidence 
in respect to the claim and report to the court with his opinion. The 
case presented is this: 

Baxter & Co. was a New York corporation having its principal 
place of business in New York City, and having also branch offices in 
varions parts of the country, including one at Savannah, Ga. Its os- 
tensible business was that of a broker in the business of buying and sell- 
ing securities and produce, but its real business was that of a "bucket 
shop," dealing with customers who deposited small margins and specu- 
lated Upon the fluctations in the market priées. It received orders and 
purported to exécute them at the market price, and credited or charged 
the accountof the customer accordingly; but it executed the orders on- 
ly upon its books. Thèse orders were sent bv wire from the office at 
which they were received to the principal office, and a confirmation 
slip was delivered to the customer, signed by Baxter & Co. Thèse 
slips contained this clause : 

"We receive no orders except with the understanding that the actual deliv- 
ery of property boiight or sold is in ail cases contemplated and uuderstood. 
It is further understood and agreed that on ail marginal business the right is 
reserved to close transactions when the marlîet value indicates an iusuffleiency 
of margin in our hands to prevent loss to us, without notice and at public or 
private sale." 

Blitch resided in Georgia, and in January, 1903, opened a spéculative 
account with Gray, the agent of Baxter & Co., at its branch office in 
Savannah, For three years previously he had had a spéculative ac- 
count with Murphy & Co., a concern carrying on a bucket shop at Sa- 
vannah. He was a merchant, doing a business of forty or fifty thou- 
sand dollars a year, and postmaster of the village in which he lived. 
Between January and August 7th, Blitch gave the Savannah office 
tiumerous orders to buy and sell cotton, and some to buy mining shares, 
and received for each order a confirmation slip such as has been refer- 
red to. On the 7th day of August, 1903, a number of thèse orders 
were outstanding. The value of the property, at the market priées 
represented by the orders to purchase, was nearly $120,000, and of the 
property represented by his orders to sell was about $40,000. At the 
market priées, on the opening of business of that day, there would hâve 
been a margin in his favor of about $1,000. There was much fluctua- 
tion in the cotton market, and his orders were most of them for the pur- 
chase or sale of cotton for future delivery. He was informed by Gray 
that his account needed additional margin by four or five hundred dol- 
lars, and thereupon he gave Gray a check, and a note payable in the 
future, amounting together to $476.81, and received a receipt therefor. 
August lOth he was notified by Gray that he could not use the note, 
and more margin must be put up at once "or he (Gray) should bave 



IN RE A. B. BAXTER & CO. 139 

to hedge the trades in September cotton and in Amalgamated Copper." 
Blitch protested, but shortly after the market opened Baxter & Co. 
closed some of the orders by a nominal sale of the September cotton 
and the shares of Amalgamated Copper. August 18th it closed the 
rest of the orders except one for the purchase of 50,000 pounds of ribs, 
and on September Ist it closed the order for ribs. Baxter & Co. duly 
notified Blitch of the closing of his orders at the respective times there- 
of. The market advanced subsequently, so that within the next 30 days 
Blitch could hâve reaHzed a large profit on his orders to purchase. 

The spécial commissioner found as facts that Gray had received the 
note given by Blitch as so much cash, and that at the time Baxter & Co. 
closed the orders Blitch's customary margin was not exhausted. He 
also made the f ollowing findings : 

"The évidence forces me to the conclusiou that Mr. Blitch never expeeted 
to reeeive and pay for the merehandise that he purchased, or to dellver the 
merehandise he sold, but that his intention in each instance was to settle on 
différences. With much doubt I find as a faet that Baxter & Oo. had rep- 
resented to him that in every instance they actually executed each order he 
gave them, and that he supposed Baxter & Co. were doing a legitimate broker- 
age business and were actually carrylng for hlm the merehandise he had di- 
rected them to purchase or to sell." 

As matter of lavi^ the spécial commissioner found that the relations 
between Blitch and Baxter & Co. were the same as though the repré- 
sentations made by it to Blitch, and believed by him, had been true; 
that the acts of Baxter & Co. in closing the orders given by Blitch were 
équivalent to a conversion of the property represented by the orders to 
purchase ; and that Blitch was entitled to recover as damages the high- 
est value of the property intermediate the time of the conversion and 
a reasonable time after he had been notified thereof. He also found 
that as to the cotton and the copper stock 15 days was a reasonable 
time, and as to the ribs 30 days was a reasonable time. 

It is contended for the alleged bankrupt that no recovery should hâve 
been allowed Blitch for the conversion of the property which he had or- 
dered Baxter & Co. to purchase, because his claim is founded merely 
upon a breach of an agent's instructions in carrying out wagering con- 
tracts. If it was the understanding between Blitch and Baxter & Co. 
that their dealings would be those ordinarily carried oa between a cus- 
tomer and a bucket shop, or that Baxter & Co. would not actually ex- 
écute the orders according to the custom of brokers, so that there would 
be no future delivery of the property ordered to be purchased, the 
transactions between them were in furtherance of a mère gambling 
scheme, and a recovery could not be permitted. 

It is too well settled to need any citation of authority that contracts 
for the purchase of property to be delivered at a future day are not void 
as wager contracts merely because the property is not in existence in the 
hands of the seller and is to be subsequently acquired by him. It is 
equally well settled that a transaction which is on its face legitimate 
cannot be held void as a wagering contract by showing that one of the 
parties to it understood and meant it to be so. "The proof must go 
further and show that this understanding was mutual — that both par- 
ties so understood the transaction," Irwin v. Williar, 110 U. S. 499, 



140 152 FEDERAL REPORTER, 

508, 4 Sup. Ct. 100, 28 L. Ed. 225 ; Eibb v. Allen, 149 U. S. 481, 492, 
13 Sup. Ct. 950, 37 L,. Ed. 819. As a man caiinot gamble vvith himseif, 
and there must be two parties to a wager, it is not eiiough that Blitch 
never intended or expected that the property ordered should be deliv- 
ered to him nor is it enoiigh that Baxter & Co. never expected or in- 
tended to secure such a delivery by executing the orders to purchase. 
In Farnum v. Whitman, 187 Mass. 381, 73 N. E. 473, the court used 
this language: 

"At common law, In order to render a oontract void as a wagering con- 
traçt, it must appear that botb iDarties understood and agreed, expres^sly or 
iiriïtliedl.y, to the things which constituted It as mntter of law a wagering con- 
trafet. 'ïhis does no rest on groiinds pèculiar to wagering contracts. ïhe nn- 
expressed or uneommunicated intention of. one party to a contract is not bind- 
ing uppn the other party to the contract. In order to be binding, tUe intention 
inust be common to both." 

That this is the law o£ Georgia sufficiently appears by Forsyth Mfg. 
Ce. V. Castelin, 112 Ga. 199, 37 S. E. 485, 81, Am. St. Rep. 28, where in 
an action by brokers it was contended that the transactions involved 
were deMlings in fictitiou's "futures." The court held that transactions 
of that kind were not invalid unless it appeared "that neither of the par- 
ties contefnplated an actiial delivery of the goods, and that it was the 
intention of both that there should be no actual delivery, but on the 
day fixed for delivery there should be a settlement of their différences, 
based on the market value of the goods on that day." 

This is a case where each party intended to engage in a séries of 
wagering transactions, and where it is sufficiently plain that Baxter & 
Co. understood the intentions of Blitch. The real inquir^- consequently 
is whether Blitch understood the intentions of Baxter & Go. The find- 
ing of the spécial commissioner, that Baxter & Co. had represented to 
Blitch that in every instance they actually executed the orders given 
them, was based upon the récital contained in the confirmation slips. 
But if Blitch did not rely upon thèse représentations, the fact that they 
were made is not important. Blitch was examined as a witness before 
the spécial commissioner, and his testimony indicates that he was a man 
of keen intelligence and extensive business expérience. We are unable 
to accept the conclusion of the court below, reached with "much 
doubt," that Blitch believed thèse représentations. He was an ex- 
perienced business man, and familiar with the business of speculating 
in futures. It is almost incredible that such a man should not hâve 
known that he was dèaling with a bucket shop, or that he was not 
aware of the ordinary business methods of such a concern. According 
to common understanding the bucket shop "uses the terms and out- 
ward forms of the exchanges, but differs from the exchanges in that 
there is no deliVery, and no expectation or intention to deliver or re- 
ceive securities or commodities said to be sold or purchased," (See 
Standard Dictionary.) Blitch not only testified that he was not aware 
that Baxter & Co. was operating a bucket shop, but he testified that he 
supposed that it was actually carrying the property covered by his or- 
ders. It is impossible to contradict the testimony of a witness as to his 
State of mind by direct évidence, unless he bas made impeaching state- 



IN KE A. B. BAXTEK <fc CO, 141 

ments, and such testimony, where it is that of an. interested party, is 
entitled to but little weight if it is inconsistent with the reasonable pre- 
sumptions arising from circumstantial évidence. The probability that 
an inteUigent man who enters upon a course of spéculative dealings 
with a bucket shop does so with the understanding that the purchases 
or sales are to be merely colorable is so strong as to amount to a pre- 
sumption of fact. It is quite incredible that Blitch should hâve believ- 
ed that Baxter & Co. were "carrying," for the purposes of his spécula- 
tion, $140,000 worth of property, or the évidence of title thereto, on 
the trifling margin of 1 per cent. The récital in the confirmation slips, 
upon which it is said he relied, was pregnant with information to an 
alert business man that Baxter & Co. was not doing business legitl- 
mately. It was such an unnecessary and unusual statement as to sug- 
gest at once that it was a précaution adopted by Baxter & Co. for its 
own protection in case the validity or legality of its transactions should 
be questioned. Its présence indicated that it was inserted for some 
ulterior purpose. Central Stock & Grain Exchange v. Board of Trade, 
196 m. 396, 63 N. E. 740 ; Weare Commission Co. v. The, People, 205 
111. 528, 70 N. E. 1076. "Hère are the very clausulae inconsuetae point- 
ed out in Twyne"s Case as the sure badges of that which they are in- 
tended to hide." Taylor v. Tavlor, 8 How. (U. S.) 205, 12 L,. Ed. 
1040. 

We are unable to doubt that each party understood the other, and 
that the implied understanding between them was, at the inception of 
and throughout their dealings, that their transactions should be those 
of the ordinary kind between customer and bucket shop proprietor. 
The courts ought not to indulge in any violent or improbable inferences 
from the facts to assist either of the parties to such dealings, or to 
difïerentiate their dealings from ordinary gambling transactions. 

Thèse conclusions render it unnecessary to consider any of the ques- 
tions as to the amount of the recovery presented by the appeal of either 
party. 

The order is reversed, with instructions to the court below to disal- 
low the claim. 



In re A. B. BAXTKR & CO. (two cases). In re WIIIïTAKER. In re 

JOSEPH. 

(Circuit Court of Appeals, Second Circuit. January 7, 1907.) 

Nos. 106, 240, 108, 241. 

Pbincipal and Agent — Evidence to Establish Relation — Transactions Be- 
tween Bucket Shops. 

Tlie transactions between two concerns engnged in business as broliers 
or bucliet sliops, one located in New Yorlc and tlie otlier in Atlanta, Ga., 
held not such as to creatc ttie relation of principal and agent between 
tliem, but merely that of correspondents. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 40, Principal and 
Agent, § 41.] 

Pétition to Review Order of, and Appeal from, the District Court 
of the United States for the Southern District of New York. 



142 152 FEDERAL REPORTER. 

J. J. Adams, for petitioner. F. M. Czaki and Fried & Czaki, for 
respondent. 

Before WALLACE, LACOMBE, and TOWNSEND, Circuit 
Judges. 

PER CURIAM. The appeal in this case présents the question 
whether the firm of Houser & Co. was the agent of the alleged bank- 
rupt at Atlanta in soHciting orders to be executed by Baxter & Co. 
at New York for the purchase and sale of stocks and products. Up- 
on a State of facts similar in ail essential particulars, it was decided in 
Municipal Telegraph & Stock Co. v. Ward, 138 Fed. 1006, 70 C. C. 
A. 384, that the relation of principal and agent did not exist. That 
décision is controlling in this court as an authority, and an independ- 
ent examination of the question is unnecessary. It is proper to say, 
however, that there are two cases to the same effect decided in the 
appellate branch of the New York Suprême Court, viz, : Holman v. 
Goslin, 103 App. Div. 606, 93 N. Y. Supp. 126, and Willard v. White. 
56 Hun, 581, 10 N. Y. Supp. 170. Smith v. New York Stock & 
Clearing House Co., 35 N. Y. Supp. 361, relied on as a décision to the 
contrary, is differentiated from the other décisions in the very im- 
portant fact that the "correspondent" deposited ail moneys received 
by him as margins and commissions in the bank account of the cor- 
poration, and also in the fact that the corporation had arranged 
directly to protect the customers of the correspondent from loss of 
margin or profits in their dealings with him. 

It follows that the court below erred in allowing the claim of Whit- 
taker. 

The order is reversed, with costs. 



UNITED STATES v. PARK & TILFORD. 

(Circuit Court of Appeals, Second Circuit January 7, 1G07.) 

No. 83 (4,075). 

CUSTOMS DUTIES— TJNTÎSUAL COVEEINGS— ADDmONAI, DtITT. 

Under Customs xVdministrative Act June 10, 1890, c. 407, § 19, 2G Stat. 
139 [U. S. Comp. St. 1901, p. 1924], tlie "additional duty" provided tliere- 
iu for unusual coverings used "otlierwise tlian in the bona fide transporta- 
tiou" of tlieir contents to the United States, is not a substitute for the usuai 
duty on coverings which accrues by including their cost in the dutiable 
value of their contents, as also provided in said section ; but both duties 
should be imposed, the latter because the coverings subserve a use In 
transportation, and the former because they subserve an additional use 
after transportation. 

[Ed. Note. — ^For cases in point, see Cent. Dig. vol. 15, Customs Duties, 
§ 20.J 

Appeal from the Circuit Court of the United States for the Southern 
District of New York. 

This cause cornes hère upon appeal from a décision of the Circuit 
Court, Southern District of New York (142 Fed. 203), affirming a 



UNITED STATES V. PAEK & TILFOED. 143 

décision of the Board of General Appraisers (G. A. 6,111 [T. D. 26,- 
608]), which reversed the action of the Collector of the Port of New 
York in assessing certain imported merchandise under the Tariff Act 
of 1897. Act July 24, 1897, c. 11, 30 Stat. 151 [U. S. Comp. St. 1901, 
p. 1626]. 

J. Osgood Nichols and Henry A. Wise, Asst. U. S. Attys. 
Edward Hartley (B. A. Levett, of counsel), for importers. 

Before WALLACE, LACOMBE, and TOWNSEND, Circuit 
Judges. 

LACOMBE, Circuit Judge. The articles in question are wooden 
boxes or cabinets containing cigars. They are more elaborate and 
ornamental than the ordinary cigar box of commerce, and it is undis- 
puted that they are unusual coverings, designed, not only for the 
transportation of the cigars packed in them, but also for the purpose 
of enhancing their attractiveness when exposed for sale, and supplying 
a pleasing réceptacle to contain them. The appraised value of the 
cabinets was $5 each, and they were invoiced as "sample cases" con- 
taining cigars. The customs officers included the value of the cabinets 
in determining the actual market value of the cigars, upon which the 
ad valorem duty of 35 per cent, on cigars was assessed and paid. The 
collector also imposed an additional duty upon the cabinets at 35 per 
cent, ad valorem, as manufactures of wood, under paragraph 208. 
Act July 24, 1897, c. 11, § 1, Schedule D, 30 Stat. 168 [U. S. Comp. 
St. 1901, p. 1646]. It is conceded that, if imported empty, the latter 
rate of duty would be the proper one; but it is contended that the 
collector was not warranted in imposing a double duty on the cabinets. 
His action was taken under section 19 of the customs administrative 
act (Act June 10, 1890, c. 407, 26 Stat. 139 [U. S. Comp. St. 1901, 
p. 1924] ), which reads as follows: 

"Sec. 19. That whenever imported merchandise is subject to an ad valorem 
rate of duty, or to a duty based upon or regulated In any mauner by tlie value 
thereof, the duty shall be assessed upon the actual market value or Whole- 
sale priée of such merchandise as bought and sold in usual Wholesale quanti- 
ties, at the time of exportation to the TJnited States, in the principal niarkets 
of the country from whence imported, and in the condition in which such 
merchandise is there bought and sold for exportation to tlie United States, or 
consigned to the United States for sale, includhig the value of ail cartons, 
cases, crates, boxes, sacks and coverings of any kind, and ail other costs, 
charges and expenses incident to placing the merchandise in condition, pack- 
ed ready for shipment to the United States, and if there be used for covering 
or holding imported merchandise, whether dutiable or free. any uniLsual ar- 
ticle or form designed for use otherwise than in the bona fide transportation 
of such merchandise to the United States, additional duty shall be levied 
and collected upon such material or article at the rate to wliich the samp 
would be subject if separately imported. ïhat the words 'value' or 'actual 
market value' whenever used in tbis act or in any law relating to the ap- 
praisement of imported merchandise shall be construed to mean the actual 
market value or wholesale priée as defined in this section." 

The language of this section is certainly plain and unambiguous. It 
provides, first, that, whenever imported merchandise is subject to an 
ad valorem duty, the value upon which that duty is to be assessed 
shall include the value of ail cases, crates, boxes, and coverings of any 



144 152 FEDERAL EEPOUTEU. 

kind., This îs a requirement applicable to ail importations of n;' 
valorem goods. There is iiothing in this part of the section to indic;it',' 
that, under any contingency, a différent rule shall be applied in as- 
sessing the valuation of any importation of such goods. 

The section next provides that, if there be used for holding the mcr- 
chandise, whether dutiable or free, any unusual covering, additional 
duty shall be levied upon such covering at the rate to which the same 
would be subject if separately imported. If this duty is to be "addition- 
al," it would seem to be the p!ain intent of the act that the aritc'e which 
pays the "additional" duty shall also pay an initial duty. If it were in- 
tended that, in the event of an unusual covering, it should pay duty 
only at the rate to which it would be subject if imported separately, 
there would be no need to use the word "additional" at ail. It is true 
that, when the imported merchandise is free, the duty on the unusual 
covering is net properly an "additional" one, but the word exactly 
covers a case like the présent, and, unless it is to be wholly disregarded, 
should require the levy of two duties on the covering; one on such 
article as subserving a use in transportation, and the other on such 
article as subserving an additional use after the transportation. 

In the majority opinion filed by the Board of General Appraisers, 
it is not disputée! that such is the literal construction of the section; 
but they reach the conclusion that it was not the intent of Congress 
to exact a double duty. They sug^est that the literal construction 
would produce a condition répugnant to fair dealing in the administra- 
tion of customs laws ; that it has been the policy of Congress so 
to frame thèse laws as to render them the least possible burden to the 
citizen and uniform in their administration ; and that such construction 
is in conflict with the report of the commitlee of Congress in presenting 
to the House of Représentatives the bill which upon its enactment 
by Congress became this act. 

It is no uncommon occurrence, however, to find in tariff acts pro- 
visions expressly devised to accomplish some purpose other than the 
mère collection of duty. Some articles are exposed to such a rate of 
duty as will practically prohibit their importation. In some cases 
cumulative duties are provided for. Paragraph 313, Act 1897. Duty 
so high as to be characterized as pénal is sometimes exacted to put a 
stop to some undesirable practice. Thus, when imported merchandise 
was inclosed in coverings designed for use otherwise than in the bona 
fîde transportation of the merchandise, a duty of 100 per cent, was 
imposed bv the tariff act of 1883. Act March 3, 1883, c. 116, § 7, 23 Stat. 
486 [U. S. Comp. St. 1901, p. 750]. It is a fact of which the courts 
which hear customs causes will take notice that there has been much 
litigation as to the question of the usualness or bona fides of various 
"coverings," and that Congress has enacted many provisions to pre- 
vent the government from suffering loss of revenue by reason of the 
adoption of some unusual covering, designed to subserve a double pur- 
pose. It certainly would not be surprising to find that Congress had 
at last decided to accomplish this by prescribing a double duty, and we 
find nothing répugnant to fair dealing in such an enactment. In the case 
at bar, the cabinets, at 25 per cent, plus 35 per cent, pay only a little 
more than half what they would hâve paid under the act of 1883. 



ALASKA EXPLORATION CD. V. NORTHERN MIN. A T. CO. 145 

It appears, moreover, from the références to the Congressional Rec- 
ord set forth in the government's brief, that the report of the House 
committee upon which the Board of General Appraisers relied was 
made at a time when the bill did not contain any provision for "addi- 
tional" duty. It was amended to its présent shape subsequently, in 
the Senate (Cong. Rec. vol. 21, pt. 4, p. 3973), and the insertion of 
this Word "additional" during the progress of the bill through the 
législative body fairly indicates an intention to subject coverings like 
thèse to a double duty. 

The décision of the Circuit Court is reversed. 



ALASKA EXPLORATION CO. v. NORTHERN MINING & TRADING CO. 

(Circuit Court of Appeals, Ninth Circuit March 4, 1907.) 

No. 1,349. 

Vendor and Purchaseb—Deeds— Record— Notice. 

WUere a deed to an undivided interest in an Alaska mlnlng claim was 
neither witnessed by two wilnesses nor aclinowledged, as required by B. 
& C. Comp. Or. §§ 5.342, 53.Ô0, 5354, 5355, made applicable to Alaska by 
Act Cong. May 17, 1884, c. 53, § 7, 23 Stat. 24, such deed was not entitled 
to record, and bence tbe rec-ord tliereof was not constructive notice to a 
subséquent purchaser. 

[Ed. Note.— For cases in point, see Cent. Dlg. vol. 48, Vendor and Pur- 
chaser, § 538.] 

In Error to the District Court of the United States for the Second 
Division of the District of Alaska. 

S. T. Jeffreys and W. S. Wood, for plaintiff in error. 
Ira D. Morton, J. C. Campbell, W. H. Metson, Frank C. Drew, C. 
H. Oatman, and J. A. Mackenzie, for défendant in error. 

Before GILBERT and ROSS, Circuit Judges, and WOLVERTON, 
District Judge. 

ROSS, Circuit Judge. The défendant in error sued the plaintifï in 
error and another corporation to recover possession of an undivided 
three-sixteenths of a certain mining claim in Alaska. The bill of 
exceptions shows that on the trial the plaintiff introduced évidence 
going to show that the claim was located by one Pierce Thomas, who, 
on the 4th day of October, 1902, executed to the plaintiff a deed for a 
three-sixteenths interest in the claim. The plaintiff in error sought to 
overcome that conveyance by showing that Thomas had made a pre- 
vious conveyance of the entire claim to one Kimber, under whom the 
plaintiff in error claims. 

It is not pretended that the défendant in error had any actual notice 
of such prior conveyance, but it was sought by the plaintiff in error to 
show constructive notice to it by the introduction of a certified copy 
of the record in the office of the recorder of the mining district in which 
the claim is situated of a deed from Thomas to Kimber of the entire 
claim ; it being provided, by the Alaskan statute of June 6, 1900, that 
ail records theretofore made in good faith in any regularly organized 
152 F.— 10 



146 132 FEDEEAL REPORTER. 

mining districts shall be public records. Carter's Ann. Codes Alaska, 
§ 16, pt. 3. The certified copy of the instrument so offered in évidence 
bears date October 7, 1898, expresses a considération of $100, purports 
to hâve been signed by Thomas, to hâve been witnessed by one Libby, 
and was recorded by the recorder of the mining district in the records 
of his office. The court below refused to admit in évidence the certified 
copy of this instrument, to which ruling the plaintifï in error reserved 
an exception. 

We think the ruling clearly right. Conceding for the purposes of 
the case, but without holding, that, under the statutes of Alaska, the 
proper office for the recording of deeds of mining claims is that of the 
recorder of the mining district in which the claim is situated, the dif- 
ficulty in the way of the plaintifï in error is that, in order for such 
a record to impart constructive notice to any one, it is essential that the 
instrument be entitled, under the law, to such recordation. 13 Cyc. 
p. <)00; Alabama Marble & S. Co. v. Chattanooga Marble & S. Co. 
(Tenn. Ch. App.) 37 S. W. 1009; Edwards v. Thom, 5 South. 707, 
25 Fia. 233 ; Keech v. Enriquez, 10 South. 91, 28 Fia. 597. 

On October 7, 1898, when it is said by the plaintifï in error Thomas 
deeded the mining claim in question to Kimber, the statute of AlasKa 
contained this provision: 

"TTi:it the gênerai Invvs of the stnte of Orefrnn now in force are herehy de- 
flarcd to be tlie hiw in saicl district so far as tlie saine ma.v be aiiplli'able and 
not In coufliLt with the provisions of thla act or the làws of the Uulted 

States." Act May 17, lb84, c. 03, | 7, 23 S ta t. 24.. 

Section 5342 of the Oregon Codes (B. & C. Comp.) provides: 

"Peeds * * • of lands or any interest therein shall be execiited In the 
présence of two witnesses, who shall subscribe their names as such. and the 
persons executiug such deeds may acknovvledge the exécution tliereof before 
any judge," etc. 

Sections 5350 and 5354 of the same Codes make provision for the 
proving and certifying of a conveyance in the absence of an acknowl- 
edginent, and by section 5355 it is provided that: 

"Every conveyance acknovifledged or proved or certified In the manner 
hereinbefore prescribed by any of the ollicers before named, may be read Ui 
évidence witliout further proof, and shall be entitled to be recorded In the 
couuty in which the lands lie." 

Sections 82, 83, 93, and 94 of part 5, c. 11, Carter's Annotated Codes 
of Alaska, are as follows : 

"Sec. 82. Execution and Acknoniedgment of Deeds. Deeds executed within 
the district, of lands or any inlerest in lands therein, shall be executed in the 
présence of two witnesses, who shall subscribe their names to the sauae as 
such : and the persons executlng such deeds may ackuowledge the exécution 
thcreof before auy judge, clerk of the district court, uotary public, or couimis- 
sioner within the district, and the oflicer takiug such acknowiedgmcnt shall 
endorse thereon a certilloate of the acknowledgment thereof and the true date 
of maliing the same uuder his hand. 

"Sec. 83. Same In States. If any deed shall be executed in any state, ter- 
ritory, or district of the United States, such deed may be executed acrcording 
to the lawa of such state, territory, or district, and the exécution thereof may 
be acknowledgred before any judge of a court of record, justice of the peace, 
or noiary public, or other othcer authorizcd by the laws of sucU state, ter- 



MOONEY V. CARTER. 147 

ritory, or district to take ttie acknowledginent of deeds tLerein, or before 
any commissioner appointed for such purpose." 

"Sec. 93. Certifieate of proof to be endorsed on deed. Every offleer wbo 
shall take the proof of any conveyance shall endorse his certifieate tbereon, 
signed by himself on the conveyance, and in sucli certifieate sball set fortli 
tlie tliings hereinbefore required to be done, l^nown, or proved, together with 
the names of the wltnesses examined before such officer, and their places 
of résidence, and the substance of the évidence by them given. 

"Sec. 94. Deed proved may be read in évidence. Every conveyance ac- 
knovrledged or proved or certified in the nianner hereinbefore preseribed by 
any of the officers before named may be read in évidence without f i.- ther 
proof thereof, and shall be entitled to be recorded in the precinct in which the 
lands lie." 

It is clear that the certified copy of the record of the recorder of the 
mining district offered in évidence by the plaintiff in error did not 
meet thèse statutory requirements, for it showed upon its face that the 
deed that was recorded was without acknowledgment or other proof 
of its exécution, and without the signature of subscribing witnesses. 
It was therefore not entitled under the law to be recorded anywhere, 
and the mère transcription of the unauthorized paper in the record of 
the mining district was not constructive notice to any one. As has 
already been said, there was no offer of any proof to show that the de- 
fendant in error had at the time of its purchase any actual notice of 
any prior conveyance of the property by Thomas. For the reasons 
stated, there was no error in the ruHngs complained of. 

The judgment is accordingly affirmed. 



MOONEY V. CARTER. 

(Circuit Court of Appeals, Fifth Circuit. March 12, 1907. On Rehearing 
. April 17, 1907.) 

No. 1,528. 

Death— Action roit Wbongftjl Death— Contkibutoey Négligence. 

Plaintlff's intestate and another were flshing from a rovvboat anchorejî 
in the Tennessee river at night without having the white light displayed 
above the stem, as required by the rules of the supervising inspecter, 
when the beat was run down by défendants steamer which was pushing 
a barge in front. The occupants of the boat after trying to attract the 
attention of those on the steamer jumped from the boat, and plaintlff's in- 
testate was drowned. The steamer did not bave a proper lookout, but 
the master, as soon as the boat was discovered, stojjped bis vessel, but 
not in time to prevent striking the boat. Hcld, that both the steamer and 
the deceased were in fault for violating the navigation rules, and tliat the 
death being the resuit of the combined négligence, there eould be no 
recoverj' therefor under Code Ala. 1896, § 27, giviug a right of action 
for death caused by the wrongful act or négligence of another. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 15, Death, § 25.] 

In Error to the Circuit Court of the United States for the Northern 
Division of the Northern District of Alabama. 

This is an action to recover damages for the death of one Charles J. Smith, 
under section 27 of the Code of Alabama of 1896, whieh provides an action 
for wrongful act, omission, or négligence causing death. 

The plaintiff below presented his cause of action in five several counts, each 
setting forth a difCerent theory. 



148 152 FEDERAL BErORTER. 

Each count states tliat on the niglit of June 18, 1904, Charles J. Smitli, the 
intestate of défendant in error, and one Wissinger, wore sitting in a small 
skiff lit anclior iu tlip Tennessee river, opposite tlie city of llecatur, Ala., and 
tliat said Smitli and Wissinger were engaged In manipulating a trot line, 
and wliile so situated and engaged tliey were approaclied by a steanil)oat of 
tlie said James E. Mooney, and tliat said steamer was pushing a barge; tbat 
said steamer was under tïie control of one William Sellars as master thereof : 
tliat said steamer ran straiglit toward said skiff, and, notwitlistanding said 
Charles J. Smith and his companion displayed signais of their whereabouts 
and danger by swinging a lighted lantern and giviug loud cries of di stress, 
said steamer ran straight at the skiff without giving any answer or response; 
and that said Charles .T. Smith àiid his companion, being unable to change 
the location of their skiff or to lift the anehor, were forced to jump into the 
water, and that said Smith was drowned. This statement of alleged facts 
is common to ail tlie counts of the complaint. Each count goes further and 
allèges différent causes for the injury. The first count charges that the 
death of Smith resulted ffom the négligence of Sellars, as master of the 
steamer, in failiiig to hâve a proper person stationed as a lookout in a suit- 
able position on either the boat or barge. The second count was abandoned 
during the progress of the trial. The third count charges the négligence of 
Sellars after he diseovered the péril of said Smith, in that he saw the signala 
of distress displayed by said Smith and his companion. but negligently and 
wrongfully persisted in holding the steamer to the course until it struck the 
skiff ont of whicli said Smith and his companion liad just spru--g. In the 
fourth count it is chargcd that the death of Smith was caused .by the wanton- 
ness and willfullness of said Sellars as master, in that he saw the signais 
of distress displayed from the skiff, ànd knew that human beings were in the 
skiff, and could .hâve changed his course, and yet he willfuUy and wantonly 
kept the steamer in a straight course on to the skiff, necessitating the jump- 
ing tlierefrom of said Smith. The last couut charges the wrong aiid négli- 
gence of the lookout on said steamer who saw the signais in time to hâve 
had the steamer stopped had he heeded said signais, yet he ignored said sig- 
nais, and allowed the steamer to procecd until too late to prevent a collision. 

'l'he défendant below pleaded the gênerai issue to ail the counts — the coii- 
tributory négligence of Smith, in that after seeing the approachiug steamer 
he took no steps to lift or loosen the anehor of his skiff until it was too late, 
jiverring that he could hâve done so and hâve gotten out of the pat' )f the 
steamer if he had tried when he flrst saw her approach; also the contributory 
négligence of Smith in boing seated in a small skiff or rowboat in the Ten- 
nessee river on a dark night, without having a white light stationed two feef 
above the stem of the boat in which he was sitting, in violation of the rule 
of the supervising inspeetor of steamboats, approved Pebruary 8, 1809, which 
requires rowboats to carry a white light two feet above the stem of the boat ; 
and, also, the contributory négligence of Smith in jumping out of the skiff 
into the river when, if he had reinained in the skiff, he would not hâve 
been injured. 

On the trial and in due season, the défendant below requested the court 
to give numerous instructions to the jury covering ail phases of the case, 
which instructions were ail refused, and exceptions were duly taken. The 
assignmenta of error présent them soriatim. 

W. W. Callahan, for plaintiff in error. 

S. S. Pleasants and E. W. Godbey, for défendant in error. 

Before FARDEE and McCORMICK, Circuit Judges, and NEW- 
MAN, District Judge. 

FARDEE, Circuit Judge (after stating the facts). From the view 
we take of the case, we find it only necessary to consider one assign- 
ment, to wit, the court erred in refusing the following instruction: 
"If the jury beheve the évidence tliey will find for the défendant." 



MOONEY V. CARTER. 149 

Counsel for défendant in error, after a short statement, begin thcir 
brief with the proposition: "We submit that on the undisputed évi- 
dence the défendant in error was entitled to the gênerai affirmative 
cliarge." As the défendant below requested the affirmative charge for 
the défendant, and the counsel for the plaintiff below insist in this court 
that the affirmative charge should bave been given for the plaintif!' 
below, it secms that there cannot be much dispute of fact in the case 
"to deflect or control the questions of law." Sec Beuttell v. Magone, 
157 U. S. 154, 15 Sup. Ct. 566, 39 L. Ed. 654. 

We bave carefully read the évidence ail brought up in the transcript, 
and we conclude that the steamer was guilty of négligence in not hav- 
ing a proper and sufficient lookout. The Ottawa. 3 Wall. 36S, 18 L. Ed. 
165; The Genesee Chief, 12 How. 443, 13 L. Ed. 1058; St. John v. 
Paine, 10 How. 567, 13 L. Ed. 537: Manhasset (D. C.) 34 Eed. 408; 
St. Nicholas (D. C.) 49 Eed. 679 ; Geo. W. Childs (D. C.) 67 Eed, 370. 
We also conclude that the failure of Smith and bis companion, wdien 
on a dark night in a rowboat anchored in the channel of the Tennessee 
river, to carry a white light two feet above the stem of the boat, as 
reqttired by the rules of the supervising inspecter of steamboats, ap- 
proved February 8. 1899, was négligence. Belden v. Chase, 150 U. S. 
698, 14 Snp. Ct 264, 37 L. Ed.' 1218. 

It is possible that if the steamer had had a vigilant and sufficient 
lookout, the location of Smith and his companion in the rowboat might 
bave been discovered in time to hâve prevented injury. It is equally 
possible that if Smith and his companion had carried the régulation 
light two feet above the stem of the rowboat the inefficient look- 
out on the steamer would bave seen the same in time to bave avoided 
the injury. But thèse are conjectures. The actual case is that both the 
steamer and Smtih were in fault, and the deaih of Smith was the resuit 
of the combined négligence. 

There is no sufficient évidence to support the spécifie allégation 
of the third count that after Sellars had discovered the péril of Smith 
and saw signais of distress displayed, be negligently persisted in hold- 
ing the steamer to her course. The proof is undisputed that as soon 
as Sellars was warned of the position of the skifï, be stopped the 
steamer, and to such purpose that the life of Smith's companion was 
saved, he being picked un by the steamer. Nor is there sufficient évi- 
dence to warrant any fînding that the master of the steamer was guilty 
of any willfullness or wantonness in sailing his vessel or in failing to 
stop and change his course, when he saw or heard the signais of dis- 
tress displayed from the skiiï. 

Reversed and remanded. 

On Rehearing. 

PER CURIAM. No one of the judges who partîcïpated in the dé- 
cision of this case desiring a reargument or rehearing, the pétition for 
rehearing is denied. 



150 152 FEDERAL REPORTER. 

BAETLETT et al. v. FARRELL, 

(Circuit Court of Appeals, Second Circuit. February 26, 1907.) 

No. 147. 

Masteb and Servant— Injuey to Servant— Négligence— Evidence. 

Evidence, in an action for injury to an employé eiigaged iu erecting a 
gas tank, caused by the seaffold on which lie was at worlc being tipped by 
the raising of the tank, whicti could bave been done only by the expansion 
of the gas from the beat of the sun, or by the pumping of compressed air 
into the tank, held sufHcient to go to the juiy on the questions whether 
it was raised by the pumping of compressed air, and, if so, whether it 
was négligence to do so without warning. 

In Error to the Circuit Court of the United States for the Eastern 
District of New York. 

Error to the Circuit Court of the United States for the Eastern Dis- 
trict of New York to review a judgment entered on the verdict of a 
jury in favor of the plaintiflf, for $4,600, for injuries received by him 
while in the employ of the défendants. 

J. N. Tuttle and Frederick W. CatUn, for plaintiflF in error. 

M. J. France and George V. S. Williams, for défendants in error. 

Before EACOMBE, TOWNSEND, and COXE, Circuit Judges. 

COXE, Circuit Judge. The plaintiff, while in the employ of the de- 
fendants, received injuries by falling from a seaffold while at work 
as a riveter on the frame work of a large gas tank which he, with other 
workmen, was engaged in erecting. The seaffold was constructed in 
the usual manner, but the plaintiff contends that the défendants were 
négligent in causing the tank to be raised, while the men were at 
work, without warning or opportunity to escape. The raising of the 
tank lifted the ends of the timbers on which the seaffold rested, caus- 
ing it to tip so that one of the planks on which the plaintiff stood 
slipped off. 

The case was sent to the jury to say whether the défendants were 
guilty of négligence in causing the tank to be raised without warn- 
ing to the plaintiff. The défendants contended that the court should 
hâve directed a verdict in their favor. 

The following propositions are established by the proof : 

First. The plaintiff was injured by reason of the tipping of the 
seaffold. 

Second. The seaffold could be tipped, in the manner described, 
only by raising the tank. 

Third. The tank could be raised either by the natural beat of the 
sun or by pumping compressed air in, and in no other way. 

Which of the two caused the tank to rise ? 

This was a question of fact, and, although the testimony was cir- 
cumstantial in character and depended largely upon presumptions, 
we think sufficient was shown to justify its submission to the jury. 

The plaintiff, who had been working on the tank for ten days prior 
to the accident, testified that he never knew the tank to be raised or 
lowered before, except after notice given to the workmen to take in 



BARTLETT V. FARRELL. 151 

tlieir scaffolds. No notice was given on this occasion and he did not 
know that the tank was rising. He was stepping from the left side 
of the scaffold f'acing outward to the right when it fell. The planks 
were not nailed but were simply laid one on another. 

Struck, a witness who was présent at the time, noticed tiiat the 
scaffold was in good condition fifteen or tvventy minutes bef orc the 
accident and was in disorder afterwards. On one side there were two, 
or more, planks missing. The tank had risen at least a foot and it 
seemed to the witness to bc rising at the time. One end of the rear 
plank had been forced back. 

When the sun is hot in the middle of the day the tank will rise 
several inches becausc of the expansion of the heated air inside, but 
not as much as a foot. 

The accident happened about 4 o'clock in the afternoon of the 14th 
of May, and, although the température on that day was not given, the 
witness testifîed that it was not a very warm day. It is a fair pre- 
sumption that as the afternoon progressed the effect of the beat on 
the tank must bave decreased. 

About fifteen minutes before the accident the witness noticed an up- 
ward movement of the tank. He said : 

"You can feel it with your foot ; a kind of buzzing ; fecl it coming up a 
lîlt, by my feet. It was goiiifr vevy slowly, you could see it wltti the naked 
■eye by watcliing tbe goose-neck. You could tell by référence to a mark that 
it would go about as fast as the long hand of a clock." 

Another witness, Hickey, who went to the scafïold immediately 
after the accident, says : 

"I saw the scaffolds on an incline from the tank, but some were high and 
some low. That is the part next to the tank ^vas high. And then they ail 
inclined ont. * * * i saw the scaffold that Farrell fell from. There was 
two or three planks missing from it and it looked a regular wreck." 

Hickey also testified that the tank had risen from a foot to eighteen 
inches from the time he had been there before. He was away about 
an hour and twenty minutes. 

On a very warm day, if they pumped no air into the tank, it miglit 
rise, by the ordinary beat, three, or four, or five inches, "but in the 
afternoon, after the beat of the day had passed, it would bc lowering 
naturally." 

There was other testimony to the same effect. No proof was of- 
fered by the défendants. 

The court instructed the jury that if they found that the accident 
was caused by the ordinary daily rise and fall of the tank the verdict 
must be for the défendants, the risk being one which v^^as assumed 
by the plaintiff. H, on the contrary, the tank was raised up beyond the 
natural daily rise and fall, then it was for the jury to say whether 
the défendants were négligent in not giving the plaintiff warning. 

The question is not whether the testimony is sufïicient to convince 
us of the défendants' fault, but whether the trial court would hâve 
been justified in saying that there was no évidence to be submitted to 
the jury. It cannot be denied that the proof of négligence was meager, 
unsatisfactory and circumstantial, and yet, we are unable to say that 



152 152 FEDERAL REPOETER. 

the jury inight not properly draw therefrom the inference that the 
défendants were at fault. The testimony leaves little doubt that the 
accident was caused by the raising of the tank. As before stated it 
co'uld hâve been raised in one of two ways only ; either by the beat of 
the siin or the pumping in of compressed air. The proof that the 
natural beat would cause a rise not to exceed five inches and that at 
four o'clock the tank would naturally be sinking instead of rising, in 
connection with the testimony that it actually rose from a foot to 
eighteen inches may, very properly, bave induced the jury to eliminate 
the natural beat theory from their calculations. This being so, the 
raising of the tank could be accounted for only upon the theory that 
air was pumped in. If air were pumped in without warning, and it 
is undisputed that no warning was given, the jury might legitimately 
hâve reached the conclusion, especially in the absence of any déniai 
or explanation, that the défendants were négligent. 
The judgment is affirmed. 



In re BROADWAY SAVINGS TRUST CO. 

(Circuit Court of Appeals, Eiglitti Circuit. March 19, 1907.) 

No. 78. 

1. BArflCRTirTCT— JUBISDICTIONAL FACT— POESUIT IN WlIICH COEPORATION IS 

En'H/vwed is Not. 

Neither the allégation nor the fact that a corporation is engagea prin- 
eipally in manufacturing, trading, printiug, puIJlishing, mining or, mer- 
cantile pursuits is jurisdictional in a proceeding in baulcruptcy. 

2. Same— Amended Petitios— Defaulting CSeditob Not Ektitled to An- 

SWEB. 

A creditor, who fails to appear or answer a pétition in hankruptcy with- 
in the time limited therefor by tlie hankruptcy hiw, thereby waives ail 
objections to subséquent ameudments thereof which do not change the 
substance of the cause of action there stated nor the extent of the relief 
there sought, and renounces hls right to contest the cause of action of 
which the original pétition gives fair notice. 
(Syllabus by the Court.) 

On Pétition for Review. 

S. W. Fordyce Jr., and Tyrrell Williams, for petitioner. 

Stanley D. Pearce (Lee W. Grant, on the brief), for respondent. 

Before SANBORN, HOOK, and ADAMS, Circuit Judges. 

Sz\NBORN, Circuit Judge. On July 37, 1906, three creditors filed 
a pétition in the court below for the adjudication of the St. Louis Safe 
& Desk Company a bankrupt, but failed to allège that it was engaged 
principally in manufacturing, trading, printing, pubhshing, mining, or 
mercantile pursuits. Bankr. Act July 1, 1898, c. 541, § 4b, 30 Stat. 
547 [U. S. Comp. St. 1901, p. 3423], as amended bv act Feb. 5, 1903, 
c. 487, § 3, 32 Stat. 797 [U. S. Comp. St. Supp. 1905, p. 683]. On 
August 20, 1906, they filed an amended pétition which remedied this 
defect, the desk company filed an answer vi'hich admitted the aver- 
ments of the latter pétition, and the desk company was adjudged a 



IN EE BKOADWAT 8AVIXG3 TRUST CO. 153 

bankrupt. The last day for filing pleadings in response to the original 
pétition was August 16, 1906, and on the next day the clerk made the 
formai order of référence of the pétition to the référée, who took no 
action upon it. On August 23, 1906, the court adjourned and did not 
sit again until September 10, 1906, when the Broadway Savings Trust 
Company, a créditer of the desk company, which had not before ap- 
peared in the proceeding, filed a pétition in the court below for the 
vacation of the adjudication and for leave to answer the amended péti- 
tion, on the ground that the adjudication was made on the same day 
that the amended pétition was filed, so that the Broadway Company and 
ihe other creditors of the desk company had no opportunity to appear 
and plead to it. On September 17, 1906, this pétition was denied, and 
on October 1, 1906, the Broadway Company filed a pétition to revise 
this order. 

The original pétition was demurrable and amendable. 1 Stat. 91, 
c. 20, § 32 [U. S. Comp. St. 1901, p. 696, § 954] ; In re Plymouth 
Cordage Co., 135 Fed. 1000, 1003, 68 C. C. A. 434, 437. 

The contention of counsel for the petitioner that the omitted al- 
légation, or the fact that the desk company was engaged principally 
in one of the pursuits which subjected it to the adjudication, was juris- 
dictional, has received deliberate and studious considération, and our 
conclusion, the reasons for it, and authorities in support of it may be 
found in our opinion in Re First National Bank of Belle Fourche, 
which is filed herewith.^ Our judgment is that neither the allégation 
nor the fact was jurisdictional, because neither conditioned the power 
of the court to hear the cause and décide every issue in it between the 
parties. It had the same jurisdiction of the cause and of the parties, and 
the same power to détermine the issues between them, whether the 
desk company was or was not engaged in one of the pursuits mentioned 
in section 4b of the bankruptcy law. The only différence the décision 
of that issue made was that if it was so engaged the court should hâve 
given judgment for the petitioners, and if it was not so occupied it 
should hâve refused to adjudicate the desk company a bankrupt. 

The only remaining question is, was it error for the court below to ad- 
judge the desk company a bankrupt upon the amended pétition without 
notice to or time for creditors who had defaulted to appear or answer 
it? A proceeding in bankruptcy is a proceeding in equity, and the rules 
and practice in equity prevail in its conduct as far as they are con- 
sonant with the speedy administration of justice which it prescribes. 
Parties who hâve appeared in a suit in equity or in bankruptcy are 
entitled to a reasonable time to demur or answer an amended plead- 
ing of their adversary. Lockman v. Lang, 132 Fed. 1, 6, 65 C. C. A. 
621, 626; Files v. Brown, 124 Fed. 133, 142, 59 C. C. A. 403, 412 
Nelson v. Eaton, 13 C. C. A, 523, 525, 66 Fed. 376, 378 ; Davis v 
Davis, 63 Miss. 818; Fisher v. Simon, 14 C. C. A. 443, 67 Fed. 387 
French v. Hay, 89 U. S. 338, 246, 22 L. Ed. 799; Blythe v. Hinckley 
(C. C.) 84 Fed. 228, 242. But the filing of an amended pétition is 
not the commencement of a new suit, unless it states a new cause of 
action or seeks more extensive relief or brings in new parties. It is 
the continuance of the same suit, and it does not necessitate the issue 
of a new subpœna to parties already before the court in equity. Cun- 

1 152 Fed. 64. 



154 152 FEDERAL EEPORTEB, 

ningham v. Pell, 6 Paige (N. Y.) 657. The fédéral courts sitting in 
equity always hâve the power to permit amendments of the pleadings 
to conform them to the proof, even after the hearing. The Trémolo 
Patent, 90 U. S. 518, 527, 23 L. Ed. 97; Neale v. Neale, 9 Wall. 1, 
9, 19 L. Ed. 590. 

If the Broadway Company had appeared or answered the original 
pétition, it would bave preserved its right to notice of subséquent pro- 
ceedings and to answer any amended pétition that might hâve been 
subsequently filed. But it was not the défendant in this suit. It was 
not required to be, and was not subpœnaed to answer the pétition. 
The bankruptcy law gave it and ail other creditors in its situation the 
option to appear and answer the pétition during a time limited, or to 
refuse to do so. It elected to renounce this privilège, to waive this 
right. It made no appearance and filed no answer. Nevertheless, if 
the substance of the cause of action stated in the original pétition had 
been radically changed b}^ the subséquent amended pétition, if more 
extensive relief had been sought and secured thereby, so that the origi- 
nal pétition failed to constitute fair notice of the adjudication actually 
obtained, the Broadway Company and other creditors might hâve had 
the right in equity to an opportunity to answer the second pétition. 
McClenny v. Ward, 80 Ala. 243; Fogg v. Merrill, 74 Me. 523, 526. 
But the adjudication rendered was the exact relief sought in the original 
pétition, and it was founded upon the cause of action substantially, 
but defectively, there stated. The Broadway Company had as complète 
a notice by the original pétition of the cause of action which the petition- 
ers presented and of the relief which they sought as it could bave receiv- 
ed from the amended pétition. It was not ignorant of the law, and it 
knew that the original pétition was amendable. By its failure to appear 
or answer, it waived its right to contest the cause of action there sub- 
stantially stated, and ail objections to subséquent amendments of that 
statement which did not change its character nor the extent of the relief 
it sought. Our conclusion is that a creditor who fails to appear or 
answer a pétition in bankruptcy within the time limited therefor by 
the bankruptcy law thereby waives aîl objections to subséquent amend- 
ments thereto which do not change the substance of the cause of action 
there stated nor the extent of the relief there sought, and renounces 
his right to contest the cause of action of which the original pétition 
gives him fair notice. 

The court below committed no error either in its adjudication of 
the desk company a bankrupt immediately upon the filing of the 
amended pétition, or in its subséquent refusai to vacate that adjudica- 
tion. The pétition is accordingly dismissed upon the merits. 

No opinion has been formed or is intimated upon the questions pre- 
sented by the motion to dismiss on the ground that the pétition was 
not filed in time, because our opinion upon the merits has rendered it 
unnecessary to décide thèse questions. 



FRANCIS V. UNITED STATES. 153 

FRANCIS V. UNITED STATES. 
(Circuit Court of Appeals, ïhird Circuit. March 12, 1907.) 

No. 49. 

1. PosT OrriCE— Wrongful Use— Soheme to Defbaud— Sepabate Défenses. 

Eev. St. § 5480 [U. S. Comp. St 1901, p. 3(ii>7], provides tbat if auy per- 
son having devised or intended to devise any sclieme or artifice to defraud, 
to be etfected by correspondence, shall in and for executing sucli scheme 
or artifice, or attempting to do so, place or cause to be placed auy letter 
in any post ofiice, or shall take or reçoive any sucli therefrom, he stiall, 
on conviction, be punished, etc. Held, tliat each mailing or taking from 
tlie post office o£ a letter pursuaut to a scbeine to detraud coustituted a 
separate offense under sucli section. 

2. CONSPIBAOT— SEPAEATE OFFENSES. 

Kev. st. § 5480 [U. S. Oomp. St. 1901, p. 3697], prohibits the mailing 
or taking from the post office of a letter pursuant to a scheme to defraud, 
and section 5440 [U. S. Comp. St. 1901, p. 3676] déclares that if two or 
more persons conspire to commit any offense against the United States, 
and one or more of such persons do any aet to effect the objeot of such 
conspiracy, ail the parties to the conspiracy shali be liable, etc. Held, 
that where accused and others conspired to further a scheme to defraud 
through the Post Office Department, each overt act of mailing a letter 
pursuant to such scheme or withdravying a letter from the post office vi^ar- 
ranted a charge of conspiracy to commit such offense, so that an indict- 
nient therefor would not shield from a subséquent Indictment for another 
conspiracy of the same person to commit another and additioual offense, 
though of the same kind. 

3. Ceiminal Law— Evidence— Withdbawal. 

Where the court in its charge directed the jury to leave out of ail con- 
sidération a certaiji conversation admitted in évidence, such direction was 
équivalent to striking out the testimony, and cured any error In its ad- 
mission. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 14, Criminal Law, 
§ 2122.] 

4. Same— Sentence — Place of Incabcebation. 

Where accused was sentenced to one year only on one of the counts of 
an indictment for conspiracy, the court bad no power to direct that such 
sentence be served in a penitentiary. 

In Error to the District Court of the United States for the Eastern 
District of Pennsylvania. 

For opinion below, see 144 Fed. 520, 

Henry J. Scott, for plaintiff in error. 
J. W. Thompson, U. S. Atty. 

Before DALLAS, GRAY, and BUFFINGTON, Circuit Judges. 

BUFFINGTON, Circuit Judge. This is a writ of error sued out by 
Stanley Francis to the District Court for the Eastern District of Penn- 
sylvania. In that court Francis was indicted with others under Rev. St. 
§ 5440 [U. S. Comp. St. 1901, p. 3676], on three indictments, each con- 
taining three counts, for conspiracy to cofnmit an offense against the 
United States prohibited by Rev. St. § 5480 [U. S. Comp. St. 1901, 
p. 3697], as amended. The allégation in substance was that Francis 
and others, composing the Storey Cotton Company, conspired to de- 



156 152 FEDERAL KEPOETER. 

vise a scheme to defraud persons by correspondence by indiiciiig them 
to remit funds to invest in supposed cotton spéculations, whicli spécu- 
lations had in fact no existence. Section 5480 provides: 

"If any person having devlsed or inteudiug to devise any scheme or arti- 
fice to defraud * * * to be elïected elther by opening or intendiiig to 
open correspondence * «= * ghall, in and for executing such scheme or 
artifice or attemptiiig to do so, place or cause to he placed any letter 
* * * in any post office * * * or shall take or receive any such there- 
from * * * such person so misusing the Post Office Establishment, shall, 
on conviction, be punishable," etc. 

And section 5440 : 

"If tvi'o or more persons conspire elther to commit any offense agaînst 
tie United States or * * * and one or more of sucli persons do any act 
to effect the object of the conspiracy ail the parties to such conspiracy shall 
be llable," etc. 

On the trial the government withdrew two counts, and Francis was 
convicted on the remaining seven. The court imposed sentences tipon 
him, aggregating five years, divided as follows : Under indictment 
44, two years; on the first count of No. 46, two years, to commence 
at the expiration of sentence at No. 44; on the second count of No. 
46, one year, to commence at the expiration of the sentence on the 
first count at No. 46. The sentence was to the Eastern Penitentiary. 
Thereupon Francis sued out this writ. The questions raised under 
the various assignments may be considered under four heads, viz. : 
First, the legality of the counts under which sentence was imposed; 
second, the application of the statute of limitations ; third, the testi- 
mony of one Quinlan ; fourth, the legality of the sentences. 

With référence to the first question, it will be noted that in Re 
Henrv, 123 U. S. 373, 8 Sup. Ct. 143, 31 L. Ed. 174, followed in Re 
De Bara, 179 U. S. 330, 21 Sup. Ct. 112 (45 L. Ed. 207), it was held : 

"ïhe act (section 5480) forbids, net the gênerai use of the post office for 
the purpose of carrying out a fraudulent scheme or device, but the putting 
in the post office of a letter or packet, or the tnking out of such a letter or 
packet from the post office in furtherance of such a scheme. Kach letter 
so taken out or put in constitutes a separate and distinct violation of the 
act." 

Now the counts hère in question are each based on a letter mailed to 
a différent person. Such mailing is a separate act, and, being done in 
pursuance of a scheme to defraud, constitutes an offense under section 
5480. Such being the fact, it follows that a conspiracy to do that act 
was a conspiracy to commit an offense against the United States. 
This brings the case within the letter and spirit of section 5440, and 
warrants a charge of conspiracy to commit that particular offense. 
That act and offense constituting the basis of a conspiracy to commit 
it, it follows that an indictment therefor will not shield from indict- 
ment a conspiracy of the same person to commit another additional 
and separate offense, although of a like gênerai kind, against the 
United States. The wording and spirit of section 5440 require such 
construction to fulfill its intent. We hold, therefore, that each of the 
counts before us covers a conspiracy indictable under section 5440. 

We. are also of opinion the défendant was not entitled to an acquittai 



UNITED STATES V. YEE GEE TOU. 157 

by virtùe of the statute of limitations. No such question was raised 
on the trial, and where, as hère, there was a gênerai verdict, presumably 
that question was, on the évidence, decided against the défendant. 
United States v. White, 5 Cranch, 73, Fed. Cas. No. 16,676. But 
apart from that we hâve, this being a criminal case, searched the tes- 
timony, and there is no évidence to support the contention now made. 
It is true the date of the letter of a third person, which is alleged 
to constitute an overt act starting the running of the statute, was 
more than three years before indictment found, but it will be noted the 
only thing to connect the défendant with that letter and make it an 
overt act was testimony that certain pencil memoranda thereon were 
alleged to be in his handwriting. There is, however, no testimony to 
show when thèse memoranda were made, and especially that they were 
in time to make the statute a bar. Moreover, the testimony is clear 
and uncontroverted that the defendant's connection with the alleged 
conspiracy began within a time when the statute would not avail. 

We find also no ground for reversai in the testimony of Quinlan 
as to a conversation with Bradley. In its charge the court said : 

"I miglit right hère say to you, you should leave out of aiiy considération 
whatever tlie conversation relateci by Senator Hi-adley with Mr. QuiJilaii on 
the 16th day of March, after the receiver was appointed, l:)ecause it now 
apiiears there were no letters mailed after that conversation, so that you will 
not take that Into considération at ail." 

This direction was équivalent to striking out the testimonv. Penna 
Co. V. Roy, 102 U. S. 452, 26 h. Ed. 141. 

. Having disposed of thèse questions, the court was warranted in 
imposing sentence. In view, however, of the décision of the Suprême 
Court in Re Mills, 135 U. S. 263, 10 Sup. Ct. 762, 34 L. Ed. 107, we 
are of opinion the sentence of one year to the penitentiary on the second 
count of No. 46 was illégal. With that exception the judgment will 
be affirmed, and in pursuance of power vested in this court (Ballew 
v. United States, 160 U. S. 200, 16 Sup. Ct. 263, 40 L. Ed. 388), the 
record will be remitted with directions to the court to enforce sentence 
on indictment No. 44 and the fîrst count of No. 46. 



UNITED STATI'^S v. YEE GEE YOU, alias YEE .TIM. 

(Circuit Court of Appeals, Fourth Circuit. March 12, 1907.) 

No. 6C1. 

1. Aliexs — Déportation of Ciiinese— Evidence — Cektificate of RESinEN-cE — 
White Witness. 

Under Act Cong. May 5, 1802, c. (10. 27 Stat. 25 [U. S. Comp. St. 1001, 
p. 13191, entitled "An act to prohil)it the coming of Chinese persons into 
the United States," as amended by Act Nov. 3, 1893, c. 14, 28 Stat. 7 \V. 
S. Comp. St. 1901, p. 1321], in déportation cases the only permissible évi- 
dence of a Chinese laborer's right to be in the United States is the cer- 
tiflcate of résidence mentioned in snch législation, or, in lieu thei'eof. tos- 
tiniony showing that by reason of accident, siekuess, or other unavoidablo 
cause he was unable to procure such certiflcate, and the testimony of at 



158 152 FEDERAL EEPORTBE. 

least one white witness that he was a résident of the United States prior 
to the registration period. 

[Ed. Note.— Citizenship of the Ohinese, see notes to Gee Pook Slng v. 
United States, 1 C. C. A. 212, and Lee- Sing Far v. United States, 35 O. C. 
A. 332.] 

2. SaME— BUKDKN DP Prooit— Merchants. 

In a proceeding to déport a Cliinaman as a Chinese laborer unlawfully 
in tlie United States, he has tlie burden o£ proving that he is a merchant, 
privileged to remain in the United States. 

3. Same— Chinese Labokers. 

Act Gong. Nov. 3, 1893, c. 14, 28 Stat. 7 [U. S. Oomp. St. 1901, p. 1321], 
amendlng Act May 5, 1892, e. 60, 27 Stat. 25 [U. S. Comp. St. 1901, p. 
1319], "to prohibit the coming of Chinese persons into the United States," 
does not restriet the meaniug of the word "laborers" as used in the prior 
acts, so as to enlarge the privileged classes. 

In Error to the District Court of the United States for the Northern 
District of West Virginia, at Wheeling. 

E. M. Showalter, Asst. U. S. Atty. 

Before GOFF and PRITCHARD, Circuit Judges, and McDOW- 
ELL, District Judge. 

GOFE, Circuit Judge. The appellee was arrested on the charge of 
being a Chinese lalDorer foiind unlawfully within the jurisdiction of the 
United States, in violation of the act of Congress approved May 5, 
1892, c. 60, 27 Stat. 25 [U. S. Comp. St. 1901, p. 1319], entitled "An 
act to prohibit the coming of Chinese persons into the United States," 
as amended by the act of November 3, 1893, c. 14, 28 Stat. 7 [U. S. 
Comp. St. 1901, p. 1321], without having the certiiîcate of résidence 
required by said act. He was given a hearing on said charge before 
a United States commissioner, and was adjudged to be unlawfully in 
the United States, and ordered to be deported in accordance with the 
provisions of said législation. From such order of déportation he 
appealed to the District Court of the United States for the Northern 
District of West Virginia, and that court on hearing of said matter 
adjudged the appellee to hâve been a résident of the United States prior 
to the enactment of the législation referred to, engaged in business as 
a merchant, and therefore lawfully entitled to be in the United States. 
Wherefore said court discharged the appellee from custody. From 
such order of discharge the United States sued eut this writ of error. 

Several assignments of error were filed, a number of which are 
immaterial and will hâve our considération only as they are involved 
in others. The évidence submitted to the court by the United States 
tended to prove that Yee Gee You is of the Chinese race; that he 
was conducting a laundry business in Wheeling, W. Va., in said 
Northern District ; that he did not hâve in his possession the certificate 
of résidence as a Chinese laborer required by law. The évidence of- 
fered by appellee was, first, his personal testimony that he was born 
in Canton, China, in 1865, and came to San Francisco, Cal., in 1880 ; 
that he worked as clerk in a store in San Franci-sco for 10 years; 
that he went to Boston, Mass., in 1890, and was there employed by 
Sam Sing, Lee Kee & Co., dealers in Chinese groceries, and that he 
purchased for $500 an interest in said firm, the capital of which was 



UNITED STATES V. YEE GEE TOU. 159 

$27,500, held by 55 différent partners ; that in 1898 he made an affidavit 
before a United States commissioner in Boston that he was a domiciled 
merchant, in order to enable him to visit China and then return to this 
country; that he received sùch certificate from the commissioner, and 
went to China, returning in about one year; that since then he with- 
drew from said firm a part of his investment with it, still retaining 
therein an interest valued at about $900 ; that for the three or four years 
prior to his arrest he had resided in WheeHng, where he had been en- 
gaged in the laundry business, owning his own laundry, and a portion of 
the time a part owner of a Chinese restaurant. The appellee then in- 
troduced the testimony of two Chinese witnesses, who stated that they 
were naturaHzed citizens of the United States, and that they had 
known the appellee in Boston from 1890 to 1898, and that he was a 
member of the firm of Sam Sing, Lee Kee & Ce, because they saw 
him at work in that store. Such was the évidence submitted to the 
court below. 

We note from this évidence that no certificate of résidence was ten- 
dered by the appellee, and that no excuse for such failure was offered 
as the statute permits to be donc, and also that he relied solely upon 
two witnesses to prove his résidence. That the Congress has the pow- 
er to exclude aliens from the United States will not be questioned, and 
that it also has the right to prescribe the method of procédure and the 
rules of évidence in déportation cases is clear. Under the act of May 
5, 1892, as amended by section 1 of the act of November 3, 1893, in dé- 
portation cases the only évidence of a Chinese laborer's right to be in 
the United States is the certificate of résidence mentioned in such 
législation, or, in lieu thereof, testimony showing that by reason of 
accident, sickness, or other unavoidable cause he was unable to pro- 
cure such certificate. The législation mentioned, in direct terms, re- 
quires the testimony of at least one creditable white witness to prove 
the résidence of a Chinese person in the United States prior to the 
registration period. In déportation cases it is error to ignore this pro- 
vision of the law. In the court below the appellee failed to offer the 
testimony of any white witness to prove his résidence. Appellee's 
failure in the particulars mentioned is conclusive against his right to 
remain in the United States, and compels his déportation. 

The appellant insists that the court below erred in holding that the 
appellee was shown by the évidence offered to properly belong to one 
of the privileged classes mentioned in the statute, namely, teachers, 
students, merchants, and traders — the finding of tbe court being that 
he was a merchant. The burden of proof was upon the appellee to 
show that he was a merchant within the meaning of that avocation 
as described in such statutes. It has been held that a Chinese person 
engaged in keeping a restaurant and lodging bouse is a laborer (United 
States V. Chung Ki Foon [D. C] 83 Fed. 143) ; that a Chinese person 
whose occupation was that of a laundryman is a laborer within the 
meaning of the law (In re Leung, 86 Fed. 303, 30 C. C. A. 69) ; that 
a Chinese person owning an interest in a mercantile firm, but not en- 
gaged in conducting it, who is also a cook in a restaurant of which he is 
part owner, is a laborer, and not a merchant under the acts we are 
now considering (Mar Bing Guey v. United States [D. C] 97 Fed. 



160 152 FEDERAL REPORTEll. 

576) ; that a Chinese person who from tlie date of his landing in this 
countrv, althoUgh he has an interest in a mercantile business, is a 
laborer (United States v. Yong Yevv [D. C] 83 Fed. 838). 

We quote vvith approval from the case of Lee Ah Yin v. United 
States, 116 Fed. 614, 54 C. C. A. 70, as follows : 

"We do not think It was the purpose of this amendatory aet to enlarge 
the limits of the privileged classes, or to restrict tlie meaning of tlio term 
'laborers' as It had been used In the treaty and in the prior acts. We think 
its purpose was not to remove any of the bars agaiust Cliinese immigration, 
but to remove doubt, and mabe deflnite and certain, as included witliin the 
désignation 'laborers,' certain occupations whlch wcre upon the border liue 
between the occupation of laborer and that of merchaut, and which in some 
aspects might be regarded as belonging to the merchant class. The occupa- 
tion of mining, taking fish for the purpose of sclling the same, peddling, op- 
erating a laundry, etc., partake of some of the characteristics of the occupa- 
tion of the merchant, and those engaged therein might in a sensé be deemed 
merchants. Evidently it was to deflne thèse spécifie occupations, and to 
déclare that persons engaged therein are not merchants, that the act was 
adopted. We find in it no évidence of an intention to enact that the word 
'laborers,' as used comprehensively in the treaty and in the prior acts, was 
thereafter to be conflued solely to manual laborers and to those who foUow 
the spécifie occupations enumerated. It is not declared that such and none 
other are to be deemed laborers. It is signiiicant that the next clause of the 
same section of the amendmemt defines the term 'merchant,' and provides 
that the term as employed therein and in the acts of which it is amendatory 
shall hâve that 'meaning and noue other.' " 

There is error in tlie judgment complained of, and the same will 
be reversed. 



CAMP BIRD, Limited, v. LARSON. 

(Circuit Court of Appeals, Eiglith Circuit. March 6, 1907.) 

No. 2,482. 

Master and Servant— Neglicence— Evidence op Change After Accident 
Inadmissible to Trove. 

B\-idence thnt after the accident tlie master repaired his machinery or 
building, or adopted a différent method of c(mdacting his business, is in- 
admissible to prove his négligence at the time of the accident. 

[Ed. Note. — For cases iii point, soe Cent. Dig. vol. 34, Master and Serv- 
ant, § 918.] 

(Syllabus by the Court.) 

In Error to the Circuit Court of the United States for the District 
of Colorado. 

L. F. Twitchell (Frank C. Goudy and Story & Story, on the brief), 
for plaintifï in error. 

John C. Bell (F. D. Catlin and C. L. Blake, on the brief), for de- 
fendant in error. 

Before SANBORN, HOOK, and ADAMS, Circuit Judges. 

SANBORN, Circuit Judge. The plaintiff below, a servant of the 
Camp Bird, Limited, a mining corporation, was injured by the fall of 
rock from a bucket which was ascending through a runway as he was 



CAMP BIRD V. LARSON. 161 

mucking in the bottom of a shaft. The bucket was drawn iip through 
a runway in the corner of the shaft which was hned with plank. At 
the tunnel level, which was 220 feet above the bottom of the shaft, 
one side of this runway was open for a height of 16 feet to permit the 
introduction of timber, pipes, and other materials. Across the upper 
end of this opening there was a timber, termed a "strut," the inner 
face of which was four inches farther from the center of the runway 
than its lining below the opening, so that the runway was four inches 
wider opposite this strut than it was below the opening. The plaintiff 
was at work at the foot of this runway, and as the bucket, which had 
been fîUed with stone, was drawn up, it caught on this timber and 
spilled some of its contents upon him. The first witness called on his 
behalf was the superintendent of the mine, and his examination pro- 
ceeded in this way : 

"Q. Did you ever see the arm of that bare timber where the bucket caught 
on the l?,th of April? A. No, I didn't. 

"Q. Didn't see the arm? A. No, sir. 

"Q. Why did you hâve the opening so high? A. To swing in timber, rail, 
pipe, tools of ail kinds, I suppose, going into the bottom. 

"Q. It wasn't necessary to hâve It that high? A. Yes, should bave been 
higher. 

"Q. Haven't you shortened it materially? A. No. 

"Q . Is it in the same condition novv that it was at the time of tlie accident? 

"Mr. Twitehell: We object, as we don't see why that bas any bearing in 
the case as to condition then. 

"Mr. Bell: We don't wish to show it as an admission of the defect, or to 
show it for any other illegitimate purposes. What we désire is to show that 
they hâve not only changea or shortened It materially, but put in différent 
timber, etc. 

"The Court: I think you can ask that question. 

"To which ruling of the court, the défendant by its counsel, then and there 
duly excepted. 

"A. No, sir. 

"Q. How bas it been changed? A. I put in some short planking from the 
lower side of that timber, probably 18 inches long. 

"Q. Doesn't that go practically 18 inches lower? A. No, not on the line 
of the timber. 

"Mr. Bell: This is a small model made by the plaintiff himself. Now, this 
is what he calls the platform. Now, at the time the accident occurred, that 
timber was square there, wasn't it, about 18 feet above? A. Yes, sir. 

"Q. Now it cornes in that shape? 

"Défendant objects, if court please. 

"ïlie Court: Counsel diseiaims any purpose — 

"Mr. Bell: But we do elaim that by this vory door they ran thoir timber 
up there, and that they corne in ou the inside and bave taken ]8-inch boards 
and bave brought it that way to bave no difficulty at ail, and hâve improved 
the shaft very much. 

"Mr. Tw'itchell: Upon that part, your honor, he states that it is souglit to 
show that they improved the shaft, aud no négligence of that sort is alleged. 
Tlie ouly négligence; tliut is nllcged is the existence of this cross-piece in tin; 
original condition of the shaft. 

"The Court: You bave asked about a spécial condition. You raay ask 
that. 

"Mr. Bell: I will pass that. 

"Q. Now, give its présent condition. A. We put in timber hère on the oul- 
side. 

"Q. Back from a line of the shaft, outside the shaft entirely? A. Yes, sir. 
152 F.— 11 



162 152 FEDERAL EEPOETEH. 

"Q. Then you took boards and you boarded from the inside of the two? 
A. No. 

"Q. How did you board it? A. Boarded it from the Inside face of that par- 
ticular timber. It came against tbe other timber." 

Evidence that after the accident the master repaired his building 
or his machinery, or adopted a différent method of conducting- his 
business, is inadmissible to prove his négligence at the time of the 
accident, because a rule that such évidence is compétent would im- 
pose a penalty upon the master for making such repairs and changes, 
would make them a confession on his part of a prior vi'rong, and 
would in that way deter him from improving his property and his 
ways. Evidence of this nature is always inadmissible because it bas 
no legitimate tendency to prove that the building, the machinery, or 
the methods were not reasonably safe and suitable for the use to v/hich 
they were applied at the time of the in jury. Railroad Co. v. Havi'- 
thorne, 144 U. S. 202, 208, 12 Sup. Ct. 591, 36 L. Ed. 405; Motey 
V. Pickle Marble & Granité Co., 20 C. C. A. 3G6, 371, 74 Fed. 155, 159 ; 
Railway Co. v. Parker, 5 C. C. A. 220, 222, 55 Fed. 595, 597. The 
réception of the évidence that after this accident the défendant put 
in short planking probably 18 inches long from the lower inside face 
of the timber, which caught the bucket so that the upper end of the 
opening took the form of an inclined plane, instead of a horizontal 
timber, as before the accident, was a clear violation of this rule of 
évidence which nécessitâtes a new trial of this action. 

The error of the admission of this testimony was not extracted by 
the charge of the court, which does not refer to it, nor by the state- 
ment of counsel for the plaintifif that they did not wish to introduce 
it as an admission of defect or for any other illegitimate purpose, es- 
pecially in view of their déclaration at the same time that they did claim 
to establish by virtue of it the fact that the défendant had taken 18- 
inch boards and had improved the shaft very much. Notwithstanding 
this statement of counsel, the fact remained that the évidence had a 
tendency to lead the jury to believe that the défendant was négligent 
before the accident, because after the accident it changed the form of 
the portion of the shaft upon which the bucket caught so that it would 
not catch it. 

Upon this ground alone, the judgment is reversed. 

The majority of the court are of the opinion that the évidence was 
sufiicient to require a submission to the jury of the issue as to the 
négligence of the company, and that it was insufKcient to show as a 
matter of law that Larson either assumed the risk or was guilty of 
contributory négligence, while the writer is convinced that there was 
no substantial évidence of any négligence on the part of the company. 



HILLHOUSE V, UNITED STATES. 163 

HILLHOUSE V. UNITED STATES. 

(Circuit Court ot Appeala, Second Circuit. January 7, 1907.) 

Nos. 90, 3,751. 

1. OusTOMS DuTiES— Classification— HousEiroLD Effects— Automobile. 

Tlae provision for "houseliold effects" in Tariff Act July 24, 1897, c. 11, 
§ 2, Free List, par. 504, 30 Stat. 19G [U. S. Comp. St. 1901, p. 1683], in- 
cludes automobiles. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 15, Customs Duties, 
§ 28.] 

2. Same— Use Abeoad One Year— Continuity of Use. 

Tlie provision for liousehold effects "used abroad • * * net less 
than one year," in Tariff Act .Tuly 24, 1897, c. 11, § 2, Free List, par. 504, 
30 Stat. 190 [U. S. Comp. St. 1901, p. 1G83], is satisiied if the periods of 
sucli use aggregate one year, even though not continuous. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 15, Customs Duties, 
§ 28.] 

3. Same— Repairs— DxTTiAEiLiTT. 

Held tliat an automobile sbould not be excluded from importation free 
of duty as housebold effects used abroad more than one year, under 
Tarife Act July 24, 1897, c. 11, § 2, Free List, par. 504, 30 Stat. 196 [U. S. 
Comp. St. 1901, p. 168.S1, by reason of having been extensively repaired 
shortly before importaûon. So mueh of the machine as is a new manu- 
facture may be assessed with duty ; but the rest, including the cost of 
overhauling, oiling, cleaning, readjusting, and regulating, is free under 
sald paragraph. 

4. Same — Entirety — Constktjctive Séparation. 

In applying a tariff law, a single article may be constructively separat- 
ed into parts subject to différent classifications. 

Appeal from the Circuit Court of the United States for the South- 
ern District of New York. 

This cause cornes hère upon appeal from a décision of the Circuit 
Court, Southern District of New York, 142 Fed. 303, affirming a dé- 
cision of the Board of General Appraisers, G. A. 5,849, T. D. 25,768, 
which sustained the collector of the port of New York, in assessing 
duty on an automobile of foreign manufacture under the tarifï act of 
1897. 

Walden & Webster (Howard T. Walden, of counsel), for importer. 
D. Frank Lloyd, Asst. U. S. Atty. 

Before LACOMBE, TOWNSEND, and COXE, Circuit Judges. 

LACOMBE, Circuit Judge. Duty was assessed under paragraph 
193, as an article wholly or in part of iron or steel or other métal, at 
45 per cent, ad valorem. It is not disputed that, if dutiable at ail, it 
should be under this paragraph. The only claim made hère — -the 
imp>orter has abandoned others which were set forth in the protest and 
discussed by the board — is that the automobile is entitled to free entry 
under — 

"Par. 504. Books, libraries, usual and reasonable fumiture, and slmilar 
household effects of persons or familles from foreign countries, ail the forego- 
ing if actually used abroad by tUem not less than one year, and not intended 
for anv other person or persons, nor for sale." Act July 24, 1897, c. 11, § 2, 
Free List, par. 504, 30 Stat. 196 [U. S. Comp. St. Supp. 1901, p. 1683]. 



164 152 FEDERAL REPORTER. 

The Suprême Court, in Arthur v. Morgan, 11'3 U. S. 495, 5 Sup. 
Ct. 241, 28 L. Ed. 825, held that carriages were properly classified as 
household effects, and we see no reason why automobiles should not 
be similarly disposed of. The Board of General Appraisers disposed 
of this claim by finding that there was no satisfactory proof that the 
machine had been used abroad for a year. This defect of proof was 
supplied in the circuit; and it now appears that after its purchase 
in October, 1901, it was used abroad for four months, was then 
brought hère (dutybeing paid on it) and used until August, 1903, 
and then taken abroad and used more than nine months in Europe. 
The act does not require continuous use abroad ; and it was conceded 
in the Circuit Court (and is conceded hère) that the automobile was 
actually used abroad by the owner for more than one year, and was not 
intended for any other person or for sale. It appears, however, that 
extensive repairs were made upon it shortly before its second shipment 
to this country. The judge at circuit found that "the niotor had been 
overhauled, new parts substituted in place of old, and the body had been 
repaired and newly upholstered." He held: 

"A new manufacture, in part at least, would seem to hâve been tlie rcsnlt. 
If the repairing had eonsisted simply of paintmg and adjvisting parts of tho 
machine which had become impaired and defective by reason of its ordiiiary 
use, a more libéral construction of the provision of the tariff act would be 
justified." 

And he affirmed the board, which had sustained an assessment on the 
full value of the machine, 10,000 francs. 

We concur in part only in this conclusion. As to so much of the 
machine as was a new manufacture which had not been used abroad 
for a year, duty was properly exacted ; but when the value of such new 
manufacture is easily determinable there seems no good reason for re- 
quiring so much of it as has been used abroad for the requisit» time to 
pay duty also. In the case at bar it appears that the total cost of 
the overhauling and repairs was 2,989.5.5 francs, of which 489.55 
francs was paid for such work as overhauling, oiling, cleaning, read- 
justing, and regulating. Upon the balance only, 2,500 francs, should 
duty as "manufactures of métal," etc., be assessed. 

The décision is reversed. 



UNITED STATES v. J. S. JOHNSON & CO. 

(Circuit Court of Appeals, Second Circuit January 8, 1907.) 

No. 91 (3,398). 

OusTOMS DuTiES— Classification — Preservbd Pineapples. 

Pineapples preserved in cans in their own juiee, witli 3 per cent, of 
sugar added for flavoring, and not aiding substantially in the préservation, 
which is accomplished by the canning process, lield dutiable as "pineapples 
preserved in their own juice," and not as fruit preserved in sugar, un- 
der Tarife Act July 24, 1897, c. 11, § 1, Schedule G, par. 2G3, 30 Stat. 171 
[U. S. Comp. St. 1901, p. 1651]. 

Appeal from the Circuit Court of the United States for the Southern 
District of New York, 



PTJLD & CO. V. UNIÏED STATES. 105 

For décision below, see 143 Fed. 915, reversing a décision of the 
Board of United States General Appraisers, G. A. 5,352 (T. D. 24,494), 
which had affirmed tlie assessment of duty by the coliector of customs 
at the port of New York. 

The merehandise consists of pineapples in tin cans. The question at is- 
sue is whether it is dutiable uuder the provision in Tarif! Act July 24, 1897, 
c. 11, § 1, Schedule G, par. 263, 30 Stat 171 [U. S. Comp. St. 1901, p. 1651], for 
"fruits preserved in sugar," as held by the coliector and the Board of General 
Appraisers, or under the further provision in the same paragraph for "pine- 
apples preserved in their own juice," as held in the court below. It appears 
from the opinion by Judge Platt in the Circuit Court that the pineai)ples as 
found in the cans conta ined nearly 14 per cent, of sugar, a little over 3 per 
cent, of which consisted of cane sugar extrinsically added in the process of 
préparation, that this sugar seemed to hâve been introduced rather in the 
way of tiavoring than as aiding substantially in the préservation of the fruit, 
and that the préservation was principally accomplished by the juice of the 
fruit together with the boiling and other canning processes. The court ex- 
pressed the view that, "when Congress referred to fruits preserved in sugar, 
it meant fruits in which sugar plays a prominent and important part," and 
that therefore the pineapples in dispute were more properly classed as 
preserved in their own juice. 

D. Frank Lloyd, Asst. U. S. Atty. 

Walden & Webster (Howard T. Walden, of counsel), for importers. 

Before LACOMBE, TOWNSEND, and COXE, Circuit Judges. 

PER CURIAM. We concur fully in Judge Platt's opinion. Inci- 
dentally référence mav be made to our récent décision in A. L. Causse 
Co. V. U. S., 151 Fed. 4 (Dec. 4, 1906), where we held that certain 
cherries were not ''preserved in their own juice" when the juices which 
were rejtained in them only tended to produce their decay. In the case 
at bar the preservative qualities are found in the juice itself, the boil- 
ing of the pineapple in the juice and the hermetically sealing of the con- 
tents in the tin cans. 

The décision is afïirmed. 



rULD & CO. v. L'NITED STATES. 

(Circuit Court of Appcals, Second Circuit. Jauuary 11, 1007.) 

Nos. 117, 4,038. 

CUSTOilS DUTIES — PbOTEST — SUFFICIENCY. 

An importer's protest read : "Protest is hereby made against ♦ ♦ * 
your décision assessing duty at 35 per cent, ad valorem, or other rate or 
rates, on lithographie prints, lirlppen, mechanical cards, etc., covered by 
entries below named. * * * This protest is inte'nded to apply sepa- 
rately and collectively to every part of goods assessed under paragraph 418, 
as well as to ail other goods assessed at 35 per cent, ad valorem." Held, 
that the protest was not insufficient because no part of the importation in 
question was assessed at the rate of 35 per cent, under paragraph 418 
(Act .Tuly 24, 1897, c. 11, § 1, Schedule N, 30 Stat. 151 [U. S. Conip. St. 1001, 
p. 1674]), or elsewhere, but should be eonstnied as relatiiig to lithographie 
prints and boolclets assessed at other rates and under another paragraph 
than were mentioned in the protest. 

Appeal from the Circuit Court of the United States for the South- 
ern District of New York. 



166 152 FEDERAL REPORTER. 

For décision below, see 143 Fed. 920, which affirmed a décision of 
the Board of United States General Appraisers, wliich had overruled 
a protest against the assessment of duty by the coUector of customs 
at the port of New York. 

The pertinent part of said protest reads as follows: "Protest is hereby 
made against your ascertainment and liquidation of duties and your déci- 
sion assessing duty at 35 per cent, ad valorem, or other rate or rates, ou 
lithographie prints, krippen, mechanical cards, etc., covered by entries below 
named. The reasons for objection under the tarife act of July 24, 1897, are 
as follows: Said merchandise is lithographie prints. It is covered by par- 
agraph 400, and is dutiable thereunder at flve cents per pound, or six cents 
per pbund, or other rate or rates, according to thickness, cutting size, etc. 
If net as aforesaid, it is printed matter or otherwise covered by paragraph 403. 
and is dutiable thereunder at only 25 per cent, ad valorem. This protest is 
intended to apply separately and collectively to every part of goods assessed 
under paragraph 418, as vi^ell as to ail other goods assessed at 35 per cent. 
ad valorem." 

It appeared that the merchandise covered by the entry mentioned in the 
protest consisted of lithographie prints and booklets, assessed at the rate of 
20 cents per pound and 8 cents per pound, respectively, under Tarife Act 1897 
(Act July 24, 18!>7, c. 11, § 1, Schedule M, par. 400, 30 Stat. 188 [U. S. Comp. 
St. 1901, p. 1672]), and that no part of the importation was classiiied at 35 per 
cent, or under paragraph 418. The board held that the protest was insuffl- 
cient on the ground that it was in terms conflned to merchandise assessed at 
35 per cent, and therefore could not be construed as covering the articles 
classified at a différent rate. This ruling was affirmed by the circuit court 
in the décision above cited, but on différent grounds from those stated by the 
board. 

Comstock & Washburn (Albert H. Washburn, of counsel), for the 
importers. 

D. Frank Uoyd, Asst. U. S. Atty. 

Before WALLACE, LACOMBE, and COXE, Circuit Judges. 

PER CURIAM. Décision reversed, for reasons orally stated at the 
close of the argument, and protest held to be a sufficient compliance 
under Customs Administrative Act June 10, 1890, § 14, par. 14, 26 Stat. 
137 [U. S. Comp. St. 1901, p. 1933]. 



STANDARD OIL CO. v. ANDERSON. 

(Circuit Court of Appeals, Second Circuit. February 26, 1907.) 

No. 162. 

Mastbr and S.EBVANT— Fellow Servasts— Seevants of Sepaeate Mastebs 
IN Same Wobk. 

PlaintifC, a longshoreman, engaged in loading a vessel as an employa 
of a master stevedore, who had contracted to do such loading, and who 
had contracted with défendant for the steam power, is not a fellow 
servant of the employé of défendant, who worked the steam winch, and 
through whose négligence plaintifC was injured; the winch man being 
hlred and paid by défendant, and the master stevedore having no power 
to discharge him. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 34, Master and Serv- 
ant, § 485. 

Who are fellow servants, see note to Northern Pae. R. Co. v. Smith, 
8 C. C. A. 668 ; Flippiu v. Kimball, 31 C. C. A. 28t!.J 



STANDARD OIL CO. V. ANDER80N. 167 

In Error to the Circuit Court of the United States for the Eastern 
District of New York. 

This cause cornes hère upon appeal from a judgment of the Circuit 
Court, in favor of défendant in error who was plaintiff below. The 
action is to recover damages for personal injuries, and the jury brought 
in a verdict for the plaintiff. 

J. W. Fuller, for plaintiff in error. 

B. L. Pettigrew, for défendant in error. 

Before WALLACE, LACOMBE, and COXE, Circuit Judges. 

LACOMBE, Circuit Judge. Plaintiff, who was in the employ of 
one Terence, a master stevedore, was engaged with others in loading 
the steamship Susquehanna with case oil at the dock of the Standard 
Oil Company, in Bayonne, N. J. A foreman and a gang of men hired 
by Terence were located at différent stations about the ship or on the 
dock, each engaged. in performing his respective duty. The plaintiff 
was in the hold, and was struck by a draft of cases which was lowered 
at a time when he was not expecting it to descend. The hoisting from 
the dock and lowering into the hold was accomplished by the use of a 
steam winch located on the dock some 50 feet distant from the hatch. 
A gangwayman, one of Terence's employés, gave signais by whistle to 
the winchman, thus advising him when to run the winch forward or 
back, and when to stop. The évidence shows that the accident happen- . 
ed because the winchman reversed the winch (so as to lower the draft) j 
before signal to do so was given him. The jury found that he was at, 
fault, and that the plaintiff was free from any contributory négligence. 
There was évidence to warrant both thèse findings, and their verdict 
thereon is to be taken as conclusive. Some argument is presented hère 
as to the plaintiff's alleged carelessness, and as to the négligence of 
some others of his gang; but the only point seriously urged is that 
plaintiff and the winchman were fellow servants. If they were not, 
the judgment must stand, because the verdict has eliminated ail other 
questions from the case. If the gangwayman or the man who hooked 
the slings were also négligent, plaintiff, if not a fellow servant with the 
winchman, could recover, if the latter's négligence was a proximate 
cause of the accident. 

The master stevedore hired the longshoremen, and contracted with 
the défendant for the steam power, agreeing to pay "$1.50 a thousand 
for hoisting." The winch was the property of défendant, standing on 
its dock, and it selected, hired, and paid the winchman who ran it. The 
master stevedore did not pay the winchman, nor hire him, and could not 
discharge him if he did not suit ; in the latter event he would complain 
to the défendant companv. This case is therefore on ail fours with The 
Slingsby, 120 Fed. 748, 57 C. C. A. 52, where we held that a sailor op- 
erating a ship's winch by order of her captain to assist a gang of long- 
shoremen in discharging cargo was not their fellow servant, although 
he received the signais to run the winch forward or to reverse from 
their foreman. Our attention has been called to The Elton, 142 Fed. 
367, 73 C. C. A. 467, in which the Circuit Court of Appeals in the Third 
Circuit reached a différent conclusion upon a similar state of facts. We 



168 152 FEDERAL EBPOETEB. 

regret that we are not able to agrée with the conclusions of law reached 
by that eminent court, but we see no reason to change thç opinion here- 
tofore expressed in The Slingsby, which was reached after a careful 
examination of the authorities cited in Thé Elton. 
The judgment is affirmed. 



SOUTHERN PAC. CO. y. BURCH. 

(Circuit Court of Appeals, Nlnth Circuit February 11, 1907.) 

No. 1,345. 

Removal of Causes— Jubisdiction oî- Fédérai, Coubt— Nonresidence oi 
Parties. 

A fédéral court cannot acquîre jurlsdictlon by reinoval of a suit In 
whlch such Jurlsdictlon is dépendent on diversity of citizensUip, where 
neittier of the parties Is a résident of the district, and the plaiutilï does 
not consent to such jurisdietion or waive bis rights. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 42, Keœoval of 
Causes, §§ 32, 33.] 

In Errer to the Circuit Court of the United States for the District of 
Nevada. 

See 145 Fed. 443. 

S. Summerfield and P. F. Dunne, for platntiff in error. 

Herbert R. Macmillan and H. H. Henderson, for défendant in error. 

Before GILBERT, ROSS, and MORROW, Circuit Judges. 

ROSS, Circuit Judge. This action was originally brought in one of 
the courts of the state of Nevada by the défendant in error as plaintiff, 
against the plaintiff in error as défendant, to recover damages for Per- 
sonal injuries alleged to hâve been sustained by the plaintiff to the 
action by reasôn of the négligence of the défendant thereto. The plain- 
tiff being a résident and citizen of the state of Utah, and the défendant 
to the action being a corporation of the state of Kentucky, and there- 
fore a résident and citizen of that state, upon the defendant's motion, 
and the filing of a pétition and bond, the case was removed from the 
state court of Nevada to the United States Circuit Court for the Dis- 
trict of Nevada, where the plaintiff to the action, défendant in error 
hère, moved the court below to remand the case to the state court for 
lack of jurisdietion in the fédéral court over it, which motion the court 
below denied, and a trial thereof having been subsequently had, result- 
ing in a verdict and judgment for the plaintiff, the case was brought 
hère by the défendant thereto by writ of error. 

Neither party to the suit being a citizen or résident of the state of 
Nevada at the time of its commencement, we must, without référence to 
the merits of the controversy, upon the authority of the case of Ex parte 
Abram C. Wisner (decided by the Suprême Court December 10, 1906) 

37 Sup. Ct. Rep. 150, 51 L. Ed. , reverse the judgment, with 

costs to the défendant in error, and with directions to the court below 
to remand the case to the state court from whence it camCj for lack of 
jurisdietion of the fédéral court over it. 



IN RE CRAWB'ORD. 109 

In re CRAWFORD. 
(Circuit Court of Appeals, Eiglitli Circuit. Marcli 19, 1907.) 

No. 68. 
Bankbuïtcy— JuBiSDioi'iox— Indian ïerritoby— Jurisdiction to Revise Ob- 

DEES. 

The United States Circuit Court of Appeals of the Eightli Circuit has 
no jurisdiction to revise in niatter of law, under section 24b of tbe bank- 
ruptcy act (Act July 1, 1898, c. ."Vil, 30 Stat. ôû:;! [3 U. S. Comp. St. 1901, 
p. o4;i2]), the orders of the courts of original jurisdiction of the Indian 
Terrltory sitting in bankruptey. 

[Ed. Note. — Appeal and review in bankruptey cases, see note to In re 
Eggert, 43 C. C. A. 9.] 
(Syllabus by the Court.) 

Pétition to Revise Order of the United States Court for the Southern 
District of the Indian Territory, in Bankruptey. 

Clinton A. Galbraith, Thomas D. McKeown, and Joseph B. Thomp- 
son, for petitioner. 

James T. Blanton, Leonidas C. Andrews, and Alvin F. Pyeatt, for 
respondent. 

Before SANBORN, HOOK, and ADAMS, Circuit Judges. 

SANBORN, Circuit Judge. John P. Cravvford has presented his 
pétition to revise in matter of ïaw, under section 24b of the bank- 
ruptey act (Act July 1, 1898, c. 541, 30 Stat. 553 [3 U. S. Comp. St 
1901, p. 3432]), an order of the United States Court for the Southern 
District of the Indian Territory, sitting as a court of bankruptey, to 
the efïect that he pay over to R. C. Fleming, the trustée of the estate 
of one Gibson, a bankrupt, $1,300, and that his exceptions to the re- 
port and order of the référée to the same effect be ovcrruled. 

The Indian Territory has never been assigned to this circuit, as 
hâve the territories of New Mexico and Oklahoma, under section 15 
of the act to establish the Circuit Courts of Appeals (Act March 3, 
1891, c. 517, 26 Stat. 830 [1 U. S. Comp. St. 1901, p. 554] ; 139 U. 
S. 707, 11 Sup. Ct. iv) ; and for that reason, as was decided in Re 
Blair, 106 Fed. 662, 664, 45 C. C. A. 530, 532, upon a review of the 
acts of Congress, the Court of Appeals of this circuit is without juris- 
diction to entertain pétitions to revise, in matters of law, the orders 
of the courts of original jurisdiction of the Indian Territory sitting 
in bankruptey. 

The pétition is therefore dismissed for want of jurisdiction. 



170 152 FEDEEAL EEPOKTEB,^ 

VENUS SHIPPING CO. r. WIESON. 
(Circuit Court of Appeals, Second Circuit January 31, 1007.) 

No. 99. 

1. ShIPPINO — NONPULFILLMENT Oï CHAETEB— DaMAOES. 

The question of the damages to a sbipowner arising from a loss of eam- 
ings under a charter whicli was abaudoiied by the charterer dépends upon 
contingencies of navigation more or less spéculative aud incapable of being 
precisely asceriained, and in such case appi'oxiinate accuracy is ali that 
eau be reasonably expected. 

[Ed. Note.— For cases in point, see Cent Dig. vol. 44, Shipping, i 213.1 

2. Same — Measuiîe or Damages. 

Défendant chartered iibelant's vesse] to earry a full cargo of cotton 
from gavannali to Brenien, agreeing to pay n specifled sum per ton for the 
vessel'a registered net tonnage. Subsequeutly be refused to fulfili tbe 
charter, and after some days of negotiatiou a nevv cliarter was made to 
talje a cargo of cotton from Gaiveston to Brenien, but witbout waiver of 
Iibelant's right to recover damages for breacb of the flrst charter. Uelct, 
tbat in estimating such damages tbe court was justified in assuming that 
the time taUen in ioading and disch.'irgiug woiild bave been tbe same under 
the flrst charter as was actually talcen under the second, and in taliing 
as the measnre of damages the aveiage datly earnings niade under the 
second charter as compared wlth tbe average which would bave been 
mnde each day under the first if the voyage bad been made in the time 
estimated. 

[Ed. Note. — For cases in point, sce Cent. Dig. vol. 44, Shipping, S 213 1 

Appeal from the District Court of the United States for the Southern 
District of New York. 

Frederick M. Brown and Butler, Notman & Mynderse, for appellant. 
George M. Clarke, Henry G. Ward, and Robinson, Biddle & Ward, 
for appellee. 

Before WALLACE, LACOMBE, and COXE, Circuit Judges. 

PËR CURIAM. The decree appealed from awarded damages to 
the libelant, the owner of the steamship Neptune, for the nonfulfillment 
of a charter party. The case involves the question of the probable loss 
sustained by a shipowner through losing the net earnings of a vessel up- 
on a voyage which was abandoned, an inquiry which generally présents 
difficulties, because its solution dépends upon varions contingencies of 
navigation more or less spéculative and incapable of being accurately 
ascertained. In such cases approximate accuracy is ail that can be rea- 
sonably expected. 

By the charter between the parties, made September 27th, the full 
cargo capacity of the steamship was let for a cotton cargo upon a voy- 
age from New York to Savannah, and thence to Bremen, including the 
period contemplated for Ioading the cargo at Savannah and discharging 
it at Bremen; and the charterer was to pay freight at the rate of a 
specified sum per ton for the net tonnage of the vessel. The voyage 
under that charter would hâve begun October 24th, but several days 
previously the charterer notified the libelant that owing to conditions in 
the cotton market it would be impracticable for him to obtain a cargo 
lit Savannah, and suggested the substitution of Gaiveston as tlie load- 



VENUS SHIPPIXG CO. V. WILSON, 171 

ing port. Negotiations by cable and otbervvise, as to substituting Gai- 
veston for Savannah, continuée! until nearly the end of the month, 
the respondent offering the then prevailing freight rates for a voyage 
via Galveston, and the libelant insisting upon the fulfillment of the 
first charter, or a freight rate which would requite the loss arising 
from the breach. October 31st the parties made a new charter for a 
voyage via Galveston upon such terms as had been previously offered 
by the charterer and refused by the hbelant ; but this was made upon 
the understanding that the libelant was not to waive any claim of dam- 
age arising from the nonfulfillment of the first charter. Under the 
second charter the vessel was employed 64 days, beginning November 
2d and ending January 5th, and her earnings above the expenses of 
lier navigation and other disbursements, which were to be borne by 
the libelant, averaged £43 5s. lOd per day. 

The court below, approving a very careful and thorough report 
made by the commissioner to whom the question of damages had been 
refèrred, found that under the first charter the vessel would hâve been 
employed 55 days, beginning October 24th and ending December 18th, 
and that her earnings above the expenses and disbursements which 
the libelant would hâve incurred would bave averaged about £59 per 
day. Damages were awarded by the court below upon the basis of the 
différence between the net earnings for the period of 55 days actually 
realized under the second charter, and those which would hâve been 
realized under the first charter. This was équivalent to allowing the 
whole of the average daiiy net earnings under the first charter be- 
tween October 24th and November 3d, the period during which the 
vessel was out of employment, and the partial loss of daily net earn- 
ings from that time until December 18th, when she should bave com- 
pleted her employment under the first charter. 

The appellant insists that the court below erred in several particulars 
in reaching its conclusions of fact in respect to the probable duration 
of the employment of the vessel if the first charter had been fulfilled, 
and in respect to the net earnings she would bave made. We hâve 
carefuUy examined the proofs in order to ascertain whether the award 
was excessive. We are satisfied that the findings of the commissioner 
in respect to the first charter are fairly sanctioned by the proofs in ail 
important particulars. We see no reason why the average daily time 
made by the vessel on the voyage to Galveston and thence to Bremen 
should not be accepted as the average daily time she would bave made 
in proceeding to Savannah and thence to Bremen, or why the time 
occupied in loading and unloading at Galveston and Bremen should 
not be accepted as sufficient data for showing what time would probably 
hâve been occupied in loading at Savannah and unloading at Bremen. 
Upon the other facts that enter into the question of duration and ex- 
pense, although doubtless as to some of them there is room for a dif- 
férence of opinion, we cannot find that any mistake bas been made, ex- 
cept in a minor particular. That error arose in treating October as a 
month of 30 days instead of 31. Criticism is made of the item of 
brokerage on freight which enters into the estimate of expenses. But 
this item was not specifically challenged in the 25 exceptions to the 
commissioner 's report, or in the 30 assignments of error in this court; 



172 152 FEDERAL REPORTER. 

and, in view of the number of errors assignée! which liave no other 
support than the ingénions arguments of counsel, we are not disposée! 
to search for errors not assigned. 

Inasmuch as under either charter the vessel would hâve been at Bre- 
men at the expiration of her term of employment, we are unable to 
appreciate the contention based upon the différence in freight earnings 
upon eastward and westward voyages across the Atlantic. The con- 
tention that the libelant's damages are in some way limited by the olïers 
made by the charterer during the negotiations preceding the nevv char- 
ter is without any merit. If on the 24th of October, or any later day, 
the charterer had offered to enter into a new charter, leaving the rights 
of the parties under the existing charter untouched, and the hbelant 
had refused such an offer, it vi^ould be unjust to charge the charterer 
with the différence betvveen the dail}^ net earnings from that time until 
the vessel éntered upon her new employment. In that case the libelant 
would' hâve refused an opportunity to mitigate the damages. But 
the libelant was within its légal rights so long as it did not refuse an 
offer which it ought to bave accepted in order to mitigate the loss. 
If the libelant had accepted thèse offers, it would in effect bave con- 
sented;to substitute a new charter, and thereby would hâve waived its 
right to enforce the earlier one. The freight rate offered by the re- 
spondent, although it was the prevailing rate at the time, was a lower 
rate than the libelant was entitled to receive under the earlier charter, 
as rates ori cotton cargoes had fallen materially since the making of 
that charter. Thexesult proves that the offers made by the charterer 
would not, if they had been accepted, hâve covered libelant's loss. 

Criticisrn bas been made of the allowance by the court below of the 
cable messages between the Hbelant and its agents, Wright & Son, 
the brokers who negotiated the charter for the libelant. It is apparent 
that the messages from Wright & Son were sent in the interests of the 
charterer, and upon bis application to bave them intercède with the 
libelant for a modification of the original charter or for the acceptance 
of offers for its cancellation ; and the messages from the libelant were 
in response to those from Wright & Son. 

The decree should be modified by deducting the daily loss in net 
earnings for a single day, with interest thereon, and, as thus modified, 
is aiifirmed, with interest and costs of this appeal. 



GOLDSMITH V. KOOPMAN. 173 

GOLDSMITH v. KOOPMAN. 

REIZENSTEIN v. SAME. 

(Circuit Court of Appeals, Second Circuit. January T, 1007. On Eehear- 
ing February 28, 1007.) 

Nos. 51, 62. 

1. Paktxership— Relation Bbtween I'aktxers— Pukchase of Interest of Co- 

PAKTNEE. 

A purcliase by one partner of tlie interest of a copartner in the part- 
nershlp will be sustained only wben it is made for a fair considération 
and upon a full disclosure of ail important information as to value. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 38, Partnersliip, § 
142. 

Pnrcbase of copartner's interest, see note to Towle v. Hammond, 40 C. 
C. A. 508.] 

2. SaîIE— FrAUD— CONCEALMENT OF FACTS. 

Complainant obtained United States and foreign patents for an in- 
vention, and a partnersliip was formed between complainant, défendants, 
and others to handle the patent and tlie invention abroad; a fund being 
contributed for the purpose by the partners, ail of whom were to sharo 
in the profits. One of the défendants v\-ent to ICngland, and thero made 
license contracts, from which he received considérable sums in cash and 
was to receive more. He cabléd information of sueh trans!icti(jiîs to a co- 
defendant, who, by withholding the same from comi^lainant and another 
partner, owning together a half interest, and by represeuting tbat the 
partnership was in debt and that more money would bave to be contrib- 
uted, secured from them an assignment of ail their interest in the partner- 
ship and patents for a considération much less than their share of the 
profits already made. Hcld, that such assignment was voidable for fraud, 
and complainant was entitled to its cancellation, and to recover his share 
of the profits realized by the assignées. 

[Ed. Note. — ^For cases in point, see Cent. Dig. vol. 38, Partnership, § 
142.] 

3. Featjd — LiABiLiTY — Eatifioaiion of Fraud of Anotiier. 

One who knowingly accepts the benefit of a con tract procured by an- 
other by fraud, in part in his interest, ratifies the transaction, and is 
equally liable for the fraud. 

4. Partnership— Beeacii op Trust by Partners— Joint and Sevebal Lia- 

BILITr. 

The right of action against quasi trustées, as partners, who hâve been 
guilty of a fraudulent breach of their duty toward copartners, is ex de- 
licto, and the tort may be treated as several or .1oint, and the défendants 
hâve no right of contribution as between theraselves. 

5. Appeal — Présentation of Objection Below — Equity — Jurisdiction. 

The objection to the jurisdiction of a court oE equity on the ground that 
complainant bas an adéquate remedy at law cannot be raised for the flrst 
time on appeal. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 2, Appeal and Error, 
§ 1180.1 

Appeal from the Circuit Court of the United States for the Southern 
District of New York. 

For opinion below, see 140 Fed. 616. 

F. T. Hovey and Herman Aaron, for appellant. 
Eugène Treadwell, Isaac Hassler, and Harrison B. Weil, for ap- 
pellees. 



174 152 FEDERAL REPORTER. 

Before WALLACE, LACOMBE, and TOWNSEND, Circuit 
Judges. 

WAELACE, Circuit Judge. This îs an appeal from a decree 
canceling, as obtained by fraud, an assignment executed by complain- 
ant October 2, 1891, by which complainant and one Reizenstein trans- 
ferred to the défendant and others ail their interest in certain patented 
inventions and in the profits arising from a license agreement whicli 
they had made with John H. Brigham. 

The undisputed facts of the case as disclosed by the proofs are 
thèse: Prier to April, 1891, the complainant Goldsmith had made an 
invention relating to coin holders or pocket banks, for which he had 
obtained letters patent in England and other foreign countries, and had 
transferred a half interest therein to one Reizenstein. April 14, 1891, 
Goldsmith and Reizenstein made an agreement with the défendant, 
Willard Upton, Henry M. Brigham, and John H. Brigham, whereby 
the parties thereto agreed to become copartners in manufacturing and 
selling the patented invention abroad, and to contribute $2,000 as cap- 
ital; each advancing his ratable proportion, and each to share rat- 
ably in the profits. By this agreement the partnership shares of the 
complainant, Reizenstein, and the défendant were to be one-fourth part 
each, Henry M. Brigham's share was to be one-eighth part, and the 
shares of John H. Brigham and Upton were to be one-sixteenth part 
each. This agreement also provided that ail matters relating to the 
partnership were to be "determined by a majority vote of ail the parties 
interested," and that each party "should be entitled to one vote for each 
one-sixteenth interest in the copartnership." The capital was duly 
contributed, and Reizenstein and John H. Brigham went to England to 
negotiate licenses and sales. Subsequently ail the parties comprising 
the copartnership entered into an agreement, bearing date May 5, 1891, 
by which John H. Brigham was made the sole licensee of the foreign 
patents, with the exclusive right to grant sublicenses and make and sell 
the patented articles during the life of the patents. By this agreement 
Brigham undertook to pay half-yearly a royalty of one cent each on ail 
of the patented articles sold, and guarantied that no less than $4,000 
should be paid over by him upon sales to be made within three years 
from the date of the agreement. This agreement had been prepared by 
Reizenstein and Brigham in England, and was not signed by the other 
parties thereto until they had returned from England, which was about 
June Ist, when ail the parties met at New York City. While Brigham 
was in England he had negotiated a sublicense agreement with Wri'T;ht 
& Butler, of Birmingham, and had begun negotiations for a similar 
agreement with Rollins & Co., of London. After the a^^^reement dated 
May 5, 1891, making Brigham sole licensee, had been signed by ail the 
parties, in August, 1891, the défendant KooDman went to England in the 
interests of a pool or subpartnership, called in the évidence "Pool No. 
2," which had been formed between Koopman, Uptcn, and the two Brig- 
hams. Under this pool thèse four associâtes were to share ail profits 
which might resuit from the license to Brigham. Neither Reizenstein 
nor the complainant were taken into this pool. After the défendant 
reached England he succeeded in making new arrangements with 



GOLDSMITH V. KOOPMAN. ^ 175 

Wright & Butler and with Rollins & Co., culminating in formai con- 
tracts by which thèse concerns undertook to pay John H. Brigham 
large sums by way of royalties as sublicensees, including payments 
in hand from one of them alone for sales of 1,200,000 of the patented 
articles. When thèse arrangements had been definitely agreed to, 
Koopman advised Upton of their purport by cable, and thereupon Up- 
ton promptly proceeded to procure from the complainant and Reizen- 
stein the assignment of October 2d. 

The principal controversy in the court below was whether this as- 
signment was induced by fraud, and whether the défendant was a par- 
ty to the fraud; and the principal assignments of error présent the 
question whether the proofs justified the court below in finding 
against the défendant upon thèse issues. 

We shall not undertake to recapitulate the évidence contained in the 
record bearing upon thèse questions, as the facts established by docu- 
mentary évidence and by the testimony of the défendant and his own 
witnesses supply, with but little assistance from the other testimony, 
enough to call for the cancellation of the assignment. The proofs 
satisfactorily support the findings of the court below to the efïect that 
the assignment was obtained from complainant and Reizenstein upon 
false statements made to them by Upton; that thèse statements were 
that the copartnership was in debt, that little or no business had been 
done abroad, and that $5,000 of new capital was needed to pay the 
debts and keep up the foreign business ; and that when thèse repré- 
sentations were made Upton knew of the successful negotiations of 
Koopman in England, and that large sums of money were about to be 
realized for the benefit of the partnership. The assignment was induc- 
ed, not only by thèse untrue représentations, but by the concealment 
from the complainant and Reizenstein by Koopman and Upton of ail 
that had lately occurred in England. Its considération was the sum of 
$1,750, and for this sum the complainant and Reizenstein parted with 
ail their interests in the partnership property at a time when thèse in- 
terests were worth at least five times that sum, and were worth pros- 
pectively much more. 

Koopman insists that he was innocent of participation in this fraud, 
and that he had no knowledge of the assignment until he returned 
from England, shortly after it had been procured. If Upton had been 
the sole perpetrator of the fraud, it is unlikely that he would hâve 
spontaneously divided the benefits of it with the défendant. The as- 
signment ran by its terms to Koopman and Upton. Both of them 
signed it, though Koopman signed by Kronheimer, as his attorney. 
In fact it was procured for the benefit of the associâtes in pool No. 2, 
and Kronheimer was a silent partner with Koopman in that pool. 
Défendant had advised Upton of the altered situation in England, 
whereby large payments would be derived from Wright & Butler and 
Rollins & Co. The day of his arrivai he was informed about the 
transaction by Kronheimer. When he learned the small considération 
which had been paid, he was put upon inquiry as to the honesty of the 
transaction. Instead of interviewing the victims he preferred to share 
the fruits of the purchase. He was a party to the transaction by rati- 
fication, if not originally by a previous understanding with Upton. 



176 152 FEDERAL REPORÏEK. 

The assignment was a fraud in the view of a court of eqiuty, irre- 
spective of any direct misrepresentations. When Koopman informed 
Upton of the changed situation in England, without informing com- 
plainant and Reizensiein of the facts which had largely enhanced the 
vakie of their interests, he was guihy of a breach of the fiduciary duties 
owing by him to them as copartners. A sale by one partner to anothcr 
of his partnership interest will be sustained ouly when it is made for a 
fair considération and upon a full disclosure of ail important informa- 
tion as to vahie. The conceahnent by Koopman of material facts, which 
it was his duty to disclose, was a fraud which invalidated the assign- 
ment. Storv on Partnership, § 172 ; Brooks v. Martin, 2 Wall. 70, 
85, 17 L. Ed. 732 ; Kimberly v. Arms, 139 U. S. 512, 9 Sup. Ct. 355, 
32 L. Ed. 764. 

We differ from the court below in the conclusion that the license 
to Brigham was inoperative. It would hâve been an operative instru- 
ment if Koopman had not signed it before the parties separated after 
their interview in New York in early June. It had been signed by 
the majority provided for in the partnership articles, and Koopman, 
as well as ail the other members of the copartnership, was therefore pre- 
cluded from challenging its validity as a transfer of the whole part- 
nership interests. We cannot accept the theory that the complainant 
or Reizenstein supposed that it was inoperative. It was explicitly re- 
cited in the assignment as in existence, and was explicitly transferred 
by the assignment to Upton and Koopman ; and the assertion of the 
complainant and Reizenstein that this was done merely as a matter 
of form cannot be allowed to prevail against their deliberate act. But 
it matters not what their suppositions may hâve been, so long as 
it was a valid and binding instrument. Its eftect was to divest them 
and ail the partners of any rights or interest in the copartnership 
property, except to share the royalty which might accrue from the 
Brigham license. 

The conclusion that the license to Brigham constituted the only prop- 
erty of the partnership after it was executed requires a modification 
of the decree. The complainant was not entitled to any profits realized 
by Brigham under his license, or derived by the défendant and Upton 
through the assignment to them. He was only entitled to his fourth 
of the royalties which Brigham undertook to account for by the license 
agreement, including, by necessary implication from the terms of the 
license, the royalty on sales made by Brigham's sublicensees. Any 
profits above the royalty which might accrue to Brigham from sales 
îjy himself or by his arrangements with sublicensees became his. The 
negotiations by Koopman in England, which culminated in the agree- 
ments with Wright & Butler and RoUins & Co., resulted in large profits 
to Brigham, and incidentally to the associâtes in the subpool. By the 
agreement with Wright & Butler that concern undertook to pay i3rig- 
ham $20,000 cash down, in considération of the abrogation of certain 
conditions of a previous sublicense; "such sum being computed at the 
rate of 2y2 cents United States currency upon the sale of 800,000 
banks guarantied to be sold by the party of the first part (Wright & 
Butler) from and after the date hereof." Under that provision he 
or the pool received $20,000; whereas, the royalty for which Brig- 



GOLDSMITH V. KOOPMAN. 177 

ham was to account under his license would hâve been $8,000. By that 
agreement Wright & Butler also undertook to take over orders for 
sales which Brigham had on hand for 400,000 banks and pay there- 
for $10,000. Under that provision of the agreement Brigham became 
accountable for royalty under his own license to the extent of $4,000. 
The decree awarded a recovery to the complainant upon the basis of 
the payments received by Brigham from his sublicensees ; whereas, it 
should hâve been upon the basis of the royalties due from him tinder 
his license. No accounting was ordered, and the decree adjudged a 
recovery of one-fourth of the sums of money which it aiïirmatively 
appeared had been received by the subpool. We observe, also, that 
the decree did not provide for the restitution by the complainant of his 
half of the $1,750 received as the considération for the assignment. 
Upon the cancellation of the assignment he was bound to restore what 
he had received, and the decree should hâve provided for the déduc- 
tion of the amount from the amount otherwise recoverable against the 
défendant. 

By the assignment to Upton and the défendant, the complainant and 
Reizenstein were wrongfully deprived of the share of the royalties 
which would otherwise hâve accrued to them under the license to Brig- 
ham. Upton and the défendant are jointly and severally Habit for the 
loss induced by their fraudulent conduct. The right of action against 
quasi trustées who hâve been guilty of a fraudulent breach of their 
trust is ex delicto, and the tort may be treated as several or joint, and 
the trustées hâve no right of contribution as between themselves. Er- 
vin V. Oregon Ry. & Navigation Co. (C. C.) 20 Fed. 577, 582; Peck 
V. Ellis, 2 Johns. Ch. (N. Y.) 131 ; Miller v. Fenton, 11 Paige (N. Y.) 
18 ; Heath v. Erie Ry. Co., 8 Blatchf. 347, Fed. Cas. No. 6,306 ; Wil- 
kinson v. Parry, 4 Russ. 278 ; Franco v. Franco, 3 Ves. 75. 

We hâve not overlooked the contention for the appellant that the 
complainant had a complète and adéquate remedy at law, and there- 
fore could not resort to a court of equity. That this position is un- 
tenable sufïïciently appears by référence to Kilbourn v. Sunderland, 
130 U. S. 505, 9 Sup. Ct. 594, 32 L. Ed. 1005, without the citation of 
other authorities. 

The decree is modified, so as to direct an accounting and a recovery 
in conformity with this opinion, and in other respects is affirmed, with 
out costs to either party. 

On Rehearing. 

PER CURIAM. We hâve considered the application by the appel- 
lee for a reargument, and think it should be denied, as we did not over- 
look the varions contentions of the appellee respecting the validity and 
effect of the license agreement with Brigham. Nor did we overlook the 
considération, though we did not refer to it in our opinion, that it does 
not appear to hâve occurred to the appellee's counsel that the court could 
not hâve adjudged that agreement to be inopcrative, void for fraud, or 
otherwise invalid. Brigham was not a party to the suit, and no decree 
could bave been made in his absence adjudging his license void. 
152 F.— 12 



178 152 FEDBEAL EEPORTBB. 

CANDA BROS. V. MICHIGAN MALLEABLE IRON 00. 

(Circuit Court of Appeals, Sixtli Circuit March 21, 1907.) 

No. 1,615. 

1. Patents— Joint Suit fob Infeingement— Profits Recoverable. 

In a suit by joint owners of a patent for its iufringement, profits can- 
not be recovered which accrued from infringements prier to the date of 
the joint ownersliip, and wlien tlie patent was the sole property of one 
of the complainants. 

2. SAME— ACCOUNTING FOB PROFITS — DEDUCTION FOE LOSSES. 

On an aceounting for profits for infringement of a patent, the Infringer 
is not entitled to deduet from the profits made during a certain period of 
time a loss subsequently incurred in a separate transaction. On such an 
aceounting only losses occurring ooncurrently with the making of profits 
and directly resulting from the particular transactions on which the profits 
are allowed may be considered in diminution of profits. 

[Ed. Note. — For cases in point, see Cent Dig. vol. 38, Patents, § 576.] 

3. S AME. 

Where Infriugement of one claim only of a patent Is adjudged, the in- 
fringer canuot be held to account for profits arising from the sale of a 
part of the device which was not an élément of such claim, although it 
may hâve been an élément of other claims. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 38, Patents, § 572.] 

4. Same— Séparation op Profits. 

It is the settled rule that, where the infringed device was a portion only 
of defendant's machine, which embraced inventions covered by other pat- 
ents, it is incumbent on complainant to show how much of the profit made 
was due to such other patented parts, and how much to those of his own 
invention; but, before such rule is applicable, the burden rests upon the 
défendant to show the existence of such extraneous éléments and the prob- 
ability that they afCected the price of the machine, and this is not done by 
showing that éléments of the combination of complalnant's patent and 
of the infringlng machine were also éléments of prier patented combina- 
tions where they were not separately patented, and were therefore open to 
use by complainant as parts of his own combination and invention. 

Appeal from the Circuit Court of the United States for the Eastern 
District of Michigan. 

James C. Chapin, for Canda Bros. 

James Whittemore, for Michigan Malléable Iron Co. 

Before LURTON, SEVERENS, and RICHARDS, Circuit Judges. 

SEVERENS, Circuit Judge. This cause Avas hère in 1903 on appeal 
from a decree of the Circuit Court dismissing the bill. The suit was 
for the infringement of a patent granted to Canda, September 29, 1891, 
for the invention of a draw-bar attachment for Connecting railroad 
cars. The number of the patent was 460,426. Being of opinion that 
the first claim of the patent was valid, and finding that the défendant 
infringed it, we reversed the decree, and directed the Circuit Court to 
enter a decree in favor of the complainants in respect of said first 
claim, and thereupon to proceed to ascertain the profits and damages 
and to grant the usual relief. The case is reported in 124 Fed. 486, 
61 C. C. A. 194. On entering the proper decree in the court below, a 
référence to a master was ordered to take proof and state an account 



CANDA BROS. V. MICHIGAN MALLEABLE IRON CO. 179 

of the profits and damages, and report the same to the court. On 
coming before the master, the complainants renounced their claim for 
damages, and the parties went into proof in respect to the profits. 
It was shown that on October 3, 1899, Ferdinand E. Canda, the paten- 
tée, assigned a one-half interest in his patent to the co-complainant, 
Charles J. Canda, and it came to be owned by them as a partnership. 
The complainants offered proof to show infringement and damages 
occurring before the assignment as well as subséquent thereto. Ob- 
jection was made by the défendant to the proof concerning the period 
before the assignment. The master in his report divided the whole 
period of infringement covered by the évidence into three parts ; First, 
that before the assignment; second, that directly following and con- 
tinuing until the end of the time during which sales were made and 
profits realized; and, third, a subséquent space of time during which 
the défendants manufactured casing for a customer who never paid 
for them, and from whom the debt is uncoUectible. For the first period 
the master found the profits to be $6,905.41, for the second $11,659.50, 
and the losses from the manufacture in the third to be $6,634.56. The 
master reported against the allowance of a recovery for the profits 
accruing during the first period, and in favor of their allowance for 
the second period; and he also reported in favor of a contention for 
the défendant that the losses of the third period should be deducted 
from the profits allowed for the second period. The resuit was a 
balance in favor of the complainant of $5,024.94. Exceptions to the 
report were filed by each party. So far as some of thèse are material, 
they will be mentioned later on ; but for our immédiate purposes 
it should be stated that the court sustained the complainants' excep- 
tion to the master's disallowance of the profits for the first period, 
but overruled the complainant's exception to the master's déduction 
of the losses of the third period. Having also overruled exceptions to 
the allowance of the profits for the second period, the court rendered 
a decree upon this adjustment in favor of the complainant for the sum 
of $11,930.35. Both parties hâve appealed. 

1. The first question in its order to be considered is whether the 
complainants were entitled to recover the profits made during the 
period of infririgement while Frederick J. Canda was the sole owner 
of the patent. The master was of opinion that they could not be recov- 
ered in this suit because the other complainant had no interest in them ; 
but the court held otherwise, and allowed them, and we think that in 
this the court was in error. The gênerai rule is that ail the parties 
suing must hâve an interest in the recovery in order to warrant a 
judgment therefor in their favor. Even if that were permissible, the 
bill did not seek to recover a several decree in favor of one of the 
complainants for one part of the profits, and a joint decree for an- 
other. On the contrary, the complaint was of infringement after the 
date of the assignment. In support of the ruling of the court in this 
particular, the learned judge cited Moore v. Marsh, 7 Wall. 515, 19 
L. Ed. 37 ; but that case is not in point for the complainants. The pat- 
entée, some time after getting his patent, assigned a one-half interest 
therein to another party. Subsequently the patentée brought a suit 
to recover damages for infringement committed before the assignment. 



180 152 FEDERAL REPORTER. 

The défendant pleaded the assignment, and insisted that, as at the 
bringing of the suit another party had become interested in the patent, 
such other party should hâve been joined as plaintiff. But the Su- 
prême Court held otherwise, and Mr. Justice Chfford, at page 522 of 
7 Wall. (19 L. Ed. 37), said: 

"It is clear that uniess the plaintiff ean maintain the action there ean be 
no redress, as it is too plain for argument that a subséquent assignée or 
lirantee ean neither maintain an action in his own name, or be joined with tho 
patentée in maintaining it for any infringenient of the exclusive right coni- 
mitted before he became interested in the patent. Undoubtedly the assignée 
thereafter stands In the place of the patentée, both as to right under the 
patent and future responsibility ; but it is a great mistake to suppose that the 
assignment of a patent carries with it a transfer of the right to damages for 
an infringement committed before such assignment." 

In the case of Adams v. Bellaire Stamping Co. (C. C.) 25 Fed. 270, 
cited by counsel for complainants, the suit was brought by a single 
plaintiff, who was assignée of the patentée, and was also assignée of 
the damages for prior infringements. The question was whether he 
could recover for prior and, for subséquent infringements and Judge 
Sage held that he could. This was because he was the assignée of the 
patentee's damages. The court below erred in including the profits 
for this pîriod in the recovery, and the decree must be corrected ac- 
cordingly. 

2. The court below also erred in sustaining the defendant's claim of 
a déduction for the losses incurred by said défendant during the third 
period of the reckoning, and in deducting those losses from the profits 
which the complainants were otherwise entitled to recover. In the 
opinion of the court, the cases of the Cawood Patent, 94 U. S. 710, 24 
h. Ed. 238, and Rubber Company v. Goodyear, 9 Wall. 788, 19 L. Ed. 
566, are cited as authority for the ruling; but thèse cases only hold 
that losses occurring concurrently with the gaining of profits may be 
taken into account — that is to say, if they are losses directly resulting 
from the particular transaction on which the profits are allowed. 
Though called losses, they are really diminutions which are taken into 
account in reaching the résultant profits of the sales on which profits 
were made. The gênerai statements made by the justices who deliv- 
ered the opinions in the cases last cited, and which are hère relied on 
as authority for the claim that ail the transactions running through 
several years are to be looked to, and the profits and losses of a con- 
tinuons business are to be balanced for a resuit, do not sustain such 
a contention. The meaning and authority of such gênerai statements 
should be limited by the facts of the case in which they were expressed. 
And it is necessary to impose such limitations in order to make the 
statements consistent with the law as since declared by the same court. 
Callaghan v. Myers, 128 U. S. 617, 664, 9 Sup. Ct. 177, 32 E. Ed. 547; 
Crosby Valve Co. v. Safety Valve Co., 141 U. S. 453, 12 Sup. Ct. 49, 
35 L. Ed. 809 ; Walker on Patents (4th Ed.) § 713. 

3. It appears that the proofs before the master included the profits 
on the bottom plate of the casing, and the report of the master included 
them. To this the défendant filed an exception, which was overruled 
by the court. The second claim of the patent included the bottom 
plate in the combination. The first did not. By référence to our former 



CANDA BROS. V. MICHIGAN MALLEABLE IRON CO. 181 

opinion, it is shown that we sustained the first daim; but, as to the 
second, we affirmed the decree of tlie Circuit Court dismissing the bill 
upon the ground solely that infringenient was not proven. We did not 
pass upon the validity of the second claim. The decree entered below in 
conformity with our mandate directed that the accounting should be for 
the infringenient of said first claim. The contention of the complainant 
that the profits on the bottom plate should be included rests upor. 
the ground that the making and selling of it was a contributory in- 
fringement of the first claim. Assuming it to be so, it does not follow 
that the défendant should be cliarged with the profits on the manu- 
facture and sale of it. The infringement was of the invention of the 
principal member of the entire casing, and only of that member. It 
might well be that the supplying of the bottom plate would be contribu- 
tory to the infringement and render the contributor liable for the tres- 
pass of the principal infringer. But infringement by the latter, if not 
of the whole thing, is only of some part, and it is the infringing of 
that part which the contributor helps the principal to do. As we pointed 
ont in our former opinion, patentable invention may be of some member 
of a combination or thing which, when associated with other éléments, 
either such as are known to the art or such as are suggested but not 
claimed by the inventor, is new and useful. But that gives him no 
proprietary interest in the things thus associated. So hère, Canda hav- 
ing invented certain new and useful parts of a draw-bar casing, though 
he might hâve omitted to mention any bottom plate, if the state of the 
art would indicate to the builder that a bottom plate should be added, 
did nevertheless specify that a bottom plate would be needed, and pro- 
ceeded further to describe a good form for one. The resuit reached 
by the court below upon this part of the accounting confounds claims 
1 and 2, and extends the recovery to ail the éléments of the second 
claim. This we think was erroneous ; but, as the master took care 
to distinguish that part of the profits which accrued on account of the 
bottom plate, the decree may and should be modified by deducting that 
part, which the master reports as amounting to $1,5.33. 

4. Another exception of the défendant rests upon the facts that cer- 
tain earlier patents, two in particular, one to Cushing and another to 
Thornburgh, had been taken out for "draw-bar stops for railroad 
cars" and "draft apparatus" for the same, which the défendant says 
indicate certain features of construction which are embodied in the 
infringing castings made and sold by the défendant, and which aug- 
ment the profits wherewith the défendant is charged. The principle 
upon which this exception is grounded is well settled ; but, before it 
can be appHed, it is incumbent on the défendant to prove that the pecu- 
liar characteristic features or some substantial part of such peculiari- 
ties of the former patents were embodied in the patented articles sold, 
and that they were of such a character that they probably contributed 
to the profits. Elizabeth v. Pavement Co., 97 U. S. 126, 24 L. Ed. 
1000. On this being shown, the burden of proof is devolved on the 
party seeking to recover the profits to prove what part of the entire 
profits are due to the use of his own invention. He must make the 
séparation of values and show to the court how much is his rightful 



182 152 FEDERAL REPORTER. 

proportion. Garretson v. Clark, 111 U. S. 120, 4 Sup. Ct. 291, 28 
L. Éd. 371. 

Hère is the rock on wliich many patent causes hâve bsen stranded 
at the end of their course, for, though it can sometimes be done, it 
is generally next to impossible to dist'nguish the profit due to one rather 
than another of the characteristics of the article sold, or manufactured 
to be sold. The price is single, and it would rarely happen that either 
the buyer or the seller would contemplate the price as made up of com- 
ponents grounded on such a distinction. The facts are similar to those 
which in other cases would condemn the guilty party to suffer the con- 
séquences of his mingling indistinguishably the property of an innocent 
party with his own or that of another. Counsel for défendant has ar- 
gued this question upon the theory that the rule laid down in the case 
of Elizabeth v. Pavement Co. was an exception merely to that stated 
in Garretson v. Clark, and seems to suppose that, in every case where 
some élément or éléments of a combination found in a former patent 
is found also in the inf ringing article, the burden is cast upon the plain- 
tiff to prove either that it did not affect the selling price of the arti- 
cle, or, if it did, to show what part of the price was due to his own inven- 
tion. But such a rule would be inconsistent with the décision in Eliza- 
beth V. Pavement Co. We think the two cases above mentioned are 
not inconsistent, and that they are easily reconciled upon the assump- 
tion that the rule of the first case is applicable to the question of the 
burden of proof of showing the présence of the extraneous élément and 
the probability that it has affected the price, and that the rule in the 
second case relates to the burden of proof after those facts are es- 
tablished. Thus, in the later case of Keystone Mfg. Co. v. Adams, 151 
U. S. 145, 148, 14 Sup. Ct. 295, 38 L. Ed. 103, in summing up the 
conclusions reached thereon, one was stated to be "that where the 
infringed device was a portion only of defendant's machine, which em- 
braced inventions covered by patents other than that for the inf ringe- 
ment of which the suit was brought, in the absence of proof to show 
how much of that profit was due to such other patents, and how much 
was a manufacturer's profit, the complainant is entitled to nominal 
damages only," from which it seems that the conditions stated must hâve 
been made to appear before the rule stated could be applied. 

Where the extraneous matter is another invention which is the 
subject of a monopoly in some other person, the reasons for the rule 
requiring a distinguishing of profits becomes clearer because of the 
necessity of preventing a double liability on the part of the défendant ; 
but the reasons for its application to any other case are vague, and the 
practice diffîcult. In the présent cause the court below held that it 
was not proven that the inventions of the Cushing and Thornburgh pat- 
ents, or either of them, were embodied in the casings. on which the prof- 
its were calculated, or contributed thereto, and in this we entirely agrée. 
An examination of the testimony in the record shows that some of 
the forms of parts of the combinations of those patents are to be found 
in the Canda patent, but nothing which represents any patented device 
of Cushing or of Thornburgh. Nor do we find any substantial thing 
deserving of being reckoned as a factor to which a portion of the price 
was due. It was settled as between thèse parties by the former decree 



TTDKN V. OHIO TABLE CO. 183 

that there was nothing in the prior art which anticipatcd the inven- 
tion of the patent in suit, and that conckision cannot now be disputed. 
The unpatented éléments of the Cushing and Thornburgh patents (and 
the}' were ail singly unpatented) were common property. Any other 
inventer might take them, if he did not take an entire combination, 
and use them as parts of his own structure, and, if they were a fit em- 
bodiment of his own ideas, they, in his combination, represented parts 
of his invention, and the invention pervaded the whole structure. We 
therefore conclude that there was no error in disallowing this exception. 

There are no other questions of sufficient importance to require dis- 
cussion. There is a question of costs, but they were in the discrétion 
of the court, and not the subject of appeal. 

The decree of the Circuit Court will be reversed, and the cause re- 
manded, with instructions to modify it in accordance with this opinion, 
and, as thus modified, re-enter it as the final decree of the court. 



TYDEN V. OHIO TABLE CO. et al. 

(Circuit Court o£ Appeals, Sixth Circuit. Marcb 18, 190T.) 

No. 1,598. 

1. Patents— iKFBiNOEMENT—LocKrNG Device ron Tables. 

The Tj'den patent, No. 67.5,.ô77, for a locliing device for pedestal tables, 
claim 1, is void as too broad and substantlally for a function. The re- 
maining ulaims, wliile disdosing invention and valid as improvement 
claims, are of narrow scope and îimited to the spécifie device sliown. As 
so construed, hcld not infringed. 

2. S AME. 

The Wilhelm patent, No. 736,327, for a loeliing device for pedestal tables. 
held not infringed. 

Appeal from the Circuit Court of the United States for the Eastern 
Division of the Northern District of Ohio. 

C. S. Burton, for appellant. 
H. Frease, for appellees. 

Before LURTON, SEVERENS, and RICHARDS, Circuit Judges. 

LURTON, Circuit Judge. This is a suit for alleged infringement of 
two patents, one issued to C. Wilhelm, August 11, 1903, and the other 
to E. Tyden, June 4, 1901. The Wilhelm patent has been assigned to 
Tyden. Both patents are for improvements in locking device for "ped- 
estal tables." It is averred that the claims sued upon, being claims 1 
and 2 of the Wilhelm patent, and 1, 2, 3, 4, 14, 1.5, and 16 of the Tyden 
patent, are capable of conjoint use, and that same hâve been so conjoint- 
ly used by the défendants, who are operating under two later patents, 
one of October 16, 1904, to J. F. Arnold for an extension table lock, 
and one of December 27, 1904, to same party for an extension table. 
The défense was invalidity of complainant's patents and noninfringe- 
ment. The court below sustained the patents, but held that they had 
not been infringed. A pedestal extension table was old. Tyden de- 
scribes such a table as "a table which, when closed up without the ex- 



184 152 FEDERAL KEPORTEK. 

tension leaves, Iiave a support consisting of a central pedestal with 
spreading feet at the base, the pedestal being vertically divided, and one 
part pertaining to each of the two parts of the table top, and having 
rigid with it two of the feet." He then says that in such tables a cen- 
ter kg, attached to a crossbar Connecting opposite slides pertaining to 
the extension devices, is inclosed within the two parts of the pedestal, 
which is hoUow for the purpose. The difficulty which he set hitiiself 
to remedy in thèse well-known tables was, that the pedestals when clos- 
ed did not close tightly so as to présent a solid and workmanlike ap- 
pearance. "My invention," says the patentée, "consists of means for 
locking the two parts of the pedestal together in such manner as to 
close them up from top to bottom. * * * " His first claim is an ex- 
ceedingly bi-oad orie, claiming, as it does, every means which involve 
an élément on each part and below the top of the pedestal. It is in thèse 
words : 

"A pedestal extension table, in combiiiation with a vertically-divided 'od- 
estnl and the two separate parts of the table top attached to the resiJt.Livo 
parts of the pedestal, means for binding the pedestal parts together, com- 
prislng an élément on each part at a substantial distance below the toj) 
of the pedestal, and means whereby they are adapted to be cotmected wheu 
the pedestal parts approach ; means for operating on said éléments after 
they are conneeted to cause them to bind the pedestal parts together, ex- 
tending from said éléments upward, aud thence under the table top toward 
the margin thereof." 

The second claim is for spécifie means for accomplishing this end. 
It is in thèse words : 

"In a pedestal extension table, tn eombination with a vertically-divided 
pedestal and the two separate parts of the table top rigid with the parts of 
the pedestal respectively, a locking device for Connecting the two parts of 
the pedestal together, comprising two mutually engaging éléments, one on 
each part of the divided pedestal, said éléments being adapted to become 
engaged before the pedestal parts are fully closed together; one of the (l 
locliing éléments being movable on the part of the pedestal to which it 
pertains, and operating connections by which it may be moved in direction 
to draw the parts of the pedestal together." 

The other claims in issue cover slight différences in means described, 
and need not be set out. 

A vertically-divided pedestal, hoUow and inclosing a central leg when 
closed, this center leg being the support for the center of the table when 
extended, one-half of the pedestal being rigidly attached to each of the 
movable members of such a table, was old. Means intended to draw 
thèse two parts of the pedestal together and hold them in contact were 
well known. That they did not do this in such manner as to make a 
tight joint and prevent an unfinished appearance is shown. That Ty- 
den has provided a locking device which is an improvement upon the c' 
devices for the purpose, and with better results, is the best which eau 
be said for him. Examples of the devices of the old art used to accon- 
plish the same purpose are to be seen in the old Briggs patent of 1843 
and the Thorn patent of 1851, also the Hofïmeier patent of 1881. De- 
vices in analogous arts performing the same fonction of drawing two 
parts closely together and holding them so were very common. For 
furniture locks, see patent No. 22,450, to Robinson; No. 139,844, to 



GENERAL ELECTRIC CO. V. BtTLLOCK ELECTRIC MFG. CO. 185 

Wolf ; No. 475,581, to Liebe; and that to Wilen, 552,026. For sash 
locks or fasteners, see patent to Christie, 160,509 ; No. 162,614, to 
Breckenridge ; patent to Ives, No. 317,540. A sash fastener made by 
Hastings is admitted to be substantially identical with sash-fastener 
devices employed before Tyden's invention as a means for holding to- 
gether the lovvcr ends of divided pedestals on extension tables. The 
lever, C, of the Tyden device is identical with the lever or brake bar in 
the patent to Jones, 608,865, for a vehicle brake. What Tyden did was 
to combine old and well-known means for locking two parts and hold- 
ing them tightly together and adapt them to the ornamental pedestals 
of tables. The field was a narrow one, and his device is not generic. 
Confîned to the spécifie means he has shown for doing the thing he set 
out to do, his patent covers a step which is but an improvement, but 
a patentable one. This does not apply to claim 1. That is not limited. 
It claims ail means for locking and holding such pedestals, and is sub- 
stantially a claim for a function. It cannot be upheld, and must be held 
void. We agrée with the court below in holding that, thus limited, the 
other claims are not infringed. We also agrée in the conclusion that 
the claims of the Wilhelm patent are not infringed. 

Modified so as to hold claim 1 of the Tyden patent void, as too broad, 
and for a function rather than a device, the decree of the Circuit Court 
will be afHrmed. 



GENERAL ELECTRIC CO. v. BULLOCK ELECTRIC JIFG. CO. et al. 

(Circuit Court of Appeals, Sixth Circuit. Marcb 21, 1907.) 

No. 1,5G7. 

Patents— Invention — Field-Magnet Pôles. 

The Roist patent. No. 573,107, for means of securing fleld-magnet pôles, 
Is void for lacli of patentable invention. 

Appeal from the Circuit Court of the United States for the Western 
Division of the Southern District of Ohio. 

W. K. Richardson, for appellant. 

Thomas F. Sheridan and Clifton V. Edwards, for appellees. 

Before LURTON, SEVERENS, and RICHARDS, Circuit Judges. 

RICHARDS, Circuit Judge. This was a suit in equity brought by 
the General Electric Company against the BuUock Electric Manu- 
facturing Company and others, for an injunction, with the usual praycr 
for an accounting, for the infringement of letters patent No. 573,107, 
issued December 15. 1896, to Henry G. Reist, the assigner of the 
complainant, for securing field magnet pôles. In the spécification, the 
invention is described as follows: 

"My invention relates to securing pole-pleces to revolvins; fleld-magnet 
structures, particularly in alternating-current dynamos, where tlie fleld-magnet 
pôles are made of assembled larainations of sheet iron. To this end I malje 
ttie iaminations with a dovetailcd tenon upon the ends, so tliat when they are 
assembled the pole-piece may be slipped sidewise into the field-magnet struc- 
ture. I then irif^ert keys, so as to take up any lost motion between the pole- 
piece and tlie fleld-magnet, the end plates of the pôles being provided with 



186 152 FEDEKAL REPORTER. 

overhanging lips or flanges wliich seire to retain the flokl-magnet coils in 
place. I may then remove any fleld-magnet coil or any pole-piece witliout 
removing the field-magnet structure as a wliole." 

It is stated in the spécification that it is manifest that the invention 
may take a number of forms, and four of. thèse forms are illustrated 
in the drawings. The claims are as follows : 

"(1) The combination with a revolving fleld-magnet structure, of pole-pieees 
separated from each other, and arranged on the perlphery of said fleld-magnet 
structure, said pole-pieces being composed of laminated material, and being 
dovetailed Into the periphery of said revolving structure, and means for tak- 
ing up the play of the parts. 

"(2) The combination with a revolving fleld-magnet structure, of pole-pieces 
projecting fronl the periphery of said field-magnet structure and separated 
from each other, said pole-pieces being each composed of a bundle of laminse, 
and outside clamping-plates, the several parts being bolted together, the pole- 
pieces being dovetailed to the periphery of said revolving structure, and lieys 
for taking up the play of the parts, as herein set forth." 

The défense made in the court below was "lack of invention," and, 
in disposing of it, Judge Thompson said (146 Fed. 551) : 

"The use of larger machines, in the course of the development of the art, 
called for stronger means for fastening the pole-pieces to the yoke, but which 
would be consistent with the maintenance of the magnetic, and electric con- 
ditions and the advantages secured by such structures as that of the Parcelle 
patent. No. 463,704. The problem was purely a mechanical one, and the me- 
chanic arts afforded a broad fleld for the sélection of such means, and Reist 
chose therefrom a well-known method, that of the dovetail and key, which 
permits the use of many difCerent forms, 'ail embodying the same gênerai 
charaeteristies,' four of which he employs, and, in addition, claims the ex- 
clusive rlght to employ the one used by the défendant and necessarily ail 
forms thereof used for the same purpose. 

"Upon bis own showing, the Invention claimed lies in the adaption of tlie 
dovetail and key method to the fastening of the pole-piece to the yoke. The 
sélection of this well-known method did not require the exercise of the in- 
ventive faculty, and no more difticulties attended its adaption than usually 
follow its employment in numerous devices of the mechanic arts. When the 
conditions are known, the adaption, usually, may safely be intrusted to the 
skilled mechanic. It is a problem for the electrical engineer and the skilled 
mechanic, and not for the inventer. 

"Patentable invention is not shown and the bill will be dismîssed." 

While we failed to agrée with Judge Thompson in his holding that 
no invention was shown in the Parcelle patent, we cannot withhold our 
approval of the conclusion of a similar nature which he reached in the 
présent case. The Reist patent involves nothing more than the ap- 
plication of the well-known dovetail and key method to the fastening of 
the laminated pole-pieces of a iield magnet to the yoke thereof. This 
method of fastening has been used time out of mind in ail kinds of 
purely mechanical devices, and recently also in dynamos and other 
electric machinery, so there is no question in this case, as in the 
Parcelle, of the transfer of a well-known device from a remote art to 
one in which it had not then been used. The invention does not pré- 
sent any resuit, whether mechanical, magnetic, or electric, which was 
new. They were ail old. Nor was there any combination produced 
which had the merit of novelty or invention. 

The judgment is affirmed. 



BALL & SOCKET FASTENER CO. V. PATENT BUTTON CO. 187 

BALL & SOCKET FASTENER CO. v. PATENT BUTTON CO. 

(Circuit Court, D. Connecticut. March 13, 1907.) 

No. 1,169. 

Patents— CoNTEACTS— Construction— Sale oï Patents and Inventions. 

A contract by which défendant transferred to complainant ail of its 
rights In certain patents and in inventions (or "separable fasteners of the 
kind hereinafter deflned but no otbers" construed, and held to cover only 
separable fasteners of the snap variety, in wbich the resiliency is in the 
socket and not in the stud or post; It being shown that there are two 
distinct types, of which that is the distinguishlng feature, and that ail 
of those covered by the patents or Identified by the contract vfere of the 
former type. 

In Equity. Bill demanding spécifie performance of certain portions 
of a contract, and, that having been granted, for further relief. 

Donald Campbell, for complainant. 

Bristol, Stoddard, Beach & Fisher Qohn K. Beach and Samuel H. 
Fisher, of counsel), for défendant. 

PLATT, District Judge. The preamble of the agreement in suit 
showfs that the Patent Button Company had certain rights under the 
Shorey patents and in any "improvements upon the inventions described 
in said patents," and that said inventions for separable fasteners had 
no relation to the "fixed buttons made and sold by the Patent Button 
Company," but did relate to the "separable fasteners made and sold by 
the Bail & Socket Fastener Company." The agreement then turns over 
to the présent complainant ail rights in the Shorey patents (paragraph 
1), waives ail rights to the présent or future inventions by Shorey (par- 
agraph 2), and ail rights in inventions for "separable fasteners of the 
kind hereinafter defined but no others" (paragraph 3). Going to para- 
graph 10, we find the "kind" defined in thèse words : 

"The said term 'separable fasteners' is now intended, and shall always be 
understood, to mean separable fasteners and no others that are now made and 
sold by the Bail & Socket Fastener Company, and * * * described in 
the aforesaid Shorey patents now existing, viz.. Nos. 345,930 and 352,271, and 
aiso * * * described in letters patent to Clark M. Platt and numbered 
181,979, and aiso such ♦ * • as may hereafter be assigned * * *." 

None having been assigned, the last clause of the définition is imma- 
terial. 

It is obvious that the agreement has to do exclusively with separable 
fasteners of the snap variety, because fixed buttons of defendant's man- 
ufacture are referred to in the preamble, and the parties could not hâve 
imagined that the term "separable fasteners," especially when connect- 
ed with the Shorey and Platt patents, could be construed as referring to 
fixed buttons, hooks and eyes, corset clasps, or any other article not en- 
dow^ed with the peculiar function discovered in the patented structures. 
The évidence shows that separable fasteners of the snap variety were, 
at the time the agreement was made, divided patentably and mechanical- 
ly into two plainly distinguished kinds or classes. One kind had as a 
distinguishlng feature a resiliency in the cup or socket ; the other kind 
was equally distinguishable by a resiliency in the stud or bail. The 



188 152 FEDERAL REPORTER. 

trade, with tlie brcvity and terscness which a business life enforces, di- 
vided them into those with "spring posts" and those with "solid posts." 
The two varieties were being produced in large quantities, but some 
makers brought out one kind, and other makers the other kind. Sep- 
arable fasteners which got the snap from a spring post or stud were 
much more expensive than those which obtained it from a spring sock- 
et. No concern was then making both kinds, and the complainant had 
confined itself absolutely to résilient socket fasteners, although it con- 
trolled a patent relating to the other kind. 

The agreement in suit is also confined, specifically and categorically, 
to turning over only the patents in which the Patent Button Company 
had rights, and which related to the kind the complainant was then 
making, and any later patents relating to the same kind, and to clench 
the matter and make assurance doubly sure, added words which are es- 
pecially adapted to emphasize the purpose in mind. It almost seems as 
if "coming events" must hâve "cast their shadow before" at the moment 
when the défendant insisted upon the insertion, and reinsertion, and in- 
sertion again, of those words of exclusion— "but no others," "and no 
others," "no others." 

Complainant says that because the parties to the agreement were in 
distinctly différent commercial channels it is probable that défendant in- 
tended to give up ail it had and ail which might corne to it in the gên- 
erai art which complainant's manufacture covered. That argument 
might hâve appealed to the défendant when the contract was under dis- 
cussion, but the contract as written shows that it was either net present- 
ed at ail or was ineffective. The patentable and mechanical distinction 
between the spring post and rigid post fasteners is a strongly marked 
and important one. It was in the minds of the parties when the agree- 
ment was made, and obviously the White patents, Nos. 691,8:32 and 
693,953, belong to the kind where the resiliency résides in the stud, 
and are thereby distinguished from tlie kind referred to in the contract, 
where thç, resiliency résides, in the post. Infinité variations might be 
applied to 'either type, but the central controUing mechanical distinction 
would remain. 

Let the bill be dismissed. 



CLANCY V. TROY BELTING & SUPriA' CO. 

(Circuit Court, N. D. New York. Mardi 19, 1907.) 

1. Patents— Assignment—Vai.] ditt. 

It is net esseutial to the validity of au asslgnmeut of a patent that It 
slioulfl be aeknowledged, where the genuiiicuess of the assignor's signature 
is proved. 
2i Same— LiCENSE. 

An oral agreement by the owner of a patent, niade without considéra- 
tion, tliat he would not trouble an infringer so long as the latter confined 
hiniself to the use of a certain métal in making the infringing device, af- 
fords no protection to the infringer af ter he has commeneed to use a' dif- 
férent métal. 
3. Same — Inl-kingement — Hose Ct-amp. 

The Redlield patent, Ko. 480,-515, for a hose clamp, construed, and hclS 
Infrlngcd. 



CLÂNCT V. TROY BELTING & SUPPLT CO. 189 

In Equity. Suit to restrain alleged infringement of United States 
letters patent to Lewis H. Redfield, assigner of one-half thereof to 
John R. Clancy, No. 480,515, dated August 9, 1893, for "hose clamp," 
and for an accounting. 

Alfred Wilkinson, for complainant. 

Alexander & Dowell (Arthur E. Dowell, of counsel) , for défendant. 

RAY, District Judge. The complainant is a manufacturer of hose 
clamps; the défendant, a corporation of the state of New York. The 
défendant sells the alleged infringing devices. Défendant says it has 
five défenses, ail complète : First, complainant has not shown com- 
plète title to the patent in suit and cannot alone maintain the action ; 
second, if he has become such owner of the patent, he has shown 
no infringing act by défendant since he became such owner ; third, 
the manufacturer of the alleged infringing devices was authorized 
and licensed by complainant to make and sell them, and that, as de- 
fendant is a mère seller, it is protected by such license consent and 
authority; fourth, that the alleged infringing devices are made under 
another patent, not owned by complainant, which is valid, and there 
is no infringement by défendant; fifth, the complainant is equitably 
estopped to maintain this suit by reason of the consent and agreement 
aforesaid and by reason of lâches. 

The défendant in open court on the argument concèdes the validity 
of complainant's patent, but says it must be given a narrow construc- 
tion. The claims, two in number, read as follows: 

"(1) As an improved article of manufacture, a hose-clamp band formed In 
one pièce of slieet métal, perforated in its ends, and liaving longitudinal sUts 
extending from a point some distance from the end of tlie band toward the 
center of its length and meeting in a transverse slit; the main portion of 
said band being bent circulai' shape, the perfor;ited end portions beiug 
bent radially outward, and the free end of the slittcd portion being bent 
back and lapped onto the inner side of the opposite end of the main portion, 
substantially as described and shown. 

"(2) The band, C, composed of sheet métal and having the flnger, e, formed 
intégral therewith and bent into the outv^'arrtly-pro.iecting loop, c', and folded 
with its free end back onto the inner side of the band and lapijed onto the 
opposite end of the main portion of the band, substantially as described and 
shown." 

This improved article of manufacture consists, when complète and 
bent into shape, of a band of circular sheet métal in one pièce, which 
may be of any suitable size, but which circular band is not intégral ; 
that is, it has two ends each of which is perforated. This band has 
in the making longitudinal slits, each extending from a point some 
distance from the end towards the center of its length, where it meets 
a transverse or cross slit. This portion produced by the slits forms a 
sort of tongue or fînger, which is bent back and towards the mouth 
or opening of the circular band, and spans or bridges it, and the free 
end, the end not attached to the band, is lapped onto the inner side 
ot the opposite end of the main portion ; that is, lapped onto the 
inner side of the end of the band to which it is not attached, or, more 
properly speaking, perhaps, the end of which it is not an intégral 
part. This slitting and bending away of the tongue leaves slots., one 



190 152 FEDERAL REPORTER. 

or more, as the case may be, in the band, which take hold of or bite 
the hose, when in actual use and closed down, and prevent slipping, 
and make its grip of the hose more firm and secure. This particular 
featvire is covered by Rediield's prior patents. There may be one or 
more fingers or tongues formed in the same way ; one or two on each 
side, depending on the size of the clamp. The perforated ends of 
the clamp are bent upvvardly or outwardly to form ears or flanges. 
The perforations therein receive a boit with a head and nut. This 
head engages with one ear, the nut with the other, and the nut is 
prevented from turning and coming ofï by means of flanges on the 
ear which bear on it. By turning the boit in the nut the two ears 
are drawn towards each other, and the diameter of the space within 
the band lessened, so that it is tightened around the hose ; and as the 
opening between the ears is spanned by the tongue or "finger," the 
pressure on the hose is uniform its entire circumference, and there is 
no buckling of any part of the hose, and no leak or cutting into the 
hose. This tongue or finger in such a device or clamp, formed in one 
pièce (aside from the boit and nut), is new and novel in the art, and 
durable, and has great practical utility. It is used by thousands and 
has met with large sales. It cheapened production. It discloses pat- 
entable novelty. 

The infringing device is an exact duplication, a Chinese copy, except 
it has more elaborate ears, but no élaboration that adds to the utility 
of the device, and is so bent as to form, at the place where the end of 
the tongue or finger is "lapped onto the inner side of the solid portions 
of the opposite end of the band," a sort of dépression, described in 
a subséquent patent (Sherman, No. 499,760, dated June 30, 1893), as 
"channels located in its solid portion at the ends of said opening." 
The only possible office or function of this channel is to allow the 
tongue or finger to lie therein and make the grasp of the clamp more 
perfect and uniform. It would occur to any one to provide this, and 
adding it did not constitute patentable invention; nor does its ad- 
dition to defendant's device avoid inîringement. The infringing de- 
vice would hâve anticipated if earlier, and it infringes be'ng later. The 
device of Sherman patent is much better described than that of the 
patent in suit; but the invention of the patent in suit is so described. 
illustrated, and claimed that it is easily understood and can readily be 
made. Being made of sheet métal, it is tough, not liable to break, and 
possesses resiliency. The spécifications say: 

"My présent Invention relates specially to the formation of the fingers 
•which span the space between the coupling-ears of the clamp to prevent the 
hose from being buclîled or crimped up and caught between said ears In the 
opération of tightenlng the clamp on the hose. 

"The ob.1ect of this invention is to form said Jîngers on the band in a 
simple and inexpensive manner and with a minimum consumptlon of material ; 
and to that end the invention consists in the improved construction of the 
hose-clamp band, as hereinafter fully described and speciflcally set forth in 
<;laims." 

In the prior art we find certain cast-iron clamps, with similar tongues 
or fingers, having similar ears ; but thèse were more cumbersome, and 
did not hâve the slits or the slots. They were more expensive, and 
were not made from or formed in "one pièce, stamped out of suitable 



CLANCT V. TROT BELTING & SUPPLT CO. 191 

slieet métal by means of suitable dies," as îs the device of the patent 
in suit. This device combines great strength with little weight and 
great elasticity, ease and simplicity of construction, and saving of 
material. 

As to title, and the right of the complainant to maintain this action, 
the facts are as follows: (1) The complainant owned one-half the 
patent when it issued. (2) Redfield, who owned the other half, Sep- 
tember 27, 1892, mortgaged it to Clancy, and this was recorded in the 
Patent Office, and there is no proof it was ever paid. It has not been 
satisfied or canceled. Thereafter Redfield assigned bis one-half in- 
terest, which was subject to the mortgage held by Clancy, to one 
Burke. Burke died, and then his interest was duly transferred to one 
Truesdell, and by him to complainant. Complainant paid ncarly $4,000 
to perfect his title. However, prior to perfecting his title, Clancy 
brought suit for the infringement against this défendant; but the de- 
fect of title, if it was, being pleaded, he discontinued the suit on his 
own motion, and then perfected his title and brought this action. 

It is said by défendant that the exécution of the assignment made' 
by Redfield is not duly proved ; it not being acknowledged. But the 
signature of Redfield thereto was duly proved by the witness Trues- 
dell, who said he was familiar with Redfield's signature, and in his 
opinion the signatures of Redfield to Exhibits D, È, F, and G are his. 
genuine signatures. Thèse are the exhibits alleged to be not proved. 
No objection was made to this proof. Perfect title in complainant 
prior to the bringing of this suit is shown. That the suits referred 
to were not dismissed on the merits, but on complainant's own mo- 
tion, appears from the record and other oral évidence not objected to. 

The défense of an oral license agreement and consent rests on the 
following évidence given by the complainant : 

"A. In 18iJf> 5Ir. IledfleW and myself commonfed a suit for infringement of 
tiiis patent against the H. B. Slierman Manufacturing Company, of Battle 
Creelc, Micli. Mr. Harrison Hoyt was our attorney. Mr. Slierman and Mr. 
Cox came on hère to Syracuse to see us, and discussed at some length entér- 
ina into an agreement. There was an agreement drawn, but upon further con- 
sidération we considered it unwise to sign it. Some time after Mr. Sherman 
called to see me, and, as I tliouglit, we had made our position pretty clear 
l)y bringing suit on this patent, and considered that he, by his position, had 
recognized the validity of our patent. I wasn't very anxious for litigation- 
or trouble, preferring to get along peacefully with our competitors if we 
could. I told Mr. Sherman that, as long as lie coniined himself to brass 
<:lamps, I would not bother him, believing tliat I could do pretty well on steel, 
although at this time almost the entire demand was for a brass clamp ; but 
I had a good deal of confidence that steel would win out in time. Sherman 
agreed to that; but he never gave me a cent, or any other considération, and 
I considered that we merely had a gentlemen's understanding. We stuek 
at the steel clamps, but it was pretty up-hill work for several years ; but 
about 1900 and 1001 we had worked up a very nice business. This was ail 
new business, worked up at a great deal of trouble, labor, and expense, ail 
bascd on the patent in suit. After we had demonstrated that there was a 
fleld for steel clamps, we understood that Mr. Sherman had gone back on his 
Word and was selling a steel clamp. We first heard of this, I think, about 
1903. My attorney, Mr. Hoyt, has been dead for several years." 

Clancy strictly complied with this agreement, but défendant did 
not. After a time he commenced making and selling steel hose clamps,. 



192 152 FEDERAL RErORTER. 

and hence tliis suit. This is proved by ample évidence. Clearly thîs 
oral agreement not to bother Sherman so long as lie confined himseîf 
to brass clamps (complainant's being of steel, sheet métal, not brass) 
did not bind Clancy after Sherman disregardèd and violated it b}' 
making and selling steel clamps, or clamps made of sheet métal, not 
brass, as he did. Nor did it thereafter protect this défendant, or others 
who were selling the steel clamps made by Sherman in violation of 
such agreement. The défendant was not selling in reliance on such an 
agreement. There is no équitable estoppel ; quite the contrary. Nor 
is there any lâches. So long as Sherman observed the agreement, and 
abided by it, Clancy would bave offended decency and good morals, 
had he repudiated it and sued for infringement. He did what good 
morals required him to do, and nothing more. The agreement had in 
its terms its own limitations. "So long as Sherman confined himself 
to brass clamps, lie was nc<" to be molested." 

I should say hère that détendant dumped into the record several 
patents, presumably to show the jjrior art and aiïect and limit the con- 
struction to be given complaniant's patent. Thèse are not accompanied 
by a Word of explanation, and within the autborities will not be con- 
sidered. 

Complainant's patent was allowed as claimed, nothing being cited 
against it, and it was not limited by any action or concessions there. 
It is entitled to as broad a construction as the language of the claims 
and the spécifications warrant. There is évidence that défendant bas 
continued to infringe down to the commencement of this action. It 
was cataloguing and offering the offending clamps for sale. 

I do not tliinfe any défense is made ont, and there will be a decree for 
complainant, with costs. 



AMOS-EICIIIA y. NORTnWESTP:EN 5IUT. LIFE INS. CO, 

(Circuit Court, E. D. Micliigan, S. D.) 

No. 8,473. 

INSUKANCE— Action on Life Policy— Evidence of Dei,iveky. 

After a nian's death, a policy of insur.-ince on liis life, payable to his 
wife, was found among his papers. Tbere were no eanceied internai 
revenue stamps thereou as re(iuired by law at the tiine of its date, but 
attached thereto was an envelope contaiuing the requisite stamps, and on 
the envelope were printed directions that such stamps were "to be at- 
tached to the second page of policy No. ■ when put in force," and 

aiso tbat, when affixed, they must be eanceied, by the agent by writlng 
the initiais of the company and the date thereon, and that, if the poiiey 
should be returned to the company before deliveiy, the uncanceled stam])s 
must accompany it. After the ijolicj' was found by the benoficiury, she 
procured the stamps to be afiîxed thereto and eanceied by the collecter 
of internai revenue, and brought suit thereon. It was not shown that 
the deeeased ever disclosed his possession of the policy to any one, or 
claimed to hâve insurance in the company. Held, that such facts did 
not croate such a coufliet of évidence, as to the essential fact of the ûe- 
livery of the policy as a comiiloted contract of insurance, as to entitle the 
plaintlfC to the submission of the case to the jury, as against the other- 
wise uncontradicted évidence on behalf of défendant that it was merely 



AMOS-EIOHIA V. NOETHWE8TERN MUT. LIFK INS. CO. 193 

delivered for examiuation and comparison wltb others, and that no 
premium was ever paid thereon. 

In Equity. On motion to direct verdict for défendant. 

T. A. E. Weadock, for the motion. 
George Donaldson, opposed. 

SWAN, District Judge (orally). The motion liere has been ably ar- 
gued on both sides, and I can conceive nothing which has not been pre- 
sented that would affect the conckision to which I hâve arrived that 
would be justified by the évidence. The motion is presented on two 
grounds : (1) That there is no évidence of the delivery of the poHcy 
sued upon. (2) There is no évidence of the payment of the first pre- 
mium which the pohcy makes a condition précèdent to its taking efïect. 

The facts are, briefly : That the policy of Hfe insurance sued upon 
in which plaintiff is named as beneficiary, was foiind among papers of 
plaintifï's husband, the insured, after his death. There is no évidence 
that he claimed it as his property. Its possession alone is prima facie 
évidence, as argued by counsel, that it was rightly in his possession. 
"Prima facie évidence" means simply that évidence which is sufïàcient, 
in the absence of évidence to the contrary, to warrant a judgment, or 
the direction of the court for recovery in favor of a person having pos- 
session. The place where it was found is prima facie évidence that it 
was rightfuUy in the possession of the deceased. Of what had the in- 
sured possession? It was not, then, the completed instrument hère sued 
upon ; it was an imperfect, inchoate obhgation. Speaking of it now 
apart from the testimony as to the purpose and the rightfulness of the 
possession, and speaking only with référence to the condition of the in- 
strument, it had not the stamps afïixed and canceled as required by law. 
If issued as a perfect obhgation, the law r(;quired it to be stamped. 
The amount of stamps required is not in controversy. By section 7 
of the Internai Revenue Act of June 13, 1898, c. 448, 30 Stat. 453 [U. 
S. Comp. St. 1901, p. 3292], sometimes called the "War Revenue Act," 
it is provided that : 

"If any person or pensons shall make, s\gn or cause to be made, signed or 
issued, any instrument, document or isaper of any kind or description whatso- 
ever, witliout the same being duly stamped for denoting tlie tax liereby im- 
posed thereon, or without having thereupon an udliesive stamp to dénote said 
tax, such person or ]iersons shall be deemed guilty of a misdemeanor, and 
upon conviction thereon sliall pay a fine, * « * jmd such instrument, docu- 
ment or paper shall not be évidence in any court." 

Therefore, primarily, it is the duty of the party issuing such instru- 
ment to affix to it, in the manner provided by law, the stamps required 
by the internai revenue act. The further duty is imposed upon the 
party issuing the instrument to cancel such stamps. That duty is also 
imposed upon the party receiving tire same — the duty of cancellation. 
The instrument, when found, had attached to it by an external fastening 
a stamped envelope, inclosing the stamps to be affixed and canceled. 
The original envelope inclosing the stamps ($2.40) stated in print upon 
its face that they were "to be attached to the second page of policy 

No. when put in force," and that : 

152 F.— 13 



194 152 FEDERAL REPORTER, 

"The stamps so afflxed must be canceled by tbe agent by writing In Inlc 
aeross the face tbe initiais of tbe company, and tbe date. If tbe polloy ig 
retumed to the company for any purpose before delivery, the uneauceled 
stamps must accompany them." 

Then followed directions as to the manner of the cancellation of the 
stamps. Two things are observable about this direction: First, that 
the instructions that the stamps should be attached is quahfied by the 
words "wlien put in force." Second, no poHcy is named. The number 
of the policy is not given. It is claimed by the défendant that the pos- 
session of tliis poHcy with the envelope inclosing the stamps was granted 
only for the purpose of the examination of the poHcy, and its compari- 
son with that of another company ; that it was not dehvered absolutely 
as a complète contract, but was simply for the purpose stated, and none 
other. That testimony is not challenged by anything in the case, ex- 
cept, if it may be called an exception, the claim made in argument that 
there are certain discrepancies in the testimony of the witness Ellis, 
the agent of the company who intrusted the policy to Amos. There is 
no testimony in contradiction to that of Ellis, and the alleged discrepan- 
cies are not supported by the record. 

Now, as I hâve said, prima facie évidence may be controverted, and, 
if it be successfully controverted, the presumption which attaches to 
it, of course, is displaced. If any witness hère testified to the delivery 
of that policy as and for a contract, an agreement between the 
parties for the Insurance upon the life of Mr. Amos, I should say 
that undoubtedly the case must go to the jury. It would be for 
them to détermine between one witness and any number of wit- 
nesses to the contrary, because there would then be presented a 
clear issue of fact. While the law attaches to the possession some 
force, the question of the purpose, character, and quality of that pos- 
session is to be determined, and, while it is prima facie évidence of de- 
livery, that is only a rebuttable presumption. It is not évidence when 
rebutted by uncontradicted crédible testimony disproving the intent 
and authority to contract, and by facts and circumstances which clearly 
négative the exécution of the alleged contract. There is no évidence 
that the party to whom it was delivered, Walter G. Amos, ever asserted 
any right under it. He never disclosed, so far as the testimony goes, to 
any person, the possession of this policy, nor made any claim that he 
had insurance in the défendant company. The right of the plaintiff to 
recover, so far as the question of delivery is concerned, rested solely 
upon the possession of the instrument. Nor is this ail. The instru- 
ment, as I hâve said, being incomplète and imperfect at that time, the 
évidence shows that no act was subsequently done by the défendant 
company to give it status as a contract, or to make it évidence in the 
cause. Whatever compliance with the internai revenue act, to make 
the policy admissible in évidence, has been made, was not the 
act of, or known to, the défendant. If the instrument is now so far a 
completed instrument as to be admissible in évidence, it was made so, 
not by the défendant, but by the act of the person having it in possession 
after the death of Walter G. Amos, who had never acted upon it in his 
life. It was not a completed légal instrument while in his possession. 
It derived the color of validity under the war revenue act after his 



AMOS-RICHIA V. NORTHWESTERN MUT. LIFE INS. CO. 195 

death, from two acts : First, the plaintiflE's application for leave to affix 
the stamps and cancel them made by the internai revenue collector at 
Détroit, under the provisions of law, and that officer's cancellation of 
the stamps. The collector of the "proper district" could affix and can- 
cel the stamps, if the policy by delivery had become a contract, and the 
omission to affix the stamps arose from any of the causes which author- 
ized the collector of internai revenue to affix and cancel the stamps, 
hut not otherwise. The collector's act could not make a contract for 
the parties, but only made the instrument receivable in évidence, if 
othervirise compétent. 

Taking into considération the undisputed facts that the policy was not 
stamped, and that the stamps were in a separate envelope, uncanceled, 
and the fact also that it was the légal duty of the défendant to affix 
and cancel them, if it were issued and delivered absolutely as a contract 
of Insurance, and the presumption which must be indulged in towards 
the défendant company that it did not intend to violate the law, or incur 
its penalties by nonperformance of the duties it enjoined — for that 
presumption défendant is entitled to — and in view of the uncontradicted 
testimony of Ellis and Cole to the fact that the policy was left with 
Amos only for examination, and not otherwise, the slight discrepancies, 
which are alleged against the credibility of the testimony of the former, 
do not amount, as against thèse facts and circumstances, to that con- 
fiict of évidence upon the vital question of delivery of the policy which 
would sanction the submission of this case to the jury. Beyond that, 
the question arises whether there was any payment made. The policy 
provides that "this policy shall not take eiïect until the first premium 
shall hâve been actually paid while the insured is in good health." 
The purpose of that clause is obvions: That there should be no de- 
ferring of the payment— no right acquired under the policy, unless the 
stipulated first payment was made while the insured was what is regard- 
ed by the company an insurable risk. That requirement is made a con- 
dition précèdent to the validity of the policy as an obligation on the 
part of the défendant. The character of défendant forbade it to insure 
without payment of the fîrst premium. Now, upon that question alone 
the évidence is ail one way. There is no évidence that defendant's 
agent was ever held out as authorized by the company to waive this 
payment. There were five witnesses who testified that that payment 
was not made. No witness testifies to the contrary. The only évidence 
appearing to the contrary is the récital of the payment of that premium 
in the printed part of the policy. The amount of the premium is stated 
in writing. Now, if there were no delivery of this poHcy, this récital is, 
of course, of no force or efîect. The nondelivery of the policy as the 
contract of the parties disproves the acknowledgment of payment. In 
addition to the testimony of the witnesses Cole, Ellis, Skinner, Davison, 
and Fraher, there is considérable testimony that Mr. Amos had not the 
means to pay for this policy. It also appears in évidence that he had 
on the 30th of January a policy in another company upon which re- 
covery was subsequently had. That policy, properly stamped, was 
found in his desk, in the same drawer with thèse two instruments. 
The stamps upon it were canceled. That, in connection with the fact 
that thèse stamps were uncanceled and unaffixed to the instrument sued 



196 152 FEDERAL REPORTER. 

upon, lends support to the conclusion reached upon the question of de- 
livery, tending to show that this policy was neither delivered to nor ac- 
cepted by deceased as a contract. See Hartford Fire Insurance Com- 
pany V. Wilson, 187 U. S. 467, 23 Sup. Ct. 189, -47 L. Ed. 261. 
For thèse reasons, a verdict is directed for défendant. 



WKIGHT V. SAMPTER et al. 
(District Court, S. D. New York. March 14, 1907.) 

1. Bankeuptcy—Prefebenoe— Knowledge or Oreditoe. 

Défendant, a young woman of no business expérience, had had mone.y 
on deposit with a bankrupt firm at 6 per cent, per aunuru ; her uncle, of 
supposed large means, being tbe financial head of the flrm. For several 
weeliS prior to June 4, 1904, she had had no communication with any 
member of the firm nor with. any employé thereof, and on that day she re- 
cei\'ed, by mail, a letter inclosing a check for the full amount of her de- 
posit and interest, with the statement that the flrm could no longer use 
her money. At this time neither défendant nor her sister nor mother, who 
also used tlie firm as their bank of deposit and received similar checks, 
had any suspicion that It was embarrassed, but on .lune 13th, following, 
they learned through the newspapers that a pétition in bankruptcy had 
been filed agaiiist the flrm, whieh was, in fact, insolveut ou the day the 
checks were received. Held, that such facts were insutficient to show 
that défendant had any reasonable cause to believe that the i)ayment to 
her was Intended to constitute a préférence as defined by Banlir. Act July 
1, 1898, c. 541, §§ 60a, 60b, 30 Stat. 502 [U. S. Comp. St. 1901, p. 3445]. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 0, Bankruptcy, § 257.] 

2. Same-^Consteuction — Pueoiiasee. 

Where défendant received payment of her debt from a bankrupt other- 
wïse than by desefent, she was a "purchaser" within Bankr. Act July 1, 
1898, c. 541, § 67e, 30 Stat. 564 [U. S. Comp. St. 1901, p. 3449], declaring 
that a preferentiàl transfer to any one not a "purchaser in good f aitli 
and for a présent, fair considération" will be void. 
3; Same— Feaxjdulent Teansfeb. 

Only such transfers by a bankrupt are fraudulent under Bankr. Act 
July. ,1, 1898, c. 541, § 67e, 30 Stat. .504 [U. S. Comp. St. 1901, p. 3449], 
invalidating preferentiàl transfers to any one not a purchaser in good 
faith and for a présent fair considération, as were fraudulent at comnion 
law or constituted acts of bankruptcy as prescribed by section 3 (30 Stat. 
546, c. 541 [U. S. Comp. St. 1901, p. 3423]), iucluding those within the Per- 
sonal properfy laws of New York (Laws 1897, p. 511, c. 417, § 24) prohib- 
iting transfers "with intent to hinder, delay or defraud creditors." 

4. Same— Pabticip.ation in Fbattd— Evidence. 

Where défendant had no knowledge of her uncle's pending insolveuey at 
the time she received a preferentiàl payment of her debt from a firm 
of which he was the dominant member, and there was nothing to indicate 
that she participated in his fraud in making such payment, except the 
fact that she did not demand or exact payment, the transfer was not 
fraudulent within Bankr. Act July 1, 1898, c. 541, § 67e, 30 Stat. 504 [U. 
S. Comp. St. 1901, p. 3449], prohibiting preferentiàl transfers made with 
intent to hinder, delay, or defraud creditors. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. C, Bankruptcy, § 257.] 

In Equity. Hearing on bill, answer, and agreed statement of facts. 

The niaterial facts stipulated by the parties are as follows: Tlie plaintiff 
is trustée in bankruptcy of the partners and iiartnership of M. Sampter, Sons 
& Co. The défendant Elvira Sampter is a nièce of the individual bankrupts, 



"WRIGHT V. SAMPTER. 197 

who are joined with her as défendants. On June 4, 1904, M. Snmpter, Sons & 
Co. were insolvent, and Arnold Sampter, one of the flrm, its flnancial head 
and a défendant herein, was well aware that the firm was "flnanclally in a 
critical condition." For a long time prior to the date above given, the de- 
fendant Elvira Sampter had îiad money ou deposit with the partnership. 
The évidence of deposit was a passhook similar to those used by savings 
banks, and she regularly received interest iipon lier defiosit at the rate of 
6 per cent, per annum. She was at liberty to incrcase or dimiuish her de- 
posit when and as she chose. Slie resided with lier sister and widowcd 
niother, both of whom had shnilar deposit accounts witli the bankrupts. Both 
mother and danghters were wlioHy nnfamiliar witii Imsiness matters, and 
for several weeks prior to .lune 4, 1004, had had no communication, either 
oral or written, with any member of the partnersliip or with any employé 
thereot Neither the défendant Kl vira Saui])tcr uor her niother nor sister 
had urged reouested or dcsired re])ayment of tlieir deiiosit acconnts, or any 
part thereof, when on or about said .Tune 4th each of them received by mail 
a letter signed by the tîrm, per Arnold Sampter, or at his direction ; which 
letters read: "We find that we can no longer use your money. and there- 
fore ask you to accept enclosed chcck for (the amount of deposit with interest 
to date) in full for your account." When thèse letters were simultaneously 
received by the défendant, her sister and mother, none of them had the slight- 
est suspicion that the family firm was either erabarrassed or insolvent. They 
and each of them accepted the statement contained in the letters as true, took 
the checks inclosed with their several communications, and collected them 
in the usual manner. Although this simultaneous repayment of long-standing 
accounts was the subject of conversation between mother and daughters, 
none of them was aware that she was being preferred over other creditors. 
About 10 days later, and on or about June t.S, 1004, they learned through the 
newspapers that a pétition in bankruptcy had heen filed against their late 
debtor. Mr. Arnold Sampter, when he caused thèse relatives to be paid, not 
only believed, as above stated, that his firm was "financially in a critical con- 
dition," but had been informed by a bank which held a large quantity of the 
firm paper that none of said paper would be renewed uiion innturity. Be- 
tween the 3d and lOth of -Tune the bankrupt fîrni paid relatives, fricnds. and 
employés who were their lawful creditors, but had not recjuested payment, the 
sum of about $30,000, and when such payments were made it was known to 
Mr. Arnold Sampter that his firm would not after such large disbursements 
be able to meet its maturing obligations. Ile madc thèse payments to rel- 
atives and friends "in order to prevent possible loss to them." The firm 
has paid a dividend in bankruptcy of about 40 per cent, with a small balance 
remaining In the trustee's hands. Prior to their failure M. Saninter, Sons 
& Co. had for many years enjoyed good réputation and crédit, and been one 
of the leading whoIesale clothing houses of this eity. 

James, Schell & Elkus and Mr. Rosenberg, for complainant. 
Max J. Kohler, for défendants. 

HOUGH, District Judge. The facts agreed upon in this cause pré- 
sent two oft-mooted questions in rather an extrême and unusual form. 
The trustée seeks to recover the sum paid Elvira Sampter on the eve 
of bankruptcy, (1) because it is a voidable préférence within sections 
fiOa and 60b of the bankruptcy act (Act Julv 1, 1898, c. 541, 30 Stat. 
562 [U. S. Corap. St. 1901, p. 3445]), and (2) because the transfer 
was "with the intent" on the bankrupt's part to "hinder, delay or de- 
fraud" his creditors, and was not for "a présent fair considération" 
within section 67e (30 Stat. 564, c. 541 fu. S. Comp. St. 1901, p. 
3449] ) ; and should also be "held null and void as against the creditors" 
of the firm "by the laws of the state" of New York, pursuant to the 
same section. 



198 152 FEDERAL EBPOETEB. 

First. It cannot be doubted that the payment in question was a préfér- 
ence, and that Miss Sampter is the person "benefited thereby," and the 
first question raised revolves around the inquiry wliether she had 
"reasonable cause to believe that it was thereby (i. e., by the payment) 
intended to give (her) a préférence." It has frequently been s<iid, in 
actions turning upon the présence or absence of reasonable cause to 
believe a material or vital fact, that anything "sufficient to excite at- 
tention and put a party on inquiry is notice of everything to which 
inquiry would hâve led," and that knovvn facts "calculated to awake 
suspicion" vvill justify an inference of actual and complète knowledge. 
In re Knopf, 16 Am. Bankr. Rep. 433, 144 Fed. 245 ; Parker v. Con- 
ner, 93 N. Y. 118, 45 Am. Rep. 178. But obviously facts, whether pro- 
ducing certainty or merely suspicion, must hâve a mind upon which 
to operate and affect, and the rule is equally well established that it 
is sufficient if the facts brought home to the person sought to be af- 
fected are such as would produce action and inquiry on the part of 
"an ordinarily intelligent man" (Grant v. Bank, 97 U. S. 80, 24 L. 
Ed. 971), "a prudent business man" (Bank v. Cook, 95 U. S. 343, 
24 L. Ed. 412 ; Toof v. Martin, 13 Wall. 40, 20 L. Ed. 481), "a person 
of ordinary prudence and discrétion" (Wager v. Hall, 16 Wall. 584, 
31 L. Ed. 504), "an ordinarily prudent man" (In re Eçgert, 4 Am. 
Bankr. Rep. 449, 102 Fed. 735), "a prudent man" (Dutcher v. Wright, 
94 U. S. 553, 24 L. Ed. 130). 

The peculiarity of this case is that the mind to be aflfected is that of 
a confiding nièce, wholly unacquainted with business knowledge, and, 
however intelligent and prudent in matters within her own expérience, 
incapable of comprehending the significance of business facts, which 
would hâve been more than enlightening to men of the business world. 
It is therefore urged by the défendants that Barbour v. Priest, 103 U. 
S. 293, 26 L. Ed. 478, justifies the proposition that not only must the 
facts exist and be sufficiently impressive to awake inquiry in such minds 
as are catalogued in the cases above cited, but they must be sufïïcient 
to impress their significance upon the mind of the person to be afifected 
—in this case a woman leading a life apart from the world of business. 
It was indeed said in the case last cited (one inducing great sympathy 
for the preferred créditer) that it is "necessary to prove the existence 
of this reasonable cause of belief * * * jjj (-he mind of the prefer- 
red party." Page 296 of 103 U. S. (26 L. Ed. 478). But thèse wprds 
must be taken in conjunction with the whole opinion, which was written 
in express consonance with Grant v. Bank, supra, and the phrase quot- 
ed I take to assume in "the preferred party" the mind of "an ordinarily 
intelligent man." It would be intolérable that the voidability of a 
préférence should dépend not upon the effect of facts admittedly or by 
proof known to a défendant, but upon the degree of intelligence or ex- 
périence which such défendant was capable of exercising in respect 
thereto; such a rule would put a premium upon ignorance, and en- 
courage the assumption thereof. The rule hère applicable is, there- 
fore : Would an ordinarily intelligent and prudent business man bave 
had reasonable cause to believe, upon any facts known to Miss Sampter, 
that her uncle intended to prefer herself, her sister and mother? I 
think not. Ail that she knew was entirely consistent with the busi- 



WKIGHT V. SAMPTER, 199 

ness conclusion that, inasmuch as 6 per cent, was a high rate of inter- 
est, it was no longer profitable for the firm to pay it, and wrong for 
them to keep the money in a mercantile venture at lower rates, which 
could be obtained with greater security elsewhere. She did not know 
that ail friends and relatives were being paid off, nor was she aware of 
any embarrassment on the part of her long prospérons uncle. If ail 
she knew had been known by a merchant, I see no reason why it should 
hâve produced any other feeling than that Sampter's Sons no longer 
felt like paying a high rate for the use of a small sum of money. 

Second. This branch of complainant's contention assumes (and I 
think properly) that the payment to Miss Sampter was with the intent 
on Arnold Sampter's part prohibited by the statute, but admits (neces- 
sarily, in my opinion) that the défendant was wholly guiltless of any 
participation in the bankrupt's purpose or design. In the view contend- 
ed for, the ignorance or innocence of the transférée is of no consé- 
quence, provided the bankrupt, with the "intent and purpose" prescrib- 
ed in 67e, exécutes a preferential transfer to any one not a "purchaser 
in good faith and for a présent fair considération." Miss Sampter was 
a "purchaser," because she acquired the payment to her otherwise than 
by descent (McCartee v. Orphan Asylum Soc, 9 Cow. [N. Y.] 437, 
18 Am. Dec. 516), and her "good faith" (as defined in Searle v. School 
District, 133 U. S., at page 563, 10 Sup. Ct. 377 [33 L. Ed. 740]) is 
unimpeachable ; but inasmuch as she neither requested nor desired the 
payment that surprised her so much to her advantage, it is denied that 
she got the money "for a présent fair considération," and the payment 
must be regarded under the act as a voluntary dissipation of a fund 
properly to be regarded as a trust for ail creditors alike. This view of 
the section under considération assumes that the bankruptcy act has 
laid down a new rule in respect of the voidability of fraudulent convey- 
ances by wholly sweeping away the requirement that the transférée or 
grantee, to merit condemnation, shall hâve either actual notice of the 
fraudulent intent, hâve participated in the fraud, or had notice of some 
fact calculated to put him on inquiry and leading to a discovery of such 
fraudulent intent. Undoubtedly this assumption finds support in Sher- 
man v. Luckhardt, 11 Am. Bankr. Rep. 26, 74 Pac. 277, 67 Kan. 
683, and possibly also in Re McLam, 3 Am. Bankr. Rep. 245, 97 Fed. 
922. But it cannot prevail in this court, being clearly opposed to the 
ruling for this circuit made in Re Bloch, 142 Fed. 674, 15 Am. Bankr. 
Rep., at page 751, viz., that the transfers prohibited by 67e are only 
those fraudulent and therefore voidable at "common law," or, what is 
the same thing, such as constitute acts of bankruptcy under section 3. 
(30 Stat. 546, c. 541 [U. S. Comp. St. 1901, p. 3423]). By "common 
law" must be understood the rules of property growing out of 13 Eliz. 
c. 5, as afifected by similar statutory enactments in force in the state 
wherein the transaction complained of took place. 

It follows that the payment to Miss Sampter is voidable under this 
section of the act, only if in fraud of creditors according to the law of 
New York as contained in the décisions of the courts of that state and 
(at présent) in the personal property law (Laws 1897, p. 511, c. 
417, § 24), prohibiting transfers "with the intent to hinder, delay or de- 
fraud creditors," and no other or différent tests are to be applied there- 



200 152 FEDERAL REPOETËB. 

to than hâve long been used in fédéral and state décisions without any 
référence to bankriiptcy. 

Further considération would be superfluous, were it not for certain 
décisions in this state wherein the courts hâve pointed out as one of the 
badges of fraud that the creditors preferred "took no affirmative or in- 
dependent action to collect their claim ; they simply accepted the ad- 
vantages which the fraudulent debtor voluntarily gave them for bis 
own purpose and as a part of the fraudulent scheme." Metcalf v. Mos- 
es, 161 N. Y. 587, 56 N. E. 67. And compare First National Bank v. 
Miller, 163 N. Y. 164, 57 N. E. 308; Mandeville v. Avery, 124 N. Y. 
376, 26 N. E. 951, 21 Am. St. Rep. 678. From thèse authorities it is 
urged that while a creditor demanding payment in the Vi^ay of business 
may lawfully obtain such payment even from a fraudulent insolvent 
intending to hinder and delay his creditors, provided that he himself 
does not participate in the fraud, a similar right does not attach to one 
who, without effort and without demand, merely receives payment of 
an unmatured debt from such fraudulent debtor. Undoubtedly as civ- 
ilization, and with it business methods, become more complex, the 
badges of fraud increase with the opportunities for fraud ; but the dé- 
cisions above referred to hâve not changed, and do not purport to 
change, the rule of law. The court or jury must find participation in 
the fraud on the part of the payée or grantee as a matter of fact, and 
each case must stand upon its own facts. There is nothing in this 
cause, except the bare fact that Miss Sampter did not demand or ex- 
pect payment, to indicate participation on her part in the fraud of her 
uncle, and that bare fact, even plus the relationship, is not enough to 
turn the scale against her; it is évidence, nothing more, and on the 
whole évidence she must be absolved. 

The bill is dismissed. 



LEWIS PUB. CO. V. WïMAN et al. 

(Circuit Court, E. D. Jlissouri, E. D. April 4, 1007.) 

No. 5,437. 

1. COUBTS— JtTBISDICTION or FEDERAL CoTJRTS— NATURE AND SOURCE. 

The courts of tlie United States int'erior to tlie Suprême Court, being 
statutory courts crented by Cougress, possess only tbose powers wliich are 
expressly granted to them by statute, aud until Congress coni'ers upon 
them jurisdiction of a matter authorized by tlie Constitution of tlie United 
States they cannot exercise it. 

[Ed. Note. — Ifor cases in point, see Cent. Dig. vol. 13, Courts, §§ 702, 
793.] 

2. SaME — JUSI.SDICTION OF STATE COURTS— NaTURE AND SOURCE. 

State courts of gênerai jurisdiction, until divc sted by au act of Congress 
Of jurisdiction in causes which, under the national Constitution, may be 
conferrcd upon the courts of the United States exflusively, may, go far 
as the Constitution and laws of the United States are coneerned, exercise 
jurisdiction over them. 

[Ed. Note.—For cases in point, see Cent. Dig. vol. 13, Courts, § 1326.] 

3. Samb— Concurrent .Jurisdictton— State and Fédéral Courts. 

Subdivision 4 of section 020. Rev. St. [U. S. Couip. St. 1901, p. 50.3]. 
does not coûter exclusive jurisdiction ou the c-ourts of the United Sl:ates 



LEWIS PUB, CO. V. WTMAN. 201 

In controvoi'sies ni'isinc; uwlcv flie postal !aws of thc United States, bnî: 
oniy coneui-rent with tlie courts of tlie states, and for tliis ruason state 
eoiu'tH iuay take eognizam-e oi' .sucli eaiirte.s. 

4. l{eMOVAL OF OaUSKS — SUBJECT OF CONTKOVEHSY — PoSTAL LaWS. 

Altliougli OoJigress bas not autliorized by spécial act the removal oJ' 
causes arising under the ])ostal laws of tbe United States, if tbe bill on 
its face sliows tliat tbe eontroversy is one arisiug under the postal lawK 
of the United States, and tbe value of the matter in controversy exceeds 
.$2,000, exclusive of interest and costs, such cause Is removable fi'om the 
State to a national court, under section 2 of the act of March 3, 3887, e. 
3T3, 24 Stat. 55;î, as corrected by tbe act of x!i.ugust 13, 1888, c. 8G6, 2:, 
Stat. 434 [U. S. Comp. St. 1901, p. 509], 
(Syllabus by the Court.) 

On Demurrer to the Jurisdiction and ilotion to Remand. 

Barclay & Fauntleroy and Carter, Collins & Jones, for complainant. 

Chester H. Krum and H. H. Glassie, for défendants. 

TRIEBER, District Jtidge. Thiis action was originally commenced 
in the circuit court of the city of St. Louis, state of Missouri, and on 
pétition of the défendants removed to this court. Défendants demurred 
to the jurisdiction of the state court, claiming that that court was whol- 
ly without jurisdiction to entertain the bill, the national courts having 
exclusive original jurisdiction of ail controversies involving the actions 
of the executive department in postal matters. 

The bill filed in the state court, in so far as it affects the jurisdictional 
question, may be briefly stated as foUows : The complainant is the pub- 
lisher of a monthly magazine which had theretofore, in conformity with 
the acts of Congress and the rules and régulations of the Post Office 
Department, been admitted to be sent through the mails at second- 
class rates ; that it has a circulation exceeding 1,000,000 copies, and that 
the privilège of sending the magazine at thèse rates is a very valuable 
one; that on March 4, 1907, the Postmaster General, without any hear- 
ing or notice to complainant and in violation of the act of Congress ap- 
proved March 3, 1901, c. 851, § 1, 31 Stat. 1107 [U S. Comp. St. 1901, 
p. 2655], annulled this privilège, and the défendant, the postmaster at 
St. Louis, where said publication is mailed, has notified complainant 
that in conformity with the order of the Postmaster General the second- 
class privilège of complainant for his said magazine has been revoked, 
and that it will hâve to be sent as third-class matter, which will cause an 
increase in the postage to complainant of probably $20,000 a month, 
and practically destroy its business and cause irréparable damage. The 
prayer of the bill is for an injunction to prevent the enforcement of 
this order of the Postmaster General by the défendants, the postmaster 
and assistant postmaster at St. Louis. 

The complainant aiso filed a motion to remand the cause to the 
state court, upon the ground that the action was not removable to this 
court. The fact that the défendants who now demur to the jurisdiction 
caused the removal of the cause to this court does not estop them from 
questioning the jurisdiction of the court from which it was removed. 
Cowlev V. Northern Pacific R. R. Co., 159 U. S. 569, 16 Sup. Ct. 127, 
40 L. Ed. 263 ; Wabash Western Rv. Co. v. Brow, 164 U. S. 371, 17 
Sup. Ct. 126, 41 L. Ed. 431 ; De Lima v. Bidwell, 182 U. S. 1, 21 Sup. 



202 152 FEDERAL REPORTER. 

et. 743, 45 L. Ed. 1041 ; Tootle v. Coleman, 107 Fed. 41, 46 C. C. A. 
132, 57 L. R. A. 120. 
_ Are the courts of the states without jurisdiction to grant relief to a 
citizen who claims that by reason of some action of an officiai of the 
Post Office Department he has been greatly injured? Or, in other 
words, hâve the national courts exclusive jurisdiction of cases of that 
nature ? In the view which this court takes it is unnecessary to déter- 
mine whether an action of this nature niay be maintained under section 
3833, Rev. St. [U. S. Comp. St. 1901, p. 2610], or whether Teal v. 
Felton, 12 How. 284, 13 L. Ed. 990, is applicable. The law is well set- 
tled that the courts of the United States inferior to the Suprême Court 
are mère créatures of Congress, and possess no powers except those 
specifically granted to them by an act of Congress, and this limitation 
applies to ail causes which, under the Constitution, Congress miglit 
hâve granted to the national courts jurisdiction to hear and détermine. 
As early as 1799, in Turner v. Bank of North America, 4 Dali. 10, 1 
L,. Ed. 718, it was said: 

"The poUtlcal truth Is that the disposai of the judiclal power (except in 
ï few specifled instances) belongs to Congress, and Congress is not bound to 
enlarge the jurisdiction of the fédéral courts to every subject in every form 
which the Constitution might warrant." 

To the same efïect are United States v. Hudson, 7 Cranch, 33, 3 L. 
Ed. 259 ; Cary v. Curtis, 3 How. 245, 11 L. Ed. 576 ; Sheldon v. Sill. 
8 How. 448, 12 L. Ed. 1147 ; Stevenson v. Fain, 195 U. S. 165, 25 Sup. 
Ct. 6. 49 L. Ed. 142; Ex parte Wisner, 203 U. S. 449, 455, 27 Sup. Ct. 

150, 51 L. Ed. ; Case Sewing Machine Companies, 18 Wall. 553, 

577, 21 L. Ed. 914. 

In the last-cited case the court say: 

"Congress, It may be eonceded, may eonfer such jurisdiction upon the cir- 
cuit courts as It may see fit, within the scope of the judicial power of tlie 
Constitution not vested in the Suprême Court; but as such tribunals are 
neither created by the Constitution nor is their jurisdiction deflned by that 
instrument, it follows that, inasmuch as they are created by au act of Con- 
gress, It Is necessary in every attempt to deflne their power to loolî to that 
source as the means of accompllshing that end. Fédéral judicial power be- 
yond ail doubt has its origin In the Constitution ; but the organization of 
the System and the distribution of the subjects of jurisdiction among sucli 
inferior courts as Congress may from time to time ordain and establish, with- 
in the scope of the judicial power, always hâve been and of right ruust be the 
worli of the Congress." 

Prior to the adoption of the Constitution no one will deny that the 
courts of the states had complète jurisdiction over ail légal questions 
capable of judicial détermination. Article 3 of the Constitution defines 
the powers which Congress may eonfer on the national courts. In the 
first judiciary act, that of September 24, 1789, c. 20, 1 Stat. 73, the 
act creating the national courts inferior to the Suprême Court and 
which but for the acts of Congress would not exist, the jurisdiction 
of the circuit courts in civil actions was limited to cases in which the 
United States were plaintiffs or petitioners and actions depending en- 
tirely on a diversity of citizenship. The first act conferring upon the 
courts of the United States original jurisdiction in cases other than that 



LEWIS PUB. CO. V. WYMAN. 203 

of diversity of citizcnship \vas the second act creating tlie bank of 
the United States, April 10, 181G, c. U, 3 Stat. 2GG. Since then several 
other spécial acts conferring jurisdiction on the national courts in cases 
in which a fédéral question is involved hâve been passed — the act of 
February 25, 1863, c. 58, 13 Stat. 665, providing for the establish- 
ment of national banks, and the act of July 27, 1868, c. 255, § 2, 15 
Stat. 236, authorizing corporations created by acts of Congress to re- 
move causes from the state to the national courts, but the first gênerai 
act which extended the jurisdiction of the national courts to cases in- 
volving a fédéral question was the judiciary act of March 3, 1875, 
c. 137, 18 Stat. 470 [U. S. Comp. St. 1901, p. 508]. Prier thereto the 
State courts had exclusive jurisdiction of causes of that nature, sub- 
ject to review by the Suprême Court of the United States, under sec- 
tion 25 of the judiciary act of September 24, 1789. The serious ob- 
jections made prior to the adoption of the Constitution of the United 
States, by reason of the fear that under article 3, § 2, of the Consti- 
tution the state courts would be deprived of a great deal of their juris- 
diction, induced Mr. Hamilton to dispute that contention in The Fed- 
eralist. In No. 82 of that publication he said : 

"The principles established in a former paper teach us that the states wlll 
retaln ail the pre-existing authorities which may not be exeluslvely delegated 
to the fédéral head, and that thls exclusive délégation can only exist in one 
of three cases — where an exclusive authority is in express terms granted to 
the Union, or where a particular authority is granted to the Union and the 
•exercise of a like authority is prohibited to the states, or where an authority 
Is granted to the Union with which a similar authority in the states would 
be utterly incompatible. Though thèse principles may not apply with the 
same force to the judicial as to the législative departtoent, yet I am Inclined 
to think that they are in the main just with respect to the former as well as 
to the latter, and under this impression I shall lay down as a rule that the 
state courts will retain the Jurisdiction they now hâve, unless it appears to 
be talîen away in one of the enumerated modes. The only thing in the prés- 
ent Constitution which wears the appearance of conflning the causes of the 
fédéral cognizance to the fédéral courts is contained in this passage, 'The 
judicial power of the United States shall be vested in one Suprême Court and 
in such inferior courts as the Congress shall from time to time ordain and 
establish.' This might either be construed to signify that the Suprême Court 
and subordinate courts of the Union should alone hâve the power of deciding 
those causes to which their authority is to extend, or simply to dénote that 
tlie orcans of the national nidieiary ph^uld be one Suprême Court and as 
many subordinate courts as Congress should think proper to appoint ; in other 
words, that the United States should exercise the judicial power with which 
they are to be invcsted through one suprême tribunal and a certain number 
of inferior ones to be instituted by them. The first exciudes, the last admlta, 
the concurrent jurisdiction of the state tribunals, and as the first would 
amount to an aliénation of state power by implication, the last appears to 
me the most defensible construction. * * * i mean, therefore, to contend 
that the United States, in the course of législation upon the objocts entrusted 
to their direction, may not commit the décision of causes arising upon the 
particular régulation to the fédéral courts solely, if such a measure should be 
deemed expédient, but I hold that the state courts will be divested of no part 
of their primitive jurisdiction further than may relate to an appeal, and I 
am even of opinion that In every case in which they were not expressly ex- 
cluded by the future acts of the national Législature they will, of course, 
take cognizance of the causes to which those acts may give birth, This I 
infer from the nature of Judiciary power and from the gênerai genius of 
the System. The judiciary power of every govemment looks beyond its 
own local or municipal laws and In civil cases lays hold of ail subjects of 



204 152 FKDERAL REPORTER. 

Htisation between pnrtios willUn its jurif^diction, tlionsli tlie causes of dis- 
pute are relative to the laws of tlie most distant part of the globe." 

Oliver EUsworth, a member of the convention wliich framed the 
Constitution and the reputed author of the judiciary act of 1789, in 
answer to George Mason (who was one of the members of that con- 
vention who refused to sign that instrument and opposed its adoption, 
and one whose objections was that the judiciary of the United States 
is 80 constructed and extended as to absorb and destroy the judiciaries 
of the several states, thereby rendering law as tedious, intricate, and 
expensive, and justice as unattainable by a great part of the com- 
inunity as in England, and enable the rich to oppress and ruin the poor) , 
said : 

"It [the Judiclal power of the United States] extends only to the objects 
and cases apeeifled, aiid wheroin the national peace or riglits, or tbe harmossy 
of the States, is concerned, and not to controversies between citizens of the 
same state (except where they claim under grants of différent states) ; and 
nOthîng lilndcrs but the suprême fédéral court may be held in différent dis- 
tricts, or in ail the states, and that ail the cases, except tbe few in which it 
has original and not appellate, jurisdiction, may, in the flrst instance, be had 
in the state courts, and thosc trials be final, except in cases of great magni- 
tude." 2 Federalist and Other Constitutional Papers, Fédéral ist Statesman 
Séries, p. 578 (the original having been published in tbe Connecticut Courant 
of November 2G, 1787, over tbe non de plume of "Laudholder'î). 

In Plaquemines Fruit Co. v. Henderson, 170 U. S. 511, 18 Sup. Ct. 
685, 42 L- Ed. 113(3, this question was again bcfore the Suprême Court, 
and Mr. Justice Harlan, speaking for the court, after a very thorough 
review of ail the authorities, epitomized the law to be : 

"As under the long-settled interprétation of tlie Constitution the mère ex- 
tension of the judicial power of the United States to suits brought by a state 
against citizens of other states did not, of itself, divest tbe state courts of 
jurisdiction to hear and détermine sueb cases, and as Congress bas not in- 
vested the national courts vvith exclusive jurisdiction in cases of that kind, 
it follovvs that the courts of a state n>:iy, so far as the Constitution and laws 
of the United States are concerned, take cognizance of a suit brought by the 
state in its own courts against citizens of other states, subject, of course, to 
the rigbt of the défendant to bave such suit removed to tbe proper Circuit 
Court of the United States, wbenever tbe removal thereof is authorized by 
the acts of Congress, and subject, also, to the authority of this court to re- 
view the final judgment of the state court, if tbe cnse be one witb''i our ap- 
pellate jurisdiction." 170 U. S. 521, 18 Sup. Ct. C>89, 42 L. Ed. 1126. 

Whether Congress could, under the Constitution, confer such exclu- 
sive jurisdiction on the national courts in cases of this kind it is un- 
necessary to détermine in this case, as it has never attempted to do so, 
so far as the research of the learned counsel or of the court has been 
able to find. The original jurisdiction of this court could only bave 
been invoked upon the ground that the right claimed by complainant, 
and of which he charges défendants are about to deprive him, is one 
granted to him by the Constitution or laws of the United States or 
under subdivision 4, § 629, Rev. St. [U. S. Comp. St. 1901, p. 503]. 
This last section is as follows : ' 

"Fourth. Of ail suits at law or in equity arising under any act providing 
for revenue from imports or tonnage, except * * * ; of ail causes arising 
under any law providing internai revenue, and of ail causes arising under the 
postal laws." 



LEWIS PUB. CO. V. WYMAN. 205 

The beginning of the section is, "The Circuit Court shall hâve juris- 
diction as follows." 

It will thus be seen that there is nothing in that section vvhich seeks 
to confer upon the courts of the United States exclusive jurisdiction. 
But as the right claimed by the complainant in his bill is one arising 
under the Constitution and laws of the United States, and the amount 
involved exceeds in value the sum of $2,000, exclusive of interest 
and costs, this court would clearly hâve original jurisdiction under 
the judiciary act of March 3, 1887, c. 373, 24 Stat. oo3, as corrected 
bv the act of August 13, 1888, c. 8C6, 35 Stat. 434 [U. S. Comp. St. 
1901, p. 509]. 

The right to remove the cause must also be sustained under the latter 
act, as there is no other act of Congress which will permit the reraoval 
of a cause of this nature from a state court to this court. Although, as 
shown above, subdivision 4 of section G29, Rev. St., includes causes aris- 
ing under any act of Congress providing for revenue from imports and 
tonnage, internai revenue and under the postal laws, section 643, Rev. 
St. fU. S. Comp. St. 1901, p. 521], only authorizes the removal of causes 
commenced against any officer appointed by or acting under authority 
of any revenue law of the United States, and does not include actions 
against officers acting under the postal laws. Whether this was a mère 
oversight on the part of Congress or intentional is immaterial, so far 
as the courts are concerned, for they are powerless to remedy the 
omissions of Congress. 

It was also contended on behalf of the défense that, in view of the 
fact that actions of this nature are an interférence with the proper dis- 
charge of the duties imposed upon one of the executive departments 
of the national government in pursuance of the Constitution, the 
wheels of the government may be stopped by improper injunctions 
granted by state courts ail over the country, if permitted. It vi'ould 
be a sufficient answer to this contention that there is no reason to pré- 
sume that the courts of the states will pervert the laws of the nation any 
more than would the national courts, and that Congress is of that 
opinion is conclusively evidenced by the fact that it bas not seen proper 
to deprive the state courts of that jurisdiction by conferring exclusive 
jurisdiction on the courts of its own création in cases of this nature, or 
even cases arising under the revenue laws. The reports of the Su- 
prême Court of the United States are full of cases which were origi- 
nally instituted a-^ainst collectors of customs and internai revenue in 
the state courts and removed to the national courts, and in none of them 
bas that high tribunal ever held that the state court in which the suit 
was originally instituted was without jurisdiction. In view of the 
well-known fact that the courts of the United States, including the 
Suprême Court, will raise jurisdictional questions of their ovvm motion, 
as was evidenced in Minnesota v. Northern Securities Company, 194 
U. S. 48, 24 Sup. Ct. 598, 48 U. Ed. 870. and Cochran v. Montgomery 
County, 199 U. S. 2()0, 26 Sup. Ct. 58, 50 L. Ed. 182, it is hardly reason- 
abîe to suppose that so important a question would hâve been over- 
looked. In the verv important cases of De Lima v. Bidvv-ell, 182 U. S. 
1, 21 Sup. Ct. 743,' 45 L. Ed. 1041, and Downes v. Bidweh, 182 U. S. 
244, 21 Sup. Ct. 770, 45 L,. Ed. 1088, which were actions arising under 



206 152 FEDERAL REPOETEE. 

the revenue laws of Congress against the collector of customs, the 
suits were originally instituted in the state courts and removed, under 
the provisions of section 643, Rev. St., to the national court. 

From what has been said it follows as of course that the demurrer 
of défendants challenging the j urisdiction of the state court must be 
overruled, and as the bill of complaint on its face shows tliat complain- 
ant claims some right granted to him by the Constitution and laws 
of the United States and the value of the matter in controversy ex- 
ceeds $2,000, the motion to remand the cause to the state court must 
also be overruled. New Orléans National Bank v. Merchant (C. C.) 
18 Fed. 841. 



PLUSIMER V. NORTHERN PAC. RY. CO. 

(Circuit Court, W. D. Washington, N. D. March 2, 1907.) 

No. 1,430. 

1. Commerce— CONSTiTUTioNAL Law— Employbr's Liabilitt Act. 

Employer's Liability Act (Act June 11, 1906, c. 3073, 34 Stat. 232), mak- 
Ing iuterstate carriers liable for injuries to employés, notwlthstanding the 
latter's négligence, if the carrier's négligence was gross in comparlson 
with that of the employé, is not unconstitutional as net within the power 
of Congress conferred by the commerce clause of the fédéral Constitution. 

2. CONSTlTUTIONAL LAW — RETROACTIVE STATUTES. 

A rétroactive statute is not unconstitutional unless its efCect would be 
a deprivation of life, liberty, or property, contraiy to the flfth amend- 
ment of the fédéral Constitution. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 10, Constitutional 
Law, § 526.] 

3. Same— Deprivation of Peoperty. 

The passage of a law taking away défenses to civil actions based on 
rules of law which are pureiy arbitrary does not constitute a depriva- 
tion of property without due process of law. 

[Ed. Note. — Eor casçs in point, see Cent. Dig. vol. 10, Constitutional 
Law, § 925.] 

4. Statuies— Employer's Liability Act— Rétroactive Opération. 

EmiDloyer's Liability Act (Act June 11, 1906, c. 3073, § 2, 34 Stat. 232) 
déclares that in ail actions subsequently bronght against any common 
carrier, to recover damages for Personal injuries to an employé, etc., the 
fact that the employé may hâve been guilty of contributory négligence 
shnil not bar a recovery where bis négligence was slight, and that of the 
employer was gross in comparison ; but the damages shali be diminished 
in proportion to the amount of négligence attributable to such employé. 
Hdd. that such act created a new right and a new obligation, and did 
nr-t merely deprive the employer of an arbitrary défense previously ex- 
isting under rules of law, and therefore, should not be construed to op- 
erate retroactively. 

At Law. Action to recover damages for a personal injury alleged to 
hâve been caused by négligence of the défendant in the opération of 
its railroad, the plaintiff being at the time of the injury in the service 
of the défendant as a brakeman. Heard on defendant's pétition for 
a new trial, after a verdict in favor of the plaintifï for $5,000. Péti- 
tion granted. 

Elias A. Wright and Herbert E. Snook, for plaintifï. 
Carroll B. Graves, for défendant. 



PLUMMEK V. NOETHERK PAO. ET. 00. 20T 

HANFORD, District Judge. The plaintiff suffered a painful in- 
jury while working for the Northern Pacific Railway Company, as a 
brakeman on one of its trains, at Seattle, in the month of March, 
1906. This action was commenced in August, 1906, to recover com- 
pensation for said injury, on the alleged ground that it was caused 
by the neghgence of the défendant in failing to keep its track and 
railway in a condition to be reasonably safe for the employés of the 
Company required to operate its trains. The eiïects of the injury are 
permanent; the plaintiff's left leg having been mangled and severed 
from his body by a car wheel passing over it. By his complaint and 
the arguments of his counsel upon the trial, the plaintiff claimed dam- 
ages in the sum of $30,000. The jury awarded him $.5,000, which 
sum is less than probably would hâve been awarded, if it had net 
been proved that his personal négligence was a contributing cause of 
the mishap ; and a verdict for the défendant on the ground that plain- 
tiff's contributory négligence had been clearly proved by ail the évi- 
dence introduced, including his own testimony, would hâve been di- 
rected, if the court had not been influenced to refuse to so direct 
the jury, by considération of the act of Congress of June 11, 1906, com- 
monly called "The Employer's Liability Act" (Act June 11, 1906, c. 
.'5073, 34 Stat. 232), which makes important changes in the law applica- 
ble to common carriers engaged in iuterstate and foreign commerce. 
The case was submitted to the jury under instructions which assumed 
that said act is valid, and applicable to the case. 

A pétition to set the verdict aside has been interposed, assigning nu- 
merous grounds, the most important of which are that said act is 
unconstitutional, and totally void, and that the court misconstrued the 
act in ruling that it is applicable to this case ; the spécifications of the 
latter ground being that the injury antedated the enactment of the 
statute referred to, and it should not hâve been held to be rétroactive 
in effect, and the plaintiff did not by his complaint clearly set forth a 
cause of action based upon said statute, and it was not proved that the 
particular train upon which the plaintiff was employed, and by which 
he was injured, was in use at the time as a carrier of merchandise or 
commodities pertaining to Interstate or foreign commerce, and that 
by the terms of said act the opération of a railway within a state is not 
subject to its provisions except when carrying on interstate and foreign 
traffic. 

This pétition having been presented and argued, the court is now 
required to review its ruHngs upon the trial, and the instructions given 
to the jury. After reflection and délibération, with due respect to 
contrary décisions of other courts, I am convinced that the employer's 
liability act is not unconstitutional, nor in principle a departure from 
the législative policy of the government. The substance and sum of 
the argurnent against the constitutionality of this statute is that the 
whole power of Congress to enact laws affecting the business of com- 
mon carriers of freight and passengers, is conferred by the interstate 
and foreign commerce clause of the Constitution, and that the con- 
tracts of carriers with their employés and the duties and obligations 
of each to the other, are matters of purely local concern, and not com- 
prehended within the constitutional grant of power "to regulate com- 



208 152 FEDERAL RBrOETBR. 

merce with foreign nations, and among the several states, and with 
the Indian tribes." This view of the subject appears to me to be much 
too narrow to accord with the practical and jtidicial interprétation 
which has been given to this clause of the Constitution. Commerce 
has been defined to be traffic; that is, the buying, selling, and ex- 
changing of commodities. This comprehends more than the mère 
contracts by which merchandise is bouglit, sold, and exchanged. The 
actual transfer of mercliandise and delivery of the manual possession 
thereof, and its transportation from one place to another are included. 
Régulations of commerce are rules to be obeyed in carrying on the 
business of buying, selling, exchanging, transferring, and moving the 
property which is the subject of traffic, and to be effective such régu- 
lations must not only control the conduct of merchants, bankers, and 
others engaged as principals in the business, but their servants and 
agents, and the carriers who serve them in the transportation of 
property from one place to another, and those who furnish the facili- 
ties for communication between distant points which aid the business. 
Ships, vehicles, railways, telegraph lines, and cables are ail necessary 
to traffic, and subjects of régulations of commerce, which may be pre- 
scribed by lawful authority. But merchants and merchandise, bankers 
and money, clerks, accountants, and agents, ships, vehicles, tracks, loco- 
motives, cars, storehouses, wharves, telegraph lines, and cables, and 
the postal service ail combined would be ineffectuai to carry on foreign 
and Interstate commerce without the skill and strength of captains, 
engineers, firemen, seamen, stevedores, trainmen, mechanics, and the 
host of laborers constituting the force necessary to operate and keep 
in repair the physical appliances of commerce. The employés who 
work for wages in every branch of the business, giving life and mo- 
bility to trade are equally subject to régulations of commerce as those 
whom they serve, and régulations prescribing their rights and obliga- 
tions with respect to their employment not only affect commerce but 
regulate commerce. 

By the statute under considération the law of the country has been 
changed radically; but it is harmonious with, and not more radical 
than other laws enacted by Congress in the exercise of the power 
conferred by the interstate and foreign commerce clause of the Con- 
stitution which hâve been uniformly acquiesced in by the people and 
enforced by the national courts, since the first shipping law was enacted 
by the first Congress in the year 1790. Act July 20, ll'DO, c. 29, 1 
Stat. 131. The scope of that law is indicated by its title, viz. : "An act 
for the government and régulation of seamen in the merchant service." 
Sixty-five pages of volume 3, United States Compiled Statutes, 1901 
(pages 3061-3125) are required to set forth the statutes which hâve 
been enacted by Congress relating to seamen in the merchant service, 
prescribing régulations comprising almost every détail of "Sailor's 
Rights." 

Thèse statutes require contracts for the employment of seamen to be 
in Vk^riting, and signed before the departure of the ships on which they 
are to serve from the shipping port ; they prescribe the minimum daily 
allowance of food, so that sailors shall not be subjected to hunger, and 
require warm rooms to be furnished on ships du ring cold weather, and 



PLUMMER V. NORTHERN PAO. EY. CO. 20!) 

that medicine chests and slop chests shall be provided for thc use and 
benefit of their crews ; they prohibit thé flogging and maltreatment of 
seamen ; they subject shipowners and masters to liability for damages 
for wrongfully withholding wages, and prescribe rules for compelling 
sailors to perform the obligations of their contracts of employment, and 
authorize the forfeiture of wages for désertion. Thèse and similar 
laws are firmly estabhshed in the jurisprudence of the country, and they 
regulate the business of carriers by water, which is an important part 
of foreign and interstate commerce. It is now too late to make the dis- 
covery that the constitutional power of Congress is not ample to author- 
ize législation on thèse subjects. The similarity of the statute under 
considération to the laws affecting the rights of shipovv'ners and mar- 
iners is obvions, and the Constitution contains no suggestion of a more 
extended grant of power to regulate the business of carriers by water 
than the power to regulate the business of carriers over land. In the 
argument in support of the defendant's pétition, an attempt was made 
to differentiate maritime commerce from its other branches, by assum- 
ing that the admiralty jurisdiction of the fédéral courts, by a necessary 
implication, embraces législative power, and the case of Butler v. Boston 
Steamship Company, 130 U. S.. 527-5.58, 9 Sup. Ct. 612, 33 h. Ed. 1017, 
was cited, in which Mr. Justice Bradley said, in effect, that as exclusive 
jurisdiction of admiralty and maritime cases is vested in the national 
courts, the exclusive power to legislate on the same subject must be 
necessarily in the national législature. Similar dictum may be found in 
the opinion by Mr. Justice Brown in the case of The Roanoke, 189 U. 
S. 185, 23 Sup. Ct. 491, 47 L. Ed. 770. This, however, falls far short 
of being a détermination by the Suprême Court that the power of Con- 
gress to enact shipping and navigation laws, steamboat inspection laws, 
and the laws relating to seamen is a mère incident or appendage of the 
judicial power of the government, and not within the scope of the pow- 
ers granted directly to Congress in express terms. Whilst the three co- 
ordinate branches of our government are intimately connected, and in 
the performance of their functions interdependent, eacli is a check on 
the others, and to insure the independence of each, the Constitution, by 
separate articles, confers the executive power upon the Président, the 
législative power upon Congress, and the judicial power upon the 
courts. The régulation of commerce requires the exercise of législative 
power, and as the power to regulate is exprcssly granted in broad terms, 
there can be no occasion for supplementing it or extending it by implica- 
tions, to comprehend any particular branch of commerce. It is to be 
noted that the Employer's Liability Act is not limited to apply, only, to 
carriers over land, but applies as well to carriers engaged in maritime 
commerce. 

As a régulation of the business of land carriers, this statute is not the 
first of its kind. The safety appliance law enacted by Congress in 189^5 
imposes a positive duty on carriers engaged in interstate commerce, to 
protect the lives and limbs of railroad employés and travelers, by equip- 
ping trains with air brakes, and automatic couplers, rendering it un- 
necessary for a man operating the coupler to go between the ends of the 
cars, and with secure grab irons or handholds in the ends and sides of 
152 F.— 14 



210 152 FEDERAL BEPOETBB. 

each car, for greater security to the men in coupling and uncoupling 
cars. It also provides for fixing a standard of the height of drawbars 
for freight cars, and it abolishes the "assumption of risk" rule, in ail 
cases in which an employé may be injured by any locomotive, car, or 
train in use contrary to the provisions of the act. In the case of John- 
son V. Southern Pacific Co., 196 U. S. 1-22, 25 Sup. Ct. 158, 49 L. Ed. 
363, the Suprême Court of the United States reversed a décision of the 
Circuit Court of Appeals for the Eighth Circuit, denying to an injured 
employé the right to recover damages in an action based upon said act, 
and held that a reasonably libéral rule of interprétation should be ap- 
plied to the act to give effect to the intention of Congress. In that case 
the constitutionality of the act does not appear to hâve been questioned, 
nevertheless the décision of the Suprême Court is necessarily an affirm- 
ance of its validity, for it is not presumable that in a contested case, ad- 
mitted to be of such public importance as to justify the granting of a 
writ of certiorari to bring it before the Suprême Court for review, learn- 
ed counsel and the court would hâve ignored a question of such para- 
mount importance. 

As I am constrained to grant the pétition for a new trial of this case, 
for error in the instructions given to the jury to the eiïect that a verdict 
in favor of the plaintifï might be rendered, notwithstanding his contrib- 
utory négligence, an expression of my opinion on the question as to the 
constitutionality of this statute might be evaded now. But the question 
has been argued fully by able counsel in this case, and it must be decided 
in disposing of other cases now pending in this district, therefore I hâve 
deemed the first opportunity to be the proper occasion for announcing 
my positive belief on the subject. 

Section 2 of the act provides as follows : 

"Sec. 2. That in ail actions hereafter brought agaiust any common carriers 
to recover damages for personal injuries to an employée, or where such in- 
juries hâve resulted in his death, the fact that the employée may hâve been 
guilty of contributory négligence shall not bar a recovery where hie cou- 
tributory négligence was slight and that of the employer was gross in com- 
parison, but the damages shall be diminished by the jury in proportion to 
the amount of négligence attributable to such employée. Ail questions of 
négligence and contributory négligence shall be for the jury." 34 Stat. 232, 
c. 3073. 

The phrase "ail actions hereafter brought" is broad enough to include 
actions for injuries suffered prior to the enactment ; but although with- 
in the letter of the law, such cases must be deemed to be not within its 
purview, if the rétroactive eiïect would defeat the law by making it un- 
constitutional. I hold that a rétroactive statute enacted by Congress 
is not unconstitutional, unless its effect would be a deprivation of life, 
liberty, or property, contrary to the fifth amendment, and that the tak- 
ing away of défenses to civil actions based upon rules of law which are 
purely arbitrary, e. g., the statute of limitations, would not be such a 
deprivation. Campbell v. Holt, 115 U. S. 620-634, 6 Sup. Ct. 209, 29 
L. Ed. 483. The plea of contributory négligence as a défense to an 
action to recover damages for an alleged tortious in jury, is an affirma- 
tive traverse of the plaintiff's cause of action, similar to a plea of want 
of considération as a défense to an action upon an alleged contract, for 



KELLET T. GREAT NORTHERN RT. CO. 211 

if it can be established by évidence it disproves the plaintiff's case. 
Such a défense does not rest upon a mare arbitrary rule exempting a 
party from légal process to enforce an obligation, but its foundation is 
in reason and natural justice. 

In the case of Little v. Hackett, 116 U. S. 371, 6 Sup. Ct. 393, 29 h. 
Ed. 652, Mr. Justice Field, in delivering the opinion of the court, said : 

"That one cannot recover damages for an injury to the commission of 
wliich he has dlrectly contributed is a rule of established law and a prin- 
elple of common justice. * • * if ijls fault, whether of omission or com- 
mission, has been the proximate cause of the injury, he is without remedy, 
against one also in the wrong." 

This rule has been heretofore generally recognized as a part of the 
common law, in England and the United States, and the same rule is 
to be found in the Roman law. Wharton on the Law of Négligence 
(2d Ed.) § 300 ; 7 Amer. & Eng. Encyc. Law (2d Ed.) 371, 372. 

Therefore this statute créâtes a new right and a new obligation. I 
do not question the justice of the rule of comparative négligence, as it 
may be applied in actions for injuries suffered after its legalization, but 
it cannot be applied to past occurrences without working a deprivation 
of property in a manner which the Constitution forbids ; for if so ap- 
plied, the statute, and not the injury, would fix the plaintiff's rights and 
the defendant's obligation, which are the important éléments of the 
cause of action. 

For this reason alone, the pétition for a new trial will be granted. 



KELLEY V. GREAT NORTHERN RT. CO. 
(Circuit Court, D. Minnesota, Fifth Division. March 11, 1907.) 

1. Commerce— PowEE to Regulate— Poweb of Congress— Employées' Lia- 

BILITY AOT. 

The act of Congress of June 11, 1906, 34 Stat. 232, c. 3073, commonly 
called the "Fédéral Employers' Liability Act," Is a régulation of commerce 
between the states or with foreign nations, within the meaning of the 
commerce clause of the Constitution, and hence within the power of Con- 
gress. 

2. Same— Nature of Power. 

Décisions deflning the meaning and scope of the commerce clause of the 
Constitution considered and discussed, the trend of ail of them being to 
the eft'ect that the commercial power conferred by the Constitution au- 
thorizes législation with respect to ail the subjects of foreign and Inter- 
state commerce, the persous engaged in it, and the Instruments by which 
it is carried on, and as to suoh suojects is without limitation. 

3. Same. 

Décisions conceming the validity of state statutes, upon the questions 
involved hère, considered and discussed, and from them the followlng 
gênerai rules deduced: (1) That the liability of common carriers for in- 
juries to their employés growing out of their négligence or the négligence 
of their other employés is a proper subject for governmental régulation, 
and Congress has the power, whenever it chooses to exercise it, to make 
régulations on that subject within its field of control, namely, Interstate 
and foreign commerce, similar to those the state Législatures may make 
in their field. (2) That such statutes are not, in themselves, régulations 
of Interstate commerce, although they control, in some degree, the con- 



212 152 FEDERAL REPORTER. 

duct and the liabllity of tliose eugaged iu such commerce, and a state 
may tlierefore, so long as Congress lias not legislated upon the particular 
Bubject, enact tliem, in the rightful exercise of its police power to regulate 
the relative rights and duties of ail persous and corporations within its 
limits, without invading the exclusive power of Congress. But Congress 
■ may also, under the power conferred by the commerce clause of the Con- 
stitution, enact such législation as a régulation of Interstate or foreigu 
commerce. (3) That, while as a gênerai rule the police power belongs to 
the States, yet Congress may, in the exercise of its power to regulate 
Interstate commerce, impose upon such commerce régulations which are 
in their esscntial nature police régulations. 
é. Same. 

If Congress, having for its object the protection of the llves and limbs 
of railroad emijloyés, can jaake a spécifie régulation such as that embod- 
ied in the "Safety Appliance Act," as tô which it would seem there eau be 
no doubt (Johnson v. Southern Pacific Co., 196 U. S. 1, 25 Sup. Ct. 158, 
49 Lf. FjG. 363), it can, with the same object in view, make a gênerai régu- 
lation such as that embodied in this act. The object of the statute is 
plain upon its face. It is apparent that Congress had in contemplation 
much more thau the mère création and imposition of the liabllity men- 
tioned. It had in contemplation the protection of the lives and persons 
of the employés of common carriers engaged in interstate or foreign com- 
merce whose employment has any relation to such commerce. With that 
object In view, it enacted the statute, and by its provisions changed cer- 
tain common-law rules determining liabllity in order to promote that ob- 
ject by securing, so far as the statute could compel it, a more careful 
sélection of employés, a doser and more careful supervision of them, 
and a more rigid enforcement of their duties. 

5. Same. 

It is the carrier engaged in interstate commerce that this act seeks to 
regulate in relation to its duties to its employés, and the power of Con- 
gress extends to, and the act was intended to cover, ail the employés 
whose employment relates to such commerce; and if such common car- 
rier is also at the same time engaged in intrastate commerce, using the 
same nieans and agencies for both, the power of Congress extends to, 
and the act was intended to cover, ail the employés whose employment 
relates to such means and agencies. 

6. Same. 

The fact that a common carrier engaged in interstate commerce may 
also be engaged in intrastate commerce, using therein in whole or in part 
the same means and agencies, cannot defeat the power of Congress to 
regulate such carrier. The régulation of intrastate commerce, which 
may resuit in such a case (if, Indeed, In such case there could be said 
to be any régulation of intrastate commerce by such an act as this), is 
incidental, and due to the manner or method in which the carrier con- 
ducts its business, and to the fact that it thus combines or commingles 
its interstate with its intrastate commerce. 

7. CONSTITUTIONAL LAM' — StATCTES — CONSTRUCTION IN FaVOK OF "VaLIDITT. 

l'ut this act is remédiai and not pénal, and would therefore not only 
permit, but, if neeessary to sustain its validity, require a libéral con- 
struction. If, therefore, it wore neeessary to sustain its validity, there 
is ample authority for so construing it as to conflue its opération to those 
whose injuries occur at a time when they are actually engaged upon in- 
terstate traflic : the facts and circumstances of each particular case de- 
termining whether or not the act is applicable. The Trade-Mark Cases 
and the McKendree Case distinguished. 

8. Masteb and Sekva NT— Injuries to Servant— Fellow Servants— Con- 

TEIBUTORY NEGLIGENCE. 

The reasoning of the cases in which the fellow-servant rule has been 
laid down by the courts has, in view of modem methods and conditions, 
lost much, and in some cases ail, of its force. The coutributory negli- 



KELLEY V. GREAT NORTHERN ET. CO. 213 

genee raie as applied l>y the courts, In view of modem conditions sur- 
rounding tliose eugaged in certain occupations, is harsli, cruel, and un- 
just, and ought long since in the furtherance of justice and in the inter- 
est of hunianity to Uave been greatly inodified. And there are substantial 
reasons why an employer engaged in certain occupations should not be 
permitted to relieve himself by contract with his employés from liabillty 
for injuries caused by his négligence or the négligence of Lis other em- 
ployés. 

9. CoNSTriuTioNAL Law— Equal Protection of Laws. 

ïhe contention that the act violâtes the ilfth, seventh, tenth, and four- 
teenth aniendments of the Constitution is without merit. 

10. Masteb and Servant — Ik.iuries to Servant — Statutoby Provisions. 

It appears that défendant is a railroad company engaged in interstate 
commerce : that plaintiff at the time of his injury, whlch was subséquent 
to the passage of the act, to wit, on the Ist day of November, 190G. was 
an employé of défendant, engaged in repairing its railroad traek on which 
such commerce is carried on ; and that plaintifC rested his complaint upon 
the provisions of the fédéral employers' liabillty act. HcUl. unon demur- 
rer raising the point, that such act is constitutional and valid, and that 
the demurrer sliould be overruled. 
(Syllabus by the Court.) 

S. F. White and John H. Norton, for plaintiff. 

W. A. Begg, J. A. î\Iurphy, and Trieber McHugh, for défendant. 

MORRIS, District Judge. Tlie défendant herein is a railroad Com- 
pany engaged in interstate coinmerce. The plaintiff at the time of the 
injury, to wit, on the Ist day of November, 1906, was an employé of the 
défendant, engaged in repairing its railroad track on vvhicli sjch com- 
merce is carried on. The complaint rests upon two claims of négli- 
gence : The négligence of the défendant, and the négligence of its 
employés who were at the time of the accident the fellow servants of 
the plaintiff. The only ground on which the demurrer w^as seriously 
pressed was that the complaint does not state facts stifficient to consti- 
tute a cause of action. My view is that the allégations as to the négli- 
gence of the employés of défendant, who were fellovi' servants of plain- 
tiff are sufficient, under the act of Congress approved June 11, 1906, 
entitled "An act relating to liabillty ot common carriers in the District 
of Columbia and territories and common carriers engaged in commerce 
hetween the states and betvi'een the states and foreign nations to their 
employés," if that act is valid. The défendant has attacked its validity 
on constitutional grounds, and to that question the argument of counsel 
was mainly directed, and upon it a décision invited. If the constitution- 
ality of the act is sustained, as I think it must be, the demurrer must 
fail. I hâve therefore deemed it necessary to décide that question, and 
to that question only is this opinion directed. That act, after the title 
above quoted, is as follows : 

"Be It enacted by the Senate and House of Représentatives of the United 
States of America in Congress assembled, that every common carrier engaged 
in trade or commerce in the District of Columbia, or in any territory of the 
United States, or between the several states, or hetween any territory and 
another, or between any territory or territories and any state or states, or 
the District of Columbia, or with foreign nations, or between the District of 
Columbia and any state or states or foreign nations, shall be liable to any of 
its employées, or, in the case of his death, to his Personal représentative for 
the beneflt of his widow and children, if any, if none, then for his parents; if 



214 152 IfEDBEAL REPORTER. 

none, tlien for hls next of kin dépendent upon him, for ail damages whleh may 
resuit trom tlie négligence of any of its officers, agents, or employées, or by 
reasou of any defeet or iusuffieieney due to its négligence in its cars, engines, 
apiiliaiices, macliiuery, track, roadbed, ways, or works. 

"Sec. 2. That in ail actions hereafter brouglit against any common carriers 
to recover damages for Personal injuries to an employée, or where such in- 
juries bave resulted in bis death, tbe fact that tbe employée may bave been 
guilty of contributory négligence shall not bar a recovery wbere bis contribu- 
tory négligence was sllgbt and that of tbe employer was gross in comparison, 
but tbe damages shall be diminisbed by tbe jury in proportion to tbe amount 
of négligence attributable to such employée. Ail questions of négligence and 
contributory négligence shall be for the jury. 

"Sec. 3. That no contract of employment, Insurance, relief beneflt, or Indem- 
nity for injury or death entered into by or on behalf of any employée, nor the 
acceptance of any such insurance, relief benefit, or indemuity by the person 
entitled tbereto, shall constitute any bar or défense to any action brought to 
recover damages for personal Injuries to or death of such employée: Pro- 
vided, however, That upon the trial of such action against any common carrier 
the défendant may set ofC therein any sum It bas contributed toward any such 
insurance, relief benefit, or Indemnity that may hâve been paid to the Injured 
employée, or, in case of his death, to bis personal représentative. 

"Sec. 4. That no action shall be maintalned under this act, unless commeneed 
withln one year from the time the cause of action accrued. 

"Sec. 5. That nothing in this act shall be held to limit the duty of common 
carriers by raiiroads or impair the rlghts of their employées imder the safety 
appliance act of March second, eighteen hundred and ninety-three, as amended 
Aprll flrst, eighteen hundred and ninety-six, and March second, niueteen hun- 
dred and three." 34 Stat. 232, e. 3073. 

As I understood the argument of counsel for défendant, it was con- 
ceded that it might not be open to question that, just as the Législatures 
of the States bave the right to change the rules of law determining the 
liability of parties as administered in their courts in cases within their 
jurisdiction, so has Congress the right by appropriate législation to 
change such rules of law as administered in the courts of the United 
States, and so as to control only cases pending therein, for the reason 
that as mère judicial rules founded on the common law or upon consid- 
érations of public policy, but having ail the force of law, they are no 
more sacred than législative enactments, which may be altered or re- 
pealed at the will of the législative department of the Government. But 
they contend — and in that I think they are correct — that the scope of the 
act in question is much broader than that, and that Congress obviously 
intended it to be so; that it was intended that it should become the su- 
prême law of the land of gênerai application, and as such binding upon 
ail courts, state and fédéral, and should fix imperative rules by which 
ail of them must hereafter be governed ; and that therefore, if valid at 
ail, it can only be valid as a régulation of commerce under the power 
conferred upon Congress by section 8 of article 1 of the Constitution 
of the United States, which, for the purposes of this discussion, is as 
follows: 

"The Congress shall hâve power," among other things, "to rcgulate commerce 
vvith foreign nations, and among the several States, and with the Indian 
tribes," .and " * * * to make ail laws which shall be necessary and projter 
for carrying into exécution tbe foregoing powers." 

Proceeding, then, upon that assumption, their contention is that the 
act is unconstitutional and invalid. 



KELLET V. GREAT NORTHERN ET. CO. 215 

The first grouiid on wliich that contention is baserl is that the subject- 
niaîter of thc act is the création and enforcement of liabilities growing 
ont of the négligence of common carriers engagea in Interstate or 
foreign commerce to their employés, and it is thcrefore not a régulation 
of commerce among the states or ivith foreign nations, zdthin the mean- 
ing of that clause of the Constitution, and hence not iinthin the power of 
Congress. 

As preliminary and leading up to a more direct considération of the 
power of Congress in référence to such législation as that embodied in 
this act, it niay be well to call attention very briefly to some of the 
décisions, state and fédéral, as to the power of the state Législatures 
in référence thereto, a proper understanding of which will prépare us 
to correctly apprehend the true doctrine in référence to the extent of 
the power reposed in Congress. It can no longer be questioned, in 
the face of thèse décisions, that the common-law rules which are af- 
fected by this act are simply rules of décision enunciated by the courts, 
according to their ideas of justice and pub'ic policy, and are necessari- 
ly subject to the control of the state Législatures in the exercise of what 
is commonly termed the police power. But when the state législation 
is directed to particular occupations, such, for instance, as that of rail- 
road companies, it is subject to certain limitations growing out of the 
constitutional provisions of the fourteenth amendment, prohibiting the 
taking of property without due process of law, or the denying to 
any person the equal protection of the laws, or an interférence with 
the liberty of contract. It seems that the contributory négligence rule 
lias never been directly modified by state législation ; at least none 
such has been called to my attention. But the reasoning of the cases 
would apply with equal force to that rule. 

Thèse décisions were rendered in cases which arose under varions 
state statutes: 

In Missouri Pacific Ry. Co. v. Mackey, 127 U. S. 205, 8 Sup. Ct. 
1161, 32 L. Ed. 107, under a Kansas statute, which provided that 
"every railroad company organized or doing business in this state, 
shall be liable for ail damages done to any employé of such company in 
conséquence of any négligence of its agents, or by any mismanagement 
of its engineers, or other employées, to any person sustaining such 
damage" ; in Minneapolis and St. Louis Rv. Co. v. Herrick, 127 U. 
S. 210, 8 Sup. Ct. 1176, 32 L. Ed. 109, under a statute of lowa, pro- 
viding that "every corporation operating a railway shall be liable for 
ail damages sustained by any person, including employées of such cor- 
poration, in conséquence of the neglect of agents, or by any mismanage- 
ment of the engineers or other employées of the corporation, and in 
■conséquence of the willful wrongs, whether of commission or omission, 
of such agents, engineers, or other employées, when such wrongs are 
in any manner connected with the use and opération of any railway on 

■ or about which they are employed, and no contract which restricts such 
liability shall be légal or binding" ; in McGuire v. C. B. & Q. Ry. Co. 
(lowa) 108 N. W. 902, under the lowa statute, after it had been 
amended by adding a provision sim'lar to that contained in section 
3 of the act of Congress hère in question, to the efïect that no contract 

■ of relief benefit or indemnity entered into prior to the injury, between 



216 152 FEDERAL REPOKTER. 

the person so injured and such corporation, should constitute a bar or 
défense to an action under the statute; in Tullis v. Lake Erie & 
Western R. R. Ce, 175 U. S. 348, 20 Sup. Ct. 13c;, 41 L. Ed. VM, 
under a statute of Indiana, in référence to the liabiHty of railroad and 
other corporations, for damages for personal injuries suffered by an 
employé while in its service; in Martin v. Pittsburg & Eake Erie R. 
Ce, 27 Sup. Ct. Rep. 100, 203 U. S. 284, 51 L. Ed. , under a stat- 
ute of Pennsylvania, which will be set forth hereafter. And many 
otlier cases under similar statutes might be cited. 

Ail of thèse décisions are to the efïect that it is compétent for a state, 
in the exercise of the police power, to change or modify the rules of 
décision determining the liability of employers to their employés, as 
applied to particular pursuits or callings, and that législation to that 
etîect is not obnoxious to the fourteenth amendment to the Constitution, 
if ail persons brought under its influence are treated alike under similar 
circumstances and condidons, and if, with a wide législative discrétion, 
the classification is practical and not palpably arbitrary. In other words, 
the liability of those in particular occupations, as, for instance, railroad 
companies, for injuries to their employés, is a proper subject for gov- 
ernmental régulation, and a state niay make such reasonable régula- 
tions on the subject with respect to ail within its territorial junsdic- 
tion as the Législature thereof may think that the public welfare de- 
mands, subject only to the limitations above indicated. 

Counsel for défendant, as I hâve understood them, not only admit, 
but urge, that such is the well-established lavv ; but they contend that 
such législation is within the power of the state Législatures only, 
and that it is not within the power of Congress under the commerce 
clause of the Constitution to enact such a statute as that hère under 
considération with référence to common carriers engaged in Inter- 
state commerce, because it merely changes or modifies the common- 
law rules determining the liability, and thus merely créâtes a liability 
of such carriers to their employés for their négligence or for the négli- 
gence of the fellow servants of the injured employé, and in no way 
prescribes rules for carrying on trafific or commerce among the states, 
and therefore in no way régulâtes such commerce. 

As I hâve said above, I hâve referred to and given the efïect of the 
foregoing décisions, because I think they prépare us to correctly ap- 
prehend the efïect of those which more nearly touch the above conten- 
tion, and from which the true doctrine in référence to the extent of 
the power of Congress may be ascertained. In this latter class are 
those décisions in which the Suprême Court of the United States has 
had under considération state statutes whose validity was attacked on 
the ground that they afïected Interstate commerce, and were régulations 
of such commerce, and were therefore within the exclusive power 
of Congress. While it might be said that in none of thèse cases was 
the exact question raised which is hère being considered, yet, as I 
think, they not only throw light upon it, but indicate beyond question 
the views entertained thereon by the justices of our highest court. 

But, before proceeding to the considération of thèse cases, let us 
hrst ascertain, as far as we can, from other décisions, the meaning 
and scope of the commerce clause of the Constitution. 



KELLET V. GREAT NORTHERN RY. CO. 217 

In determining the meaning and scope of that clause the Suprême 
Court has, from the time of the delivery of the opinion of the great 
Chief Justice in Gibbons v. Ogden, untiî now, seemed to think it un- 
desirable to give to the words therein any hard and fast définition, or 
to mark with absolute certainty the extent of the power thereby con- 
ferred. It has been declared that "interstate commerce" is a term of 
very large significance (Hopkins v. U. S., 171 U. S. 578, 597, 19 Sup, 
Ct. 40, 43 L. Ed. 290, citing many cases), and that the power conferred 
by the Constitution is, as to interstate and fore'gn commerce, one with- 
out limitation. "It authorizes législation with respect to ail the sub- 
jects of foreign and interstate commerce, the persans engagea in it, 
and the instruments by which it is carricd on." Sherlock v. Alling, 
iiifra. 

In Telegraph Company v. Texas, 105 U. S. 4G0, 464, 26 L. Ed. 1067, 
the court says : 

"In Pensacola Telpprapli Company v. Western Union Telegraph Company, 
96 U. S. ], 24 L. Ed. 708, this court held that the telegraph was an instrument 
of commerce, and that telegraph eompanies \Yere suhject to the regulating 
power of Congress in respect to their foreign and interstate business. A tele- 
graph Company oecupies the sanie relation to connneree as a carrier of mes- 
i-ages that a railroad company does as a carrier of goods. Both eompanies 
are instruments of commerce, and their 'business is commerce itself." 

In this opinion the italics in ail quotations are mv own. 

In Lottery Cases, 188 U. S. 321, 346, 23 Sup. Ct. 331, 47 L. Ed. 493, 
Mr. Justice Harlan, delivering the opinion of the majority of the court, 
reviews at great length the cases in which the court has considered 
the meaning of the term "commerce among the several states" in the 
commerce clause of the Constitution, and the power of Congress there- 
under, and very completely summarizes the effect of the décisions. I 
can only quote a small portion of what he says, but an examination of 
the case will show the very large significance of the term and the dififi- 
culty of giving it a précise définition and the wide scope of the power. 
He says : 

"The leading case under the commerce clause of the Constitution is Gibbons 
V. Ogden, 9 Wheat. 1, 389. 194, L. Ed. 23. Iteferring to that clause, Chief 
Justice Marshall said : 'The subject to be regiilated is "commerce" ; and our 
Constitution being, as was aptly said at the bar, one of enmneration and not 
of définition, to ascertain the extent of the power, it becomes necessary to 
settle the meaning of the word. 'l'iie counsel for the appellee would limit 
it to trafflc, to buylng and selling, or the iuterchange of commoditieS, and. do 
not admit that it compreliends navigation. 'This would restriet a gênerai 
term, ai)plicable to many objects, to one of its significations. "Commerce," 
undoubtedly, is traffic, but it is something more ; it is intercourse. • * * It 
has been truly said that "commerce." as the word is used in the Constitution, 
is a miit, every part of which is indicated by the term. If this be the admit- 
ted meaning of the word. in its applications to foreign nations, it must carry 
the same meaning thro\tghout the sentence, and remain a unit, unless there 
be some plain, intelligiblf! cause which alters it. The sub.iect to which the 
power is next applied is to commerce "among the several States." The word 
"among" means intermingled with. A thing which is among othors is inter- 
mingled with them. Connneree among tlie states cannot stop at the external 
boundary Une of each state, but may be intrortuced into the interior. It is 
not intended to say that thèse words comprehend that commerce, which is 
completel.y internai, which is carried on between m an and nian in a state, or 
between différent parts of the same state, and which does not extend to or af- 



218 152 FEDERAL BEPOKTER. 

fect otlier states. Such a power would be inconvenieut and Is certalnly un' 
necessary. Comprehensive as tlie word "among" is, it may very properly be 
restricted to tbat commerce wliicli concerns more states than one. * • « 
ïhe genius and character of the whole government seem to be tbat its action 
is to be applied to ail tlie external concerns of tlie Nation and to those internai 
concerns which affect the states geuerally ; but not to those which are com- 
pletely within a particular state, which do not aCfect other states, and with 
which it is not necessary to interfère for the purpose of executing some of 
the gênerai powers of the government. • * * ' 

"Agaiu: 'We are now arrived at the inquiry: What is this powerî It 
is the power to regulate ; that is, to prescribe the rule by which commerce is to 
be governed. This power, like ail others vested inCougress, Is complète it% 
itself, may be exercised to its utmost extent, and ackuowledges no limitation)!, 
other than are prescrihed in the Constitution. Thèse are expressed in plaiu 
ternis, and do not affect the questions which arise in this case, or which 
liave been discussed at the bar. If, as bas always been uuderstood, the 
sovereignty of Congress, though llmited to specifled objects, is plenary as to 
those objecte, the power over coiamerce with foreign nations, and among the 
several states, is vested in Congress as ahsolutely as it would 6e in a single 
govermne)it, having in its Constitution the same restrictions on the exercise of 
the potcer as are found in the Constitution of the United States.' 
* •**•***** « 

"This référence to prior adjudications could be extended if it were necessary 
to do so. The cases cited, however, sufflciently iudicate the grouuds upou 
which this court bas proceeded when determining the meaning and scope of 
the commerce clause. They show that commerce among the states embraoes 
navigation, intercourse, comm.unication, traffic, the transit of pcrsons, and the 
transmission of messages l)y telegraph. They also show that the power to 
regulate oom,m-erce among the several states is vested in Congress as ahsolutely 
us it wonH 6e in a single government, havîng in its Constitution the same 
restrictions on the exercise of the power as are found in the Constitution of 
the United States; that such power is plenary, complète in itself, and may 6e 
exerted hy Congress to its utmost extent, subject only to such limitations as 
the Constitutian imposes upon the exercise of the powers granted by it; and 
that in determining the character of the régulations to 6e adopted Congress 
has « large discrétion which is not to 6e controlled iy the courts, simply 6e- 
cause, in thetr opinion such régulations may not he the best or most effective 
that could be employed." 

Bearing in mind, then, the large significance given to the terms of 
the commerce clause and the wide scope of the power thereby con- 
ferred, let us consider some of those cases, wherein the validity of 
State statutes is concerned, to which I hâve referred as more nearly 
touching the question raised hère. 

Among them are the following: In Cooley v. Board of Wardens, 
53 U. S. 298, 13 L. Ed. 996, under a Peniisylvania stattite provid- 
ing that a vessel which neglects or refuses to take a pilot shall for- 
feit and pay to the master warden of the pilots, for the use of the 
Society for the Relief of Distressed and Decayed Pilots, their wid- 
ows and children, one-half the regular amount of pilotage; in Mor- 
gan V. Louisiana, 118 U. S. 455, 6 Sup. Ct. 1114, 30 L. Ed. 637, un- 
der statutes of Louisiana establishing a System of quarantine laws ; 
in Smith v. Alabama, 124 U. S. 465, 8 Sup. Ct. 564, 31 L,. Ed. 508, 
under an Alabama statute requiring locomotive engineers to be ex- 
amined and licensed by a board to be appointed for that purpose; 
in Nashville, Chattanooga & St. Louis Railway v. Alabama, 128 U. 
S. 96, 9 Sup. Ct. 28, 32 L. Ed. 352, under an Alabama statute re- 
quiring locomotive engineers and other persons employed by a rail- 
road Company in a capacity which calls for the ability to distinguish 



KELLET V. GREAT NORTHERN RT. CO. 219 

and discriminate between color signais, to be examined, etc. ; in West- 
ern Union Telegraph Company v. James, 1G3 U. S. G50, 16 Sup. 
Ct. 934, 40 L. Ed. 1105, under a Georgia statute requiring every te!e- 
grapii Company witli a line of wires, wholly or partly within tliat state, 
to receive dispatches, and, on payment of the nsual charges, to transmit 
and deliver them with due diligence, under a penaltv of $100 ; in Hen- 
nington v. Georgia, 163 U. S. 299, 16 Sup. Ct. lO'SG, 41 L. Ed. 166, 
under a Georgia statute forbidding the running of freight trains on 
any raiiroad in the state on Sunday, and providing for the trial and 
punishment on conviction of a superintendent of a raiiroad company 
violating that provision; in New York, New Haven & Hartford R. 
R. V. New York, 165 U. S. 628, 17 Sup. Ct. 418, 41 L. Ed. 853, under 
a New York statute regulating the heating of steam passenger cars, 
and directing guards and guard posts to be placed on raiiroad bridges 
and trestles and the approaches thereto ; in Missouri, Kansas & Texas 
Ry. V. Haber, 169 U. S. 613, 18 Sup. Ct. 488, 42 L. Ed. 8?8, under 
a Kansas statute relating to bringing into the state cattle liable to or 
capable of communicating Texas, splenic, or Spanish fever to any 
domestic cattle of the state ; in Rasmussen v. Idaho, 181 U. S. 198, 
21 Sup. Ct. 594, 45 L. Ed. 820, under a Colorado statute relating to 
the introduction of infections or contagious diseases among the cattle 
and horses of that state; in Sherlock" v. Alling, 93 U. S. 99, 23 L. 
Ed. 819, under a statute of Indiana giving a right of action to the 
Personal représentatives of the deceased, where his death is caused by 
the wrongful act or omission of another ; in Peirce v. Van Dusen, 78 
Fed. 693, 24 C. C. A. 280, C9 E. R. A. 705, under a statute of Ohio 
for the protection and relief of raiiroad employés, providing that raii- 
road or railway corporations or companies shall not make certain con- 
tracts for exemption from liability to their employés, shall not use de- 
fective cars, etc., and to a certain extent abrogating in actions against 
such companies for personal injuries to employés the rule as to fel- 
low servants ; in Martin v. Pittsburg & Lake Erie Ry. Co., supra, un- 
der a statute of Pennsylvania providing that when any person should 
sustain personal injury or loss of life while lawfully engaged or em- 
ployed on or about the roads, works, dépôts, and premises of a raii- 
road company or in or about any train or car therein or thereon, of 
which company such person is not an employé, the right of action and 
recovery in ail such cases against the company shall be such only as 
would exist if such person were an employé, provided that this section 
shall not apply to passengers. 

In ail of thèse cases the state législation has been sustained as a valid 
exercise of the police power of the state, although it may affect Inter- 
state commerce, against the contention that it was an invasion of 
the power given by the Constitution to Congress to regulate interstate 
commerce. But in ail of them the court has been careful to in- 
dicate that, as to interstate commmerce, Congress also has the power 
to enact such législation ; that while the power of Congress to regulate 
such commerce is plenary, it is compétent for the states to pass such 
législation until Congress acts; and that such state législation, in so 
far as it may conflict therewith, must yield to similar législation by 
Congress, whenever it chooses to exercise its 2:)0wer. 



220 152 FEDERAL RKrORTKR. 

In M., K. and T. Ry. v. Ilaher, at page 635 of 169 U. S., at page 49S 
of 18 Sup. Ct. (42 h. Ed. 878), the court says : 

"Thèse cases ail proceed uiion the si'omd that tlio régulation of tbc enjoy- 
ment of the relative rights, and the pertonnaïu'e of tlie dnties, of ail pei-son> 
withhi the jurisdiction of a state, beloug primavily to siich state uiider Un 
reserved power to provide for the safety of ail persoiis and property within it>î 
Hnuts ; and that even if tlie subjioet of sueh régulations be one that niay be 
(ukeu under the exclusive control of Congress and l)e reaehed by luitional 
iegislation, any action taken by the state u|)on that subject that does not 
directly interfère witli riglits secured by tlie Constitution of the United States 
or by some valid act of Congress nnist be res))ected iiiitil (Jongrvss Inier- 
fcnvu." 

In Cooley v. Board of Wardens, after holding that the power to 
regulate commerce inchides the régulation of navigation, and that pilot 
laws are régulations of navigation, and therefore of commerce, within 
the grant to Congress of the commercial power, but that the mère 
grant of the commercial power to Congress does not forbid the states 
from passing laws to regulate pilotage, the court goes on to say, at 
page 318 of 53 U. S. (13 L. Ed. 9\m)\ 

"The grant of conunercial power to Congress does not coutain any tenns 
whieh expressly exclude the states from exercisiiig an authority over its sub- 
ject-matter. If they are excludwl, it must be because the nature of the power 
thus granted to Congress re(iuires that a similar autiiority should not exist 
in tlie states. If it were conceded, on tlie one side, that tlie nature of this 
po\^'er, like that to legislate for the District of Colunibia, is absolutely and 
totally répugnant to ti'ie existence of similar power in the states, probabl,y no 
«ne would deiiy that the grant of the power to Congress iis effeetually and 
l)erfectly excludes the states from ail future législation on the subjeet as if 
express words had beeii used to exciude them. And, on the other hand, if it 
were admitted that the existence of tliis power in Congress, like the power of 
taxation, is compatible with the existence of a similar power in the states, 
tlien it would be in conformity with the conteniporary ex])osition of the Con- 
stitution (Federalist, Xo. 32), and with the .iudicial construction, given from 
time to finie b.v tliis court, after the niost delibevato considération, to hold that 
the mère grant of such a power to Congress did not ini]ily a prohibition on the 
states to exercise the saine power; that it is not the mère existence of such 
a power, but Un arerclm hn CoH.r/rc.S'.s', whicli may be incompatible with the ex- 
ercise of the sanu> power by the states, and that tlie states may legislate in 
tho ahspnco of coiigrcssioiial refinJiition»." 

In Nashville, Chattanooga & St. L. Rv. v. Alahama, at page 99 of 
128 U. S., at page 28 of 9 Sup. Ct, (32 E. Ed. 3.52), the court 'says: 

"It is conceded that the iiower of Congress to regulate Interstate comnierco 
is plenary; that, as incident to it, Congress may legislate as to the (iualifica- 
tioiis. duties, and liahililies of eniiiloyés and otliers ou railway trains engaged 
in that commerce. ;nid that sucii Iegislation will supersede any state action 
on the sub.iect. liiit viifil Kuch Ici/inldlioii /.•« liad it is clearly within tlu; com- 
Tietency of tiie states to provide against accidents on trains whilst ^vitliiu 
their limits." 

In New York, New Havcn & Hartford R. R. v. New York, tlie 
court said, at page G31 of lti5 U. S., at page 419 of 17 Sup. Ct. (41 
E. Ed. 853) : 

"According to unniei'ous décisions of tliis court (some of wliich are cited 
;n the niargin) sustaining the validity of state i-egulations enaeted under the 
police powers of the state, and wliicli incidentally afl'e(;ted commerce among 
/lie states and with foreigii naticais. it was clearly coni])etcnt for the state of 
New York, in the ahuenvc of nuiionul IcyMution covcriiuj the subjcct, to for- 



KELLEY V. GREAT NORTHERN MY. CO. l'iil 

liid, under ]);'naltirs, tho hPiitiiia; of pasi-îensOT cars iii tlmt st;;t(>. 'ly stores oi- 
funiaces kejit insule tlie curs or siispendwi tlierel'roni, altlioiif,'li sacli cars may 
be employed in iiiterstat(ï coinuiercc. Wliilc tlio laws oi' tlu; states uiust yirhl 
to aets of ('oiigress passeû in exocntion of tlie powcrs conf<'i'i'(>d ni)on it by 
tlie Constitution ((iil)l}ons v. Ogden, <) Wlitiat. 1, 211. fi L. Kd. 'S.]), tlie nierc 
ja'ant to Coufîress of tlio povrer to rejiulate comniorcî' witli forcira nations and 
amon<; tlie states did not of itsolf and vithout leijixldtiim hy ('(iiujrc^K, iui)iair 
tlie autiiority of tlie states to estalilisli sueh reason:ible rep^ulations as were 
appropriate for tlie protection of tbe boaltb, tbe lives, and tbe safety of tlieir 
))eople." 

It ma}' be urged that the cases above qtioled from, and somc of tlie 
others cited, do not dircctly bear upon the question which we hâve 
hère. But the cases of Sherlock v. Alling, Pcirce v. Van Ditsen, and 
Martin v. Pittsburg & Lake Erie R. R. Co., supra, do bear directly 
upon that question, and in my judgment completely décide it ; each of 
them being a case in which the statute changed the common-law rule 
of liability. 

It would seem to be a little remarkable that in thèse three cases, as 
well as in the others, ail of which arose before Congress had seen fit 
to take any action on the subject, the vaîidity of such législation by 
the states, where it affected common carriers engaged in interstate 
commerce, was assailed on the ground that it did regulate interstate 
commerce, and was therefore an invasion of the power of Congress 
over that subject, while now, since Congress bas acted, in a statute 
whose provisions apply only to those engaged in interstate commerce, 
the opposite contention is made. In Sherlock v. Alling it was contend- 
ed, quoting from the opinion at the bottom of page 101 of 93 U. S. 
(23 L. Ed'. 819): 

"Tliat the statute of Indiana créâtes a new llabi'ity, and could not. there- 
fore. be applied to cases where the in.iuries coiiiiilained of were caused by 
marine torts, without interfering witb the exclusive régulation of coinniercc 
vested in Congress. Tbe position of tbe défendants, as we iinderstand it, is 
that as by botb the coinnion and maritime law tlie rigbt of action for Personal 
torts dies with the person in.iured, the statute whicli allows actions for sucb. 
torts, when resulting in the death of the pers(m injured. to lie brought by the 
Personal représentatives of the deeeased. enlarges the liability of jiarties for 
such torts, and that sucb enlarged liability, if ;ipjilied to cases of marine 
torts, would constitute a new burden upon comiiierce." 

After referring to the cases in which state législation had been held 
invalid because directly imposing a tax or burden upon interstate com- 
merce, and after holding that no such opération could be ascribed to 
the Indiana statute, the court, speaking by Mr. Justice rieid, at page 
103 of 93 U. S. (.S3 L. Ed. 819), goes on to say: 

"That statute imposes no tax, prescribes no duty, and in no l'esjiect inter- 
fères with any régulations for tbe navigation and use of vesseis. It only 
déclares a gênerai principle respcKiting the liuhility of ail jiersons «itliiu the 
ijurisdiction of the state for torts resulting in tlie death of jiarties injured. 
And in the application of the jirinciple it nuda^s no différence where tbe injury 
eom])lained of occurred in the state, wbether on land or ou water. Oenei'a'i 
législation of this kind, iirescribing tlu; liabiliiicti or duties of citizens of a 
state, without distinction as to pursuit or calling. is not open to any valid 
ob.iection, Jiectinse U mny affcct pci-xonn ciifiaycd iii forcign or iiitet-statccoiii 
iiicrcr. Ob.iection might witb equal propriety be urged against législation pre- 
scribing the form in which contraets shaU be autlienticated, or ])ro])erty de- 
scend or be distributed ou the death of Itsowner, because applicable to the 



222 1D2 FEDERAL KEPOKÏEK. 

contracts or estâtes of persons engaged iu siieh commerce. In conferring upon 
Cougress tlie régulation of comuieree, it \Yas uever iiitended to eut the statea 
off from leglslatiug on ail subjects relatiug to the health, life, and sal'ety of 
their citizens, tlwiKjh the legMation might indirectly affect the commerce of 
the country. Législation, in a great variety of ways, niay att'ect commerce 
and persons engaged in it witliout constituting a régulation of it, vvithin the 
meaning of the Constitution. 

"/* is true that the cffmmercial poicer confcrred hy the Gonstitittîon is one 
without limitation. It authorixes législation icith rexpeet to ail the subjects 
of foreign ami ititerstate commerce, the persons engaged in it, and the instru- 
ments hy which it is carrieê on. And législation has largely dealt, so far as 
commerce by vvater is concerned, witli the instruments of that commerce. It 
has embraced the whole subjeet of navigation; prescribed what shall con- 
.-'.titute American vessels, and by whom they shall be navigated; how they 
shall be registered or enrolled and licensed ; to what tonnage, hospital. and 
other dues they shall be subjected ; what rules they shall obey in passing 
each other; and what provi.nons their owners shall make for the health, 
.wfety, and comfort of their crews. Since steam has been applied to the pro- 
pulsion of vossels, législation has embraced an infinité variety of further dé- 
tails, to guard agaiust accident and conséquent loss of life. 

"The power to prescribe thèse and similar régulations necessarily involves 
the right to déclare the liability which shall follow their infraction. What- 
cver, therefore, Gongress détermines, cither as to a régulation or the liability 
for ils infringement, is exclusive of state authority. But vvith référence to a 
great variety of matters touehing the rights and liabilitles of persons engaged 
in commerce, either as owners or navigators of vessels, the laïcs of Gongress 
are silent, and the laws of the state govern. The rules for the acquisition of 
property by persons engaged in navigation, and for its transfer and descent, 
are, with some exceptions, those prescribed by the state to which the vessels 
belong • and it may be said generally that the législation of a state not di- 
rected againrt commerce or any of its régulations, but relatir.g to the rights, 
dnties, and liabilitles of citizens, and only indii-ectly and remotely affecting 
'hf, ^nornt'^n nf comm.crce. is of obligatory force upon citizens within its ter- 
ritorial jurisdiction, whether on land or water or engaged in commerce, foreign 
or Interstate, or in any other pursuit. In our .iudgment, the statute of Indi- 
•mn ^''ills under this class. Vntil Gongress, therefore. m.alccs some régulation 
touehing the Uahility of parties for marine torts resulting in the death of the 
persons injured, ice are of opinion that the statute of Indlana applies, giving 
a right of action in sueh cases to the personal représentatives of the deeeased. 
and that. as thus applied, it constitutes no encroachment upon the commercial 
power of Gongress." 

In Peirce v. Van Dusen, the Circuit Court, composed of Mr. Justice 
Harlan and Judges Taft and Lurton. had under considération the 
Ohio statute which changed or modified the fellow servant rule, thus, 
as is contended hère, creatinï^ a hability wbich did not theretofore 
exist. It is true that the principal question before the court was wheth- 
er the statute of Ohio was applicable to cases against a receiver of a 
railroad corporation, especially one acting under the orders of a fédéral 
court; but the court went on to consider its applicability to railroad 
companies doing business in Ohio and engaged in interstate commerce 
(the railroad company in that case being so engaged) and the question 
of its validity arising from the fact that it thus affected such commerce. 
Speaking by Mr. Tustice Harlan, the court says, at page 698 of 78 Fed., 
at page 384 of 24 C. C. A. (69 h. K A. 705) : 

"go much as to the scope and true nicanlng of the Ohio statute, without réf- 
érence to the courts in which it may be enforced. If the statute nieans what 
we hold it to mean, must not full effect be given to it in actions for personal 
injuries brought against a receiver in a court of the United States? This 
question must be answered in the affirmative. Such législation is not liable 



KELLKY V. GREAT KOETHEEN ET. CO. 223 

to tlie objoi-tidii that it cncroaclies upon fédéral authovity, or upon the juris- 
«iiction or jiower ot tbe UDited States court. Tlie statute does notliing more 
tliaii to preseribe a rule of action to be observed by ail withiu tbe state. The 
autbority to euact it is derlved from tbe gênerai power of tbe state to regu- 
iate tbe exercise of tlie relative rights and duties, and to provide for tbe 
s'afety, of ail persons within its territorial jurisdiction. It is tbe duty of 
tbe fédéral court sitting in thls state to enfoi'ce ail ejiactments baving sucti 
objecta in v\ew, unless tbey eiicroacb U])0i> tbe powers and autbority of the 
United States. That duty arises ont of tbe statute declaring that 'the laws 
of the several states, except \^'here tbe Constitution, treatios, or slatutes of the 
United States otbenvise require or provide, shall be regarded as rules of de- 
«■isiou in trials at comnion law In the courts of the United States, in cases 
where they apply.' lîev. St. § 72] ; Baltimore & O. K. Co. v. Cam]), 31 U. S. 
App. 233, 13 C. C. A. 2;i3, and G5 Fed. y."j2. Indeed, if Congross bad uot so 
de<,'lared, this court, upon principles of coniity, and ia support of tbe public 
policy of tbe state, migbt well recognize and enforce, in actions brouglit 
against receivers of railroads. any rrJes establislied by tbe state for liko 
actions brought against raiiroad companies. 

"ïhe Ohio statute is not a])plicable aloue to raiiroad corijorations of Obio 
engaged in the domestic commerce of this state. It is equally applicable to 
raiiroad corporations doing business in Ohio and cnfmgcd in commerce arnonp 
thr ntatcK. although the statute, in its opération, ma;/ (iffeet in some degree a 
fsuhjcct ovcr vhU'li Coin/rc-ifi can excrt fui! poicer. Tbe states may do many 
things affecting commerce with foreign nations and among tbe several states 
until Congres» eovers the suJiJcct hij national Icyislation." 

Then, after citing and commenting upon many of the cases which 
I hâve above cited, the court says, at page 700 of 78 Fed., at page 286 
of 24C. C. A. (69 L. R.A. 705): 

''Vncxouliteûly. ttie irlwle siihject of the Unbi'it'y of intcrstate raiiroad com- 
panien for the ncgliffcnce of tliose in their service may he covercd by national 
leeiiMation etinHed hy Conyre.is iinder itn pmcer to ret/uluie commerce among 
the states. But as Congrcss has not dealt icith that siihject, it was compétent 
for Ohio to déclare that au employé of îuiy raiiroad corporation doing business 
hère, Inchiding those engaged in conunerce among the states, sball be deemed, 
in respect to his nets within this state, the superior, not the fellow servant, of 
other employés plaeed uuder his control. If tbe elïect of tbe Ohio stfitute be, 
.'is undoubtedly it is, to impose upon sueli coiporation-s in pai-ticul.'ir circum- 
stances, a liability for injuries received by some of its employés which would 
not otherwise rest upon them according to tlie principles of gênerai law, that 
fact does not release the fédéral court frnm its oblig.ntion to enforce the en- 
actments of the state. Of the validity of such state législation we entcrtain 
no doubt." 

It is difficult to understand whv, if Congress may regulate the liabil- 
ity of common carriers engaged in intersfite commerce to stran'2;ers, 
it may not regulate their liability to their employés ; the protection of 
Interstate commerce and of the persons engaged therein bcing as much 
involved in the one case as in the otber. 

In the case of Martin v. Pitt^burg & T^ake Erie R. R. Co., the 
court had under considération the l'ennsvlvania statute wliose pro- 
visions hâve been given above. The plaintiff, Martin, was injured 
while he was on a train of the raiiroad company, in the employ of 
the United States as a railway postal clerk on a route extending from 
Cleveland, Ohio, to P'ittsburg, Pa. The injuries arose from the de- 
railing in Pennsylvania of the train by the négligence of the crew of 
a work train in permitting a switch leading to a s'de track to be open. 
The défendant, among other défenses, pleaded the law of Pennsvlvania 
above referred to and alleged that it was applicable and relieved from 



224 1Ô2 FEDERAL EEPOUTKR. 

responsibility. In repl)' thc plaiiitiff denied the existence and applica- 
bility of the statute, and furtber contended that the statute if existini;' 
and applicable was void, first, because contrary to the power delegated 
to Congress to establish po.st offices and post roads ; second, becanse ré- 
pugnant to the commerce clause of the Constitution ; and, third, because 
in conflict with the equal protection and due process clauses of the 
fourteenth amendment, and also the clause prohibiting a state froiii 
making or enforcing any law which shall abridge the privilèges or 
immunities of citizens of the United vStatcs. On the trial before a jury 
the court held the statutes to be applicable and valid, and hence operat- 
ive to defeat a recovery. There was a verdict and judgment in favor 
of the défendant, which was severally affirmcd by the Circuit Court and 
by the Suprême Court of the state of Ohio. The Suprême Court of the 
IJnited States also affirmed the judgment, holding the statute to be ap- 
plicble and valid. After disposing of the first contention, tiie court 
went on to consider the second contention as to the repugnancy of tlic 
statute to the commerce clause of the Constitution, and, speaking b}- 
Air. Justice White, said: 

"This briiij;s us to tlio 8ecoiid contention — tlie roijusnancy of the reniisyl- 
ViUiia stntnte to tlic eoiinuci-ce clause of tlie Constitution. It is îi])iiarent tr(;ni 
tlic (leciaion in tlie l'rice Case, just proviously referred to, tluU: in ileciiiini.; 
tlint question we nnist détermine tlie apjilieation of tlie statute to tbe plaiii- 
tiff in crror, wlioUy irresiiective of tlie fact tliat at tlie tinie lie was injuroa lie 
was a raihvay postal clerli. In otlier words, tlie valiility or invalidity of tlie 
statute is to be adjudsed iireci^cly as if tbe plaintif!' was, at the tiine of tlie 
injury, serving for'bire in tlie eniploynieut of a private individual or corpora- 
ti(iii. 

"Under tlie circuinstanees we liave stated, tlie case of Tennsylvania R. R. 
Co. V. Ilnsbes, 1<>1 U. S. 477, 24 Sup. Ct. ]o2, 48 L. Ed. 2(>8, clearly establishes 
tbe unsonndness of tbe contention that tbe l'eniisylvania statute in question 
was void because in conflict with tlie commerce clause. In that case a borse 
was sbipped froni a point in tbe state of New York to a point in tbe state of 
Pennsylvania, under a bill of lading wbicli liniited tbe rijrlit of recovery to 
not exceeding ^^^H} for any injury which uiit;lit be occasioned to tlie animal 
during tbe transit. Tlie borse was burt witbin tbe state of Pennsylvania 
throngh tbe négligence of a Connecting carrier. In tbe c(>urts of Pennsylvania, 
applying the Pennsylvania doctrine which dénies tbe right of a connnon car- 
rier to limit its liability for injuries resulting froni négligence, a recovery 
was bnd in tbe suni of $10,001). tbe value of tbe animal. On writ of orror froni 
this court tbe judgment of tlie Suprême Court of l'eiinsylvania was allinned ; 
it beiug held that, at Icast, in flic ahsrnce of JctiUUifUm l)y GongrcHs on tlic 
mihicct. tbe elïeet of the comiiierce clause of the Constitution was not to de- 
iirive the state of Pennsylvania of autborlty to legislate as to those witbin 
its jurisdictinn conceriiing tlic lUihiliti/ of connnon carriers, alihoii'ih imcli, 
IcaUlatimt mifiht, to initie c.rteiit. indircctlii nffcct iiitcr.'tSato connnicrcc. Tbe 
niliiig in tbe Ilugiies Case in effect but reitevated the iirinciple îidopled and 
applird in Chicago, M. & St. P. R. R. Co. v. Solan. 10!) U. S. i;«, 18 Sup. Ct. 
289. 42 L. Ed. GSS, irlicre an lotra statute forhiildina a commun carrier from, 
conlmctiiiff to cxem'it it.'ielf froni liuJiiUty iciix siistuincd as to a pcraon iclio 
wan injiircd durîng an intcrstatc trunsportation. 

"ïhe contention that because, in tlie cases referred to, tbe opération of the 
state laws wliicli were sustained was to aiigmeiit the liability of a carrier, 
therefore the rulings are inapjiosite bere, wliere tbe conséquence of tbe ap- 
plication of tlie state statute may be to lesseu tbe carrier's liability, rests ujion 
a distinction witbout !i ditference. Tbe resuit of tlie previous rulings was 
^o recogiiize, in thc ahsciicc of action l)ij Coiiiircs-n. tlic iiower of tbe states to 
legisla. !e. and of course this )iowor involved tlie antliovity to regulate as tbe 
state miglit deem bost for tlie public good, witliout référence to wbother tbe 



KELLET T. GREAT NOETHEEN ET. CO. 225 

effect of the législation might be to lirait or broaden the responsibility of the 
carrier. In otlier words, the assertion of fédéral rights is disposed of when 
we détermine the question of power, and doing so does not involve consider- 
Ing the wisdom with which the lawful power may bave been under stated 
conditions exerted. * • * 

"The contention that because plaintiff in error, as a citizen of the United 
States, had a constitutional right to travel from one state to another, he 
was entitled, as the resuit of an accident happening in Pennsylvania. to a 
cause of action not allovifed by the laws of the state, is in a différent forui 
to reiterate that the Pennsylvania statute was répugnant to the commercp 
clause of the Constitution of the United States. Conceding, if the accident 
had happened in Ohio, there would hâve been a right to recover, that fact did 
noc deprive the state of Pennsylvania of its authority to iegislate so as to 
attect persons and things within its borders. The commerce clause not being 
contruiling in the absence of législation hy Congres», it foUows, of necessity, 
that the plaintiff in error, as an incident of his right to travel from state to 
Btate, did not possess the privilèges, as to an accident happening in Pennsyl- 
vania, to exert a cause of action not given by the laws of that state, and had 
no Immunity exempting him from the control of the state législation." 

In the case of Pennsylvania R. R. Co. v. Hughes, referred to in the 
opinion of Mr. Justice White, abovc quoted, the court says, at page 
491 of 191 U. S., at page 136 of 24 Sup. Ct. (48 L. Ed. 268) : 

"It is true that this language was used of a statute of lowa enacting a rulf 
of obligation for common carriers in that state. But the principle recognized 
is that, in the absence of Congressionul législation upon the suhject, a state 
may require a common carrier, although in the exécution of a contract for 
Interstate carriage, to use great care and diligence in the carrying of passen- 
gers and transportation of goods, and to 6e liaile for the whole loss resulting 
from négligence in the discharge of its duties. 

"We can see no différence in the application of the principle iased upon the 
marmer in which the state requires this degree of care and responsibility, 
whether enacted Mo a statute or resulting from the rules of lato enforced 
in the state courts. The state has a right to promote the welfare and safety 
of those within its jurisdiction by requiring common carriers to be responsible 
to the full measure of the loss resulting from their négligence, a contract to 
the contrary notwithstanding. This requirement in the case just cited ig held, 
in the absence of Congressional action providing a différent measure of Ua- 
hility when contracts, such as the one now before us, are made in relation to 
Interstate carriage. Its pertinence to the case under considération renders 
further discussion unnecessary." 

In C, M. & St. P. Ry. Co. v. Solan, 169 U. S. at page 137, 18 Sup. Ct. 
at page 291 (42 L. Ed. 688) the court says: 

"They are not, in themselves, régulations of Interstate commerce, althougb 
they control, in some degree, the cooduct and the liability of those engaged 
In such commerce. So long as Congress has not legislated upon the pariicular 
subject, they are rather to be regarded as législation in aid of such com- 
merce, and as a rightful exercise of the police power of the state tb regulate 
the relative rights and duties of ail persons and corporations within its 
limits." 

The eflfect of thèse décisions and of ail those cited above, as I un- 
derstand them, is that such législation as that considered and reviewed 
therein may not be, and is not necessarily and in and of itself, a rég- 
ulation of commerce, but that it may be adopted as such, and that 
Congress can enact such législation as a régulation of Interstate com- 
merce. And in the décisions from which I hâve so fully quoted the 
court recognizes and déclares, if the language means anvthing, that 
Congress has power under the commerce clause of the Constitution 
152 F.— 15 



226 152 FEDBEAL KBPOETEB. 

to enact such législation as that hère under considération, changing as 
to common carriers engaged in Interstate commerce common-law rules 
of liability, as a régulation of interstate commerce. 

It is contended that tlie portions of the opinions which I hâve em- 
phasized are obiter dicta. If they are, it is strange, indeed unfortu- 
nate, that the eminent judges of our highest court should so often fall 
into such dicta. But they are not obiter dicta. The question of the 
invasion by the state législation of the power of Congress under the 
commerce clause of the Constitution was necessarily involved therein, 
and if such législation was a mère création of a liability, and was for 
that reason not a régulation of commerce, and therefore not within 
the power of Congress, as is contended hère, it is difficult to under- 
stand why the court did not so déclare, and thus dispose of the cases. 
If the power to enact such législation is in the state Législatures only, 
and not in Congress, the court had only to say so, and it was unnec- 
essary to so elaborately discuss that question. By doing so, and by 
saying what they did, they recognized that the question of the power 
of Congress was involved in the cases, and they recognized and de- 
clared that such législation is within the power conferred by the 
commerce clause. 

Nor are thèse cases to the effect that the power of Congress can only 
be exerted by prescribing that some particular thing shall be donc. And 
it would seem to be apparent that this act is none the less a rule or rég- 
ulation under which the business of such carriers is to be conducted and 
by which it is to be governed, because it does not prescribe that some 
spécifie thing should be done or some spécifie appliance used. 

In Johnson v. Southern Pacilîc Co., 196 U. S. 1, 25 Sup. Ct. 158, 49 
Iv. Ed. 363, the court had under considération the act of Congress 
known as the "Safety Apphance Act" of March 2, 1893 (37 Stat. 531, 
c. 196 [U. S. Çomp, St. 1901, p. 3174]), requiring railroads engaged 
in interstate commerce to equip their locomotives, trains, and cars with 
air brakes, autbmatic couplers, etc. The plaintiff claimed that he was 
relieved of assumption of risk under common-law rules by section 8 
of that act, which provided : 

"That any employée of any such common carrier who may be lujured by any 
locomotive, car, or train in use contrary to the provision of this act shall not 
be deemed thereby to hâve assumed the risk thereby occasioned, although 
continuing in the employment of such carrier after the unlawful use of such, 
locomotive, car, or train had been brought to his knowledge." 

That this act was squarely within the power of Congress under the 
commerce clause of the Constitution was not questioned. And that, in 
connection with such a régulation as that requiring the use of such ap- 
pliances, Congress had the power, under the commerce clause of the 
Constitution, to change the common-law rule as to the assumption ci 
risk, seems to hâve been thought too clear for argument. In that case 
the court said : 

"The object was to protect the lives and limbs of railroad employés by 
rendering it unnecossary for a man operating the couplers to go between the 
ends of the cars, and that object wonld be defeatcd, not necessarily by the use 
of s.utomatic couplers of différent khids, but if those différent kinds would 
not automatically couple with each othcr." 



KELLET V. GREAT NORTHERN RT. CO. 22Ï 



And again : 



"TUe primary object of the act was to promote tbe public welfare by se- 
curing tlie safety of employés and travelers." 

The court hère recognizes that the public welfare, as involved in in- 
terstate commerce, may be promoted by législation of Congress for the 
protection of persons employed in carrying'it on. 

While the act hère under considération does not state either in its 
title or body, as did that act, what the object of it is, it seems to me that 
such object is plain upon its face. It will be apparent, I think, from a 
mère reading of the statjute, that Congress had in contemplation much 
more than the mère création and imposition of the liabiiity mentioned 
upon common carriers engaged in Interstate commerce to their em- 
ployés. It seems to me to be apparent that it had in contemplation the 
protection of the lives and persons of the employés of such carriers 
whose employment had any relation to such commerce, and that it 
enacted the statute for that purpose, and by its provisions changed cer- 
tain common-law rules determining liabiiity in order to promote that 
object by securing a more careful sélection of employés, a doser and 
more careful supervision bf them, and a more rigid enforcement of their 
duties, and thus to promote the public welfare. 

In Mikkelson v. Truesdale, 65 N. W. 260, 63 Minn. 137, the Suprême 
Court of Minnesota had under considération the state statute entitled 
"An act to define the liabilities of railroad companies in relation to dam- 
ages sustained by their employés." Neither in the title nor in the body 
of the act was anything said as to its object, but the court said that 
it was — 

"a police régulation intended to protect life, person, and property by se- 
curing a more careful sélection of servants and a more rigid enlorcement of 
their duties by railroad companies, by malùng them pecuniarily responsible 
to those of their servants vsflio are injured by tbe négligence of incompétent 
or careless fellow servants." 

Now, if Congress has power, as a régulation of commerce, having in 
view the promotion of the public welfare by securing the safety of em- 
ployés and travelers, to pass an act like the safety appliance act, requir- 
ing the use of spécifie appHances, and can in connection therewith and 
to promote the objects of the statute change the common-law rule as to 
the assumption of risk, has it not power as a régulation of commerce to 
pass such an act as the one we are hère considering ? 

Must Congress be obliged, in order to bring its législation within the 
commerce clause of the Constitution, to provide specifically and definite- 
ly for ail the conditions that may exist and for ail of the almost inhnite 
situations and circumstances that may arise afïecting the safety of em- 
ployés in the conduct of the business of common carriers? Must it 
specifically and definitely provide what précautions should be taken for 
the safety of employés under ail such conditions and in ail thèse almost 
innumerable situations? Can it not say generally, as it has, in efifect, 
said in this act : "We cannot anticipate ail of thèse conditions and situ- 
ations. We cannot provide for ail the précautions which ought to be 
taken for the safety of employés by common carriers engaged in inter- 
state commerce. But in order to secure, under ail conditions and in ail 



228 152 FEDERAL REPORTER. 

situations, a more diligent and thorough performance of tlie duties of 
such carriers, and in order to compel and insure that every proper pré- 
caution shall be taken for the safety of their employés both as to the 
agencies and instrumentalities used and as to the sélection and supervi- 
sion of Such employés, and in order to mînimize as far as possible the 
dangers to such employés, we will not permit such carriers, in case of 
the death or in jury of an employé resulting from theïr négligence or 
the négligence of any of their servants, to invoke certain common-law 
rules for the purpose of escaping liability, but they shall be governed 
by and their liability shall be ascertained by the rules herein land down." 
May not Congress say, as it has, in efïect, said in this act, we déclare 
that Interstate commerce, including those engaged therein and the pub- 
lic to be served thereby, must be safe-guarded by the rules of liability 
herein prescribed and that such commerce must bear the burden hereby 
imposed ? It seems to me there can be but one answer to thèse ques- 
tions ; and that is, that Congress need not provide specifîcally and defi- 
nitely for ail such conditions and situations, and that it has power under 
the commerce clause to pass such an act. 

Undoubtedly, if Congress may prescribe spécifie rules, it may pre- 
scribe gênerai rules, and may prescribe the conséquences which shall 
foUow in case of a violation of either. There is no suggestion in the 
Constitution or in reason to the contrary. The fîeld belongs to Con- 
gress, and it may, if it sees fit, occupy ail of it. Congress has by the 
statute hère in question, in efïect, said: "The employés of those en- 
gaged in interstate commerce are too frequently placed in péril of life 
and limb' through the négligence of their employers and through the 
négligence of their own fellow servants. Such commerce itself is sub- 
ject to unnecessary hazards for the same reason. This must be pre- 
vented, or at least reduced to a minimum. The négligence of fellow 
servants is in large measure under the control of the employers, if the 
îatter but exercise proper care in the sélection of such servants and in 
their supervision and require of them the performance of tasks only 
which will impose reasonable tests upon their skill or powers of endur- 
ance. Increasing the liability of the employer will tend to decrease 
those périls and hazards. The duties of such Carriers as declared by 
the courts and as prescribed by particular statvites are well known and 
understood, and such duties must be more faithfuUy performed, and 
such carriers must see to it that greater précautions are taken to safe- 
guard such commerce and to protect their employés engaged therein, 
and in order to secure this the fuies of their liability shall be as herein 
provided." 

If it be contended that the création of such liabilities is an exercise 
of the police power, and that such poWer belongs to the states, the an- 
swer is that while, as a gênerai rule, the police power belongs to the 
States, and was by the Constitution reserved to the states, yet Congress 
may, in the exercise of its power to regulate commerce, impose upon 
such commerce régulations which are in their essential nature police 
régulations. Upon no other theory can the décisions in Johnson v. 
Southern Pacific Co., supra, and in Lottery Cases, supra, be justified 
and sustained. 



KELLEY V. GREAT NORTHERN RY. CO. 229 

I am therefore of the opinion that the lîrst ground on which the 
constitutionality of this act is clenied is not well taken. 

The second ground on which the constitutionality of the act is attack- 
ed is; That, if it be admitted that the act does regulate Interstate com- 
merce, if also régulâtes commerce that is excliisively within the several 
States, and that the lutter is so inseparably combined ivith the former 
as to condemn the whole act as imzvarranted by the Constitution. The 
contention, as I understand it, is that a common carrier engaged in in- 
terstate commerce may be, engaged in intrastate commerce also, and the 
language of the act being so broad as to cover ail the employés of such 
carrier, without référence to the nature of their employment, it is not 
only a régulation of Interstate commerce, but also a régulation of in- 
trastate commerce, and as it is impossible to so construe it as to sepa- 
rate the two it must be held invalid. 

This contention is, I think, answered by what I hâve already said, 
and by the décisions to which I hâve referred, and others to which I 
shall call attention. It is well to recall the familiar rule that, while it 
is an imperative duty from which no court should shrink to déclare void 
any statute the unconstitutionality of which is made apparent, due re- 
gard to the boundary between the législative and the judicial depart- 
ments of the government requires that this duty should be exërcised 
with the greatest caution. Under this rule, where under one construc- 
tion a statute may be invalid, if there is another reasonable construction 
which would sustain its validity, the latter should be adopted. Am. 
and Eng. Ency. of Law (Old Édition) vol. 3, p. 674, note and cases 
there cited. If, therefore, it were necessarv to sustain its validity that 
this act should be so construed as to confine its opération to those whose 
injuries occurred at a time when they were actually engaged upon in- 
terstate traffic, I think that, having in view its object, there is ample au- 
thority for such construction. And the courts, giving it such construc- 
tion, should détermine from the facts and circumstances of each particu- 
lar case whether or not it is applicable. Even in the Johnson Case, 
where the act under considération was not whoUy remédiai, the Su- 
prême Court refused to give it an absolutely strict construction, as had 
been done by the Circuit Court of Appeals. The act hère under consid- 
ération is not pénal, but may be regarded as wholly remédiai, and as 
such would not only permit, but require, a wider latitude of construc- 
tion. It would seem to be absurd to say that, where Congress has 
enacted a statute of a remédiai nature, it must be held unconstitutional, 
because, while it might be construed to apply to a subject clearly within 
the control of Congress, it might also be construed to apply to some- 
thing not within such control. 

But it is not necessary to so narrowlv construe the act in order to sus- 
tain its validitv. It should be fairly and rcasonablv construed (Church 
of The Holy Trinity v. U. S.. 143 U. S. 457, 12 Sup. Ct. 511, 36 L. 
Ed. 226), having in view its object, and bearing in mind that it is the 
carrier engaged- in intcrstate commerce which the act seeks to regulate 
in relation to its duty to its employés. From a mère reading of the act, 
it will be apparent that no argument is necessary to show that the ex- 
pression "any common carriers," in the second section of the act, means 
"any common carriers engaged in Interstate or foreign commerce." 



230 152 FEDERAL REPORTEE. 

Congress evidently intended that the act should embrace ail the em ■ 
ployés to whom its power under the commerce clause of the Constitu- 
tion extends, and if the power of Congress over interstate commerce is 
one without limitation, plehary and complète in itself, and which inay 
be exerted to its utmost extent, subject only to such limitations as the 
Constitution of the United States imposes, and if it authorizes législa- 
tion with respect to ail the subjects of foreign and interstate commerce, 
the persons engaged in it, and the instruments by which it is carried on ; 
and if under such power Congress can, for the purpose of promoting 
the safety of employés engaged therein, and of persons and property 
carried therein, enact législation such as that contained in this act un- 
der which the liability of carriers engaged in such commerce to their 
employés shall be determined (and the cases cited fully sustain ail the 
foregoing propositions), it would seem to be apparent that it can make 
such législation applicable to ail employés of such carriers whose em- 
ployment relates to such commerce. And if such carrier is also en- 
gaged in intrastate commerce, using therein the same means and agen- 
cies, such as railroad tracks, switches, cars, etc., it would also seem to 
be apparent that Congress can make such législation applicable to ail 
employés of such carrier whose employment relates to such means and 
agencies. In such case it may be said that the employment of such em- 
ployés relates to interstate commerce. 

It seems to me that, as to a carrier engaged in both interstate and in- 
trastate commerce, the act applies, and was intended to apply, where 
such carrier uses, in whole or in part, the same means and agencies in 
both, and where the employment of the injured employé has some rela- 
tion to such interstate commerce or to such means and agencies. 

If the carrier's business is carried on in such a way that the act must 
apply to ail its employés for the reason that the employment of ail of 
them relates to interstate commerce, it can make no différence, so far 
as the power of Congress to pass the act is concerned. 

That it is within the power of Congress to regulate the liaïïility of 
common carriers engaged at the same time in both interstate and in- 
trastate commerce, and using the same means and agencies for both, 
to ail their employés whose employment has some relation to such 
means and agencies, and that Congress so intended, would seem to be 
apparent when we reflect that the safety of interstate commerce, and 
the protection of the lives and persons of those engaged therein, and 
of the persons and property carried therein, may dépend as much upon 
the taking of proper précautions for the safety of employés engaged 
upon intrastate traffic as upon the taking of such précautions for the 
safety of those engaged upon interstate traffic only. 

Let us suppose that such carrier has commingled in a train, cars con- 
taining state trafïîc only with those containing interstate traffic, and that 
while engaged on such train a brakeman is injured while setting a 
brake on one of the cars containing only state traffic; or, again, that 
such carrier has a yard in which are handled both cars containing only 
state traffic and those containing interstate traffic, and that while hand- 
ling a car containing only state traffic a switchman is injured; or, 
again, that such carrier is operating, on its line of road on which trains 
containing interstate traffic are operated, a train made up entirely of 



KELLET V. GREAT NORTHERN ET. 00. 231 

cars containîng only intrastate traffic, and that on such train a brakeman 
is injured. Could it be said, in eitlier of such cases, that the employ- 
ment of such brakeman or switchman had no relation to interstate com- 
merce, and that he was not within the spirit and object and purpose of 
tlie statute ? And could it be said that a careful sélection of such em- 
ployés, a close and careful supervision of them, and a rigid enf orcement 
of their duties, and the taking of proper précautions for their safety 
were not of vital importance in securing the safety of life, person, and 
property in interstate commerce ? 

It may be well, in this connection, to call attention to what Mr. Jus- 
tice Brewer, in Baltimore & Ohio Railroad v. Baugh, 149 U. S. 368, 
378, 13 Sup. et. 914, 918 (37 L. Ed. 772) says. After referring to the 
authorities holding that the question of the liability of a railroad Com- 
pany for injuries to its servants is a matter of gênerai and not of local 
law, which the court would, in the absence of express statute on the 
subject, détermine for itself, he continues: 

" * * * There Is no question as to the power of the states to leglslate 
and change the rules of the common law in this respect as in otliers ; but, 
In the absence of snch législation, the question is one deteiminable only by 
the gênerai principles of that law. Further than that, it is a question in 
which the Nation as a whole is Interested. It enfers into the commerce of 
the country. Commerce between the states is a matter of national régulation, 
and to establish it as such was one of the principal causes which led to the 
adoption of our Constitution. To-day the volume of interstate commerce far 
exceeds the anticipation of those who framed the Constitution, and the main 
ehannels through which this interstate commerce passes are the railroads of 
the country. Congress has legislated in respect to this commerce not merely 
by the interstate commerce act and its amendments (24 Stat. 379, c. 104 [U. 
S. Comp. St. 1901, p. 3154]), but also by an act pass«d at the last session, re- 
quiring the use of automatic couplers on freight cars (Pub. Acts, 52d Cong., 
2d Sess., c. 113). The lines of this very plaintiff In error extend into half a 
dozen or more states, and its trains are largely employed in interstate com- 
merce. As it passes from state to state, must the rights, obligations, and 
duties subsisting between it and its employés change at every state line? If 
to a train running from Baltimore to Chicago it should, within the limita of 
the state of Ohio. attaeh a car for a distance only within that state, ought 
the law controlling the relation of a brakeman on that car to the company 
to be différent from that subsisting between the brakeman on the through 
cars and the company?" 

It would seem to be clear that it is of the first importance that Con- 
gress should be able to regulate the liability of such common carrier to 
ail such employés. 

The fact that a common carrier engaged in interstate commerce may 
also be engaged in intrastate commerce, using therein in whole or in 
part the same means and agencies, cannot defeat the power of Congress 
to regulate such carrier. The régulation of intrastate commerce which 
may resuit in such a case (if, indeed, in such case there can be said to 
be any régulation of intrastate commerce by such an act as this) is due 
to the fact that the carrier is at the same time and with the same means 
and agencies engaged in both kinds of commerce ; and it seems to me 
that it could not possibly be said that, because the législation of Con- 
gress may operate upon intrastate commerce on account of the carrier 
being thus engaged in both kinds of commerce, it must be declared un- 
constitutional, and thus the power of Congress defeated. The cases 



232 152 FEDERAL EErOKTEll. 

cited show that the states niay enact législation of tlie kind hcre in ques- 
tion when Congress has not already spoken, and that such législation 
will be valid, although it may aiïect Interstate commerce. Is it possible, 
then, if such législation is withiu the power of Congress as a régulation 
of Interstate commerce, that Congress cannot exercise that power as to 
those engaged in such commerce merely, because at the same time and 
with the same means and agencies they are engaged in intrastate com- 
merce? The question, it scems to me, answers itself. 

In considering what was said in Johnson v. Southern F-icific Com- 
pany, supra, as to the character of the car being local only, and not ac- 
tually engaged in Interstate movement, it must be borne in mind that 
the act there being considered was that of March 2, 189;3, wiiich was by 
its terms restricted in its application to cars "used in moving interstate 
trafific"; but there are clauses and expressions in the opinion which 
might be interpreted to indicate that, if the act had been as broad as the 
one hère under considération, it would not bave been necessary to con- 
sider that question at ail, and that it would hâve made no diiïerence as 
to whether the car was being used in moving interstate traffic or not. 

The act was amended by the act of March 2, 1903 (32 Stat. 943, c. 
976 [U. S. Comp. St. Supp. 1905, p. 003] ), which provided that the 
provisions of the former act should be held to apply to "ail trains, loco- 
motives, tenders, cars, and similar vehicles used on any railroad cn- 
gai^éd in interstate commerce." 

in U. S. V. Great Northern Ry. Co., (D. C.) 145 Fed. 438, the court 
had under considération the latter aCt, and Judge Whitson, in an opinion 
in which I entirely concur, held that it applied to ail cars regularly used 
on any railroad engaged in interstate commerce, not only while actually 
in use in such commerce, but at ail times when in use on such roacl. 
The court said : 

"The allégations of the sixth cause of action are that tlie défendant used 
on Its Une of railroad in Hillyard, in the state of Washington, a locomotive 
englue In moving a car coutaiuins iuter.state traffic, consisned from St. Cloud, 
m the State of Minnesota, to Hillyard, in the state of Waslujigton, wheii the 
coupling and uncou]iling apiiaratus of the locomotive was ont of repair and 
inoperative. The suliicioncy of tliese severai allégations is challeuged iipon 
the sole ground that it does not afilnuatively appear that the cars and loco- 
motive were being used in interstjite trafiic, for tlie reason that reliance nnist 
he made upon the allégations tliat they were used only in the state of Wash- 
ington. Haviug référence to the constitutional powers of Congress, the argu- 
ment is that a comnion carrier is not af .>cted by the législation which the 
plaintiff would iuvoke, because it does not apply to tratflc within the states. 

"The title of the act of tSOli fully reiiects the législative intent as expr(;sged 
in the act, and it is manifest tliat the pur])ose in view was the régulation of 
commerce between the states by requiring connnon carriers to coiU'orm to cer- 
tain requiremeuts regarded as essential to tlie safety of employées and pas- 
sengers. To sustain tlie deinurrer would be to liold that it is hcyoïid the 
power of Congress to control the instrumontalities tlirough whioli iiitei^tato 
commerce may be carried on. Hut the j^rorogati^-e neccssarily carrics with it 
the authority to prescribe the rules and régulations wliicli shall apply to 
those engaged in it. Illustrations of the futility of any effort on the jiart of 
Congress to exercise its constitutional powers in tins regard, if the contention 
made by the défendant can be sustained, are not far to seek. An interstate 
carrier niiglit liaul tratlic from one state to anotlier, tlicre transfer it, and 
l'rom thenee traii^'iiort it, witliout any of the safety aiiplianecs provided h.y 
luw. If it be answered that tins would he an évasion of the law, the resuit 



KELLEY V. GKEAT KORTIIERN RY. CO, 233 

is susceptible of fuvtlier illustration. Cars; eontaiiiinï state fi-jiffic fould !><■ 
commingled with tliose coiitaiinDs iiitcvsiatc traMi<', aiid tlnis defeat the pur- 
poses of the lesislatiou upoii tlic wuli.iect. 'J'iie eiî'eet of tliis would be to eu- 
danger the train eugaged in intersrate tralHe. Agaiu, a carrier could lise 
trains engaged entirely in state tratfic upou its lines, without the requisite 
equipmeut, wliieh might rcsult in injnry to passengers by coniing in collision 
with a train engaged in intersrat(î tratli<-. Jt is tlic carrier ■whiclt ilic actn 
scek to rei/uldte, <ind it ix lnj tJtia laethod that V'jinjrciiH lias undertakcn tu 
bring the muitcr iinder control." 

As said by Mr. Justice Harlan, in the Lottcry Case, supra: 

"It is to be remarked that tlie ('<iiisti1iilii>ii tUics iiut tlcfiiui irhat is to de 
dcemed a Icgitimale rcfivdutiun of iiiterslatr e<)iiimer(:e. lu (Jibbons v. Ogden 
it was said that tlie power to regulate sueh connuerce is the ]jower to pre- 
scril)e the nde by whi<-h it is to lie governed. But this gênerai observation 
leaves it to be determined, wheu the (pu-stion conies before the court, whether 
("ongress in jireseribii'.g n particular rule lias exceeded its ])o\ver under the 
(■oustitution. While our gov(>rniiient niust be aeknowledged by ail to be one 
of enunierated i)o\vers (MeCuUoeh v. Maryland, 4 Wheat. .'}1(), 40.5, 40T, 4 L. 
Ed. .579), the Constitution does not atteni])t to set forth ail the means hy which 
such powers uiay be earried into exécution. It leaves to Cougress a large dis- 
crétion as to the means that may be eniployed in executing a given power. 
•The Sound construction of the (Constitution,' this court bas said, 'must allow 
to the national Ix>gislature that discrétion, with res))ect to the means by which 
the jiowers it coufers are to be earried into exécution, whieli wlll enable that 
body to perform the high duties assigned to it in the manner niost bénéficiai 
to the people. Let the end be legitimate, let it be within the scope of the Con- 
stitution, and ail means which are apj)ropriate, which are plainly adaptcii 
to tliat end, vidnch are not prohibited, but consistent with the letter and 
spirit of the Constitution, are constitiitional.' 4 AVheat. 421." 

In an able article on the act hère in question in the Central Law 
Journal of October 12, 1900, vol. 63, p. 284, cited by counsel hère, and 
very largely quoted from, the authors say : 

"The gênerai and sweeping ternis 'every comnioii carrier,' 'any of its eni- 
ployGs,' 'any of its offleers, agents, or employés,' 'ail instrumentalitios,' 'any 
(ïommon carriers,' and 'any employé,' nnist establish the proposition that 
there was but one idea in the mind of Congress, namely, that as to commerce 
tliere shall be no states." 

To say that because Congress, as a régulation of interstate commerce, 
and for the purpose of promoting the public welfare by protecting 
life and person therein, has seen fit to abolish or modify certain rules 
of décision founded on the common law upon considérations of public 
policy, in référence to those engaged in such commerce, it has thereby 
in efïect meant that as to commerce there shall be no states, seems to 
me to be very extrême, if not absurd. The plain answer to any such 
assertion is that a person or corporation engaged in both interstate 
commerce and intrastate commerce, and using therein the same means 
and agencies, and employing those whose employment relates to such 
interstate commerce or to such means and agencies, must submit to 
such conditions as that branch of the govcrnment to which plenary 
power over such commerce lias been given by the Constitution may 
prescribe, even though such conditions may attect the intrastate com- 
merce in which such person or corporation is engaged. 

In the same article its authors seem to look upon the changes made 
by this act in the fellow servant rule, the contributory négligence 
rule, the rule as to the freedom of a carrier to contract witii ^.s em- 



334 152 FEDERAL REPORTEE. 

ployés conccrning its liability for an injury to an employé, and thé 
removal of the limit to the amount of recovery for an injury resulting 
in death, so often prescribed by state statutes, as startling and dan- 
gerous. They do not so impress me. I think it bas corne to be gen- 
erally recognized that the reasoning of the cases in which the fellow 
servant rule has been laid down by the courts has, in view of modem 
methods and the many dangerous mechanical means and appliances 
used in ahnost cvery branch of modem industry, lost much, and in 
some cases ail, of its force. I think it may be fairly asserted that the 
contributory négligence rule, as laid down and applied by the courts, 
is, in view of modem conditions, certainly as applied to those en- 
gaged in certain occupations, a harsh, cruel, and unjust rule, and ought 
long since in the furtherance of justice and in the interest of humanity 
to hâve been greatly modified. 

It has never been the rule in admiralty, to which one of the text- 
books on the Law of Négligence refers as being certainly nearer 
idéal justice, "if juries could be trusted to act upon it." This act 
at least leads in the direction of the admiralty law, and certainly, if 
a rule is an idéal one, its adoption should be striven for in any intelli- 
gent judicial System, and even if.it were admitted that juries could 
not be trusted to act upon it, to which I do not at ail agrée, that would 
not be a condemnation of the rule, but of a part of that system of 
jurispnidence which has come down from our forefathers, and which 
is, and let us devoutly hope always will be, firnily rooted in our Con- 
stitution and laws. And is it not absurd that a common maximum 
standard should be established to measure the value of the lives of 
men to their familles, especially when that standard is as low as some 
of the Législatures hâve fixed it? It would seem that the value of 
the life of a man to his family, or to those dépendent upon him, 
should be determined, as ail other damages are determined, by the 
particular circumstances of each case. And there are substantial rea- 
sons why an employer, especially one engaged in certain occupations, 
should not be permitted to relieve himself by contract witli his em- 
ployés from liability for injuries caused by his négligence or the nég- 
ligence of his other employés. 

I do not think that the Trade-Mark Cases, 100 U. S. 83, 35 L,. Ed. 
550, or Illinois Central Railroad Company v. McKendree, 27 Sup. Ct. 

Rep. 153, 303 U. S. 514, 51 L. Ed. , or any of that line of cases 

are applicable to the question now under considération. This opinion 
is already too long, and I can therefore only review the Trade-Mark 
Case. A careful considération of that case will, I think, not only not 
defeat the conclusion which I bave reached, but will tend to strengthen 
it. 

That décision was rendered in the considération of indictments 
brought under the purely pénal sections of the trade-mark statute. 
Congress passed that statute upon the manifest assumption that the 
whole subject of trade-marks was a matter of national control under 
that clause of the Constitution providing that Congress shall hâve 
power "to promote the progrès s of science and useful arts by secur- 
ing for limited times to authors and inventors the exclusive right to 
their respective writings and discoveries." There was therefore no 



KELLET V. GREAT NORTHERN RT. CO. 2o5 

possible room for the contention that Congress intended that the law 
should be applicable to those trade-marks only .which were used in 
Interstate commerce. And in the Sixth circuit the law was pro- 
nounced constitutional in a case on which the question was argued 
and decided upon that clause of the Constitution, and in which the 
opinion was advanced that it is the only provision by which the au- 
thority of Congress on the subject of trade-marks is conferred. That 
contention, however, was not insisted upon by the Attorney General 
in the Trade-Mark Cases. He based ïiis main argument upon the 
commerce clause of the Constitution. The court, after considering 
the power of Congress to deal with the subject under the clause above 
quoted, and deciding adversely to such power, went on to consider 
the power of Congress to deal with the subject under the commerce 
clause of the Constitution. 

The court refused to décide the question whether the trade-mark 
bears such a relation to commerce in gênerai terms as to bring it 
within congressional control, when used or applied to the classes of 
commerce which fall within that control. The décision was that, 
when Congress undertakes to enact a law which can only be valid 
as a régulation of commerce, it is reasonable to expect to find on 
the face of the law or from its essential nature that it is a régula- 
tion of commerce with foreign nations or among the several states 
or with the Indian tribes; that, if not so limited, it is in excess of 
the power of Congress; that the act there under considération was 
not so limited; that if its main purpose be to establish a régulation 
applicable to ail trade, to commerce at ail points, especially if it be 
apparent that it is designed to govern the commerce whoUy between 
the citizens of the same state, it is obviously the exercise of a power 
not confided to Congress ; that, if there is no récognition of this prin- 
ciple, it is invalid ; that it was manifest that no such distinction was 
to be found in that act, but that its broad purpose was to establish 
a universal System of trade-mark reg'stration for the benefit of ail 
who had already used a trade-mark or who wished to adopt one in 
the future, without regard to the character of the trade to which it 
must be applied or the résidence of the owner; and that it was there- 
fore invalid. The court says: 

"ïhe question, therofore, wliether the trade-mark bears such a relation to 
commerce in gênerai terms as to brlug it within congressional control, when 
used or applied to the classes of commerce tchwh fall within that control, is 
one which, in the présent case, we propose to leave undecidccj. We adopt 
this course because when this court is calliîd on in the course oï the adminis- 
tration of the law to consider whether an act of Congress, or ot any other 
department of the government, is within the constitutional authority of that 
department, a due respect for a eo-ordinate branch of the government requires 
that we shall décide that it bas transcended its powers only when that Is so 
plain that we cannot avoid the duty. 

''Tn such cases it is manifestlv the dietate of wisdom and Judicial propriety 
to décide no more than is necessary to the case in haud. That such bas been 
the uniform course of this court in regard to statutes passed by Congress will 
readily appear to any one who will consider the vast amount of argument pre- 
sented to us assailing them as unconstitutional, and he will coxmt, as he may 
do on bis Angers, the instances in which this court bas declared an act of Con- 
gress void for want of constitutional power. 

"Governed by this view of our duty, we proceefl to remark that a glanée at 



2.3G 152 FEDERAL REPORTER. 

the roiimioi'ce cImiiro of fhe Constitution discloses at onee whnt lias been often 
the subject of eoiunient in tliis tourt and ont of it, tliat the power of régula- 
tion there couferred on Congress is limited to commerce wlth foreign na- 
tions, commerce among the states, and commerce with the Tndian tribes. 
While bearlng in mind the libéral construction that commerce with foreign na- 
tions means commerce between citizens of the United States and citizens and 
subjects of foreign nations, and commerce among tlie states means commei'co 
between the individual citiKens of différent states, there still remaius a very 
large amount of connnerce, perhaps tUe Jargest, wliich, being trade or traffic 
between citizens of the same state, is beyond tlie control of Congress. 

"Wben, therefore, Congress undertakes to euact a law, whicb can only be 
valid as a régulation of commerce, it is rcasonuMc to expect to find on the 
face of the law, or from ita essential nature, that it is a régulation of com- 
merce with foreign nations, or among the several states, or with the Indian 
tribes. If not so limited, it is in excess of the power of Congress. If its njain 
pui-pose be to'establisb a régulation applicable to ail trade, to commerce at ail 
points, espeeially if it be apparent that it is designed to govern the commerce 
wholl;^ between citizens of the same state, it is obviously the exercise of a 
power not conflded to Congress. 

"We flnd no récognition of this prineiple in the chapter on trade-marics in 
the Revised Statutes. We ivould naturally look for this in the description of 
the elass of persans rvho are entitled to register a trade-niark, or in rcferenre 
to the goods to which it shoiild lie applîed. If, for instance, the statuts de- 
scribed persans engaged in a commerce between the différent states, and rc- 
lated to the u«e of trade-marks in such eommerce, it would be évident that 
Congress believed it was acting under the clause of the Constitution which au- 
thorizes^ it to regulate commerce among the states. So if, when the trnde- 
mark bas been registered, Congress had protected its nso on goods sold iy a 
citizen of one state to another, or hy a citizen of a foreign state to a citieen 
of the United States, It would be seen that Congress was at least intending to 
exercise the power of régulation conferred by that clause of the Constitution. 
But no Sîwh idea is foxind or suggested in this statiite. Its language is: 'Any 
person or flrm domiciled in the United States, and any corporation created 
by the United States, or of any state or territory thereof — or any person 
residing in a foreign country whicli by treaty or couvention affords similar 
privilèges to our citizens, niay by registration obtaiu protection for bis trade- 
mark. Hère is no requirement that such person shall be engagea in the kind. 
of commerce ivhich Congress is authorized to regulate. It is a gênerai décla- 
ration that anybody in the Vnited States, and anybody in any otlier country 
which permits us to do the like, may, by registering a trade-niaric, hâve it 
fully protected. So, wbile the person registering is required to fumish 'a 
statement of the class, of merchandise, and the particular description of the 
goods comprised in such elass, by M'hich the trade-mark bas been or is in- 
lended to be appropriated,' there is no hint that the goods are to be trans- 
ported from one state to another, or between the United States and foreign 
countries. Section 49.39 is intended to impose some restriction upon the Com- 
missioner of ï'atents in the matter of registration, but no limitation is sug- 
gested in regard to persons or propcrty engaged in the différent classes of 
commerce mentioned in the Constitution. The remédies provided by the act, 
when the right of the owner of the registered trade-mark is infringed, are not 
confined to the case of a tradic-mark used in foreign or intorstate commerce. 

"It is therefore manifest that no such distinction is found in the act, but 
that its broad purpose was to establisb a universal System of trade-mark 
registration for the benefit of ail who had already used a trade-mark, or who 
wished to adopt one in the future, without regard to the character of the trade 
to ic'hich it was to be applied or the résidence of the owncr, with the solitary 
exception that those who reslded in foreign countries which exteuded no such 
privilèges to us were excluded from them hère." 

The statute hère under considération discloses on its face that it is 
intended as a régulation of interstate and foreign commerce, being ex- 
pressly confined to common carriers engaged in such commerce. The 



KELLEY V. GREAT NORTHERN RT. CO. 237 

purpose of the act is not to establish a régulation applicable to ail trade, 
to commerce at ail points, but simply to establish a régulation of Inter- 
state and foreign commerce. It is not designed to govern commerce 
whoUy between citizens of the same state, but simply to protect Inter- 
state commerce. Local or intrastate commerce if affected at ail by it, 
is only attected because the carrier may be at the same time and with 
the same means and agencies engaged in Interstate commerce. If the 
act appHed to ail common carriers, irrespective of the character of com- 
merce in which they might be engaged, it would come within the rule 
announced in the Trade-Mark Cases. But we find on the face of the 
law that it is expressly confined to common carriers engaged in Inter- 
state commerce, over which, under the authorities cited, Conp-ress has 
paramount and exclusive control whenever it chooses to exercise its 
power. AU thèse considérations distinguish and dififerentiate it from 
the act which was under considération in the Trade-Mark Cases. 

That Congress has since cured the defect in the former trade-mark 
laws, by providing that they shall apply to trade-marks used in com- 
merce with foreign nations, or among the several states, or with Indian 
tribes (33 Stat. 724, c. 593 [U. S. Comp. St. Supp. 1905, p. 668]), would' 
seem to indicate at least that the members of the judiciary committees 
in the two Houses of Congress, composed as they are of lawyers of 
great ability, hâve placed the same interprétation upon the décision in 
the Trade-Mark Cases as that indicated above. 

As to the McKêndree Case, it is to be observed that the order of the 
Secretary there being considered undertook "to make a stringent régu- 
lation with highly pénal conséquences," single in character, and includ- 
ing commerce wholly within the state. The order was not limited to In- 
terstate commerce. It was a régulation as to the transportation of cat- 
tle from one side of a Une within a state to the other side of said Hne, 
and it appUed "to ail cattle transported from the south of this line to 
parts of the United States north thereof." "A party prosecuted for 
violating this order would be within its terms if the cattle were brought 
from the south of the line to a point north of the line within the state 
of Tennessee." It therefore included cattle transported wholly within 
the state of Tennessee from points south of the line to points north of it, 
as well as those which came from or were going to points outside of the 
state. It applied to ail who might transport such cattle, whether en- 
gaged in Interstate commerce or not. In other words, it was in no way 
limited to Interstate commerce. What I hâve said, therefore, in rela- 
tion to the Trade-Mark Cases is equally applicable to this case. 

Again, let us remember that it is the carrier, one engaged in Inter- 
state commerce, which the act hère in question régulâtes in relation to 
its duty to its employés, and that if it may be said (as I do not think 
it can be) to regulate intrastate commerce by reason of the fact that it 
may apply to an employé who at the time of his injurv is engaged upon 
intrastate traffic, it is because of the manner or method in which the 
carrier conducts its business, combining or commingling its interstatc 
with its intrastate commerce. The act hère in question is directed to 
common carriers engaged in Interstate or foreign commerce, and over 
such carriers Congress has plenary power. 



238 152 FEDERAL REFOETER. 

Iti the construction of a statute the inquiry always is : What was tlie 
législative intent? In the Trade-Mark Cases it was held that the act 
in question clearly indicated the législative intent to embrace ail trade- 
marks without respect to the character of the commerce in which they 
were used. In the McKendree Case it was held, first, that the act, if 
otherwise valid, evidenced no intent on the part of Congress to author- 
ize' the Secretary to promulgate the rule there involved, and, second, 
that the rule on its face carried with it no suggestion that the secretary 
intended thereby anything other or différent from the plain import of 
its terms ; that he evidently intended it to apply to ail commerce, and 
that it was therefore invalid. 

This act on its face relates to carriers engagea in interstate commerce. 
It extends to ail such carriers. It extends to no others. Its fair mean- 
ing and interprétation is that it applies to ail those employés of such car- 
riers, and to those only, who hâve some relation to such commerce or to 
the means and agencies employed therein. Cases may possibly arise 
where a carrier engaged to some limited extent in interstate commerce 
may not be an interstate carrier within the meaning of this act, as re- 
spects a particular employé, or as respects the circumstances of some 
particular case. That remains to be declared when the case arises. Ex- 
trême cases which may hâve no existence, and which may never exist, 
are not to be conjured up for the purpose of defeating the obvious in- 
tention of Congress. Extraordinary situations are usually not in the 
minds of the lawmakers, and législation is not to be held bad with réf- 
érence thereto. If the gênerai purpose of the law, as fairly indicated 
by its terms, is within constitutional limits, it will not be defeated by 
applying to it the test of some extrême case, possibly within the literal 
provisions of the act, but entirely beyond its spirit and meaning as a 
whole. 

In the foregoing discussion référence has been made principally, if 
not altogether, to railroads engaged in interstate commerce, but the 
same principles and the same reasoning would apply as well to other 
common carriers engaged in such commerce. I am therefore of the 
opinion that the second ground on which the objection to the constitu- 
tionality of this act is based is not well taken. 

The contention that the act is void because it dénies the equal protec- 
tion of the laws is, I think, without merit. It is beyond question that 
a state Législature can change the common4aw rules determining the 
liability of employer to employé as to ail employers within its jurisdic- 
tion, and that such législation would not be contrary to the fourteenth 
amendment, because the danger to employés is greater in some occupa- 
tions than in others, or because in the same occupation some of the em- 
ployés may be exposed to greater danger than others. It was the évi- 
dent intention of Congress that the act hère in question should embrace 
ail employers and ail of their employés to whom its power under the 
commerce clause, of the Constitution extends, and, considering the ex- 
tent of that power, the fact that it applies to ail such employés, irrespec- 
tive of the danger of their particular employments, no more affects its 
constitutionality than would such fact affect the constitutionality of a 
similar state enactm.ent whose provisions were made applicable to ail 
employers under its jurisdiction. 



KELLET V. GEEAT NORTHEEN RT. CO. 239 

But, if the foregoing position is unsound, and if this congressional 
enactment is subject to the equal-protection paragraph of the fourteenth 
amendaient, I am still of the opinion that, bearing in mind tl:e object 
of the statute, the pecuHar character of the business of the carriers af- 
fected, and the pubUc nature of their functions, and the fact that they 
are ail treated alike under similar circumstances and conditions, it is 
valid, because the classification therein made is within the range of the 
législative discrétion, and is practical, and not palpably arbitrary. Mis- 
souri Pacific Ry. Co. v. Mackey, 127 U. S. 205, 8 Sup. Ct. 1161, 32 L. 
Ed. 107; Tullis v. Lake Erie & Western R. R., 175 U. S. 348, 20 Sup. 
Ct. 136, 44 L. Ed. 192 ; St. E., I. M. & S. Ry. Co. v. Paul, 173 U. S. 
404, 19 Sup. Ct. 419, 43 L. Ed. 746. 

Nor can it be said that for this reason the law is harsh and inéquita- 
ble, because where the danger is less the liability will less frequently 
arise, and, if there be practically no danger, there will be practically no 
liability. But, if it is, that would furnish no just cause for declaring it 
invalid. The remedy would lie not with the courts, but with Congress. 

In Eottery Cases, supra, Mr. Justice Harlan says : 

"But, as often said, the possible abuse of a power is not an argument 
against its existence. There is probably no governmental power that may 
not be exerted to the injury of the public. If what is done by Congress is 
manifestly in excess of the powers granted to it, then upon the courts will 
rest the duty of adjudglng that its action is neither légal nor binding upon tho 
people. But If what Congress does is within the limita of its power, and is 
simply iinwise or injurions, the remedy Is that suggested by Chief Justice 
Marshall, in Gibbons v. Ogden, when he sald : 'The wlsdoni and the discré- 
tion of Congress, their identity with the people, and the Influence which their 
constituents possess at élections, are, in this, as in many other instances, as 
that, for example, of declaring war, the sole restrainte on which they hâve 
relied, to seeure them from its abuse. They are the restraints ou which the 
people must often rely solely, in ail représentative governments.' " 

The contention that the act violâtes the tenth amendment of the Con- 
stitution is but another way of saying that it is not within the power of 
Congress under the commerce clause. And I think that no argument is 
necessary to réfute the contention that it violâtes the fifth and seventh 
amendments. 

I am therefore of the opinion that the act in question is constitution- 
al and valid, and the demurrer must be overruled. 

I am not unmindful of the fact that the foregoing opinion, in so far 
as it relates to the commerce clause of the Constitution, is in conflict 
with opinions already pronounced by other fédéral judges of the high- 
est learning and ability, and I hâve approached and considered the ques- 
tions involved with a just and real respect for décisions supported by 
such authority ; but, feeling that I must exercise by own understanding 
and judgment with that independence which is expected from this dc- 
partment of the government, I find myself unable to reach any other 
conclusions than those above indicated. 



240 152 FEDERAL EEPOKÏKR. 

HUNTINGTON NAT. BANK v. HUNTINGTON DISTILLIXG CO. et al. 
(Circuit Court, S. D. West Virginia. Marcli ô, lOOT.) 

1. Limitation of Actions— Pleading Bar— Equitt. 

Not merely the défense of lâches, but the bar of the statute against a 
suit for au accounting by an admiiiistratrix for money whieh went into 
tlie l'iands of iutostiite. 11., is sutHcieutly pleaded by an aiiswer alleging 
that if tliere bad ever been anj' claim agaliist K. in bis lifetime by rea- 
son of the aileged' transactions, which is denied, said claim is barred by 
the laps« of tiiiie aiid the neglect of plaiiitiff to bave a settlemeut of tlio 
same in the lil'etime of décèdent, and défendant therefore pleads that any 
sueh claim is barred, as plaintift allowed the claim to sleep till attor the 
death of deceased ; the same strictness of pleading the statute not beiug 
required in equity as at law. 

[FA. Note. — For cases in point, see Cent Dig. vol. 33, Limitation of Ac- 
tions, §§ eSS-GSG.] 

2. Courts — Fédéral Courts — Proceduke in State Courts — Witnesses — Com- 

PETENCT— ÏRANSACTI0N8 WITH DecEDENTS. 

Notwithstanding that under the state statute persous interested in the 
eveut of tlie suit, thougb not parties thereto, are incompétent to testify to 
transactions or communications with defendant's intestate, tbey may do 
so in a suit in a fédéral court, under Rev. St. U. S. s 858 [U. S. Comp. 
St. 1901, p. 059], providing that In tUe courts of the TJnited States no wit- 
ness shall be excluded becauso be is a party to or interested in the issue 
tried,; provided, that in actions by or against administra tors ueither parry 
shall be allowed to testity against the othcr, as to transactions with, or 
statements by, deceased, unloss calied to testify tbereto by the oi)posite 
party, or required to testify thereto by the court. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 13, Courts, § 925.] 
S. Trusts— Trustée Be Son Tort. 

Where a company executed a paper whereby it assigned aecounts and 
sold goods to a bank, providing that the banlc sbould collect the one and 
sell the other aiid apply tlic proceeds to payment of the company's notes 
to tbe bank, and the président of the bank concealed from tlie banli sucli 
faet, and vvithout authority of liis co-directors toolï possession of the 
projierty and used the proceeds for other debts of tbe company, of which 
he was a stockholder, lie coustituted himself a trustée de son tort for 
the bank. 

[Ed. Note. — For cases in point, see Cent. Dig. vol. 47, Trusts, §§ 153- 
156.] 

4. Limitation of Actions — IIunning ce Statute— Obstructing Prosecution 

OF lîIGHT. 

Where a company assigned aecounts and sold goods to a bank to apply 
the proceeds on tbe company's notes to the bank, and the bank's président 
concealed such facts from it, aud took possession of the projierty and 
applied tbe proceeds to other debts of tlie company, of which lie was a 
stockholder, the statute did not, during such concealment, run against tbe 
bank's right of action for an acoounting, under Code 1906, § 3511, provid- 
ing that where a debtor obstnicts the prosecution of a right the time of 
.such obstruction shall not be coniputedin the limitation pei'iod. 

5. Sajik — Enforcement of Trust — Lâches. 

Where a bank's président concealed from it the facts giviug it right 
to bave him account as a trustée de son tort, but a year after bis death 
and the discovery of the facts it conimenced suit, the défense of lâches 
is not available. 

[Ed. Note. — For cases lu point, see Cent. Dig. vol. 47, Trusts, §§ 508- 
573.J 



HUNTINGTON NAT. BAXK V. IIUNTINGTOS DISTILLING CO. 241 

In Equity. 

Simms & Enslow, for plaintiff. 

Vinson & Thompson, J. W. Capcrton, and James R. Bush, for dé- 
fendants. 

DAYTOX, District Judge (sitting specially). This suit was insti- 
tuted in 1905, in the Circuit Court of Cabell county, West Virginia, for 
two purposes : First, to compel Minerva Phelps Russell administratrix 
of the estate of John Hooe Russell, to account for the proceeds of the 
property of the Huntington Distilling Company which are alleged to 
havc gone into his hands under a certain written assignment made by 
said distilling company to the plaintift bank to secure payment of some- 
thing over $9,000 debt due from it to said bank; and, second, in case 
thèse proceeds were found insufifîcient to pay in fuU said debt, then to re- 
quire certain stockholders to pay any balance of said debt ont of alleged 
unpaid stock subscriptions of theirs. The administratrix of Russell, de- 
ceased, a citizen of Kentucky, although appointed in West Virginia, re- 
moved the cause to this court, and heretofore Keller, District Judge for 
this district, has overruled a motion to remand, and, upon demurrer, bas 
held the bill niultifarious, and for that reason dismissed it so far as the 
parties interested in the payment of the stock subscriptions are concern- 
ed, but entertaining it as to the controversy between the plaintiff and 
Russell's administratrix as to the proceeds of the distilling company al- 
leged to hâve gone into his hands. The bill sets forth in détail certain 
facts as to this property which will be considered more fully later on, 
and to it an answer has been filed by the administratrix, denying in dé- 
tail its allégations, and charging plaintiff's demand against decedent's 
estate to be barred by lapse of time and by neglect and négligence of 
plaintiff in asserting it. She has also tendered and asked leave to file 
an amendment to this answer, specifically pleading the bar of the West 
Virginia statute of limitations provided by section 18, c. 104, of the 
Code (1906) of the state. To the fîling of this amendment the plaintiff 
has excepted, and by stipulation of counsel it has been agreed that I 
shall pass upon this exception, and, in case the amendment is permitted 
to be filed, then an amendment to the bill is tendered and asked by the 
plaintiff to be filed, and a gênerai replication also tendered. Whatever 
détermination I may reach as to this, it is further stipulated that the 
cause should be submitted to and dctermined by me without further de- 
lay upon its merits. 

It seems to me the objection to the filing of this amendment to the an- 
swer can be speedily disposed of . In my opinion it is immaterial wheth- 
er it be filed or net, for, as I construe the allégations of the original an- 
swer, it sufficiently pleads this statute. It distinctly says : 

"* * * If thftre had ever at any time been aiiy daim or demand asainst 
the said John Hooe Paissell in his iifetime t)y reason of said transactions 
(wliicli this respondent dénies), then said (rlaim is l)arred by tlie lapse of tinve 
and the neglect and neîjligence of tiic plaintiff. its ofBcers and directors, to 
hâve a settlement of the samo in tlie Iifetime of the décèdent; and she there- 
fore pleads that any .such clalm, if any there be or was. is barred and can- 
not now be colleeted ont of his estate. as said officers and directors of the 
plaintiff and managers thereof allowed this claini and transaction to sleep 
uutil after tlie deaili of said John Hooe Itussell." 

102 F.— IC 



242 152 FEDERAL EEPORTER. 

It seems to me clear that this language sets up the bar by statute, as 
well as the équitable défense of lâches. "'Anything in an answer which 
will apprise the plaintiff that the défendant relies on the statute of limi- 
tations is sufficient, if such facts are stated as are necessary to show 
that the statute is applicable." Tazewell's Ex'r v. Whittle's Adm'r, 13 
Grat. (Va.) 339 (Syl.,pt. 1). 

Moncure, J., in this case further says, at page 344 : 

"The same strictness of pleading is not required in equity as at law. It 
is not common to plead tlie statute specially or formally in equity, but only 
to rely upon it, in gênerai terms, in the answer." 

This, in haec verba, is reaffirmed in Cole's Ex'r v. Martin, 99 Va. 223, 
37 S. E. 907. 

In this State this freedom in practice has been greatly extended, and 
it is now held that it is the duty of the personal représentative to rely 
upon the statute of limitations, and when not done in the answer, it may 
be relied on, and in effect pleaded, by such personal représentative and 
by creditors as to each other's demands, by means of exception to a 
commissioner's report made to settle and ascertain the debts of a décè- 
dent. Woodyard v. Polsley, 14 W. Va. 211. If, therefore, as a matter 
of more formai pleading, the défendant desires to file this amendment 
to her answer, I can see no objection, and it may be filed. 

Nor can I see any particular objection to the amendment of the bill 
asked for by the plaintiff to more fully set forth facts alleged to be suffi- 
cient to withdraw its demand without the bar of this statute, although 
what I hâve said above about the necessity for the amendment to the 
answer applies with equal force to the amendment asked of the bill. I 
regard both unnecessary, but unobjectionable. 

Coming now to the merits of the case, I am met at the very thresh- 
old with a very interesting preliminary question which it seems to me 
should be fîrst determined. A very large part of the testimony upon 
which the plaintiff rests its case has been given by officers, directors, 
and stockholders of the bank who are practically interested in the resuit 
of this suit, and their évidence substantially relates to transactions and 
communications had by them with the décèdent, Russell. The counsel 
for défendant has in every instance, I think, and with the utmost care, 
preserved objection to this kind of testimony, entering objections there- 
to and motions to strike out, at the time when taken. Is such testimony 
compétent? Section 23, c. 130 (section 3945) of the Code of 1906 of 
this State, provides : 

"No party to any action, suit or proceeding, nor any person interested In 
the event thereof, nor any person from, through or under whom, any such 
party or interested i>erson dérives any interest or titie by assignaient or 
otherwise, sliali be examined as a witness in regard to any personal transac- 
tion or communication between such witness and a person at the time of 
such examination, deceased, insane or lunatic, against the executor, admin- 
istrator, heir at law, next of liin, assignée, legatee, or survivor of such per- 
son, or the assignée or committee of such insane person or lunatic." 

Under this statute, the Suprême Court of Appeals of West Virginia, 
without discussion, and apparently, without much considération, but 
rather as a matter of course, has held, in Carskadon v. Minke, 26 W. 
Va. 729, that: 



HUNTINGTON NAT. BANK V. HTJNTINGTON DISTILLING CO. 243 

"In a suit to settle the affairs of an unincorporated company or a partner- 
shlp — one of the members being dead — the survivlng members are not tmder 
the statute of 1882 compétent to testlfy as wltnesses In regard to sueh af- 
fairs." 

And in Development Co. v. Thornburg, 46 W. Va. 99, 33 S. E. 108, 
relying for support on the preceding case, it is held : 

"Persons who are directors and stockholders of a corporation are Incom- 
pétent to testify against the administrator and heirs at law of a deceased 
person in favor of such corporation, as to any communication or transaction 
had with such deceased person in their officiai capacity as such directors, un- 
less such administrator and heirs at law are examined as to such communica- 
tion or transaction in their own behalf or the testimony of such deceased 
person touching the same is given in évidence." 

It is not surprising that a very considérable direct conflict should arise 
in the décisions of the courts of last resort of the states touching this 
question. For example, the Suprême Court of Appeals of Virginia has, 
in construing the statute of that state, ruled exactly opposite to that of 
the Suprême Court of this state. See Bank v. Terry's Adm'r, 99 Va. 
194, 37 S. E. 843 ; Insurance Co. v. Oliver, 95 Va. 445, 28 S. E. 594. 
In Georgia the rule first laid down was that such witnesses were incom- 
pétent. Banking Co. v. Papot, 59 Ga. 343; R. R. Co. v. Papot, 67 
Ga. 675. But subsequently the rule seems to hâve been exactly re- 
versed. Ullman v. Brunswick T. G. & L. Co., 96 Ga. 635, 24 S. E. 409. 
In Illinois, Indiana, lowa, Minnesota, New York, and Pennsylvania 
such witnesses hâve been held incompétent. Ice Machine Co. v. Kei- 
fer, 134 111. 481, 25 N. E. 799, 10 L. R. A. 696, 23 Am. St. Rep. 688; 
Modlin V. Turnpike Co., 48 Ind. 492 ; Bank v. Owen, 52 lowa, 107, 
2 N. W. 980 ; Elevator Co. v. Ins. Co., 40 Minn. 152, 41 N. W. 547 ; 
Keller v. Mfg. Co., 39 Hun (N. Y.) 348 ; Foster v. Collner, 107 Pa. 
30o. In Maryland, Michigan, Mississippi, New Jersey, and Tennessee 
the opposite rule prevails. Downes v. M. & D. R. Co., 37 Md. 100 ; 
Rust V. Bennett, 39 Mich. 531 ; Mitchell v. Sav. Inst., 56 Miss. 444 ; 
N. J. T. & S. D. Co. v. Camden S. D. & T. Co., 58 N. J. Law, 196, 33 
Atl. 475 ; Grange Warehouse Ass'n v. Owen, 86 Tenn. 355, 7 S. W. 
457. But since 18C2 we hâve had fédéral législation on this subject, 
which, as it remains to-day, is found in section 8.58 of the Revised Stat- 
utes of the United States [U. S. Comp. St. 1901, p. 659], and is as 
follows : 

"In the courts of the United States no witness shall be excluded in any 
action on account of color, or in any civil action because he is a party to or 
interested in the issue tried: Providcd, Tliat in actions by or against execu- 
tors, administrators, or guardians, in which jndgment may be rendercd for 
or against them, neither party sball be allowed to testify against the other, 
as to any transaction with, or statenient by, the testator, intestate, or ward. 
unless called to testify thereto by the opposite party, or required to testify 
thereto by the court. In ail other respects, the laws of the state in which 
the court is held shall be the rules of décision as to the competency of wit- 
iiesses in the courts of the United States in trials at common law, and in eq- 
uity and admiralty." 

This statute has been held to be a remédiai one, intended to remove 
technical disqualifications in the common-law rules of évidence and to 
promote the fair administration of justice, and to be liberally construed. 



244 152 FEDERAL REPORTE K. 

It is a complète abolition of the rule of exclusion under the comnion lav,' 
in ail of the courts of the United States. By it interested parties, ex- 
cept those named in the proviso, are placéd upon a footing of equality 
with ail other witnesses, so that they may testify for themselves and be 
compelled to testifv for others. Goodwin v. Fox, 129 U. S. (iOl, ï) 
Sup. Ct. 367, 32 L.'Ed. 805 ; Texas v. Chiles, 21 Wall. (U. S.) 488, 22 
L. Ed. 650 ; U. S. V. Clark, 96 U. S. 37--12, 24 L. Ed. 696 ; R. R. 
Co. V. Pollard, 22 Wall. (U. S.) 341, 22 L. Ed. 877 ; Lowrey v. Kus- 
worm (C. C.) 66 Fed. 539. 

It bas been furtber held that the competency of parties as witnesses 
in the fédéral courts dépends upon the acts of Congress as codified in 
this section. It is not derived from the statutes of any state, and is not 
subject to the condition and qualifications imposed by the state lavvs, 
nor is it subject to other exceptions and qualifications imposed by such 
state laws. King v. Worthington, 104 U. S. 44, 26 L. Ed. 652 ; White 
V. Wansey, 53 C. C. A. 634, 116 Fed. 345 ; Travis v. Ins. Co., 43 C. 
C. A. 653, 104 Fed. 486. 

Finally, the exact condition of facts existing hère arose and was de- 
termined under this statute in the case of Potter v. National Bank, 
102 U. S. 163, 26 L. Ed. 111. The case was appealed from the North- 
ern District of Illinois, in which state, as we bave heretofore noted, this 
kind of testimony by its Suprême Court was held, under state statute, 
incompétent. The action was one brought by the bank against Potter, 
exécuter of Ward. On the trial Sturgiss, not a party to the suit, but 
interested in the issues to be tried, was allowed to testify to a conversa- 
tion had by him with décèdent, against objection, and the Suprême 
Court affirmed the ruiing and held be was not disqualified, but compé- 
tent. It is therefore very clear that I must wholly disregard the ruiing 
of the Suprême Court of Appeals of this state to the contrary, and hold 
the évidence of thèse bank officers, directors, and stockholders to be 
perfectly compétent in this court. So holding, a careful analysis of 
the testimony bas led me to believe the facts hère to be substantially as 
follows : 

Décèdent Russell was, prior to the year 1892, up to the time of bis 
death in January, 1903, président of the Bank of Fluntington, and of the 
Huntington National Bank, its successor. He was the largest stock- 
holder, and actively in charge and control of its affaira. In 1892 the 
Huntington Distilling Company was organized as a corporation by 
Russell and four others, and in the course of its opérations became in- 
debted to the Bank of Huntington in varions sums now aggregating 
near, if not quite, $10,000. Tbe Bank of Huntington, a state institu- 
tion, was merged into the National Bank of Huntington, and this paper 
indebtedness was taken over by the latter. This merger was made 
in the fall of 1903, and some time prior thereto, likely in the early part 
of the same year, the Huntington Distilling Company, of which Rus- 
sell at the time was treasurer, by its président and secretary, executed 
a paper writing, not dated, in which it set forth its indebtedness to the 
Bank of Huntington in various sums of money, its désire to provide 
payment thereof, its ownership of about 7,600 gallons of brandy in 
bond at Huntington, in considération of ail which it thereby did "sell, 
transfer and deliver over to said bank ail the proceeds of saie' brandy 



HUNTINGTON NAT. BANK V. HTJNTINGTON DISTILLING CO. 245 

aforesaid, together with ail the book accounts of said Huntington Dis- 
tilling Company." And it was further provided that "said bank is to 
hâve said accounts collected, and apply the proceeds thereof to the pay- 
ment of its notes as aforesaid. And to sell said brandy and apply the pro- 
ceeds arising therefrom to the further payment of said indebtedness." 
There is no question of the exécution of this paper, and there can be 
no doubt of its delivery to Russell ; how it was found, and where, is not 
very material, for, certain it is, I think, that no stockholder, director. 
or ofïîcer of the bank other than Russell knew of its existence until 
after his death in 1903. I regard the explanation made that it was 
found in his private papers in his private box in the bank when appraise- 
ment of the estate was made as at least reasonable and probable, but of 
one thing there can be no doubt, to wit, that Russell concealed absolutely 
from his fellow directors and stockholders of the bank the existence of 
this paper, and the bank's rights and interests in this personal prop- 
erty under and by virtue of its terms and provisions. Nor can there be 
any doubt of the fact that Russell took charge of the brandy and of the 
accounts of the distilling company, disposing of the first and collecting 
the second. The proceeds were not, however, paid by him to the bank, 
but were deposited therein to the crédit of the distilling company, and 
withdrawn from time to time and paid out upon checks of the distilling 
company drawn to some extent by Worden, manager and in control, 
under Russell, of the property, and subject to his order, but mostly by 
Russell himself. Thèse facts, it seems to me, réfute the position so 
strenuously urged by counsel for the défendant that this paper was not 
delivered to Russell, and was not found as testified to by Oney, the 
cashier. If such paper was executed — and its mère exécution, as I 
hâve heretofore said, is not denied — it is both possible, but strongly to 
be presumed, that Russell would be consulted and be fully informed of 
it. There were but three persons substantially interested in the dis- 
tilling company, each having equal interest, each having subscribed 
$8,000 to the capital stock ; the other two clearly were but nominal 
shareholders, having but one share each, and doubtless holding thèse on- 
ly in order that the law requiring five shareholders as a prerequisite to 
incorporation and its maintenance might be complied with. Russell 
was one of the three, and he was at the time treasurer of the company. 
Its management was not naturally under his control, but under that of 
its président; but immediately after the exécution of this paper, Rus- 
sell, the treasurer of the distilling company and président of the bank 
to whom the property was sold and assigned, naturally took sole charge 
of it. The président of the distilling company bas testified : 

"At the time this statement was made from the boolis and accounts both 
were then in the possession of Mr. Russell, and I had no right under our 
agreement to collect any of thèse accounts, nor no one else had but Mr. 
Russell." 

The last of the brandy was disposed of by him in 1898. The other 
officers of the bank during thèse years, however, had not been unsolicit- 
ous about the bank debts owing by this company. The matter had 
been discussed in the directors' meetings. At the time of the merger 
of the old bank into the new one, Russell had assured them the notes 
of the distilling company were good, and upon, doubtless, this repre- 



246 152 FEDERAL REPORTER, 

sentatioli, they were taken over as such. When the Ceredo National 
Bank sued the company, thèse directors of the plaintiff put out their 
notes for suit, and a race was made by the two banks to secure priority 
of judgrnent, one by the regular action of debt, the other by statutory 
notice. The judgments of thèse banks were taken at the same term, 
the plaintiff's a couple of days before the others, but the one of the 
Ceredo bank was held to relate back to the first day of the term, while 
those of the plaintiff, taken by notice were held not to, so the Ceredo 
bank got priority in lien upon the real estate of the distilHng company, 
as fuUy shown by the opinion in the case by the Suprême Court of 
Appeals. First Nat. Bk. Ceredo v. Huntington Distilling Co., 41 W. 
Va. 530, 23 S. E. 792, 56 Am. St. Rep. 878. 

It further appears by the évidence in this case that a balance was 
realized from the sale of the company's real estate and was applied 
by the plaintiiï bank to its judgments. While ail this trouble, expense, 
and litigation was going on in the state court and the Suprême Court 
of Appeals, Russell remained silent and made no disclosure as to the 
assignment to the bank which he then held. Ail the satisfaction he gave 
his co-directors was the gênerai statement to the effect that the property 
of the company was being disposed of and its accounts collected for 
the purpose of liquidating the debts due the bank. Why did he take 
this course ? It seems to me that it is not necessary to harshly criticise 
his conduct under ail the facts in the case. While I am constrained to 
hold that as a question of law his silence, his concealment of this paper, 
and his misdirection of the funds operate as a fraud upon the bank, 
yet his conduct, considered in the light of common expérience, was not 
unnatural. The évidence discloses that he was a man of large means, 
with the very best réputation for honor and integrity; successful in 
business, and doubtless having the confidence of everylDody. He was 
the largest stockholder and at the head of the oldest bank in his city. 
In this condition of life, and with a spotless réputation to maintain, he 
became interested in this unfortunate distilling company. He knew 
his connection with it had given it crédit. He knew if it f ailed to pay 
its debts that, justly or unjustly, he must suffer in réputation and lose 
a measure of the public confidence which he then had. Thèse considéra- 
tion ^ weigh heavily upon the minds of honest business men. He may 
hâve thought that it was absolutely necessary in order to make the 
most out of the property to get it out of the hands of his associâtes 
into his own, and this assignment to his bank may hâve been procured 
by him for this purpose. At the same time he may hâve felt that if it 
was revealed that he, while one of the three substantial stockholders 
and the treasurer of the comp 'n', had procured this assignment of ail 
its property to the bank of which he was the largest stockholder and 
président, to the exclusion of other creditors, he must necessarily 
be charged with dishonesty and bad faith, and that litigation would 
doubtless ensue touching such assignment. Thèse, I say, are plausible 
explanations for his silence and his manifest détermination to take 
the whole matter into his own hands, work out the problem alone as 
best he could, and in the end personally protect his bank in any loss 
it might sustain. This, and this alone, it seems to me, can explain his 
remark to Enslow "that he supposed he was in such condition that he 



HUNTINGTON NAT. BANK V. HUSTINGTON DISTILLING CO. 247 

woiild eventually hâve to pây the same" (thèse debts). In other words, 
he had failed, as successful business men even do sometimes, to straight- 
en eut the affairs of the distilling company and make its assets cover 
its Habilities, and as he had concealed the existence of the transfer of 
the brandy and accounts to the l^ank, had allowed, and even directed, 
the proceeds derived by him therefrom to be appUed to the paynient of 
other debts and obhgations of the concern, he knew he was liable, and, 
Hke the inherently honest man that he was, he recognized his personal 
HabiHty. He doubtless would hâve adjusted this matter with the bank 
sometime, had he lived. Nor is the administratrix, now that he is 
dead, to be criticised for making the vigorous défense she bas to this 
action ; for the law requires her, as a fiduciary, to plead thèse défenses 
of lâches and Hmitation. 

However, in charitably consideriiig the conduct of Russell in this 
matter, we must not overlook the légal principles and déductions that 
mnst guide us in determining his liability for such conduct. Some of 
thèse déductions and principles may be thus stated: 

First. This assignment, if it had been a gênerai one on behalf of 
the distilling company to Russell to secure payment of its debts gener- 
ally, would bave justified his conduct in depositing the proceeds arising 
therefrom in his name as assignée of the distilling company, and, sub- 
ject to the well-known limitations in regard to priority and equality, 
in checking out and paying said proceeds upon the expenses and debts 
generally. Under such conditions his co-directors of the bank would 
hâve been entitled to the same disclosure of the nature and terms of the 
assignment, of the progress made in carrying out its terms, no less, 
no more, than any other of the creditors, and would bave had no other 
or différent right than any other créditer to call him to a légal account- 
ing for his acts. 

Second. If, however, this assignment was not made to Russell him- 
,self but directly to the bank, and by its terms sold, transferred, and 
delivered over to said bank this brandy and the proceeds of thèse ac- 
counts, as it appears to me it clearly does, there can be no question 
that it was the plain duty of Russell, the moment the paper came to his 
hands, to call together the board of the directors of the bank and submit 
it to their considération. This is true, I am confident, for several 
reasons : (a) Because it was their right to détermine whether such 
assignment should be accepted by the bank, and the obligation assumed 
of defending it against légal assaults that might be made upon its in- 
tegrity. (b) If accepted, it was their clear right to détermine what 
disposition should be made of the assigned property. It was their dis- 
tinct province to say what agent should be selected to sell and dispose 
of it for and on behalf of the bank, for I do not think it came within 
the gênerai duties of Russell as président of the bank to make such 
sale and disposition without being so authorized by the directorate, any 
more than it would bave been his gênerai duty as such président, with- 
out spécial authority, to hâve sold the real estate, fîxtures, or other 
property of the bank. 

Third. Having concealed the existence of this assignment from his 
co-directors, having without their authority taken possession of said 
property and disposed of it under such conditions and without such au- 



248 152 FEDERAL REPORTER. 

thority, he constitutecl himself a trustée de son tort for tlie banlc, and 
must hâve been held, and ]iis estate must now be held, to strict account 
for bis acts in such trust relation. 

Fourtb. Trusts of this character being- solely subjects of équitable 
jurisdiction under tbe common law, statutes of limitation were not ap- 
plicable. In modem practice, wbile courts of cquity will apply tbe stat- 
ute of limitation in administering trust estâtes, it will in doing so look 
to ail tbe facts and circumstances to asccrtain wbether équitable 
grounds exist against its strict enforcement, and, when such grounds 
do exist, will not hesitate to construe tbe case outside tbe bar, under 
tbe exceptions provided for by the statu te itself, and by tbe dictâtes of 
equity and good conscience. Weinrich v. Wolf, 24 W. Va. 303. 

Fiftb. Under section 18, c. 104, of the Code (section 3511) of 1906 
of West Virginia, express exception to the statute of limitations is 
made where the debtor absconds or conceals himself, "or by any other 
indirect ways or means, obstructs the prosecution of such right." And 
in the cases of Reynold's Adm'rs v. Gawthrop's Heirs, 37 W. Va. 3, 16 
S. E. 364, Vanbibber v. Beirne, 6 W. Va. 179, and Thompson v. Whit- 
taker, 41 W.. Va. 574, 23 S. E. 795, this section bas been construed. In 
the first case it is held, where a person by any indirect way or means 
osbtructs the prosecution of a right, the time during which such ob- 
struction-continues shall not be com.puted in the limitation periods. In 
the second case it is held, where it properly appears by tbe pleadings 
that the facts on which the cause of action was founded were exclusive- 
ly in tbe khowledge of défendant, that he fraudulently concealed the 
facts, and that by such ways and means he defeated and obstructed the 
plaintifï from bringing bis action within the time limited, the effect of 
the statute may be avoided in actions at law as well as in suits in equity. 
In the third case it is held : 

"Under this section it requires soine positive, afflrmiitivo act by défendant 
to operate under tlie clause, or by any otliei- indirect ways or means obstruct 
the prosecution of such right." 

Mère silence will not do, but there must be some act designed to con- 
ceal the existence of its liability and operate in some way upon the 
plaintiiï and prevent or delay suit for it. 

Sixth. The défense of lâches must necessarily be liberally upbeld and 
applied by courts of equity, because its basic principle is to prevent op- 
pression and injustice, so easy of perpétration wbere loss of written 
évidence, removal of witnesses, death of parties, and the numerous oth- 
er like causes incident to life may whoUy change conditions and render 
it impossible to know tbe right and truth of the matter. He who unrea- 
sonably delays bis action until thèse conditions arise must lose his cause. 
In determining wbether such delay is reasonable, tbe statute of limita- 
tions does not control, for a less period than tbe one provided by the 
statutory bar may, under given circumstances, be sufficient for this dé- 
fense. While thèse principles are true, equity will allow no man, by 
his own fraudulent acts, by concealing paper contract or évidence nec- 
essary upon which to base an action against himself, to take advantage 
of delay occasioned by such conduct on his part. He who appeals to 
equity must corne witb pure hcart and clean bands. It is true to-day, 



KANSAS CITY V. HEXNEGAN. 249 

as ft was when Lord Loughborough décidée! Eeaumont v. Bonîtbce, .") 
Ves. 485, that no possible case can rightly stand under tbe bénéficient 
admini.^iration of equity, wherein ''a confidential agent and steward can 
impute neglect to his employer; for it is his duty to rcnder an account 
and a fair account, to his principal and distinctly apprise him of the 
whole right he bas. It is not for him to say that a person bas been 
guilty of négligence wbose négligence it was his duty to guard against 
with regard to his transactions with ail persons, and particularly with 
himself." 

Briefly applying thèse principles touching thèse two défenses relied on 
in tbis case, the one lâches, the other of tbe bar of limitations, it is only 
necessary to say that it was Russell's clear duty as président of the 
bank, to see to it that the bank lost notb.ing by lâches or limitation in 
bringing an action. He knew when he did not turn over the proceeds 
of this brandy and of thèse accounts to the bank that it had a cause of 
action against himself therefor, and it was his duty to do one of three 
things, either settle his liability, resign his directorship and presidency 
of the bank, or bave himself at once sued by it. He did neither, but 
on the contrary he concealed the assignment. took possession of the 
property, and diverted to other uses its proceeds. The other bank offi- 
cers learned tbis only after his death in 4903 ; they allowed his admin- 
istratrix the year allowed by statute to settle the demand, and, when not 
settled, almost immediately brought this suit. Under such circumstan- 
ces neither the statute of limitations nor the défense of lâches can avail, 
but decedent's estate must be held liable for an accounting for the pro- 
ceeds of the brandy and the accounts coHected, less ail necessary expens- 
es incurred in the sale of the one and the collection of tbe other, and de- 
cree of référence to a master commissioner may be entered directing 
him to state this account. 



KANSAS CITY v. IIENNEGAN et <a). 

(Circuit Court, W. 1). Missouri, W. D. Mardi 11, 1907.) 

Ko. 3,14.j. 

1. Removal of Causes— CoNDE^rNATioN I'hoceedings. 

A proceediiig by a muiiiciyality to condeiim jirivate ]iroperty to its 
publie use partalies of tlie eliaraeter of a suit at law so far as to render 
it removable from tlie state to the proj)er fédéral court, where tlie condi- 
tions exlst authorizins a removal as prescribed by tlie removal acts. 

[Ed. Note. — I'roc(<ediiifrs under power of eminent domain as civil suits 
under laws relatifs to removal of causes to fédéral (rourts, sec note to 
South Dakota & C. Kv. Co. v. Chicago, M. & St. T. Ky. Co., 7o C. G. A. 
183.] 

2. SaJIE — SErAltABLE CONTROVERSY. 

Silice a proceedins to coiideiun land by l'Cansas City under its city char- 
ter as constrned by the Suprême Court of the state ])re>«<iits a case of an 
indivisible unit, to be tried to one and the saine jury, uiiless a jury trial 
is waived, and tlie wliole flnding as aî^aiust ail the défendants must be 
euiljraeed in one judginent, so that if reverscd on ap]ieal the entire case 
must be tried de novo, sucli a ijroceediiif; as at^ainst both résidents and 
nonresideuts did not iiresent a separable coutroversy as between the city 



250 152 FEDERAL REPORTEE. 

and the nonresi dents whose property was sought to be condemned, and 
was therefore not removable to the fédéral courts. 

[Ed. Note. — See separable controversy as ground for removal of cause 
to fédéral court, see notes to Robbins v. Elleubogeu, 18 0. C. A. 86; 
Mecke v. Valleytown Minerai Oo., 33 O. C. A. 105.] 

Condemnation. 

E. C. Meservey and W. A. Knotts, for plaintiff. 

A. S. Van Valkenburgh and Ritchie & Meyer, for défendants, 

PHILIPS, District Judge. Kansas City desiring to extend what is 
known as its gênerai "Market Square" for the purposes of a public 
market, its board of aldermen, by ordinance, approved by the mayor, 
in conformity with the provisions of its charter, designated a large 
quantity of land to be condemned for such use. This area embraces 
perhaps a block or more of ground, laid off into lots, with buildings 
thereon, owned in severalty by a large number of persons. The ordi- 
nance also, as in such case provided in the charter, designated what is 
known as a "benefit district," to be assessed, in connection with the 
city itself, to raise the necessary means for paying for the private prop- 
erty to be taken and appropriated for such use. This benefit district 
embraces, say, 8 or 10 blocks of ground. The property within this 
large benefit district, as is usual, is owned separately by a vast number 
of persons. After the preliminary inquest before the mayor, as pro- 
vided under the charter, an appeal was taken from the findings of the 
jury to the circuit court of Jackson county. A given portion of the 
real estate to be taken and appropriated by the city belonged to Richard 
H. Hennegan and Richard B. Plall — said Hennegan ownmg a life es- 
tate therein, and the said Hall the estate in remainder. Hennegan 
and Hall being nonresident citizens of the state, in due time and form 
filed their pétition in the state circuit court for removal of the case 
into this court, which was accordingly donc. Kansas City has filed a 
motion to remand this cause, on the ground that the removing défend- 
ants did not hâve such a separable controversy as to entitle them to 
remove the whole cause into this jurisdiction. This motion has been 
heard and submitted. 

The provisions of the charter of Kansas City in respect of condemna- 
tion proceedings are practically the same as stated in the Pacific Rail- 
road Removal Cases, reported in 115 U. S. 3, 20, 21, 33, 5 Sup. Ct. 
1113, 39 L,. Ed. 319. That a proceeding instituted by a corporation 
or municipality to condemn private property to its public use so far 
partakes of the character of a suit at law as to render it removable 
from the state court into the proper fédéral court, where the condi- 
tions exist authorizing a removal as prescribed by the removal act of 
Congress, is no longer an open question in this jurisdiction. Union 
Terminal Railway Company v. C, B. & Q. R. Co. (C. C.) 119 Fed. 
209 ; South Dakota Central Railway Company v. C, M. & St. P. Ry. 
Co., 141 Fed. 578, 73 C. C. A. 176; Traction Company v. Mining 
Company, 196 U. S. 240, 25 Sup. Ct. 251, 49 L. Ed. 462. 

Most of the questions raised and discussed by counsel for Kansas 
City on the motion to remand were considered and ruled upon in the 
Pacific Railroad Removal Cases, 115 U. S., 5 Sup. Ct., 29 L,. Ed., 



KANSAS CITY V. HENNEGAN. 251 

oupra. That was a condemnation proceeding instituted by Kansas 
City under the same charter, in effect, as that hère involved, to con- 
demn to the city's use lands for the opening of Twelfth street in said 
city, extending through a large quantity of land belonging to sep- 
arate owners. The décision in that case answers the suggestion of 
counsel for the city that the cases where it has been ruled that the non- 
resident citizen seeking the removal of the cause from the state to the 
fédéral court présent the instance where the petitioner for removal was 
the sole défendant, and that the right of such nonresident property 
owner to remove the cause should be limited accordingly. The record 
in said Pacific Railroad Removal Cases, on file in the office of the clerk 
of this court, which is before me, shows that it was a proceeding by 
the city to condemn property, to the use of said street, owned in sev- 
eralty by a great number of individuals and corporations, under an or- 
dinance establishing a large benefit district wherein a vast number of 
persons owned in severalty tracts of land to be assessed for benefits to 
pay the damages for property taken. The Union Pacific Railroad 
Company owned a certain tract of land, part of which was sought to 
be condemned and appropriated absolutely for this street, and a part 
was within the benefit district designated to be assessed by way of bene- 
fits. A large body of défendants were citizens of the state of Missouri ; 
yet the Union Pacific Railroad Company, as a nonresident corporation, 
was held to be entitled to remove the proceeding, on the ground that 
the controversy was wholly separable as between it and the city, 

The case of Hennegan and Hall, the removing défendants in the 
case at bar, is stronger in f avor of their right. The Union Pacific Rail- 
road Company, in the Removal Cases, was concerned not only as to 
that portion of its land sought to be appropriated by the city, but also 
as to the portion within the district to be assessed for benefits. In the 
latter respect it was more or less directly interested with ail the 
other similarly situated codefendants in the benefit district, whereas 
the whole property involved of Hennegan and Hall is sought to be 
taken. This being so, according to the opinion of Mr. Justice Bradley 
in said Removal Cases, the matter in which they are concerned is as 
to the amount of damages to be found in their favor, representing the 
value of their property, which, being separable from tlie other issues 
in the case, was therefore removable under the judiciary act. The 
défendants hère raise no question of jurisdiction as to the right of the 
city to condemn this property. Whether or not any other person's 
land is to be taken, and the value thereof, Mr. Justice Bradley said, 
did not concern the removing défendant, as by express provision of 
the charter "each pièce of property taken is valued by itself, 'without 
référence to the proposed improvement,' and the amount of benefit to 
each pièce of property benefited is ascertained separately without référ- 
ence to the other pièces benefited." And therefore he held that "this 
controversy involving thèse issues is a distinct controversy between 
the Company and the city. It may be settled in the same trial with 
the other appeals, and by a single jury; but the controversy is a dis- 
tinct and separate one, and is capable of being tried distinctly and 
separately from the others." 



252 152 FEDERAL KBPORTER. 

The doubt cast upon the decisiveness of that ruling in this caso 
arises on the following statement in the opinion of Mr. Justice Bradley : 

"AVe hâve not been furnislied by the counsel on either side with référence to 
any décisions of the îlissouri courts giving construction to this section. Wheth- 
er the direction that the cause sliall he tried de novo requires tliat ail the 
valuations and assessments are to he retried, or ouly those affecting tlie ap- 
pellants, is not expressly stated." 

That opinion was filed in May, 1885. At the October term, 1884, 
of the Suprême Court of Missouri, tlie case of State ex rel. Holden v. 
Gill, 84 Mo. 248, was heard. When the opinion was filed does not 
appear ; but f rom the condition of the docket of that court, known to 
the writer of this opinion then connected with the court, and the date 
of the publication of volume 84 of the Reports, it is altogether probable 
that this opinion had not been announced when Mr. Justice Bradley 
prepared the opinion in the Pacific Railroad Removal Cases. 

The construction of section 3 of said charter was directly involved 
in the case before the Suprême Court of Missouri. The substantive 
effect of that construction was that the condemnation proceeding against 
the varions défendants presented the case of an indivisible unit, to be 
tried to one and the same jury, unless trial by jury be waived, and the 
jury must pass upon and make awards as to the amount of damages 
for each and every separate pièce of land taken or damaged, and dé- 
termine the benefits to be assessed against each pièce of property within 
the benefit district. The whole finding must be embraced in one judg- 
ment. So much so is the judgment a unit, it was held not only that 
in the event of an appeal by a single défendant from the award in the 
mayor's court the whole case, including each separate pièce of property 
involved, must be gone over and tried de novo, but also that if any error 
be committed in the progress of the trial in the circuit court prejudi- 
cial to the interests of any one of the varions défendants suing ont a 
writ of error, for which the judgment should be reversed, the reversai 
opérâtes as a vacation of the entire judgment, necessitating, on remand, 
a trial de novo of the whole case from beginning to end, both as to the 
reascertainment of the amount of damages sustained by each owner 
whose property is taken or damaged, and the reascertainment and read- 
justment of the benefits to be assessed against each tract or parcel of 
land within the benefit district. 

The writ of error in that case was sued out by only a small per cent, 
of the défendants, who were interested only in the amount of benefits 
assessed against their property. The only error committed bj' the 
trial court was in an instruction given to the jury, authorizing them to 
predicate their judgment alone upon their personal view of the prop- 
erty, regardless of the other évidence in the case touching the same ; 
under which instruction the finding of the jury, both as to the value of 
the property taken and the amount of benefits assessed, might hâve been 
erroneonsly influenced. It must .be confessed that the broad terms of 
the opinion in that case could well operate as an oppressive injustice 
in tlie instance of a codefendant whose separate property is sought 
to be condemned. The oniy question involved betwecn him, the city, 
and others is the value of bis property sought to be taken or con- 
demned; that is to be tried out as a single issue between them. 111 = 



KANSAS CITY V. HENNEGAN. 253 

lawyer tries his case cleanly and faultlessly; the court commits no 
error în its rulings or instructions to the jury on the issues; he and 
the city acquiesce in the findings of the jury, neither asking for a re- 
view thereof; but as to some question or matter respecting the trial 
of another condemnee, or assessee for benefits, error is committed, 
and either the city or the party immediately concerned sues out a writ 
of error. For that error the cause is reversed. Why should there 
be a trial de novo of the issue between the city and the owner whose 
property has beeh correctly valued in the first trial, in which issue 
no error was committed ? He is not concerned in the valuation of any 
other defendant's property, or in the assessment to be made upon the 
property in the assessed district. The assessments upon the benefîted 
district are only a means by which the city raises the necessary money 
to pay for the property taken. Until the property owner is paid the 
value of his property so found, the city under its charter cannot take 
possession of the property. AU concerned bave had their day in court 
on the trial of this cause. What becomes of the maxim that no person 
shall be twice vexed in a suit concerning the .same cause? How 
inexpressibly hard and oppressive is it on him that he should be again 
burdened with the expenses of a rehearing by re-employing a lawyer, 
and attending perhaps with his witnesses through another tedious liear- 
ing, which, as the history of such inquest shows, niay drag its weary 
length through weeks and months ; and then again be exposed to a 
repetitious error of the court, to a reversai, and a trial de novo, ad in- 
finitum ! It would seem that, as to a défendant so situated, the court 
should give such a practical, sensible construction to the statute as to 
avoid such absurdity and gross injustice. The resuit of an error 
should never be visited upon the unoffending suitor. 

The évident thought in the mind of Mr. Justice Bradley, in his opin- 
ion in the Removal Cases, was that, after the amount of damages 
found to be paid, the assessment pro rata against the benefited prop- 
erty would be a mère matter of "mathematical calculation." With 
this view in his mind, he suggested that, where the single issue of value 
of property was involved between the separate owner and the city, 
if the State court "had equity powers it might direct a separate issue 
for the trial of this controversy by itself. It might try the other ap- 
peals without a jury (the parties waiving a jury), and try this contro- 
versy by a jury." It must now be conceded that in such condemnation 
proceeding neither the state court nor this court can exercise equity 
powers, and so divide the method of assessment under this charter, 
for the palpable reason that it is a suit at law, friable as an entirety, to 
one and the same jury, or to the court if ail the parties waive a jurv. 
And each party to be assessed for benefits is interested and concerned 
in seeing that as little damages as possible are assessed for the prop- 
erty to be taken ; for in the proportion of the diminution of the fund 
to be paid are the burdens of the subjects of assessment for benefits 
lessened. 

The ruling in State ex rel. Hoklen v. Gill has not been overruled bv 
the Suprême Court, as far as I am advised. The attention of the court 
has been directed by counsel for the removing défendants to the case of 
Kansas City v. Block, 175 Mo. -±33, 413, 74 S. W. 993, 996, wherein 



254 152 FEDERAL EEPORTER, 

Judge Fox was discussing the question raised by those défendants, 
who alone had sued out a writ of error to hâve reviewed the judgment 
of the circuit court in the condemnation proceeding instituted by Kansas 
City. They raised the question that some of the parties named in the 
proceeding had not been duly notified, and had not appeared in the 
case below. It was of this contention that Judge Fox said : 

"It is însisted that the judgment in this proceeding is erroneous because 
of the want of service of process upon some of the otlier parties in interest, 
and the insuffleiency of the notice by publication. It is suflicSent to say, as to 
this contention, that the parties who appellant claims are injured by this pro- 
ceeding are not before the court. We will heed their grievances when our 
attention is directed to them in an appropriate proceeding for that purpose. 
This judgment is not an entirety ; the interests of the parties are inde- 
peudent of each other; the property damaged or benefited Is not located at the 
same place." 

We may aptly apply to the foregoing language the sensible observa- 
tion of Chief Justice Marshall, in his final summing up in the trial 
of Aaron Burr: 

"Every opinion, to be correctly understood, ought to be considered with the 
View to the case in which it was delivered. * * * General expressions ought 
not to be considered as overruling settled principles, without a direct déclara- 
tion to that effect." 

As the parties not appealing in the case considered by Judge Fox 
were not complaining of the judgment against them for the lack of 
sufficient notice, the cause was not to be reversed by the appellants 
for any error which did not préjudice them. In that sensé the inter- 
ests of the parties concerned in the error being separate, Judge Fox 
said that the judgment was not an entirety. The ruling in the Holden- 
Gill Case was not involved, and evidently was not in the mind of the 
learned judge. Without any direct référence to the Holden-Gill Case, 
it would be strained for this court to infer that it was the mind of the 
Suprême Court to overturn the deliberate ruling in that case. 

In the récent case of Cincinnati, N. O. & T. P. Ry. Co. v. Bohon, 200 
U. S. 321, 26 Sup. Ct. 166, 50 L. Ed. 448, Mr. Justice Day, in dis- 
cussing the question of the removability of a suit against a nonresident 
railroad company where it was joined with its servant as a codefend- 
ant, under a statute of Kentucky which authorized such joint action, 
said : 

"A State has an unquestionable right by its Constitution and laws to regu- 
late actions for négligence, and where It has provided that the plaiutifC in 
such cases may proceed jolntly or severally against those llable for the in- 
jury, and the plaintiff in due course of law and in good faith has flled a péti- 
tion electing to sue for a joint recovery given by the laws of the state, we 
know of nothing in the fédéral removal statute which will couvert such action 
into a separable controversy for the purpose of removal because of the prés- 
ence of a nonresident défendant therein properly joined in the action under 
the Constitution and laws of the state wherein it is conducting its opérations 
and is duly served with process." 

In the case at bar, under the scheme of the charter of Kansas City, 
by législative grant the state has seen fit, according to the ruling of 
the Suprême Court of the state, to require in condemnation proceed- 
ings by the city that it shall in one suit join ail persons as défendants 



KIRKMAN V. M'CLATJGHET. 255 

whose property interests are to be affected thereby, whether as owners 
of parcels of land to be taken and appropriated to the use of the city, 
or as owners in the designated benefit district to be burdened with as- 
sessments to pay for the property so appropriated ; that the whole case 
shall be tried to one jury, unless waived ; and that there shaU be but 
one judgment. The Suprême Court of the state bas construed this 
charter to mean that ahhough the estâtes and interests of the différent 
défendants may be separate, yet the suit is an indivisible unit, with 
absohite interdependence between ail the défendants, incapable of sép- 
aration into parts so that one may be unaffected by the findings and 
judgment as it concerns another. The wisdom, justice, or sound policy 
of this législation this court cannot revise or correct, as it is within 
the competency of the Législature to direct how the soverc'gn power 
of eminent domain shall be exercised by the city, and the manner of 
procédure therein. If the method adopted be harsh and oppressive 
in the particular noted in this opinion, it is for the I^egislature to correct 
the abuse, or for the Suprême Court of the state to so tone down, by 
reasonable construction in a revised opinion when confronted with 
such question, the apparent ruling in the Holden-Gill Case, as not 
to produce the absurd and harsh resuit indicated. 

Since the décision of the Suprême Court was published in the Holden- 
Gill Case there bas been no attempted removal of such condemnation 
proceedings instituted under the charter of Kansas City by a single non- 
resident défendant, to my knowledge, save that of Kansas City v. C, 
M. & St. P. Ry. Co. et al, for the extension of Wyandotte street, in 
1894. There was a motion by the city to remand the cause. The 
record entry in that case is as follows : 

"Motion to Remand. This cause having been heretofore submitted to the 
court, and now the court being tnUy advised in the premises, doth order that 
the same be sustained, and that this cause be remanded to the circuit court 
of Jaelcson county." 

No opinion was filed by the court, and I am unable to recall whether 
or not it was a consent order or an expression of the opinion then 
entertained by the presiding judge. 

Yielding to what I conceive to be the effect of the construction 
placed on this charter by the state court, the motion to remand must 
be sustained. 



KIRKMAN V. McCLAUGHRT. 

(Circuit Court, D. Kansas, First Division. March 13, 1007.) 

No. 8,505. 

Chiminal Law— Sentence— Différent Offenses— Consécutive Opération. 

Where sentence is passed against an oiîender in tlie civil courts, pre- 
scribing ditïerent ternis of imprisonment ou the same day, the ternis will 
be construed to run concurrontly, unless the sentence expressly indicates 
an intention that they shall be served consecutively. 

[Ed. Note.— For cases in point, see Cent. Dig. vol. 15, Criminal Law, 
§ 3315.] 



256 152 B'BDERAL REPORTKU. 

2. Aemy and Navy— War Bkparimeni— Rulings^EfiiUct. 

Whlle tlie ruliiigs of tlie W:ir Deiiartmeut aud its practice, as enunciat- 
ed lu adjudicated cases emaiiating tliei'efroiii, is iiot bJnding on the féd- 
éral coïirts, such rulings will not be overtlirown, except for the inost co- 
gent reasous. 

3. Same— Army Regui-ations— Construction. 

Army Kegulatioris, par. 081, providhig tliat, wlien "soldiers" eltlier un- 
dergolng or awaitiug sentence commit offenses for wliicli tbey are tried 
and sentenced, tlie second sentence shall be O'xecuted on tbe expiration of 
the first, applies to offlcers as well as xorivate soldiers. 

4. SaJIE— SeSTJîNCE— DiFFEEEKT Ol'TENSES— SERVICE. 

l'etltioner was tried for a military offense, and sentenced May 23, 1905, 
to dismissal and confinement in tbe penitentiary for tvvo yoars. During 
tbe pendency of the proceedings, lie was placed on trial for a second of- 
fense, and oïl April 6, lOOû, was sentenced to be disnilssed froni tbe serv- 
ice and to be confined for a period of one year. P.otli proceedings were 
reviewed, and tlie sentence confirmed by the l'resident on Jul.y 15, 1905, 
and the place of confinement desiguated by executive order. Ilcld, that 
tlie sentences oporated consecntivoly, aud not concurrently, nnder Army 
Régulations, par. 981, providing that, wheii soldiers eitlier undergoing or 
avvaiting sentence commit offenses for wbich tbey are tried and sentenced, 
the second sentence shall be executed on the expiration of the first. 

Habeas Corpus. 

This is a pétition for a writ of habeas corpus flled by George W. Kirkmau, 
late captain Twenty-Fiftb United States Infanti'.y, against R. "W. MeClaughry, 
the warden of the United States penitentiary at Ft. Leavenworth, in wbich 
pénal Institution petitioner is conflned by autbority of sente—es imposed by 
gênerai courts-martial duly and regularly entered against hiiii and properl,y 
approved in compliance with the articles of war. The facts necessary to an 
uiiderstandiiig and décision of tbe précise question preseuted by the pétition 
for the writ and the return of the warden to the writ are thèse : 

In pnrsuance of spécial order No. 9, dated Headquarters Department of 
Missouri, January 9, 1903, petitioner was regularly tried by a gênerai court- 
martial, duly eonstituted and eonvened at Ft. Niobrara, Neb., ou spécifica- 
tions and charges of violation of the provisions of the sixty-first and sixty- 
second articles of war. The trial resulted in a conviction of petitioner, and 
sentence was imposed May 23, 1905, as follows: 

"And the court does therefore sentence him, Capt. George W. Kirkman, 
Twenty-Fiftli United States Infaiitr,y, to be dlsmissed froni the service of tbe 
United States and to be confined at hard labor in such penitentiary as the 
reviewing autbority may direct, for the period of two (2) years." 

Tbe record of the proceedings of the court having been transniitted and sub- 
initted to the Président for his approval before exécution, in pursuance of the 
lOGtb article of war, the sentence pronounced was duly approved by the Prési- 
dent, and the place of confinement under the sentence desiguated, in the fol- 
lowing language : 

"The White Honse, ,Iuue 15, 190.5. 

"Tbe sentence in the foregolng case of Captain Geo. W. Kiricman, 25th Régi- 
ment of Infantry, is approved and will be carried into exécution. 

"Théodore Roosevelt. 

"The United States penitentiary at Fort Ijeavenworth, Kansas, is desiguated 
as tbe place for his confinement." 

During the pendency of this proceeding against the petitioner, and its post- 
ponement aw-aiting the taking and arrivai of proofs from the Philippines, pe- 
titioner comniitted other and further offenses, and was again, in pursuance 
of S])ecial order No. 47, dated Headquarters Department of the Missouri, 
March 18, 1905, regularly placed u])on his second trial, and tried before a gên- 
erai court-martial, duly eonstituted and eonvened at Ft. Niobrara, Neb., on 
spécifications and charges of violation of the provisions of the sixty-first and 
sixty-second articles of war, and was, on the Oth day of April, 1905, eonvlcted 
and sentenced as foliows: 



KIRKMAN V. M'cLAUGHET. ii57 

"And the court does therefore sentence him, Oapt. Geo. AV. Kirkman, Twcn- 
ty-Fifth Infantry, to be dismissed fi'om the service of the United Sliites and 
to be confiued at hard labor at sueli place as the reviewing authority may 
direct for the period of oue (1) year." 

The record of this second proceeding against petitioner haviug been trans- 
mitted and submitted to the Président, in pursuance of the articles of war, the 
same was duly approved by him and the place of confinement dcsignated, in 
the following language: 

"The White House, .June 15, 190.1 

"The sentence in the foregoing case of Captain Geo. W. Kirkman, 25th 
Régiment of Infantr.y, is approved and will be carried Into exécution. 

"Théodore Roosevelt. 

"Captain Kirkman ceases to be an offlcer of the army from June 17, 1905. 
The United States penitentiary at Fort Leavenworth, Kansas, is designated as 
the place for bis confinement." 

As shown by the record, thèse trials were had beforc separate courts-martial 
for distinct offenses included therein in each case, being such civil statutory 
offenses as .lustifled the imposition of the sentence pronouneed against peti- 
tioner, under the ninety-seventh article of war. 

Under this state of facts, as shown by the pétition for the writ, and the re- 
turn made to the writ by the warlen of the penitentiary, i)etitioner demands 
his release from custody, in the following language, as copied from his péti- 
tion: 

"Your petitioner further shows to your honorable court that a sentence of a 
court-martial becomes valid only when sanctioned by the reviewing authority ; 
that the sentences of both the above-mentioned courts-martial were approved 
on the same day by the reviewing authority, namely, .Tune 15, 1905; that both 
sentences began to run on said day ; that on January 22, liXiT, allowing for 
good behavior, a time equal to the longest sentence had been served; that both 
sentences ran concurrently, and tlierefore on said 22d day of January, 1907, 
both sentences had been served and sufCered." 

Wherefore petitioner prayed the issuance of the writ and his discharge 
thereunder. 

Floyd E. Harper, for petitioner. 

H. J. Bone, U. S. Atty., J. R. Wish, Asst. U. S. Atty., and Wm. G. 
Doane, Judge Advocate, for respondent. 

POLLOCK, District Judge (after stating the facts). As the pétition 
for the writ was fîled in this court on February 8th of the présent 
year, and the writ issued on the 4th day of this présent month, and as 
the term of sentence as claimed by the petitioner began to run on the 
loth of June, 1905, it is quite clear the sentence of two years, imposed 
under the proceedings first instituted against him, had expired neither 
at the date of the filing of the pétition, nor at the date the writ was 
issued, nor even on this 7th day of March, 1907, when the case was sub- 
mitted for décision upon the pétition and the return to the writ, unless 
allowance of time for good behavior, as claimed by the petitioner, be 
made. But as the case has been submitted for décision on the return 
to the writ, the truth of which is admitted, on the theory that such 
return does not constitute a légal justification for the détention of the 
petitioner, admitted by the warden, and as no proofs hâve been ofifered 
in support of the claim made for good behavior in the pétition, and as 
the return does not admit allowance to the petitioner of time for good 
behavior, it may well be doubted whether in the présent state of the 
record the petitioner has shown himself entitled to his discharge, even 
though his contention that the sentences imposed run concurrently 
should be sustained. However, assuming for the purpose of this de- 
152 F.— 17 



258 152 FEDERAL REPORTER. 

cision petitioner is entitled to an allowance of tinie for good behavior, 
as claimed by him, is he then entitled to his discharge, under the facts 
above stated? 

Beyond doubt, it is the settled rule in the civil courts of this nation 
(as the term "civil" is used in contradistinction of "military" courts), 
when engaged in the exercise of their criminal jurisdiction, and aiso 
the settled rule in most, if not ail, of the states of this Union, by virtue 
of common-law principles, or in the exercise of express législative au- 
thority, when imposing sentence upon an oflfender convicted on two 
or more counts in a criminal pleading charging separate and distinct 
offenses, or in imposing sentence after conviction against an offender 
in two or more cases in which distinct crimes are charged, that the 
terms of imprisonment imposed may run consecutively or cumulatively, 
instead of concurrently ; that is, the second term to beg'n at the ex- 
piration of the first, etc. 1 Chitty on Criminal Law, 718 ; 13 Cyc. 
p. 962; Blitz v. United States, 153 U. vS. 308, 14 Sup. Ct. 924, 38 
L. Ed. 725 ; Howard v. United States, 75 Fed. 986, 21 C. C. A. 586, 
34 L. R. A. 509 ; In re Esmond (D. C.) 42 Fed. 827 ; Kite v. Common- 
wealth. 11 Metc. (Mass.) 581; Mims v. State, 26 Minn. 498, 5 N. W. 
374; State v. Carlyle, 33 Kan. 716, 7 Pac. 623. However,_conceding 
the power of the court in such case to impose sentence against an of- 
fender prescribing différent terms of imprisonment to run consecutively, 
as a settled rule the sentence pronounced must clearly and definitely 
express the purpose and intent that the terms are to be served consecu- 
tively, or it will be held the terms run concurrently, and not cumula- 
tively. U. S. V. Patterson (C. C.) 29 Fed. 776; Ex parte Gafford, 
25 Nev. 101, 57 Pac. 484, 83 Am. St. Rep. 568 ; Ex parte Hunt, 28 
Tex. App. 361, 13 S. W. 145 ; Wallace v. State, 41 Fia. 547, 26 South. 
713 ; Larney v. Cleveland, 34 Ohio St. 599 ; In re Strickler, 51 Kan. 
700, 33 Pac. 620. 

In harraony with thèse principles, had the sentence of imprisonment 
imposed by the gênerai courts-martial against petitioner béen imposed 
by a civil court of the country for the infraction of a criminal statute 
of the land, they would of necessity hâve run concurrently, and not 
consecutively, and petitioner would in such case be entitled to his 
discharge as demanded by him, for the language employed évidences 
no intent to impose accumulative terms of imprisonment, and, although 
rendered by separate courts and on différent days, yet from the nature 
of the punishment imposed they could not become operative or be exe- 
cuted until approved by the Président and the place of imprisonment 
had been by him designated, in accordance with the 106th article of 
war. The question hère raised for décision, however, is not the rule 
applied to sentences imposed by civil courts of this country, but the 
applicability or inapplicability of that rule to sentences imposed by the 
military courts of the country. 

Are the rules of law applied to the judgments of such courts by 
reason of the law of their création, the practice, and proceedings therein 
obtaining, or in the very nature of things, such as to preclude the 
giving of the same effect to their sentences imposed as would be given 
to judgments of conviction imposed by civil tribunals in the exercise 
of their criminal jurisdiction? 



259 

The constitutional power, authority, and Jurisdiction of courts-martial 
is found in article 1, § 8, of the Constitution, which confers the power on 
Congress to "raise and support armies," to make rules for the govern- 
ment and régulation of land and naval forces, "to make ail l?i;.'s that 
shall be necessary and proper for carrying into exécution the foregoing 
powers and ail other powers vested by this Constitution in the govern- 
ment of the United States, or in any department or officer thereof." 
By Rev. St. § 1342 [U. S. Comp. St. 1901, p. 944], Congress enacted 
what is known as the "Articles of War" now in force for the govern- 
ment of the armies, and has, from time to time since the passage of the 
act, amended thèse articles of war and changed the procédure before 
courts-martial. The law administered by courts-martial consists of 
thèse articles of war and the régulations and instructions sanctioned by 
the Président, as commander in chief of the army, for the government 
of the army under the Constitution. Cyc. vol. 3, p. 844 ; United States 
V. Freeman, 3 How. 556, 11 L. Ed. 724; Gratiot v. United States, 4 
How. 80, 11 L. Ed. 884 ; Ex parte Reed, 100 U. S. 13, 25 L. Ed. 538. 
Courts-martial possess the same full, complète, and plenary jurisdiction 
over offenses committed against military law as hâve civil courts of 
the country over controversies within their cognizance, and while act- 
ing within the sphère of such exclusive jurisdiction they are suprême. 
Carter v. Roberts, 177 U. S. 496, 20 Sup. Ct. 713, 44 L. Ed. 861 ; In 
re Grimley, Petitioner, 137 U. S. 147, 11 Sup. Ct. 54, 34 L. Ed. 636; 
Smith V. Whitney, 116 U. S. 167, 6 Sup. Ct. 570, 29 L. Ed. 601 ; 
Kurtz V. Moffitt, 115 U. S. 487, 6 Sup. Ct. 148, 29 L. Ed. 458. 

As no controversy is raised in this case as to the jurisdiction of the 
court over the person and offense charged, and as the power and juris- 
diction to impose the separate punishments assessed against petitioner 
is unquestioned, and the law therein administered being ascertained, 
we come now to the question involved in this case, namely, the power 
to hold petitioner in imprisonment until the termination of both terms, 
notwithstanding the sentences imposed went into exécution on the same 
day, are not in terms made to relate to each other, and are not in ex- 
press words made to run consecutively. In considering this question, 
it may be observed, by the very contract of enlistment, a soldier in the 
service of his country waives many of his civil rights, and engages to 
be bound to implicit obédience of the orders of his superiors and to the 
rules and régulations of the service ; to waive many of his constitutional 
rights obtaining in civil courts of justice when arraigned as a défend- 
ant for trial before a court-martial. As said by Mr. Justice Brown, 
when on the district bench, in United States v. Clark (C. C.) 31 Fed. 
710: 

"It would be extremely unwise for the civil courts to lay down gênerai priu- 
ciples of law which would tend to Impair that of the military arm, or whicli 
would seeœ to justify or commend conduct prejudicial to good order and mili- 
tary discipline. An army is a necessity — perhaps I ought to say an unfor- 
tunate necessity — under every System of government, aud no civilized state in 
modem times has been able to dispense with one. To insure effloieney, an 
army must be, to a certain extent, a despotism. Each oflicer; from the gên- 
erai to the corporal, is invested with an arbitrarj' power over those beneath 
liiiu, and the soldier who enlists in the army waives, in some particulars, his 
rights as a civilian, surrenders his personal liberty duriug the terms of his en- 



260 152 FEDERAL REPORTER. 

listment, and consents to corne and go at the will of bis superior ofBcers. He 
agrées to become auienable to the niilitai'y courts, to be disciplined for offenses 
unknown to the civil law, to relinquisli his riglit of trial by jury, and to re- 
ceive punisbments which, to the civllian, seem out of ail proportion to the mag- 
nitude of the offense." 

In so far as I hâve been able to détermine, the question hère présent- 
ée! is not ruled by any adjudicated case, and its solution in reason must 
dépend upon the law administered by courts-martial and the rules and 
précédents which govern and control in that department of the govern- 
ment. While it may be true the construction placed upon the articles 
of war and the rules and régulations for the government of the army 
promulgated by the executive through the Secretary of War by the 
commanding officer of a military department, though approved by the 
Secretary of War, are not binding upon the judicial department, yet 
they are entitled to great weight. It is not for the judicial department 
of the government to in any wise control or direct proceedings in the 
military courts of the country by such forms of procédure or methods of 
practice as they might approve. The same efïect must be given to 
the judgments and sentences of courts-martial imposed by them against 
offenders in the exercise of their exclusive military jurisdiction under 
the Constitution, as would be given by such courts if "the question arose 
in a matter over which such courts had cognizance, unless it may be 
said upon the record presented such judgment is void for want of juris- 
diction, or because it was rendered under a law clearly unconstitutional, 
or for some other cause. 

Coming, then, to a considération of the précise question hère in- 
volved, the légal effect of the sentences imposed upon petitioner as a 
.justification to the warden for his admitted détention of petitioner, it 
is clear to my mind such légal intent must be founded in the law admin- 
istered by courts-martial imposing the sentence against petitioner, as 
construed by those ofhcers of the War Department of the government 
learned in military law and its practice as enunciated in the adjudicated 
cases emanating from that department, for, as has been said, while such 
rulings may not be binding upon this court, yet they are entitled to great 
weight and considération; and should not be overthrown, except for the 
most cogent reasons and upon undoubted grounds. As said by the Su- 
prême Court in United States v. Healey, 160 U. S. 136, 16 Sup. Ct. 
3é7, 40 h. Ed. 369 : 

"When the practice in a department in interproting a statute is uniforin, 
and the meaning of tlie statute, upon examination, is found to be doubtful or 
obscure, this court will accei>t the interprétation by the department as the true 
oue." 

As said bv that court in Railroad v. Whitney, 132 U. S. 366, 10 
Sup. Ct. 115 (33 L. Ed. 363): 

"It is true that the décisions of the Land Department on matters of law are 
not binding upon this court, in any sensé. But on questions similar to tlie 
one iuvolved in this case they are entitled to great respect at the hands of any 
court." 

And, again, as said by that court in United States v. Moore, 95 U. 
S. 760,24 E. Ed. 588: 



KIKKMAN V. m'CLAUGHRT. 261 

"The construction given to a statute by those cliarged witli the diity of ex- 
ecuting it is always entitled to the most respectful considération, and ought 
not to be overruled witbout cogent reasons. * * * The oflicers concern- 
ed are usually able men, and masters ot the subject. Not uufrequently they 
are the draftsmen of the laws they are aftervvard called upon to interpret." 

What, therefore, are the régulations sanctioned and promulgated by 
the Président for the government of the army which are administered 
as the law by courts-martial, and what are the rulings applicable to the 
sentences pronounced by such courts against offenders, as construed 
by men learned in military law charged with its enforcement, as ap- 
plied to this particulaf case ? The language of the return made by the 
warden, in response to the writ issued in this case, reads : 

"That during arrest pending trial on charges above mentioned he, said 
Kirl^man, upon further offenses charged as coniniitted by hiin during said ar- 
rest was again duly arraigned before a gênerai court-martial convened by 
spécial orders No. 47." 

Paragraph 981 of the army régulations provide: 

"When soldiers either undergoijig or awalting sentence commît offenses for 
which they are tried and sentenced the second sentence shall be executed upon 
the expiration of the flrst." 

This régulation, as lias been seen, is embodied in and f orms a part 
of the law administered by courts-martial. Under the language of the 
return which is admitted by petitioner to be true, this régulation is 
directly applicable to and décisive of the question involved, had peti- 
tioner been a private soldier instead of an officer of the rank of cap- 
tain; the insistence of petitioner being this régulation does not control 
hère for that reason. Whatever may be the distinction in the service 
as the term "soldier" and "officer" are uscd in common parlance, I am 
inclined to the opinion the word "soldier," as employed in this régula- 
tion, is used in its gênerai signification, and is applicable to petitioner. 
The régulation above quoted would seem from the authorities on 
the subject to be the outgrowth of a gênerai rule of procédure obtain- 
ing in military law long prior to its announcement; that is to say, 
the régulation seems to bave sprung from the law, and not the law from 
the régulation. 

- Winthrop, in his work on Military I^aw and Précédents (volume 1, 
p. 651), says: 

"As bas already been indicatcd in this chapter. a sentence of imprisonment 
duly adjudged a military person, who is at the lime undergoing a sentence of 
the same character (or who bas received such a sentence which, however, bas 
not yet been approved or comnienced to be enforced, but is duly approved 
presently), is cumulative upon the itire sentence and to he executed accord- 
ingly, i. e., its exécution is to follow iinmediately, and to proceed in due course 
tilï Itself completed. This principle is now Incoriiornted in paragraph ini';), 
A. R. wbere it is declared, in gênerai ternis, when soldiers, either undergoing 
or awaiting sentences, commit offenses for which they are tried and sen- 
tenced, the second sentence will be executed upon the expiration of the flrst." 

Mr. Davis, in his work on Military Law (page 161), says: 

"Where. while an oHieer or soldier is undergoing a certain sentence, he is 
jigain brought to trial for a military offense, and a further sentence is ad- 
.iudged hini, imposing a punishment of the same species as that which is being 
c.vecuted, it is the gênerai rule of the service that the second sentence is to be 



262 152 FEDERAL REPOETEB. 

regarded as cumulative upon the flrst, and that its exécution is to commença 
when exécution of tlie first Is eompleted. ïlals, whether or not tlie court in 
the second sentence may hâve In terms specifled that the second punishment 
should be additional to the first ; such second punishment being made cumu- 
lative by opération of lavi^ Irrespective of any direction in the sentence." 

In the year 1873, shortly after the adoption of the présent articles 
of war by Congress, Judge Advocate General Holt submitted for the 
considération of the Secretary of War the following opinion as to the 
method of procédure in the exécution of separate sentences of imprison- 
ment imposed by courts-martial, and the same was approved by the 
Secretary : 

"This man, on his plea of guilty, was convicted of theft, and sentenced witR 
dishonorable discharge, and loss of ail pay and allowances, to be confined at 
hard labor for six months — which expired on the 29th of May last. While 
held in confinement on this charge, but before his trial, to wit, on the 7th day 
of October, 1872, he deserted, and for this offense vras subsequentiy tried and 
sentenced with dishonorable discharge and loss of ail pay and allowances, to 
be confined in some military prison for the period of three years. The orders 
promulgating the proc«edings of the court in botli cases bear the same date,. 
November 29, 1873. Under thèse circumstances, the prisouer inquired whether 
he can be legaily held under the second sentence after having been dishonor- 
ably diacharged under the first. As the law takes no notice of the fractions 
of a day, both thèse sentences must be held to hâve gone into opération at 
the same moment, and the dishonorable discharge under them leave the pris- 
ouer, in character oif convict, to serve out the longer sentence, after his con- 
finement under the flrst has terminated. The continuance of his confinement 
under the second sentence is therefore regarded as strictly légal." Record 
Book No. 34, pp. 479-480. 

In 1895 Judge Advocate General Leiber rendered the following opin- 
ion on the same subject : 

"The warden of the Minnesota state prison asks, with référence to the case 
of a prisoner 'receiving sentences, one for four years, the other for one year, 
on the same day,' and the term of service of each sentence commences, 'Are 
tliey concurrent?' The inquiry relates to the sentences of Charles Douglasis, 
proïnulgated in spécial orders No. 120, 1894. Department of Dakota. This 
man was tried August 15, 1894, and sentenced to four years' confinement, and 
while awaiting sentence was on August 20th tried for another offense and 
sentenced to one year's confinement. Paragraph 1029 of the Army Régulations 
is as foIIowB : 'When soldiers, either undergoing or awaiting sentence, com- 
mit offenses for which they are tried and sentenced, the second sentence will 
be executed upon the expiration of the first.' Now paragraph 981 Anuy Régu- 
lations. Under this régulation, as well as the established practice of the serv- 
ice, the sentence of confinement for one year in this case takes efCect upon 
the expiration of the four years' term. The sentences are cumulative and 
not concurrent" Record Card, 1609. 

The above rulings formulate and contain what has been the settled 
practice of the War Department of our government on the subject now 
under investigation for more than one-third of a century, and thèse 
rulings are known and understood of ail men learned in military afïairs. 
Such being the settled and well-known practice of the War Depart- 
ment, and as petitioner is now held in confinement in conformity to 
such established practice in exécution of the judgments imposed by 
courts-martial, while such practice is not in harmony with that which 
obtains in civil courts of this country, yet I am fully convinced, from 
the fact he became an officer of the army engaged in the service of his 



BLAKE V. SAEGENT. 2G3 

country, he is not entitled to insist on the rules of law applicable to 
sentences imposed by the civil courts of his country, in the exercise 
of their criminal jurisdiction, being now employed to effectuate his 
release from confinement legally imposed under the known and well- 
established practice and procédure foUowed by military courts in the 
exercise of their exclusive jurisdiction, and in conformity with the 
articles of war and régulations promulgated by the Président for the 
government of the service to which he was subject when he committed 
the offenses charged, and to the authority of which he must bow. 

It follows the return made by the warden must be held to be a com- 
plète justification for the restraint of petitioner, and the pétition be dis- 
missed. 

It is 30 ordered. 



BLAKE V. SARGENT. 

(District Court, D. Missouri, S. D. Mareh 14, 1907.) 

No. 62. 

PAKTNERSHIP— FiBM AND INDIVIDUAL CBEDITORS— PaTMENT FEOM PIBM ASSETS. 

Wlxen a firm and the members tliereof were insolvent one of them made 
a sale of tiis interest to the other for a nominal sura and the assumption 
by the purchaser of the firm debts. Thereupon the purehaser used funds 
so received to pay an individual creditor. Held that, the sale not being 
in good faith, the funds so paid could be recovered for the firm creditors. 

In Equity. 

Karnes, New & Krauthoff, for complainant. 

A. E. Spencer and Willard P. Hall, for défendant. 

PHILIPS, District Judge. In the early part of 1903 Samuel W. 
King and James E. Maxwell formed a partnership under the firm name 
of King & Maxwell Paint & Glass Company, and thereafter conducted 
such business at Kansas City, Mo., until June 11, 15)04, at which time 
the concern was insolvent, owing debts to the amount of about $39,000. 
In Maxwell's testimony, on examination before the référée in bank- 
ruptcy, he said that the total amount of his assets was $13,000. He 
afterwards scheduled them at about $18,000. About the 80th day of 
June, 1904, on pétition of creditors of the concern, a receiver was ap- 
pointed to take charge of the assets in a proceeding instituted in the 
State circuit court. On the 23d day of June, 1904, a pétition in involun- 
tary bankruptcy was filed against them as partners and individuals in 
the United States District Court for the Western Division of the West- 
ern District of Missouri, on which they were, on the Ist day of August, 
1904, adjudged bankrupts as partners and as individuals. Later, suit 
was brought against the défendant, Laura A. Sargent, in the United 
States District Court for the Southwestern Division, Judicial District 
of Missouri, by Daniel F. Blake, as trustée in bankruptcy of the estate, 
to recover from her the sum of $3,738, alleged to hâve been received 
by her as an individual creditor of said Maxwell, which he paid her 
out of the funds of the partnership estate without the knowledge of 



264 152 FEDERAL REPORTEE. 

the other partner, Samuel W. King. Evidence has been taken on the 
issues joined, and the cause has been argued and submitted to the court. 

.The lavv is well settled that one partner cannot appropriate partner- 
ship property to the payment of his individual ùebts without the direct 
consent of the other partner. Thiâ, for the reason that as between the 
partners the equity of the relation demands that the partnership assets 
shall- be first applied to the payment of partnership liabilities, and the 
interest of a partner in the partnership estate only attaches after dis- 
solution of the partnership in the residuum after the payment and 
satisfaction of partnership liabilities. One partner, therefore, has no 
authority, sua sponte, to dispose of partnership property for his in- 
dividual benefit by way of paving his individual debts. Hilliker v. 
Francisco, 65 Mo. 598;' Flanagan v. Alexander, 50 Mo. 50, 51; Cald- 
well V. Scott, 54 N. H. 414. Equally well settled is it that one partner 
cannot appropriate such property "without the consent of his copartner 
to the payment of his individual debts, either with or without the 
knowledge of the creditor that such property belonged to the partner- 
ship." Rogers v. Batchelor, 12 Pet. 221, 9 h. Ed. 1063; Caldwell 
V. Scott, supra; Ackley v. Staehlin, 56 Mo. 558, 561; Price v. Plunt, 
59 Mo. 258, 263. 

Thèse gênerai rules are not controverted by the learned counsel for 
the défendant, but their contention is that at the time of the payments 
made by Maxwell to Mrs. Sargent, who is his mother, the copartner- 
ship of King & Maxwell had been dissolved by mutual consent, and the 
entire interest of the partnership property of King had been trans- 
ferred to Maxwell, whereby the latter became the sole owner of the 
partnership estate, and had the right to transfer the same to Mrs. Sar- 
gent in payment of his individual debt. The proof shows that on the 
llth day of June, 1904, said King did, in form, make a bill of sale to 
ail his interest in the partnership property to said Maxwell in considéra- 
tion of $834.34, claimed to bave been paid to him by said Maxwell 
with the understanding and agreement that said Maxwell assumed the 
payment of ail outstanding debts and obligations of said partnership, 
and that he (Maxwell) should hâve the right to continue and operate 
said business under said firm name for one year thereafter. No public 
notice was given of this arrangement, and the business thereafter con- 
tinued in the name of King & Maxwell Paint & Glass Company until 
the time of the appointment of a receiver as aforesaid by the state 
court. After that, on the 21st day of June, 1904, the attorney of said 
Maxwell, of his own motion, put said contract of sale to record. On 
the day of the exécution of said contract of sale said Maxwell drew a 
check in the name of the firm in favor of the partnership on the First 
National Bank of Kansas City for the sum of $2,500, out of a fund 
theretofore deposited to the crédit of the partnership in said bank, and 
sent the same to his mother, the défendant, Mrs. Sargent, as a part 
payment on a note for $3,500 then held by her against said Maxwell; 
and on the 14th day of June thereafter said Maxwell drew another 
check in the same way on said bank in favor of said concern for the sum 
of $1,231.90, and transmitted the same to his mother, the défendant, in 
satisfaction of said note. 



BLAKE V. SAHGEST. 265 

The proposition of law asserted by defendant's counsel in the ab- 
stract is correct. But the effects of a partnership are vested, in solido, 
in the partnership, and not in the constituent members in severalty. 
The partnership property is primarily hable for the payment of part- 
nership debts. While this preferential right of such creditors is recog- 
nized in the marslialing and distribution of the assets among the cred- 
itors it does not constitute a lien in law upon the assets ; but it exists 
in equity, inter se the partners, which a court of equity works out 
through the partners in favor of the Society creditors. Level v. Far- 
ris, 24 Mo. App. 4G1, approved in Hundley v. Farris, 103 Mo. 7d, 8G, 
15 S. W. 313, 12 L. R. A. 254, 23 Am. St. Rep. 863. 

Se where the partnership ends by the retirement of a member and 
the transfer of his interest in the partnership property to the other 
partner, the latter becomes entitled, in his own right, to the entire es- 
tate, and may apply the sanie to the payment of his individual debts, to 
the exclusion of partnership creditors who hâve not theretofore fast- 
ened, by appropriate proceeding, their équitable preferential rights 
upon the property. Case v. Beauregard, 99 U. S. 100, 25 L. Ed. 370 ; 
Huiskamp v. MoUne Wagon Company, 131 U. S. 310, 7 Sup. Ct. 899, 
30 L. Ed. 971 ; Seger v. Thomas Bros., 107 Mo. 635, 18 S W. 33 ; 
Reyburn v. Mitchell, 106 Mo. 365, 16 S. W. 592, 27 Am. St. Rep. 350. 

It is to be observed and kept in mind, however, in applying this 
gênerai doctrine, that the text-writers and courts predicate it upon the 
condition that the dissolution and transfer between the partners must 
be bona fide as respects the partnership creditors whose preferential 
right is thus sought to be displaced and lost. Story on Partnership, 
§ 361, says : 

"The Joint creditors of the partnership, while ail the partners are living 
and solvent, can enforce no claim against the joint effects or the separate ef- 
fects of the partners, exeept by a common action at law. It is only in cases 
where there is a dissolution by tlie death or bankruptcy of one partner that 
the right of the joint creditors can attaeh, as a quasi lien upon the partner- 
ship effects, as a derivative, subordinate right, under and through the lien 
and equity of the partners." 

Se in Huiskamp v. Moline Wagon Company, supra, the court said : 

"It was only necessary thrt the disposition of tbe property should hâve been 
bona fide on the part of both parties, and without any intent to hinder or 
delay the plaintiiï." 

This exception is thus stated in Am. & Eng. Enc. Eaw, vol 14 p 
238 (2d Ed.) : • . i^- 

"The only limitation upon the partners' right to so deal with the property 
is that the right should be exercised bona fide and without any intent to de- 
fraud the creditors of the flrm, or to deprive them of their légal or équitable 
elaims upon the joint estate in case of insolvency. 

"If one partner transfers his interest in the joint property to a copartner 
with intent tp deprive the firm creditors of its proper application to the pay- 
ment of the joint debts, such a conveyance is fraudnlent and will not defeat 
the right of the joint creditors to follow the partnership effects and hâve them 
appropriated to the payment of the debts of the fîrm. 

"If the firm and ail its members are insolvent, and the insolvency is patent 
to ail the members, a fraudulent intent will generally be presumed as a 
matter of law. 



266 152 PBDEEAL EEPOETER. 

"But if the firni Is solvent, the conveyance is not per se Invalid, and can 
only be avoided by pi-oof of tlie actual fraudulent design." 

în Arnold v. Hagerman, 45 N. J. Eq. 186, 198, 199, 17 Atl. 93, 96, 
14 Am. St. Uep. 712, Dixon, J., pertinently observed : 

"The case would hâve been entirely différent if copartners who were In- 
solvent and unable to pay the debts of the firm, either ont of their copartner- 
ship effects or of their individuai property, had made an assignment of the 
property of both to pay the individuai debts of one of the copartners only. 
For an insolvent copartner who was unable to pay the debts which the firm 
owed would be guilty of a fraud upon the joint creditors if he authorized his 
share of the property of the tinn to be applied to the payaient of a debt for 
which neither he nor his property was liable, at law or in equity. So in 
Vandoren v. Stickle, 24 N. J. Eq. 331, it was deelared that a voluntary trans- 
fer by a firm of notes owned by the partnershlp to the wife of one of tho 
I)artners was fraudulent as to partnership creditors, and the notes in the 
hancis of the wife were decreed to be partnership assets. * * ♦ Part- 
nership creditors, in equity, hâve an inhérent prlority of claim upon partner- 
ship property over individuai creditors, and a transfer of partnersliip property 
by one partner, with the consent of the other partners, or of ail the partners, 
to pay individuai debts, is fraudulent and void as to firm creditors, unless 
the firm was then solvent and had sufiScient property remaining to pay the 
partnership debts." 

Further on, quite pertinently to the case at bar, the court said: 

"The considération nominally given by Farr to Hagerman and Fielder 
was the surrender of their notes, and his covenant to indemnify them against 
firm creditora * * « Farr's covenant to indemnify does not constitute a 
valuable considération, since he may be relieved therefrom on the total 
failure of the transfer for which it was made." 

See, also, Howe v. Lawrence, 9 Cush. 55,3, 57 Am. Dec. 68. 
In Flack v. Charron, 29 Md. 311, it is said that: 

"While tlie joint creditors hâve no rtght to impoach or call into question the 
bona Me sales or transfers of the partnership property, it bas been uniform- 
ly held tliat it was necessary to the validity of such sales or transfers, as 
against tiie creditors, tliat they should be fair and bona fide; and, where they 
hâve been found otherwise, they hâve been deelared inoperative as against 
creditors." 

Judge Thompson, in Re Estate of Edwards & Wigginton, 47 Mo. 
App. 312, said : 

"It is well settled that partners, cannotdefeat the opération of this salutary 
nile by making, while insolvent or in the preiiaration of insolvency, convey- 
ances of their firm assets to secnre individuai creditors, although both the 
partnei-s may coucur in so doing." 

In Earle v. Art Library Pub. Co. (C. C.) 95 Fed. 544, the syllabus is : 

"After a firm is actually insolvent, a partner cannot, by a transfer of his 
interest to his copartner, constitute the assets of the firm the individuai prop- 
erty of the latter as against the partnership creditors." 

The rule in this respect is appositelv stated in Darby & Co. v. Gilli- 
gan, 33 W. Va. 246, 249, 10 S. E. 400', 401, 6 L. R. A. 740, as follows : 

"If the firm is insolvent, or on the eve of insolvency, and both of the 
partners are insolvent, a purchase by one partner of the interest of the other 
in considération of the former's assumption of ail the debts of the firm, will 
be regarded as a purchase upon a considération which is of no value whatever, 
and, no équivalent having been given, the transfer is in effiect voluntary, and 



BLAKE V. 8ARGEXT. 267 

its only efïect, If sustaiued, would be to IiinLlcr partnersUip cveditors, and 
hence is deemed ineffectuai to convert tbe joint property into separate prop- 
erty as against the firm creditors." 

See, also, Till's Case, 3 Neb. 261 ; Roop v. Herron, 15 Neb. 73, 78, 
80, 81, 17 N. W. 353. 

The mère dissolution of an insolvent partnership does net impair 
the right of the partnership creditors to hâve the assets accumulated 
by the society appUed to tlie joint debts. Tenney v . Johnson, 43 N. H, 
144; McDonald & Co. v. Cash & Hainds, 45 Mo. App. 77, 78. 

Applying thèse salutary rules to the case under considération, what 
do we find? On June 11, 1904, when the claimed retirement of King 
from the partnership occurred, the concern was hopelessly insolvent. 
The contribution made by each of thèse partners to the business was 
only $2,500. The évidence shows that both partners had drawn out 
of the funds of the estate more than they had put in. They owed debts 
to the amount of $29,000, and accordine^ to the resuit of the examina- 
tion of their books by the expert, Mr. Peak, their assets were short 
over $10,000. Their business was falling behind, and each of them 
knew this fact. Their books and the assets on hand showed this. It 
excites impatience in the honest and impartial mind for either of them 
to prétend that they did not know the business of the concern was on 
its last legs and that bankruptcy was staring them in the face. Mère 
words are of little significance when the obvious truth contradicts 
them. After withdrawing from the concern more than they had put 
into it, with $29,000 of outstanding indebtedness, with known inability 
to meet it, King is permitted to thrust his hand into the community 
bag and take out $234, pocket it and walk away, leaving Maxwell to 
hold what was left in the bag, with apparent authority to apply it to 
his individual debts, which he proceeded forthwith to do by turning 
over $3,731.90 of the moneys in bank arising from the sale of partner- 
ship goods, for which they had obtained crédit as partners and to which 
said creditors had a preferential right in equity over the individual 
creditors. Maxwell sent this money to his mother when the note she 
held against him had about a year and a half to run before its ma- 
turity. While it may be conceded for the purposes of this discussion 
that she did not know that he had taken the money sent her out of part- 
nership funds, it is not unworthy of comment that the indorsements on 
the back of this note are a little remarkable. They are as f oUows : 

"June 29, 1903, received Interest for six montlis to June 10. 

"February, 1904, received $23.85. 

"May, 1904, received $25. 

"June 19, balance back Interest $91.15. 

"lieceived interest due June 10, $140." 

It is a little remarkable, if thèse indorsements were made în the 
regular course of business, that after the entry of June 19th — "balance 
back interest $91.15" — they should then go back and enter "Received 
interest due June 10, $140"; justifying the inference that there had 
been some posting out of the usual course. That it was Maxwell's 
scheme and purpose, by the simulated transfer to him, to assume an 
ostensible légal attitude in order to prefer his mother at the expense 
of the partnership creditors, is indisputably manifested by the imrae- 



268 152 FEDERAL REPORTER. 

diate relation between the mère semblance of a dissolution of the part- 
nership and the transfer to his mother. The testimony of the expert 
witness, Mr. Peak, shows that between the llth and tlîe 18th . ,vs of 
June, 1904, exclusive of the $3,731.90 paid to Mrs. Sargent, the assets 
diminished nearly $1,000. The transaction was not bona fide; it was 
without the considération the law exacts; it was done when the con- 
cern, and both parties, were insolvent; and it was in défiance of the 
spirit and purpose of the bankrupt law. 

JudgeAdams, in Re Jones et al. (D. C.) 100 Fed. 781, 783, com- 
ments upon the policy of the bankrupt act respecting the marshaling 
and appropriation of the partnership assets of a bankrupt estate, which 
is to be done so as to secure an équitable distribution of the property 
between the partnership and individual creditors according fo their 
priorities; that the partnership property shall be appropriated to the 
payment of partnership debts. He then asserts : 

"It is perfectly apparent what the gênerai scheme of tlie bankruptcy act 
contemplâtes with regard to partnership assets, namely, that they shall be 
in good faith applied first to the payment of partnership debts ; therefore 
any scheme or device resorted to, by persons in eontemplntion of Ijanliriiptey. 
for the purpose of charging partnership assets with the individual liabilitie 
of the partners, is, in substance and effect, violative of tlie- provisions of tlie 
act, and, inasmueh as the court is required to so marshal partnership assets 
as to secure the équitable distribution of the property of the several estâtes, 
it, is clear that the court must brush away ail thèse attempts at évasion and 
hold the parties to the requirements of the bauiîruptcy act, administered 
broadly ànd e(iuitabl.y to aceomplish the objects intended by it. The scheme 
resorted to, as shown In the statement of this case, by the banljrupts to foist 
upon the partnership assets the payment of their individual liabilities, was 
at least devised for an inéquitable purpose with in the purview of the bank- 
ruptcy act. The physical and undisputed facts surrounding the case are also, 
in my opinion, sufflcient to stamp the transaction as fraudulent within the 
meaning of the bankruptcy act." 

If on the 9th day of June, 1904, Maxwell had covertly withdrawn 
$3,731.90 of the funds of the concern from the bank and paid it over to 
his mother on his individual debt, it would hâve been a fraud on the 
other partner and the partnership creditors, and Mrs. Sargent would 
hâve been amendable therefor at the suit of the trustée in bankruptcy of 
the partnership estate. So say ail the authorities. It would be a 
mockery of the bankrupt act, which compels the application of the 
assets of the estate earned and acquired by the partnership society to 
the benefit of the joint creditors as a preferential right over the in- 
dividual creditors, to hold that a mala fides dissolution and transfer 
by King to Maxwell, without a valid considération, when the concern 
and both parties were insolvent, could couvert the favored individual 
créditer of Maxwell into a bona fide préférée. If this construction 
of the bankrupt act were to obtain, ail that would be essential for co- 
partners to defeat the équitable priority of partnership creditors in the 
distribution of the partnership assets by giving it ail to the creditors of 
the individual partner would be, in the face of the known insolvency 
of the copartners, to go through a simulated dissolution and division 
among themselves of the joint assets and turning it over to their in- 
dividual creditors, and the next day enter into voluntary bankruptcy 
or submit to involuntary bankruptcy and, when the transaction should 



UNITED STATES V. DELAWAEE, L. & W. E. CO. 269 

be assailed by their partnership creditors, answer that, liaving goa.t 
through the form of a dissolution and partition, the product of tlie 
goods obtained from the partnership creditors had been turned over to 
their individual creditors, who are entitled to hold because they did not 
knovv of the dissolution of the partnership or the insolvency of the 
concern. In other words, the attempted transfer by King to Maxwell 
was not bona fide ; it was not based upon any vaUd considération ; it 
was done when the partners were insolvent, and in the teeth of the 
policy of the bankrupt act. Equity looks to substance, and not to mère 
form. So that the légal attitude of the défendant, Mrs. Sargent, is as 
if the simulated dissolution of partnership and the transfer by King 
to Maxwell had never been gone through with ; and, with or without 
notice of how Maxwell got the money with which to pay lier, she must 
make restitution for the benefit of the partnership creditors, represented 
by the trustée in bankruptcy. 

Counsel for défendant are in error in the statement made in their 
brief herein that there was no adjudication in bankruptcy against King 
as an individual. The record before me shows that the adjudication 
went against the copartnership, as well as against each one of the in- 
dividual members thereof; and they applied for and obtained their 
discharge both as partners and as individuals. 

While the bill of complaint in thiscase does not, in its caption, re- 
cite that the complainant, Blake, sues as trustée of the individual estate 
of King, yet the suit is by Blake as trustée of the partnership estate ; 
and, as the fund sued for is recoverable only for the benefit of the part- 
nership estate, the omission of the name of King individually is quite 
immaterial. 

Decree for complainant as prayed. 



UNITED STATES v. DELAWARP, L. & W. R, CO. 
(Circuit Court, S. D. New Yorlj. February 14, 1907.) 

1. Carriers— Interstate Commerce— Rebatbs. 

A shipment from New York City to Buffalo, by way of New Jersey and 
Pennsylvania, is Interstate commerce, and so Is subject to the provisions 
of tlie Elldns law (Act Feb. 19, 1903, c. 708, 32 Stat. 847 [U. S. Comp. St. 
Supp. 1905, p. 599]), as to rebates ; the interstate commerce act (Act Feb. 4, 
1887, c. 104, § 1, 24 Stat. 379 [U. S. Comp. St. 1901, p. 3154]), though pro- 
viding tiiat the provisions of the act shall apply to any carrier engaged 
in the transportation of passengers or property from one state to any other 
State, having a proviso that, the provisions of this act shall not apply to 
the transportation of property '"wholly" wltliin one state. 

2. SamE — INDICTMENT FOR GiVING ReBATES. 

An indictment against a carrier, alleging that P. was the duly author- 
Ized agent of the S. Company and vested by it with the sole and exclu- 
sive power and autliority to détermine over which line any shipment by it 
Bhould be made ; that défendant entered into an tmlawf ul agreement with 
P. whereby it was agreed that P., as such agent, should cause S. to make 
large shipments over defendant's road, and S. should pay défendant the 
lawful rate for such shipments, and thereafter P. should présent claims 
to défendant for a rebate on such shipments, under the guise of claims 
for services; and that such scheme was earried out, and défendant made 
payments to P. by way of rebate — charges a payment of rebates in viola- 



270 152 FEDERAL EEPOKTEB. 

tion of tbe Elkins law (Act Feb. 19, 1903, c. 708, 32 Stat. 847 [U. S. Comp. 
St. Supp. 1905, p. 599]) ; the fact that the rebate is paid to another than 
the sbipper being immaterial, thougb a payment whlch is but a commis- 
sion for obtaining business for tbe carrier is not within tbe statute. 

3. Indictment and Information— Duplicity. 

An indictment under the Elldns law (Act Feb. 19, 1903, c. 708, 32 Stat. 
847 [U. S. Conip. St. Supp. 1905, p. 599]), declaring it unlawful for a car- 
rier to offer, grant, or give a rebate, alleging tbat défendant offered, 
granted, and ^ave a rebate, Js not dupliqitous, but charges but one offense. 

4. Caeriebs — Act as to Rjebates— Effeot or Repeal of Priob Statutes. 

Tbe provision of tbe Hepburn law (Act June 29, 1906, c. 3591, § 10, 34 
Stat. 584), repealing laws in couflict with tbe act, tbat "the amendments 
herein provided for shall not affect causes now pending * * * but sueh 
causes shall be prosecuted to a conclusion in tbe manner heretofore pro- 
vided by law," in view of Rev. St. § 13 [U. S. Comp. St. 1901, p. 6], pro- 
viding that "the repeal of any statute shall not hâve the effect to re- 
lease or eitinguisb any penalty, forfeiture or liability Incurred under such 
statute, unless the repealing act shall so expressly provide, and such stat- 
ute sball be treated as still remaining In forée for the purpose of sus- 
taining any prpper action or prosecution for the enforcement of such pen- 
alty, forfeiture or liability," applies to rebate offenses committed before, 
but prosecution for which was commenced after. tbe passage of such act; 
so that an indictment in such a case alîcging that a carrier "uulawfully 
and willfullv" gave rebates, whlch would be enough under the Elkins law 
(Act Feb. 19, 1903, e. 708. 32 Stat. 847 [U. S. Comp. St. Supp. 1905, p. 509]), 
is sullicient. though under tbe Henburn law it would' be necessary to al- 
lège that they were given "knowlngly." 

Henry L. Stimson, U. S. Dist. Atty. (Henry A. Wise, John W. H. 
Crim, and Francis W. Bird, of counsel). 
John B. Stanchfield (Charles A. Collin, of counsel), for défendant. 

HOLT, District Judge. This is a demurrer to an indictment char- 
ging the défendant witli the offense of paying rebates, in violation of 
the interstate commerce act and the acts amending it, particularly the 
act of 1903 commonly called the "Elkins Act." Tlie indictment con- 
tains ten counts. The first and second counts charge payments of 
rebates by the. défendant in October, 1903 ; the third and fourth counts, 
in May, 1904; the fifth and sixth counts, in September, 1904; the 
seventli and eighth counts, in January, 1905 ; and the ninth and tenth 
counts, in February, 1905. The odd-numbered counts charge tlie pay- 
ment of rebates on sliipments of merchandise from New York to 
Bufïalo; the even-numbered counts charge such payments on ship- 
ments from New York to points beyond Buffalo. 

Varions grounds of demurrer are relied on. In the first place, the 
odd-numbered counts are demurred to on the ground that a shipment 
from New York to Buffalo is not interstate commerce, and that a 
payment of a rebate on such a shipment is not prohibited by the inter- 
state commerce act. Goods shipped from New York to Buffalo over 
the defendant's road are transported from New York City to and 
through New Jersey to Pennsylvania, thence through Pennsylvania 
to the State of New York again, and thence by rail to Buffalo. In 
other words, the goods are transported from a point in the state of 
New York, through two other states, to another point in the state 
of New York. The défendant daims that such transportation is not 
interstate commerce, and that Congress cannot constitutionally pass 



UNITED STATES V. DELAWAKE, L. & W. R. CO. 271 

an act imposing a criminal punishment for giving rebates upon such a 
shipment. It is also claimed that, even if such transportation is In- 
terstate commerce, the interstate commerce act does not in fact apply 
to such a case. But I think that the authorities, although not en- 
tirely consistent, support the claim of the government that such trans- 
portation is interstate commerce, and that it is covered by the first sec- 
tion of the interstate commerce act. Hanley v. Kansas, etc., Ry. Co., 
187 U. S. 617, 23 Sup. Ct. 214, 47 L. Ed. 333 ; Lord v. Steamship 
Ce, 102 U. S. 541, 26 L. Ed. 224 ; Pacific Coast S. S. Co. v. Railroad 
Commissioners (C. G.) 9 Sawy. 253, 18 Fed. 10. The case of Lehigh 
Valley, R. R. Co. v. Pennsylvania, 145 U. S. 192, 12 Sup. Ct. 806, 3G 
L. Ed. 672, upon the authority of which the case of U. S. ex rel. 
Kellogg V. Lehigh Valley R. R. Co. (D. C.) 115 Fed. 373, and similar 
cases hâve been decided, was a case of a tax imposed by a state upon 
receipts in the proportion of the amount of transportation within the 
state. The Suprême Court, in the case of Hanley v. Kansas City 
Southern Ry. Co., supra, distinguishes it upon this ground, and holds 
that those cases Which, out of déférence to the case of Lehigh Valley 
R. R. Co, V. Pennsylvania, hâve held that transportation of merchan- 
dise from one point in a state, through other states, to another point in 
the same state, was not interstate commerce, carried its conclusions too 
far. Moreover, aside from the authorities, it seems to me that, upon 
principle, the view that the transportation of merchandise over such a 
route constitutes interstate commerce is correct. The defendant's road 
passes through New Jersey, Pennsylvania, and New York. Neither 
of those states alone could regulate the transportation of merchandise 
over any part of the line except that which was situated within that 
state. Transportation upon such a road, therefore, cannot be efficiently 
regulated at ail unless it is regulated by the United States. It is true 
that if the United States government has authority to regulate the 
transportation of merchandise between New York and Bulïalo on the 
Lackawanna, the Erie, and the Lehigh Valley roâds, and not upon the 
New York Central, there is a possibility that the New York Central 
road might obtain undue advantages in compétition with the other 
three roads mentioned. On the other hand, if the government has not 
the power to regulate such transportation on the three roads first men- 
tioned, and the state of New York should regulate transportation on 
the New York Central, between points in the state of New York, it 
would be po?.«ible for the three roads mentioned to obtain undue 
advantage over the Central to a still greater extent. There is a pos- 
sibility of some discrimination under any theory, but I think that the 
simplest theory is that as soon as merchandise is carried from one 
state to another it becomes interstate commerce. 

I do not think that too much weight should be given to a critical 
examination of the précise language of certain clauses in the first sec- 
tion of the interstate commerce act (Act Feb. 4, 1887, c. 104, 24 Stat. 
379 [U. S. Comp. St. 1901, p. 3154]). That section does provide that 
the provisions of the act shall apply to any common carrier engaged 
in the transportation of passengers or property from one state to any 
other state. This is the only language in the act applicable to trans- 
portation from one state to another, and undoubtedly the natural mean- 



272 152 FEDERAL EEPORÏEE. 

ing of this language would not include such a case of transportation 
of merchandise from New York to Biiffalo. At the same time it is a 
perfectly correct statement to say that goods shipped from New York 
to Buffalo on the Lackawanna road are transported from one state to 
another. The act contains a clause applying to transportation from 
any place in the United States through a foreign country to any other 
place in the United States. It is argued that, if the act was meant to 
apply to transportation from any place in a state, through another 
State, to any other place in the same state, there would hâve been such 
a clause inserted as was inserted in the case of transportation through 
a foreign country. But I think that the proviso at the end of the sec- 
tion removes any doubt in the matter. That proviso déclares that 
"the provisions of this act shall not apply to the transportation of 
property, or to the receiving, storage, delivery or handling of prop- 
erty wholly within one state. * * * " 'j'he word "wholly," as there 
used, imports, in my opinion, that such provisions shall apply to any 
transportation of property which is not wholly within one state. 

Another ground of demurrer to the indictment is in substance that 
none of the counts allège facts constituting a crime, because they al- 
lège that the rebates were paid, not to the American Sugar Refining 
Companies, the shippers of the sugar, but to Lowell M. Palmer. Each 
count of the indictment allèges that Lowell M. Palmer was the duly 
authorized agent of the said sugar refining companies, and was vested 
by them with the sole and exclusive power and authority to détermine 
over which of the Unes of common carriers running west from New 
York any shipments of sugar of said sugar refining companies should 
be made; that the Lackawanna Railroad Company entered into an 
unlawful agreement with the said Palmer, whereby it was agreed that 
the said Palmer, as agent as aforesaid, should cause the said sugar 
refining companies to ship over the defendant's road large amounts of 
sugar ; that the sugar refining companies should pay to the défendant 
the lawful rates for such shipments ; that thereafter the said Palmer 
should présent daims to the Lackawanna Railroad Company for a 
rebate upon such shipments, such claims to be in the guise of claims for 
extra lighterage; that thereupon said claims should be paid by the 
said Lackawanna Railroad Company, and that they should thereby 
give a rebate to the said Palmer of one cent for every hundred pounds 
of sugar shipped. It is then alleged that certain sugars were shipped 
from time to time, the transportation of which was paid for at the full 
tarifif rates to the Lackawanna Railroad Company; that thereafter 
claims for rebate in the guise of claims for extra lighterage were pre- 
sented by the said Palmer to the railroad Company, and that there- 
after the said railroad company paid to the said Palmer by way of 
rebate certain sums. The indictment further allèges that the said 
claims for extra lighterage and the payment thereof as aforesaid was 
a mère device agreed upon by the parties thereto to conceal the pay- 
ment of such rebates, and that no services of lighterage or extra light- 
erage were at any times performed by the said Lowell M. Palmer or 
the said sugar refining companies in respect to the transportation of 
said sugars. The defendant's counsel argues that thèse allégations 
are consistent with the existence of a simple arrangement by which 



UNITED STATES V. DELAWARE, L. & W. R. CO. 273 

the railroad company paid Palmer a commission for obtaining tlie 
business. But I do not think so. This indictment is substantially 
based upon the Elkins act. That act was intended, among othcr 
things, to cover the cases where the rebates are not paid directly to the 
shipper. It provides in substance that it shah be unlawful for any 
carrier to give any rebate in respect of the transportation of any prop- 
erty in interstate commerce vvhereby any such property shall be trans- 
ported at a less rate than that named in the tariff filed by the carrier. 
The test by this statute is whether the carrier has transported the 
property at a less rate than that named in the tariff. In determining 
this question no legitimate expense of doing the business by the car- 
rier should be deducted. The carrier has a right to employ persons 
to sohcit business, just as it has a right to employ clerks and em- 
ployés of ail kinds to do the business, and any payments for such a 
purpose cannot constitute a rebate, concession, or discrimination with- 
in the meaning of the act ; but the mère fact that a rebate is not paid 
to the shipper, but is paid to somebody else, is quite immaterial under 
the Elkins act. If it is in fact a rebate, concession, or discrimination 
■vvhereby the property is transported at a less rate than that named in 
the tariff, the unlawful act is committed. If upon the trial of this 
case it should appear from ail the évidence that tîie payments charged 
were nothing but a payment to Palmer as a commission for obtaining 
business for the railroad, they would not be rebates within the meaning 
of the act. But the indictment allèges that they were. The allégations 
are that it was agreed that claims for rebates should be put in under 
the guise of a charge for extra lighterage, that no services for light- 
erage or extra lighterage were ever rendered, and that the amounts 
paid were in fact rebates. Moreover, upon the facts alleged, Palmer 
occupied such a relation to the sugar companies that it is impossible 
to regard him as an agent of the railroad company. He is alleged to 
be a duly authorized agent of the sugar companies, vested by them 
with the sole and exclusive power and authority to détermine over 
which lines of common carriers any shipments of the sugar of said 
sugar refining companies should be made, and that it was agreed be- 
tween the railroad company and Palmer that the said Palmer, as agent 
as aforesaid, should cause much larger amounts of shipments to be 
made over the defendant's line than had theretofore been made under 
the said arrangement for the payment of rebates. 

Another ground of demurrer is the claim that each covmt of the in- 
dictment is void for duplicity. This objection is based on the fact 
that the Elkins act provided that it is unlawful for any corporation to 
ofifer, grant, or give a rebate, and that each count of the indictment 
allèges that the railroad company offered, granted, and gave a rebate. 
It is argued that as under the statute ofifering to give a rebate is a 
crime, and the actual giving of a rebate is a crime, two crimes are 
charged in each count of the indictment. But the gênerai rule is well 
settled that in a criminal pleading, where a statute makes either of two 
or more distinct acts connected with the same gênerai offense and 
subject to the same measure and kind of punishment indictable sep- 
arately and as distinct crimes when committed by différent persons or 
Î52 F.— IS 



274 152 FEDERAL EEPOETEIl. 

at différent times, they may, when committed by the same person at 
the same time, be coupled in one count as constituting one offense. 
U. S. V. Fero (D. C.) 18 Fed. 901, 903; Crain v. U. S., 162 U. S. 625, 
16 Sup. Ct. 952, 40 L. Ed. 1097. In a criminal pleading, if a statute 
makes each one of varions acts criminal, and the indictment sets forth 
said acts coupled with the conjunctive "and" instead of the disjunctive 
"or," if such acts are shown fo be merely différent stages of the same 
transaction, the indictment is good. U. S. v. Janes (D. C.) 74 Fed. 
545 ; Lehman v. U. S., 127 Fed. 41, 45, 61 C. C. A. 577 ; U. S. v. 
Nunnemacher, 7 Biss. 133, Fed. Cas. No. 15,903. 

Another ground of demurrer to this indictment is that none of the 
counts alleged that the défendant knowingly gave any rebates. The 
allégations are in substance that the défendant unlawfuUy and v^^ill- 
fully gave the rebates. The indictment admittedly would be sufficient 
in this respect under the Elkins act, but it is claimed that the so-called 
"Hepburn Act," passed in 1906, made it necessary in this case to al- 
lège that the défendant knowingly gave the rebates. Ail the acts al- 
leged in this indictment, the making of the alleged agreement for a 
rebate, the transportation of the property, the payment of the tariff 
price, the presentment of claims for rebates, and the payment of the 
rebates, took place while the Elkins law was in effect. The indict- 
ment, however, was found in August, 1906, after the passage of the 
Hepburn bill. The Hepburn bill re-enacted the first section of the 
Elkins act (Act Feb. 19, 1903, c. 708, 32 Stat. 847 [U. S. Comp. St. 
Supp. 1905, p. 599]) down to the end of its statement of what was 
unlawful. The following sentence in the original act made such acts 
a misdemeanor, and this sentence in the Hepburn act was amended 
by inserting the words which are underlined as follows: 

"Every person or coi"poration, tchether carner or shipper, who shall, knotc- 
■ingiy, olfer, grant, or glve, or solicit, aceept, or receive any such rebates, con- 
cession or discrimination, shall be deemed guilty of a misdemeanor." 

The Hepburn bill (Act Tune 29, 1906, c. 3591, 34 Stat. 584) contained 
a saving clause as follows : 

"Sec. 10. That ail laws and parts of laws In confliet with the provisions 
of this act are hereby repealed, but the amendments herein provided for shall 
net afl'ect causes now pending in courts of the United States, but such 
causes shall be prosecuted to a conclusion In the manner heretofore provided 
by law." 

The defendant's counsel argues that as by section 10 ail laws in con- 
fliet with the provisions of the Hepburn act are repealed by it, and 
as the amendments provided for in that act shall not affect causes "now 
pending" in the courts of the United States, therefore no prosecutions 
could be brought under the Elkins act after the Hepburn act was pass- 
ed, that the saving clause only saved cases then pending, and that in 
any subséquent prosecutions the indictment must allège that the de- 
fendants did the acts alleged to be criminal knowingly. The thirteenth 
section of the United States Revised Statutes [U. S. Comp. St. 1901, 
p. 6] reads as follows: 

"Sec. 13. Repeals not to affect liabilitles unless, etc. 

"The repeal of any statute shall not hâve the effect to release or extlnguish 
any penalty, forfeiture, or liability incurred under such statute, unless the 



UNITED STATES V, DELAWAEE, L. & W. K. CO. 2(0 

repealing act shall so expressly provide, and such statute shall be treated as 
stiil remaining in force for the purpose of snstainiiifr any proper action or 
prosecution for the enforcement of sucli penalty, forfeiture or liability." 

This section changes the rule of the common law by providing- that 
the repeal of any statute shall not hâve the efïect to release or extin- 
guish any liability incurred under such statute unless the repealing act 
shall so expressly provide. It is claimed that this provision is not ap- 
plicable to this case, because the Hepburn act bas a spécifie saving 
clause of its own, and, as by the tenth section of the Hepburn act 
causes now pending only are explicitly saved, it follows that that clause 
takes the place of the gênerai provisions concerning repeal in section 
13 of the United States Revised Statutes. The question whether it 
does or does not must be admitted to be a nice one, but in my opinion 
section 13 of the United States Revised Statutes applies. Its provisions 
are gênerai, applying to ail subséquent législation of Congress. It pro- 
vides that the repeal of any statute shall not extinguish any liability in- 
curred under it unless the repealing act shall so expressly provide. Sec- 
tion 10 of the Hepburn act does not expressly provide that the repeal of 
the Elkins act shall release or extinguish crimmal liability incurred un- 
der said statute, and therefore, in my opinion, section 13 of the Revised 
Statutes applies. This view has been reached by Judge Landis of Chi- 
cago in the case of U. S. v. Standard Oil Company (D. C.) 148 Fed. 
719, decided January 3, 1907, and by Judge Morris in the case of 
United States v. Chicago, etc., Railway Company and others (D. C.) 
151 Fed. 84, in an opinion handed down late in January, 1907. In 
this case Judge Lochren, who is stated in a mémorandum at the end 
of the opinion to hâve sat with Judge Morris at the hearing of thèse 
demurrers, but to bave taken no part in this décision, expresses a con- 
trary view. In both of thèse décisions much reliance is placed upon 
the case of Lang v. U. S., 133 Fed. 201, 66 C. C. A. 255. This case 
arose under a différent statute, but presented, it seems to me, the same 
identical question. In that case Judge Barker held that section 13 of 
the United States Revised Statutes applied notwithstanding a similar 
saving clause. Judge Grosscup concurred in his décision upon a dif- 
férent ground, while Judge Jenkins dissented. The questions in- 
volved are very elaborately argued in thèse opinions, and I shall sim- 
ply say that, with great respect for the distinguished judges who differ 
from them, I concur with the views of Judges Landis, Morris, and 
Barker. I cannot believe that it was the intention of Congress that 
parties who had committed offenses under the Elkins act should be 
discharged from. ail liability because indictments had not been filed at 
the time the Hepburn act was passed, while others, no more morally 
guilty, should be continued to be prosecuted under indictments found 
before that act was passed. I think that if that was the intention of 
Congress it would bave said so. Section 13 of the United States Re- 
vised Statutes provides that the repeal of any statute shall not release 
any penalty or liability incurred under it unless the repealing act shall 
expressly so provide. The repealing act in this case did not so ex- 
pressly provide. The best argument that can be made in support of 
the repeal is that it impliedly so provided. But in my opinion, since 



276 152 FEDERAL REPOEÏEU. 

section 13 was adoptée! there can be no repeal by implication in sucli a 
case. 

My conclusion is tbat the demurrer should be overruled. 



WALSII et al. v. TWEEDIE TRADING 00. 

THE HBRM. 

(District Court, S. D. New Yorli. February 28, 1907.) 

SHIPPING— ClIAETBB PARTY— OPTIONAL EMPLOYMENT Or YESSEL. 

A ctiarter for a steamship was for a voyage to the west eoast of Soutli 
America and return, but gave the charterer an option to employ the vessel 
in gênerai trade for a period of about three months, but not exceeding 
five months. After employing the vessel between ports of the United 
States, the West Indies, and eastern South America for between two and 
three months, the charterer proposed to send her to the west coast of 
South America, and ofCered an increased hire, but the owners refused. 
Such voyage would hâve Involved a considérable extension of time in ex- 
cess of five months. HeU, that the charterer had used the vessel under 
the option for gênerai trading, and was not then entitled to make the west 
coast voyage under the charter without a f urther agreement for the addi- 
tional time. 

In Admiralty. 

Convers & Kirlin and Russell T. Mount, for Walsh and others. 
Wheeler, Cortis & Haight, for Twéedie Trading Company. 

ADAMS, District Judge. The first of the above actions, William 
S. Walsh, et al., agents for owners, against the Tweedie Trading Com- 
pany, was brought to recover from the latter, a balanc; of hire of the 
steamship Herm vmder charter dated New York, June 21, 1905. She 
went into service July l"3th, 1905. The claim was for hire from No- 
vember 3rd, 1905 to December 20th, 1905, at the rate of £1100 per 
month and from December 20th to January 4th, 1906, at the rate of 
£1500 per month. The total hire claimed was $9,573.64. Crédits 
were allowed by reason of payments and other matters to the extent 
of $6,333.99, leaving a balance of hire due of $3,339.65, for which 
this action was brought. 

It was alleged in the answer, with other things not necessary to con- 
sider hère, that the libellants were not entitled to recover the said hire 
because they refused to send the steamer to the west coast of South 
America in accordance with the charterer's demand. The claim is set 
forth more in détail in the cross libel, the second action, wherein it was 
alleged : 

"Pourth. Thereafter the steamship Herm was delivered to the libellant and 
in accordance with the provisions of the charter party aforementioned, the 
libellant notified the respondent that it was consideriug sending sald steam- 
ship to the west coast of South America. Thereupon the respondent, in vio- 
lation of the tenus of the charter party, notified the libellant that it would not 
allow said steamship to proceed to the west coast of South America. By rea- 
son of the promises, and because no cargo could be received in Brazil, where 
the said steamship then was, the libellant was forced to bring her back from 
Brazil in ballast, to its damage in the sum of !f7,500, and it also sustained 
other damages which, as nearly as can be estimated at présent, amounts to 



WALSH V. TWEEDIE TRADING CO. Zil 

$20,000. Prior to said refusai by the respondent, tlie libellant had paid to tbe 
respondent under said charter party, the sum of $1,311.82 as hire, which sum 
bas not been earned by reason of the premises." 

The charter party provided, inter alia, as follows: 

"Witnessetb, That the said owners agrée to let, and the said eharterers agrée 
to hire the said steamship froni the time of delivery, for eue round trip to 
West Coast of South America * * * to be employed in carrying lawful 
merchandise, * * * between safe port and or ports in British North 
America, and or United States of America, and or West Indies, and or Cen- 
tral America, and or Carribbean Sea, and or Gulf of Mexico, and or South 
America, and or Europe, and or Africa, and or Asia, and or Australia, exclud- 
ing River St. Lawrence from October Ist to ilay Ist (White Sea, Black Sea, 
and the Baltic out of seasonl. Magdalena River, and ail unsafe ports ; as the 
Oharterers or their Agents shall direct, on the following conditions:" 

"Charterers bave the option of employing the steamer in gênerai trade for 
the period of about three (3) months, up to five (5) months, but in any event 
time not to exceed 5 months. subject of course to stranding, sinking, stress of 
weather or other accidents." 

The latter clatise was added at the foot of the instrument in type- 
writing. 

It has been agreed that the Herm was dehvered to the charterer 
at New York on the 12th of July, 190:") ; she finished loading her New- 
York cargo July 19th; sailed for Fernandina July 2:^th; arrived at 
Fernandina July 23rd ; loaded at Fernandina and sailed July 30th for 
Pernambuco ; arrived at Pernambuco August 18th ; completed dis- 
charge of cargo intended for Pernambuco and sailed August 24th for 
Rio ; arrived at Rio August 29th. completed dischargï there of the 
Rio cargo September 1.3th and sailed the 14th for Santos ; arrived at 
Santos the 15th and completed her discharge of cargo the 2 ~th ; she 
lay idle at Santos, with steam up ready to leave port at a moment's 
notice, until October 5th. She left Santos October 5th for Pernam- 
buco, where she arrived the 6th ; she left Pernambuco the 6th for Bar- 
badoes stopping there practically only for orders ; then proceeded on to 
New York, still in ballast, where she arrived November lF,t, 1905. 
The loading in New York began November 2nd, was completed the 
8th and she sailed for Baltimore on that day ; she arrived in Baltimore 
the lOth and completed loading there the 24th; she sailed th;nce for 
Tampico November 25th, where she arrived December 6th; she com- 
pleted her discharge there December 21st and sailed for Coatzacoalcos, 
where she arrived December 2.5th and completed her discharge t'^e 3 Ist; 
she sailed for Galveston the same day and arrived there for re-delivery 
January 4th, 1906. 

When the steamer was at Santos, a dispute arose between the owners 
and the charterer with respect to the steamer's employment on the 
west coast, the charterer desiring an extension of time to enable it to 
make a voyage to the northern part of the coast, which thï owners 
refused excepting upon a considérable advance in the rate of hire. 
No agreement being reached, the charterer ordered the steamer to 
New York and she was afterwards emplo)-ed for a short time in making 
1 trip to Tampico and Coatzacoalcos, thence to Galveston where she 
went out of the charterer's service. 



278 152 FEDERAL EBrOKTER. 

This dispute arises entirely out of the provisions of the charter party 
above quoted. The vessel reached Santos in September. After dis- 
charging cargo there she remained idle for fifteen days until Ocfcober 
5th. During this time some cable corresponderxa took place as fol- 
lows : 

The charterer on the 3d of October, cabled to the owners ; 

"Herm wlll you allow 2 months continuation of présent charter £100 extra 
per month faillng this Tweedie considering West Coast South America voyage." 

On the 4th of October the owners replied : 

"Herm owners agrée to not exceeding 2 months continuation £200 extra per 
month whole period présent charter and continuation différence failing this 
they protest keeping Herm over 5 months as per charter party therefore West 
Coast South America voyage impossible." 

The ship agents on the 5th of October cabled to the owners : 

"SS 'Herm' charterers they reject your proposition no freight offiering San- 
tos-Rio Janeiro. West Coast voyage may occupy up to seven months from 
now. Cliarterers daim West Coast option is without time limlt As you 
say you will not allow over five months total from start, chnrterers hâve or- 
dered ship to proceed in ballast to Louisberg seeking freight orders off Per- 
nambuco. They hâve given us notice that they hold owners responsible. Can 
arrange it to satisfaction of ail coneerned if you can arrange ship to be rede- 
livered to owners at Europe not later than Januarj' 31st, penalty — £500." 

In reply to this the owners cabled : 

"Herm Tweedie threats ineffective owners insist on fulfllment of charter 
party which is In any event time not to exceed 5 months." 

On the same day, the respondent sent the steamer to Pernambuco, 
where she arrived October 6th. Stopping off Barbadoes, practically 
only for orders, she proceeded in ballast to New York where she ar- 
rived November Ist. By arrangement between the parties, without 
préjudice to their rights under the original contract, she did some fur- 
ther work for the charterer and was re-delivered to the owners at Gai- 
veston, January 4, 1906. 

The charterer's daim is set forth in the 4th paragraph of the counter- 
claim, above quoted. Its points are: (1) The charter was primarily 
for a trip to the west coast ; the alternative option was never exercised, 
and the charterer had a right to send the vessel to the west coast, 
and (3) the owners' refusai to send her to the west coast was an an- 
ticipatory breach of contract. 

The owners claim (1) that the clause "but in any event not to exceed 
5 months" is applicable to the entire contract and limits the round trip 
to the west coast option as well as to the gênerai trading option; (3) 
that should this clause appear to the court as an ambiguity appearing 
on the face of the contract, it is clearly shown to hâve been understood 
as a gênerai limitation, by the cable communications upon which the 
charter was framed; (3) that should it appear to the court that the 
5 months' limitation applies only to the gênerai trading clause, yet the 
libellants never refused to allow the steamer to proceed to the west 
coast, and it is therefore not guilty of the breach of contract claim- 
ed by the respondent. 



UNITED STATES V. POMEROY. 279 

The cliarterer contends also that the option was never declared nor 
resorted to by it and the whole matter is determinable under the first 
clause of the contract, providing for a round trip to the west coast, 
while the owners contend that the provision contained in the option 
clause "but in any event time not to exceed 5 months" was a gênerai 
limitation of the entire charter. 

It appears that a voyage to the west coast involved considérable time. 
A vessel of the capacity of this one woukl require 18 to 20 days to load 
at starting port and probably 30 for discharging; that would leave 
approximately 100 days for going and returning, a steaming distance 
one way of upwards of 10,000 miles. One of the witnesses said that 
it was practically impossible to make it within the limit, which seems 
to be true. It looks as though the charterer never really contemplated 
the west coast trip but intended that the steamer's time should be oc- 
cupied in gênerai trading, meaning to the eastern coast of South 
America, where its business was usually donc. It seems that the 
charterer intended from the beginning to use the vessel in such trading 
and it was only when it found that businesss there would be slack, 
that it resorted to the west coast demand, for which it appeared an 
extension of time would be required. It then offered an advanced 
rate for an extended period but the owners demanded more than the 
charterer offered or was willing to pay and the vessel was sent north 
for re-delivery. 

I find that the owners are entitled to their hire without any déduc- 
tion, excepting $36.46 for a further allowance for bunker coal on arrivai 
and $435.78 for disbursements made for the owners at Tampico. 

There will be a decree for the libellants for $3,877.41, with interest. 
The cross-libel will be dismissed. 



TJXITED STATES v. POMEROY. 
(Circuit Court, S. D. New Torlî. February 27, 1007.) 

1. Fines— Death or Party— Abatement. 

Where aecused was eoiivicted of giving rebates, In violation of tbe Inter- 
state commerce act and its amendments, and sentenced to pay a fine, but 
died after judgœent bef