text:
    SOUTHERN PAC. CO. v. KAUFFMAN et al.
    No. 6247.
    Circuit Court of Appeals, Ninth Circuit.
    May 8, 1931.

      Guy Y. Shoup, Dunne, Dunne & Cook, Christian F. Kimball, and Thomas B. Dozier, all of San Francisco, Cal., for appellant.
    Lionel B. Benás, Edward S. B.ell, Kil-patrick & Goodman, Frank E. Kilpatrick, and Booth B. Goodman, all of Oakland, Cal., for appellees.
    Before RUDKIN, WILBUR, and SAW-TELLE, Circuit Judges.
   WILBUR, Circuit Judge.

The appellee was severely injured in a collision between an automobile in which he was riding and a passenger train of appellant’s, occurring at approximately 2 o’clock p. m. July 19, 1927, about one mile east of Los Banos, Cal., at a grade crossing known as Canal Farms Crossing. At the time of the collision, the appellee was asleep upon the back seat of the Dodge car, which was being driven by his mother. With the mother in the front seat was appellee’s father, and in the rear of the car with appellee were his five brothers and sisters. At the point of collision -the railroadi crossed near the point of intersection of the center lines of two highways which were at right angles with each other. The wigwag crossing signal established by the appellant at the crossing had two arms at right angles to each other, operating in planes perpendicular to the respective highways and was situated in the -intersection of the highways and upon the railroad right of way. The highway upon whieh the Dodge automobile was being operated by appellee’s mother was a main thoroughfare 60 feet wide, paved with concrete surface 16 feet wide. It .intersected the appellant’s railroad at an angle of about 30-degrees (29° 45')." The automobile was approaching the intersection from the east, and the railroad train from about west-northwest, making the angle of approach 150° 15'.

Appellee stated his cause of action against the Southern Pacific Company in - three counts. The first count alleges that the appellant negligently operated and maintained the train on its railway tracks, and negligently collided with the automobile in which the appellee was riding. ■ The second count alleges that the appellant negligently permitted trees and shrubbery to grow upon its right of way near said crossing in places which obstructed the view of drivers of automobiles upon the highway, and that these obstructions prevented appellee’s mother from having a view of defendant’s tracks and trains thereon before driving upon the crossing. The third count alleges that the defendant negligently and carelessly permitted the electric wigwag signal maintained at the crossing to become out of repair to such an extent that the said signal failed to work or operate as a signal device. Such failure was assigned as the proximate cause of the accident.

The questions at issue are as to whether or not the whistle of the passenger train was blown as a warning upon approaching the crossing; as to whether or not the locomotive bell was rung; whether or not the bushes which it was claimed obstructed the view of plaintiff’s mother toward the approaching train in fact did so, and, if so, whether or not such trees and bushes were upon the right of way of the railway company; and whether or not the wigwag was in actual operation immediately before and at the time of the collision, and, if not, whether its failure to operate was due to negligence in its maintenance.

It appears from the evidence that the train was being operated at from 25 to 30 miles per hour, that until the instant of the accident the attention of appellee’s father was wholly directed to the examination of a road map, and that he did not observe the locomotive until the automobile was on the railroad track and immediately in front of the locomotive. The accident occurred in broad daylight on a clear day. The crossing was marked not only by the usual railway crossing signal, two bars at right angles forming an X, mounted on a vertical post, and marked “Railroad Crossing, Look Out for the Cars,” but also by a circular disc mounted on a pole with the letters “R. R.” and two heavy lines intersecting at right angles upon the disc 300 feet from the crossing, as required by the California Vehicle Act (Cal. Stat. 1923, pp. 517, 555, § 117). The wigwag was in a conspicuous position to warn travelers upon the highway, and was plainly visible for á long distance before the crossing was reached; the line of telegraph poles and wires along the railroad also indicated the crossing. At the crossing was the usual cattle guard. The paving in the highway approached the tracks at a slight grade, plainly visible as one approached upon the highway. The highway and railroad were straight for a long distance as the automobile and railway train approached the crossing. According to the testimony of the appellee’s father and the fireman of the locomotive, the Dodge car stopped at a distance of 15 feet from the railway track. At that time the locomotive of the passenger train, which collided with the automobile, was about 100 feet from the crossing and within less than three seconds thereof. The Dodge ear started forward “jerkily” and stopped, or nearly stopped, or stalled, on the track immediately in front of the locomotive, and the collision occurred almost instantly thereafter. Appel-lee’s father testified that his attention was attracted by the stopping of the automobile in which he was riding, that it started forward “jerkily,” that he glanced downward and saw his wife’s hand on the emergency brake, and -that when he looked up the locomotive was towering above him and the collision occurred almost at that instant. A truck was following the Dodge ear in question at a distance of about 100 feet, and was driven by appellee’s brother, who testified that he was observing the car .driven by his mother and also observing the wigwag; that he saw the Dodge car come to a complete stop and then go forward. 'He testified that the wigwag was not operating at that time, and it is upon his testimony that appellee largely depends to establish the charge of negligence in taking care of its wigwag signal at that crossing. The fireman of the locomotive also testified that the automobile came to a complete stop before it reached the crossing and that it then moved forward. There is no testimony that the automobile did not stop, although, for purposes of impeachment, a statement made by the fireman in the report of the accident to the company was produced. While this statement was consistent with the idea that the automobile never came to a complete stop, it was not entirely inconsistent with the proposition that the automobile stopped and started up. Assuming that this statement of the fireman conflicted with his .testimony, its utmost effect would, be to eliminate his testimony on that subject which had corroborated that of the appel-lee’s father and brother. Such a statement would not be competent evidence of the facts therein stated so as to create a conflict with the testimony, of appellee’s father and brother to the effect that the automobile in which appellee was riding came to a full and complete stop before reaching the railroad tracks. The father testified that this stop occurred while the automobile was at a point 15 feet from the railroad tracks. The testimony of the fireman confirms this as the point at which the automobile stopped. The testimony of the son is not inconsistent with that of the father as to the point where the automobile stopped.

We will first deal with the cause of action 'based upon the charge of negligence in the maintenance of the wigwag and in allowing it to get out of repair. The only evidence that the wigwag was out of repair is that of the appellee’s brother, who testified ' that the wigwag was not operating at the time of the accident. We do not overlook the testimony that some one was seen on the wigwag signal the next morning after the accident, or the evidence that fire was seen -near its conduits that same afternoon. It was so constructed that it should operate. But it has been properly held that the mere failure of such a wigwag to operate automatically upon the occasion of an accident is not evidence of negligence on the part of the railroad company. Vaca v. S. P. Co., 91 Cal. App. 470, 267 P. 346; Kingsbury v. B. & M. R. R., 79 N. H. 203, 106 A. 642, 643. It is proper to consider the fact, if it be a fact, that the signal did not operate, in measuring the care exercise^ by the traveler in 'negotiating the crossing, and it is therefore relevant on the question of contributory negligence, but, without more evidence tending to show negligence in the maintenance of the wigwag, it is insufficient to establish such negligence. To rebut any inference of negligence which might arise from the failure of the wigwag to operate at the time and place in question, the appellant, although claiming and introducing many witnesses to establish that the wigwag did operate properly at the time of the accident, presented the testimony of the inspector whose duty it was to inspect the signal, and this witness testified that he had inspected the apparatus daily for many days previous to the accident and found and reported that the apparatus was working properly. He also testified that the day after the accident he made a careful inspection and test of the signal and it was working perfectly, and that there was no defect in it. At this juncture appellant offered a witness who frequently used the highway at this crossing and sought to prove by him that for a considerable period of time previous to the accident the wigwag was working properly. The witness testified that he crossed the track at this crossing “quite often before July 19, 1927; that he crossed on an average of once a day, and sometimes two or three times a day; that he had occasion to cross there when a train was approaching the crossing several times.” He was then asked: “When there was a train approaching was or was not the wigwag working?” This was objected to as immaterial, irrelevant and incompetent; whereupon counsel stated the purpose of the evidence as follows: “We deem it the law of the state of California that our obligation is to maintain that wigwag without negligence in its maintenance; that an isolated failure to work is not necessarily indicative of negligence. Our duty is to maintain it so that it operates and functions normally. For that reason, we propose to show, if we can, a general use of the wigwag over a period of months or years preceding this time, and the uniform operation of the wigwag during that period of time.” Whereupon the court ruled as follows: “Suppose the other side desire to introduce evidence that it did not operate, or evidence tending to show that it did not operate regularly, I think that evidence would not be admissible. And I think this is inadmissible. The objection is sustained.”

Appellant excepted thereto. Later the appellant offered other evidence thereon as follows:

“Mr. Durst. If the Court please, we have some other witnesses, Mr. Aired, Mr. Stewart, Mr. Cluffo, and Mr. Starkes, whose testimony would go to the general condition of the maintenance of that wigwag. They are stage drivers and truck drivers in that vicinity who frequently have been over it prior to the accident. As I understand the Court’s ruling when that question was asked of this last witness, the testimony is not admissible. We will- proffer them as witnesses and reserve an exception, if we may, to the question that would be asked similar to that other question. We .do this in order to expedite the trial.
“The Court. Very well. Let it be understood that the witnesses are here and that you offer to place them on the stand, and ask them the same question with reference to the condition of the wigwag prior to the accident, and some time prior thereto. The plaintiff objects?
“Mr. Goodman. Yes, your Honor, the plaintiff objects, because they cover a long period prior to the accident, and not at the time.
“Mr. Durst. Prior to and subsequent to the accident.
“Mr. Goodman. These witnesses were not there at the time of the accident, wer'e they ?
“Mr. Durst. No.
“The Court. It is understood you object to lhat testimony?
“Mr. Goodman. Yes, on the ground that it is immaterial, irrelevant and incompetent.
“The Court. The objection is sustained.
“To said ruling defendant then and there excepted, and now excepts, and assigns the same as error.”

The. purpose for which the evidence was offered, as stated, was to show that the appellant did not neglect its duty in the maintenance of the wigwag. For such purpose evidence more remote from the time of the accident was admissible than for the purpose of showing the probability that the wigwag actually worked at the time of the accident, for both purposes the amount of such evidence and the period, before and after the accident, it may cover must rest largely in the discretion of the trial judge. The exclusion of this evidence, in so far as it tended to show that the wigwag actually operated to warn the plaintiff’s mother, was within the sound discretion of the trial judge. But this evidence was offered for the purpose of showing that due care was exercised by the appellant in the maintenance of the wigwag, and it was clearly admissible for that purpose. It is true that the testimony of the inspector above referred to was sufficient, if believed, to establish due care on the part of the Railroad Company, but the question of negligence in maintaining the wigwag was submitted to the jury by the trial court (instruction No. 20). The jury were instructed that, if the wigwag signal was in bad condition and out of operation at the time of the accident, due to the negligence of the defendant in maintaining it or in failing to discover its condition by the exercise of reasonable care, and that the accident was proximately caused by the failure of the signal device to operate, the plaintiff was entitled to recover, unless he was guilty of” contributory negligence. It was important upon this issue to supplement the testimony of the employees of the railroad company by the evidence of disinterested witnesses, if it could be done, and the railroad company sought só to do by the testimony of those accustomed to use the highway at this crossing. Evidence that the wigwag signal had worked continuously and properly for a long period of time before the accident would be relevant upon the question of the degree of care of the railroad company. It is clear that, if the evidence adduced by the witnesses offered by the railroad company had been to the effect that frequently and for long periods of time the wigwag had failed to operate as it was designed to do in order to warn travelers upon the highway, it would tend to show negligence on the part of the railroad company in maintaining the signal. Conversely, evidence to the effect that the wigwag was operating properly would tend to rebut the claim of negligence.

In determining the degree of care exercised before an accident, evidence as to the condition of the thing which caused the accident is admissible to establish due care or negligence as the case may be. In the Encyclopedia of Evidence, vol. 8, p. 913, § 6, it is stated: “Evidence that the defect that caused the injury existed a considerable time before the accident is admissible to show notice to the defendant of such defect.” See Shearer v. Town of Buckley, 31 Wash. 370, 72 P. 76, by the Supreme Court of the state of Washington, where the issue was as to negligence of the town in maintaining a sidewalk. To the same effect, by the same court, in Falldin v. City of Seattle, 57 Wash. 307, 106 P. 914; to the same effect, in Hunt v. City of Dubuque, 96 Iowa, 314, 65 N. W. 319, where evidence of long standing defect in a sidewalk was held proper evidence to show constructive notice of the defect. Similarly to show lack of notice it was held that evidence of witnesses who frequently passed over the walk that they had noticed no defect and would have done so if such defect existed was held competent to show that there was no constructive notice of the defect. In Lake Erie, etc., v. Howarth, 73 Ind. App. 454, 124 N. E. 687, 127 N. E. 804, the question at issue was as to negligence in the maintenance of an automatic bell at a railway crossing. It was held that evidence that the bell did ring, and, conversely, that it did not ring, over considerable periods before the accident, was admissible, both to show whether or not the railway company had notice that the bell was out of repair, and less remote evidence upon the possibility or probability that it did or did not ring at the time of the accident. In Kingsbury v. Boston, 79 N. H. 203, 106 A. 642, 643, supra, it was held that evidence that an automatic crossing bell failed to ring at the time of the accident is not evidence of negligence, where the bell operated immediately before and a short time thereafter. The court there said: “The mere fact that the bell did not ring, if it is a fact, does not authorize the inference that its failure to do so was due to the defendant’s negligence, since it is apparent it may have been due to some cause for which the defendant was not responsible.”

For analogous cases see District of Columbia v. Armes, 107 U. S. 519, 2 S. Ct. 840, 27 L. Ed. 618; Burke v. Witherbee, 98 N. Y. 562; Lafflin v. Buffalo, etc. Co., 106 N. Y. 136, 12 N. E. 599, 60 Am. Rep. 433; McCaldin v. Parke, 142 N. Y. 564, 37 N. E. 622; Colorado Mtg. & Inv. Co. v. Rees, 21 Colo. 435, 42 P. 42; McCarragher v. Rogers, 120 N. Y. 526, 24 N. E. 812; Calkins v. City of Hartford, 33 Conn. 58, 87 Am. Dec. 194; Alcott v. Public Serv. Corp. of N. J., 78 N. J. Law, 482, 74 A. 499, 32 L. R. A. (N. S.) 1084, 138 Am. St. Rep. 619. See, also, Wigmore on Evid. (2d Ed.) § 458, and notes; Fleming v. Northern Paper Mill Co., 135 Wis. 157, 114 N. W. 841, 15 L. R. A. (N. S.) 701; and extensive notes in 32 L. R. A. (N. S.) 1085; et seq.

The admissibility of evidence that a machine had worked properly for a long period of time before an accident is peculiarly appropriate where the only evidence of negligence in its maintenance is the circumstance that at the time of the accident it failed to work properly. See Memphis Street Ry. Co. v. Stockton, 143 Tenn. 201, 226 S. W. 187, and note thereon 22 A. L. R. 1471, 1473. While the range and extent of such testimony must rest largely in the discretion of the trial court, we are constrained to hold that the appellant was entitled to fortify the testimony of its employees by the evidence of disinterested witnesses offered and to cover a reasonable period before the accident by such testimony.

The ruling upon the offering of this testimony was erroneous. If the issue as to negligence in maintaining the wigwag had been withdrawn from the jury and the question submitted to the jury had been solely as to the effect of the stoppage of the wigwag upon the appellant’s claim of contributory negligence, we might hold that the ruling rejecting this evidence was not prejudicial to the appellant. But where the issue of negligence in the care of the signal device was submitted to the jury notwithstanding the objection of the appellant and notwithstanding the fact that there was no affirmative evidence of negligence sufficient to justify its submission to the jury, we must hold that the rejection of this testimony tending to affirmatively establish that the wigwag was and for a long period had been in good working order, was prejudicial as well as erroneous.

Appellant claims that the court erroneously denied its motion for a directed verdict on the count charging negligence in the care of the wigwag signal. If this motion had been separately presented, it should have been granted (Wilmington Star M. Co. v. Fulton, 205 U. S. 60, 27 S. Ct. 412, 51 L. Ed. 708), but the motion was for a general verdict in favor of the defendant on all counts and was properly denied if on any count or charge of negligence alleged the jury could find a verdict for the plaintiff under the evidence. The question was not raised by any other requested instruction.

In view of a new trial, we deem it necessary to consider the question presented by the contentions of the parties with reference to the claim that the negligence of the appellee’s mother in operating her automobile at the crossing was the sole proximate cause of the accident, and that therefore the negligence of the appellant, if any, was not a proximate cause thereof. Appellant’s contention as to the law and facts with relation to this question can best be stated by quoting from its brief as follows:

“On any view of the evidence she stopped at a point fifteen feet from defendant’s track. This was beyond the bush and the pole. This was at a point from which she had an unimpaired view of defendant’s track in the direction from which the train was approaching, all the way to Los Banos Station. Further, it cannot be disputed that at' this time the train itself was in plain view. At this point, and with this approaching train so in view, she either did not look before driving in front of the train, or having looked and seen the train she attempted to cross immediately in front of it. Under either hypothesis she was guilty of negligence proximately causing the resulting accident. No discussion of the proposition that failure to look when looking would have disclosed an approaching train is necessary. And as the Supreme Court of California has epigrammatically stated the rule, as to seeing the train and attempting to cross in front of it, ‘to make such attempt and fail is conclusive evidence of negligence.’ * é •
“There is here only one rational explanation of the accident, and that is that Zella Kauffman stopped, saw the approaching train, and attempted to cross in front of it. Her machine was stopped by her at a point where she could see the approaching train. The train was then plainly within her view. She did not stop as a matter of idle curiosity, nor for any reason other than that she was approaching a railroad track of the presence of which she had been warned by an advance railroad crossing sign, by a standard railroad crossing sign at the crossing itself, by a wigwag signal, whether working or not, which was plainly within view, and, lastly, and above all, by the tracks themselves. S. P. Co. v. Day (C. C. A.) 38 F.(2d) 958; Holmes v. S. P., etc., 97 Cal. 161, 31 P. 834. When she stopped' in heed of such warnings she stopped for only one purpose, and that was to ascertain whether or not the crossing at that point and at that time could be made in safety. There was one sure way of ascertaining that fact, and that was by looking. She stopped to look and did look, and in looking she saw defendant’s approaching train (the law so presumes — Young v. S. P. Co., 189 Cal. 746, 754, 210 P. 259) and attempted to cross in front of it. Indeed, she almost succeeded. The train struck only the rear end of her automobile. Had her automobile been operating properly she probably would have crossed safely. As it was the engine must have been balked and almost died — it was not running smoothly, for when she started again the machine went forward with a jerky motion. The responsibility for this failure of the automobile to carry its driver and the other occupants across in safety is one which must rest on her shoulders alone— this responsibility cannot be shifted to the defendant railroad company. * * *
“It does not lie in the mouth of the plaintiff to now urge that this duty was neglected. The law and the legal presumptions (Young v. S. P. Co., supra) as well as the facts point conclusively to the proposition that she looked and saw the train. * * *
“The significance of the fact that the negligence of the driver of the automobile in this case was in crossing in front of an approaching train with knowledge that that train was approaching is that it makes any charged negligence on the part of the defendant railroad company remote and not proximate.”

On the other hand, the view of the appel-lee on the law and the facts is thus stated in his brief: “We then have the presumption, always present, that the deceased used ordinary care for her own safety. Taking this, in conjunction with the other testimony of both plaintiff’s and defendant’s witnesses that she stopped and then started, it is fair to presume that she noticed that the wigwag was not working, the bushes obstructed her view, and not hearing any whistle or bell, was lured by defendant’s negligence and started again.”

But the evidence establishes without conflict that .the automobile was stopped at or about the point within 15 or 20 feet of the track, and that the driver of the automobile was able to see an approaching train from that point. The appellee’s father, who was sitting on the front seat of the automobile, on the righthand side, testified upon his direct examination that the automobile came to a stop 15 feet from the track. He figured the 15 feet from the front of the machine. He testified that as he looked the ground over after-wards “it would seem it was just about 15 feet from the track when she tried to make the first stop.” Appellee’s brother testified that the next day he measured the distance from the track to the first obstruction to a clear view of an approaching train and that it was about 20 to 25 feet to the first obstruction. R. W. Stanard, an uncle of appellee’s mother, who also measured the distance from the track to the first obstruction to the view, gave the distance as approximately 25 feet to some bushes about 8 feet high. The fireman on the approaching train testified he could see the whole automobile at' the point where it stopped. The view was unobstructed. A series of photographs were introduced by the defendant, but apparently the exact position of the camera at the time each of the pictures was taken was not shown by any evidence other than that of the photographs themselves. They were taken the day after the accident. These pictures seem to show clearly that, after passing the line of telegraph poles along the railway right of way, the only obstruction to the line of vision between the automobile and the approaching locomotive was a pole carrying a power line at the base of which, on the edge of an irrigation ditch, was a small clump of willows which the witness estimated to be about 8 feet high. The photographs show that before arriving at this point, and immediately after leaving it, the driver of an automobile would have clear opportunity to see an approaching train if, as is claimed, his view was obstructed momentarily by the very highest branches of the bush as he passed it.

The court instructed the jury in accordance with the appellant’s theory of the law, in effect that, unless the deceased stopped her automobile at a point where her view was obstructed, there could be no recovery either by the plaintiff for his injuries or by her husband and children for her death. That instruction is as follows: “If you believe from the evidence that the automobile approached to a point within fifteen feet of the track, slowing down as if to stop, and that from such point the driver of the automobile had; a clear and unobstructed view in the direction of the approaching train and that she, saw, or had she looked she would have seen, the train approaching when she left such point and proceeded over the railroad crossing in said automobile, then I instruct you that the proximate cause of said collision was the negligence of the driver of said automobile, and your verdicts must be for the defendant, Southern Pacific Company, in both cases.”

This instruction, in our view, was erroneous so far as the appellee is concerned, for the reason that in determining whether or not the negligence of the railroad company was the proximate cause of the injury the fact that the driver of the automobile was also negligent is not a determining factor. The negligence of both'may have been concurrent, co-operating' to cause the injuries to the appellee. If the driver of the automobile saw the approaching train in time to stop, any negligence of the railway company in failing to give notice of the approach of the train would no longer be an operating cause for the injury. If, however, she did not see the approaching train, although she might have done so by looking, and, in ignorance of the fact that it was approaching, moved forward to the point of collision, the failure of the railway company to give warning of the approach of the train tending to contribute to her ignorance, and therefore to the disaster, would be a proximate cause of the injury.

In view of the necessity of a new trial of this action we note another assignment of error. Appellant sought an instruction to the effect that, if the appellee were asleep cm the back seat of the automobile, he was not exercising ordinary care. We think that the court properly left this question to the jury, and that appellant’s instruction No. 36 was properly refused, and the court’s instruction on that subject, excepted to by the appellant, was' properly given. The general effect of this instruction is indicated by the following sentence contained therein: “Whether in this case he did exercise such care is a question for you to determine, having in mind that he was 13 years of age at the time of the accident.”

Judgment reversed.

SAWTELLE, Circuit Judge, concurs.


source: Caselaw Access Project

author: VAN VALKENBURGH, Circuit Judge.

license: Public Domain

text:
    CARDINAL et al. v. UNITED STATES.
    No. 9075.
    Circuit Court of Appeals, Eighth Circuit.
    May 1, 1931.
    Will A. Blanchard, of Anoka, Minn., and Thomas E. Latimer, of Minneapolis, Minn., for appellants.
    Lewis L. Drill, U. S. Atty., and Robert Y. Renseh and O. A. Blanchard, Asst. U. S. Attys., all of St. Paul, Minn.
    Before YAN VALKENBURGH and BOOTH, Circuit Judges,, and MUNGER, District Judge.
   VAN VALKENBURGH, Circuit Judge.

Appellant Adolphus Cardinal lives on a farm of three hundred and twenty acres situated sixteen miles north of St. Paul, Minn. Appellant Ray Cardinal is his son, and lives upon another farm of seventy-six acres. This latter tract also is the property of Adolphus Cardinal, and is situated one and one-half miles from the latter’s home. Appellant Archie Cardinal, son of Adolphus Cardinal, twenty years old, lives with his father. Adolphus Cardinal had placed his son Ray on this seventy-six acre tract; it was known as the Ray Cardinal farm, and the father intended that ultimately it should become the property of his said son. Adolphus Cardinal, however, still retained both title and jus disponendi. He testifies that, about October 1, 1927, two men came to his home place, said they were trappers and wished to lease an acre of his land in the vicinity of a knoll or hill on the Ray Cardinal farm near Otter Lake, upon which to build a shack for trapping, hunting, and fishing. As a result of these negotiations he produced a lease dated November 1, 1927, running to one A. Johnson, as lessee, for a period of five years at an annual rental of $25, and testifies that two installments of rental had been paid him prior to January 24, 1929.

It appears that Ray Cardinal came upon the seventy-six acre tract October 27, 1927. With the financial assistance of his father he built on the place a four-room house and a bam. He says that in the fall of 1928 two men came to his place, said they were the ones who had rented the land from his father, and asked permission to prepare in his barn a. place in which they could sleep. They agreed to furnish the material and build the room themselves. Permission was granted. The room was built and meagerly furnished in November, 1928.

January 24, 1929, in the midst of a blizzard, prohibition officers visited the Ray Cardinal farm. They found tracks leading from the barn to the knoll or hill, at about which point the hunting shack was supposed to be built. Instead of a shack.the officers discovered a cave, eighty feet long by forty feet wide, about ten feet high at the entrance, and twenty feet high at the opposite end. At the rear was an additional space containing about eighty square feet. This cave was entered by a trapdoor about three feet square situated on the side of the hill, and, at the time, almost entirely concealed by the covering of snow. The cave contained a very elaborate and extensive distilling plant, not at that time in operation; but the officers found there five barrels, containing approximately two hundred and fifty gallons of high-proof “moonshine” whiskey. Prom the cave tracks of a man and a dog led back to the house of Ray Cardinal, distant about one thousand feet. The officers proceeded from the cave to this house and placed Ray Cardinal under arrest. One of the officers then returned to White Bear, Minn., for assistance. Officer James Harney remained. At about 2 o’clock in the afternoon Archie Cardinal drove up with a sleigh in which were three men besides himself. He says he came to get a load of stumps from his brother’s farm. He claims that he had picked up the three men, strangers, who had asked him for a ride. Two of these three men were identified as Ben Holtzshutter and Prank Giroux. The third man is known only as John Doe. He and Giroux speedily made their escape, and are still fugitives. Archie Cardinal admits that in October, 1928, he hauled a load of corn sugar from St. Paul to the Ray Cardinal farm, unloaded it in the pasture in which the eave was situated, and behind a woodpile at a distance of one hundred or one hundred and fifty feet from the barn; that he did this at the instance of Holtzshutter, who paid him $6 for the hauling. Ray Cardinal subsequently admitted that Holtzshutter was one of the men who came to him about renting the room in his barn. Adolphus Cardinal also identified Holtzshutter > as the man who came with Johnson to lease ground for the hunting shack. Government officers testified that Archie Cardinal had stated to them that he had assisted in making the excavation for the cave, and that the team and scraper of Ray Cardinal had been used in this work. This was denied by Archie and Ray Cardinal at the trial of this ease. All three appellants stoutly denied any knowledge of the existence of the still and protested their innocence of participation or interest in the unlawful enterprise.

March 2, 1929, an-indictment was returned in the District Court for the District of Minnesota, charging that, January 24, 1929, in the cave heretofore described, Archie Cardinal, Ben Holtzshutter, Adolphus Cardinal, Ray Cardinal, Prank Giroux, and one John Doe (specifically described) “did feloniously have in their possession and under their control a certain still and distilling apparatus set up, used, and intended for use in the manufacture of distilled spirits, to-wit, whisky, which said still and distilling apparatus was not and had not been registered with the Collector of Internal Revenue for the District of Minnesota,” etc. The three appellants were the only ones in custody when the ease was called, and they alone were tried. Yerdict of guilty resulted. The assigned errors relied upon deal entirely with the charge of the court.

This prosecution is brought under the provisions of section 281, title 26, USCA, the part material to the question now before us reading as follows: “Stills and distilling apparatus shall be registered immediately upon their being set up. Every still or distilling apparatus not so registered, together with all personal property in the possession or custody, or under the control of such person, and found in the building, or in any yard or inclosure connected with the building in which the same may be set up, shall be forfeited. And every person having in his possession or custody, or under his control, any still or distilling apparatus set up which is not so registered, shall pay a penalty of $500, and shall be fined not less than $100, nor more than $1,000, and imprisoned for not less than one month, nor more than two years.”

The court in its charge practically narrowed the ease against appellants in the following language: “* * * 'The evidence does not seem to disclose that they were actively engaged in the operation of the still, and did not have it in their possession or under their control in that sense, and you' were told that if they are guilty it is because they were aiding and abetting; that is, they were assisting in some way those who were really guilty in a primary way. They were aiding and assisting them to have this possession and this control.”

The aiding and abetting upon whieh the court based its instructions to the jury consisted (a) in renting the site for the still with knowledge that it was to be used for that purpose, or (b), if that knowledge came afterwards, in consenting to and aiding in the continued unlawful possession. The statute defining aiders and abettors (section 550, title 18, USCA) as principals is very broad in its terms. It reads: “Whoever directly commits any act constituting an offense defined in any law of the United States, or aids, abets, counsels, commands, induces, or procures its commission, is a principal.”

Throughout the submission of this case it was accepted and, in substance, stated that the defendants were not in actual physical possession and control of the still and distilling apparatus. The potential guilt of appellants was based upon the theory that they were aiders and abettors in the unlawful possession and control of others. The suggestion was made that this offense, demanding actual possession and control and duty to register, excludes the element of aiding and abetting as denounced by the statute. We do not.think the application of the act is so limited. While it is at least doubtful whether the offense of concealing assets from a trustee in bankruptcy can be committed by another than the bankrupt, or one who has been discharged as such (United States v. Rabinowish, 238 U. S. 78, 86, 35 S. Ct. 682, 59 L. Ed. 1211), nevertheless it has been consistently held that all who aid and abet in such concealment are liable as principals. Barron v. United States (C. C. A. 1) 5 F.(2d) 799; Reinstein et al. v. United States (C. C. A. 2) 282 F. 214.

In Rosencranz v. United States (C. C. A. 9) 155 F. 38, 43, it is held that “a man who rents a house to be kept as a disorderly house, and which is so kept with his knowledge, especially where he derives a profit from that mode of using the property, may well be called the keeper of the house and be punished as such,” following Lowenstein v. People, 54 Barb. (N. Y.) 299, and People v. Erwin, 4 Denio (N. Y.) 129. The decision is based upon the general proposition that “all who procure, counsel, aid, or abet the commission of the crime are principals."' Appellants are persons competent to commit the offense charged, and no reason appears why they may not aid and abet such unlawful acts of others. Counsel, however, urge the well-known rule that “knowledge without some evidence of participation is not enough. Circumstances merely arousing suspicion of guilt are insufficient.” Tingle v. United States (C. C. A. 8) 38 F.(2d) 573, 575; Turinetti v. United States (C. C. A. 8) 2 F.(2d) 15; United States v. Newton (D. C.) 52 F. 275, 289; United States v. McClarty (D. C.) 191 F. 518, 522.

A number of conspiracy cases have been cited, and others examined are instructive upon the point under consideration. In Tur-cott v. United States (C. C. A. 7) 21 F.(2d) 829, the general rule is stated that active participation in an alleged conspiracy is necessary. Mere knowledge of the illegal acts of others is not enough. Liberato v. United States (C. C. A. 9) 13 F.(2d) 564, and Cos-tal et al. v. United States (C. C. A. 6) 13 F. (2d) 843, are not helpful, because, in those eases, active participation is shown. McDaniel et al. v. United States (C. C. A. 5) 24 F.(2d) 303, 305, hold's that knowledge that others are in a conspiracy to violate the law and full sympathy with and approval of the object of that conspiracy without more would not make one a party. In Brady v. United States (C. C. A. 7) 41 F.(2d) 449, appellant was charged with one De Keyzer of conspiracy to violate the National Prohibition Act. Brady, the owner of a former saloon property, vacant some years, leased the premises to De Keyzer, who was later found guilty of possession and sale, and the maintenance of a nuisance. The court found that Brady must have been “well aware of the violations of law on his property and of the unlawful character of the business there being transacted.” It was held that, for this reason, a jury question was presented as to both defendants. The holding of the Fourth Circuit in Di Bonaventura et al. v. United States (C. C. A.) 15 F.(2d) 494, 495, is especially interesting in its application to the ease at bar, and demands liberal quotation for the better understanding of that application: “A landlord who knowingly allows liquor to be manufactured on his premises in violation of law is guilty of maintaining a nuisance in contravention of section 21 of title 2 of the National Prohibition Act, 41 Stat. 314 (Comp. St. § 10138½jj [27 USCA § 33]). And the failure of the landlord to stop the unlawful manufacture after knowledge that his premises are being used for that purpose is evidence which the jury may consider on the question of aiding and abetting, and which, under some circumstances, may justify his conviction of manufacturing in violation of the statute. Reynolds v. U. S. (C. C. A. 6th) 282 F. 256; Steir v. U. S. (C. C. A. 1st) 2 F. (2d) 149. And it is trap also that, where one with knowledge of the existence of a conspiracy aids the conspirators in the carrying out of their unlawful design, he is equally guilty with them. Simpson v. U. S. (C. C. A. 4th) 11 F.(2d) 591; Rudner v. U. S. (C. C. A. 6th) 281 F. 516. But a landlord is not necessarily guilty of conspiracy to violate the Prohibition Act merely because he has knowledge that liquor is being manufactured on his premises and does not stop it.”

This holding was based upon the consideration that the crime of conspiracy is distinct from that which is the object of conspiracy, as appears from the language which follows: “The learned trial judge evidently had in mind the rule that one who, with knowledge of the existence of a conspiracy, aids in carrying out its design is guilty with the other conspirators; but the trouble is that the portions of the charge complained of authorized a conviction, not upon a finding that a conspiracy existed, and that the landlord, with knowledge of its existence, aided the conspirators in carrying out its purpose, but upon a finding of no more than that liquor was being manufactured on his premises, and that he knew what was going on and did not stop it. This might have justified a conviction of maintaining a nuisance or of unlawful manufacture, but not a conviction of the felony of conspiracy, in the absence of any finding that the landlord entered into a combination or agreement to violate the law, or that he, with knowledge that a conspiracy existed, not merely that the law was being violated, aided the conspirators in carrying out their unlawful design.”

In Reynolds v. United States (C. C. A. 6) 282 F. 256, 257, it was held that, although appellant’s status was that of a mere landlord, yet, if she had knowledge that her tenant was carrying on the distilling charged, she would herself be guilty of manufacture. Concerning this aspect of the charge, the Circuit Court of Appeals said: “We do not doubt that the relation of a landlord to manufacturing carried on by a tenant, and after the landlord has knowledge of the tenant’s enterprise, may be such as to constitute aiding and abetting, and accordingly to make the landlord a principal, under Criminal Code, § 332 (Comp. St. § 10506 [18 USCA § 550]), and liable to conviction upon the indictment for the principal offense. It is upon this view of the matter that the charge is to be justified, if at all. However, we think the inference of aiding and abetting is rather permissive than imperative. A landlord must not only have knowledge, but, after sufficiently complete notice or knowledge, a reasonable time must have elapsed for him to reach his tenant and insist upon either vacation of the premises or an absolute cessation of the illicit business. Indeed, the longer mere nonexercise of a power to prevent would not necessarily be aiding and abetting; it would be one of the elements supporting a composite inference. U. S. v. Gooding, 12 Wheat. 460, 475, 6 L. Ed. 693; Words and Phrases, First, Second and Third Series, ‘Aiding and Abetting.’ The extent of that reasonable time and the character of the noninterference are influenced by all the conditions .of the particular ease, and by the charge these additional elements were, in effect, excluded from the jury’s consideration.”

We see no reason why the offense of aiding and abetting may not be committed in connection with the unlawful possession, custody, or control of an unregistered still, as well as in eonn'eetion with the illicit manufacture of liquor or the maintenance of a nuisance. It is further our opinion that one cannot knowingly permit his premises to be used for an unlawful purpose, thereby contributing to the success of the enterprise in a very substantial way, without becoming a party thereto, unless, within a reasonable time after becoming aware of the unlawful use, dependent upon the circumstances of the individual case, he takes steps reasonably calculated to terminate that unlawful use. In the instant case, as in the Reynolds Case, supra, this important qualification was not sharply submitted to the consideration of the jury.

As to some of the appellants, the evidence would tend to show participation in the enterprise in jointly exercising possession, custody, and control of the unregistered distilling plant. It was located upon the farm occupied by -Ray Cardinal. He furnished sleeping quarters for those who rented this parcel from his father. There was testimony that his team was employed in the excavation, and that he warned his brother, and those who came with him on the date of the raid, that they had better “get out” because federal officers had raided the premises. His knowledge of the existence of the plant was a matter of legitimate inference. Archie Cardinal also might well have been found to be a principal. He appeared with the others in a blizzard on the day of the raid, and made the rather flimsy pretext that he had come for a load of stumps. There was testimony that he had worked upon the excavation of the cave, and he admits hauling a load of corn sugar, and unloading it behind a woodpile on the premises at the instance of Holtzshutter.

’ Adolphus Cardinal, the father, owned the land and made the lease of the ground upon or under which the plant was installed. No other connection with the enterprise is shown. That hiá sons might have informed him of the true situation amounts to little more than suspicion of guilt, which is not enough to warrant conviction. He lived one and one-half miles from the location of the still; and testifies that he had been unable to" walk much and had never visited the place since the pit was dug. But the main ground of participation, submitted by the court, was that of aiding and abetting by permitting the premises to be used with knowledge of the unlawful purpose. This matter received especial emphasis and was sharply defined. At. one time, during the deliberation of the jury, the court said :

“The question is whether or not these defendants, or any of them, were so intimately connected with the maintenance of the still at that place and with the possession of it, through the furnishing or providing the place, that they knowingly aided and abetted? •
“Juror: You spoke about knowing that this still existed. I was just going to ask if it would make any difference whether that knowledge came to me before the still was in operation or afterward? Would the same responsibility rest with me if I came to the knowledge after the still had been established, as if I had known it in advance?
“The Court: In respect to that, if the knowledge came afterward, and the conduct of the man was such that he consented to and aided in the unlawful possession, it would be equally binding as if he knew of it in advance, as a contemplated proposition, otherwise not.”

Repeated statements by the court advised the jurors that they would be justified in returning a verdict of guilty against the defendants if they had “knowledge that the land under their control was being unlawfully used for the purpose in question, with their consent and acquiescence.” Obviously mere consent and acquiescence would not suffice in any case unless that specific defendant had the power and the duty to terminate the tenancy. Neither Ray Cardinal nor Archie Cardinal had this power. A conviction on this ground could not be allowed to stand as to them. As stated above, the evidence against Adolphus Cardinal, the owner, is of doubtful substance.

Another serious criticism is made to the court’s submission. It is that the charge of the court was argumentative, emphasizing testimony favorable to the government and discrediting that of the defendants. We find it necessary to quote somewhat at length from the charge. The following paragraphs have to do with the claim of defendants that they had no knowledge of the existence of the still:

“You know what the situation was at the place in question. The young man, Ray Cardinal, had lived on the place for a year and a few months. This cavern, or dug-out, where the still was, was somewhere from four hundred to a thousand feet from his residence; that is, it was somewhere from one block to two blocks and a half — the ordinary city block, from his residence, and evidently had been there for some time. The excavation was such that at least one thousand cubic yards of dirt had to be removed, perhaps considerably more than that. You know what he elaims in connection therewith — -that he had never seen it, did not know it was there. He has a right to say that, if it is true; if it is not true, he has not any right to say it.
“You know that the father elaims to have rented the place, in the fall of 1927, and that although this large still was found there, he has never been there since, so far as we know. He has a right to keep away from it, and to tell you the truth in reference thereto; he has no right to tell anything else.
“The faet that the young man did not know of it, or elaims that he did not know of it, the fact that the older man elaims he did not know of it, and did not go to see it, may have, or may not have some considerable bearing with you in determining whether they or either of them are telling the truth in connection with such a matter. What is the reasonableness, or the unreasonableness of the story ? Did they, or either of them, know well enough that something of that kind was going on there, and know well enough that they were furnishing a place for it, and kept away intentionally, if they kept away at all? Or, is it a faet that, in entire innocence, they had no knowledge whatever that such a still was there? * * *
“Without speaking definitely about this case, you must understand that in many of these cases that are for trial, and even at this term of court, let me say — I am not speaking particularly of this ease, but in the trial of lawsuits, the effort is constantly being made to see just how gullible a jury is, just how much they will swallow, just how simple minded they are; that is sometimes on the one side, and sometimes on the other, that the effort is being made. You must be shrewd and far sighted, and see to it that nobody shall be encouraged to try to impose upon you, or make you believe stories which sensible people would reject, wherever the attempt is made, whether by the government people in a case like this, or in a civil action by the plaintiff, or in either kind of an action, by the defendant, or his witnesses. * * ®
“If these men or any of them were not connected in any way with this still, you would know well enough what your duty must be under the circumstances; it would be to find the defendants * * * and eaeh of them not guilty. Now, then, by reason of their propinquity to this still, by reason of the opportunity which they had for knowing that of which they say they never availed themselves, by reason of the other facts which the Court will not detail for you, —if you are satisfied that they or any of them are guilty, it would then of course, be your duty to convict.”

The jury retired at 4:15 p. m. March 15, 1929. At 9 o’clock the next morning the jury appeared and the following colloquy took place:

“The Court: Ladies and gentlemen, have you elected a foreman?
“Mrs. Kellington: Yes, your Honor.
“The Court: You are the foreman, are you Mrs. Kellington?
“Mrs. Kellington: Yes.
“The-Court: There is nothing .startling at all in connection with asking you to come in this morning at this time. I assume, of course, that you have not agreed ?
“Mrs. Kellington: No, we have not.”
The court then proceeded to instruct the jury further. Among other things, it said: “If there was someone who was knowingly making it more easily possible for these people to maintain and control that still, and this assistance was of a substantial character, the person so rendering such assistance is equally guilty with those that were in the cave and operating or maintaining or controlling the still.”
At 2:15 p. m. of the same day, March 16th, the jury returned to the court.
“The Court: Mr. Foreman, you have indicated that you want further assistance?
“The Foreman: No, we cannot come to any agreement.
“The Court: Well, that seems to be the situation, you think?
“The Foreman: Yes.”

The court then inquired what points were troubling them, and a juror said:

“There seems to be some question among the twelve in regard to the part of the defendants in this ease.
“The Court: Yes. Well, so far as we know, the part, if any, which they had, or which any of them had, was in connection with the furnishing or providing a place where this still might be operated, and where it might be possessed and controlled by, perhaps, somebody else. As I indicated to you this morning, perhaps it was Mr. Holschut-ter, or somebody else. Of course, Mr. Hoi-schutter had no right to be on the ground at all, unless by consent of those who had the general control of it. Now, those who had such general control come to you and say that they knew nothing about it; they did not know anything about any such still being there at all. The outstanding fact, however, is that it was a very large affair. You know the distance that it was from the house, and you know whether it is likely or is not likely that such a thing was going on there without people all around knowing about it. They say they did not know of it. Well, give that such weight as you think it is fairly entitled to receive.
“Then, there are the other certain matters, including the fact that the men were living in the' barn for a time, — some men, anyway; the proximity of the place to the house; whether it is likely that it was known of by the owners, or those having charge of the premises.
“Maybe the defendants are telling the truth, and maybe they are not. Of course, there might be a large still in my backyard, and I might say, ‘I don’t know anything about it,’ but you would not believe me at all. You would say, ‘You are just saying that because you think that will help you most.’ Now,' are these people doing the same thing, or are they tellin the truth when they say they did not know anything about it, their part in it, if they had any part, and the Court does not indicate that at all, leaving it to you; your good sense is called for; your judgment is being drafted. The part which they had in it, if any, was in providing •the place, or furnishing the place where these operations might be carried on. There are various considerations on one hand, which are more or less persuasive. Now, you might say they are very persuasive, or some of you may think they are not, which would lead to the conclusion that they did not know what was going on, or that when they now say they did not, they are not telling us the truth.
“On the other hand, you have seen them, and they have said that they did not know about it. Maybe that is the truth. I am saying that that is possibly the truth. That is for you to say; it is not for the Court to say; it is for you to say. Do you say that those people were living there and had control of that place, and that they were going and coming, and had no information of any still there ? Or, do you’ say that they must have had the knowledge; that they must have known that they were providing such a place?”

At 5:25 p. m. of March 16th, the jury returned again to the court room.

“The Court: Mr. Foreman, you have not agreed, and you have come into court, as I understand, to ask for further assistance have you not? *
“Foreman: No, we have all the instructions we want, but we cannot seem to agree.”

Thereupon, the court, inviting questions from the jury, entered upon a rather extended charge, covering, in questions and answers, more than five pages of the record. At none of these supplemental charges were counsel for defendants present, but in all of them exceptions were allowed to each statement of the court.

As said by this court in Rudd v. United States, 173 F. 912, 914: “We do not mean to impair in any degree the right of a trial court in both eivil and criminal eases to comment upon the facts, to express its opinion upon them, and to sum up the evidence, for that is one of the most valuable features of the practice in the courts of the United States. A judge should not be a mere automatic oracle of the lawj but a living participant in the trial, and so far as the limitations of his position permit should see that justice is done. But his comments upon the facts should be judicial and dispassionate, and so carefully guarded that the jurors, who are the triers of them, may be left free to exercise their independent judgment.”

Undoubtedly, taking his charge as a whole, the learned trial judge, actuated by the best of his motives, endeavored to hold the scales of justice level between government and defendants; but we cannot escape the conviction that, in his zeal to avoid a mistrial, particularly by his supplemental charges, repeated at short intervals, generally without request from the jury, he unconsciously exercised undue pressure in securing a verdict. Our conclusion is, for reasons appearing in this opinion, that the judgment below should be set aside and the case remanded for a new trial. It is so ordered.


author: LINDLEY, District Judge.

text:
    THIEL SERVICE CO. v. COMMISSIONER OF INTERNAL REVENUE.
    No. 4393.
    Circuit Court of Appeals, Seventh Circuit.
    June 2, 1931.
    Laurence Graves, of Washington, D. C., and E. J. Quinn, of Chicago, Ill., for petitioner.
    F. Edward Mitchell, of Washington, D. C., G. A. Youngquist, Asst. Atty. Gen., and Sewall Key and Hayner N. Larson, Sp. Assts. to Atty. Gen. (C. M. Charest, Gen. Counsel, Bureau of Internal Revenue, and Stanley Suydam, Sp. Atty., Bureau of Internal Revenue, both of Washington, D. C., of counsel), for respondent.
    Before EVANS and SPARKS, Circuit Judges, and LINDLEY,'District Judge.
   LINDLEY, District Judge.

This is a review of the decision of the United States Board of Tax Appeals approving the assessment of a deficiency in income and profits tax of petitioner for the year 19191 The sole question involved is whether the assessment was barred by the statute of limitations. Originally petitioner complained also of an assessment for the year 1918 but has now abandoned its contention in that respect.

Petitioner’s return for the year 1919 was filed February 10, 1920. The time within which assessments thereon might be made expired five years from the date of filing, viz., February 10th, 1925. Revenue Act 1926, § 277 (a), (b), and section 278 (c), 26 USCA § 1057 and note, and section 1060 note; Revenue Act 1924, § 277 (a) (2), 26 USCA § 1057 note; Revenue Act 1921, § 250 (d), 42 Stat. 265; Revenue Act 1918, § 250 (d), 40 Stat. 1083.

On November 25, 1924, petitioner, acting through its president, filed a waiver extending the time for making the assessment for one year after the expiration of the statutory period, thus enlarging the time within which an assessment might be made to February 10, 1926. On December 4, 1924, in reply to a request from the government, petitioner, again acting through its president, filed a seeond waiver, the legal effect of which was to extend the period one year from the previously enlarged period. The assessment complained of was beyond the time included within the first extension but within that of the second.

The successive extensions, made before the expiration of the respective preceding periods of limitation, were, under the decision of the Supreme Court in W. P. Brown & Sons Lumber Co. v. Burnet, 282 U. S. 283, 51 S. Ct. 140, 75 L. Ed. 343, decided January 5, 1931, valid, unless there appears in evidence some fact invalidating the seeond under some recognized legal ground for rescission, such as mutual mistake or fraud.

The evidence discloses that the president of petitioner executed each of the waivers in behalf of the company. Though the tax attorney of petitioner was not consulted be-f ore' the seeond waiver was filed, the president must have known that he signed both waivers. The seeond waiver remained on file, without protest or objection for more than three years, long after the time included within the first extension within which the Commissioner might have levied an assessment. Though the request for the seeond waiver may have been made because of oversight of the first, no tangible evidence of such fact appears, and the government having on file with it the two waivers, each executed by the president and providing for successive extensions, had, in the absence of any objection thereto, a right to rely thereon. It is now too late for petitioner to attack the validity of the waiver. If it executed the second extension under a misapprehension, good faith required that it call its objections to tbe attention of tbe government before the expiration of the first extension and thereby prevent reliance upon the second and postponement of assessment to a time covered by the latter. Familiar principals of the law of estoppel adequately support this conclusion.

The evidence amply and substantially supported the Board’s finding, and it cannot, therefore, be disturbed upon review. W. S. Bogle & Co. v. Commissioner (C. C. A.) 26 F.(2d) 771; Bedell v. Commissioner (C. C. A.) 30 F.(2d) 622.

Accordingly the order of the Board of Tax Appeals is affirmed at the cost of petitioner.


author: NETERER, District Judge.

text:
    PANKRATZ LUMBER CO. v. UNITED STATES.
    No. 6363.
    Circuit Court of Appeals, Ninth Circuit.
    May 25, 1931.
    Lundin, Barto & Devin, of Seattle, Wash., for appellant.
    Anthony Savage, U. S. Atty., and Jeffrey Heiman, Asst. U. S. Atty., both of Seattle, Wash.

    Before WILBUR and SAWTELLE, Circuit Judges, and NETERER, District Judge.
   NETERER, District Judge.

The appellant corporation was indicted in two counts, and George and John Pank-ratz, president and treasurer, respectively, of appellant, were indicted in two- counts of separate indictments charging falsification of income tax returns for the years 1927 and 1928 (26 USCA § 1266). The acts and transactions charged in each indictment are substantially the same, George and John Pank-ratz, as president and treasurer, made the returns for the appellant. The appellant was-eonvieted on count Z, charging falsification of the 1928 return, and -the Pankratzes were acquitted- ,on both counts. Appellant contends that the verdict of conviction is fatal because inconsistent and, from denial of motions in arrest of judgment and for a new-trial, appeals.

It was said at bar and in the briefs that the indictments were consolidated’ and tried together. 18 USCA § 557,. authorizes-consolidation of indictments when the parties are the same and the acts and transaction!are the same. When indictments are consolidated they become in legal effect separate-counts in one indictment. Kettenbach v. United States (C. C. A.) 202 F. 377. In the--instant ease the parties are not the same. There is no order of consolidation in the record. The indictments were tried together,submitted on the same evidence, and separate-verdicts returned. Separate indictments maybe tried by the same jury and on the same evidence by consent of all the parties, event-hough the parties may not be the same in theindietments.

Appellant is a distinct corporate entity,, and the fact that its officers are the sole stockholders does not change the status or relation. The theory opposing inconsistent verdicts is no doubt former acquittal. If A is charged in several indictments with the same transad-' tions and acts, and these indictments are consolidated and he is acquitted on one count and convicted on another for the same transactions and acts, to permit the inconsistent verdict to stand would punish him for aots- and transactions of which the jury had acquitted him. The finding of not guilty becomes res ad judicata as to A; but B, on the-same charge, may not on conviction invoke a not guilty verdict as to A as res adjudieata. In the instant ease, irrespective of any view the court may have as to inconsistent ver-diets, the appellant may not claim that the verdict of not guilty as to the officers is inconsistent as to it and, therefore, res ad judi-cata. There is no intimation that the evidence is insufficient to convict appellant; ample evidence is disclosed by the record.

Affirmed.


author: FOSTER, Circuit Judge.

text:
    RUSSELL v. EDMONDSON et al. In re GODFREY MARBLE CO.
    No. 6155.
    Circuit Court of Appeals, Fifth Circuit.
    May 29, 1931.
    Prank A. Holden, of Atlanta, Ga., Horace M. Holden, of Athens, Ga., and Frank R. Martin, of Atlanta, Ga., for appellant.
    John L. Tye, Jr., of Atlanta, Ga. (Tye, Thomson & Tye, of Atlanta, Ga., on the brief), for appellees.
    Before BRYAN, POSTER, and HUTCH-ESON, Circuit Judges.
   FOSTER, Circuit Judge.

This is an appeal from a judgment vacating a restraining order, issued by the referee, which enjoined the sale of certain real estate belonging to the Godfrey Marble Company, against which a petition for involuntary bankruptcy had been filed, and dismissing the petition of a receiver appointed to said company for an injunction to permanently stay the sale.

It appears without dispute from the record that on December 1, 1926, the Godfrey Marble Company executed and sold a series of bonds secured by a first mortgage on certain real estate in Pulton county, Ga., naming appellee the Atlanta Trust Company as trustee. A default occurred and the trustee instituted foreclosure proceedings in the superior court of Pulton county on July 2, 1930. A decree of foreclosure was entered on November 4,1930, and appellee Edmond-son was appointed commissioner to make the sale. The property was advertised for sale on December 2, 1930. On that date the proceedings in bankruptcy were instituted, and appellant was named as receiver. He immediately applied to the referee for a restraining order to stop the sale, on the ground that the outstanding bond issue was approximately .$23,000, while the property was carried on the boobs of the company at a net value of $97,000, and that he believed that it could be administered to the best interests of the creditors in the bankruptcy court. No allegation of fraud in the execution of the mortgage was made, nor was the good faith of the trustee in instituting the foreclosure proceedings attacked.

It is evident that the jurisdiction of the state court attached more than five months before the bankruptcy proceedings were instituted. The proceedings in the state court were to enforce a valid existing lien, not dependent upon the institution of that suit. Regardless of any conflict of authorities that may have heretofore existed, it is now settled that in the circumstances shown the federal courts will not interfere with the orderly procedure in the state courts because of the intervention of. bankruptcy. Straton et al., Special Commissioners, v. New, Trustee, 51 S. Ct. 465, 75 L. Ed.-, decided April 20, 1931. If there is any equity for the general creditors in the property, the trustee may obtain it by proper proceedings without bringing about an unseemly conflict of jurisdiction between the state and the federal courts.

The record presents no reversible error.

Affirmed.


text:
    PIGOTT et al. v. POE, Internal Revenue Collector (two cases).
    Nos. 5996, 5997.
    Circuit Court of Appeals, Ninth Circuit.
    June 1, 1931.
    Lawrence Bogle, Cassius E. Gates, and Edward G. Dobrin, all of Seattle, Wash. (Bogle, Bogle & Gates, of Seattle, Wash., of counsel), for appellants.
    Anthony Savage, U. S. Atty., and Jeffrey Heiman, Asst. U. S. Atty., both of Seattle, Wash., and John R. Wheeler, Sp. Atty., Bureau of Internal Revenue, of Washington, D. C., for appellee.
    Before WILBUR and SAWTELLE, Circuit Judges, and NETERER, District Judge.
   NETERER, District Judge.

These eases include the same parties, the same question of law and issue of fact, and are submitted together. From a judgment of dismissal, the plaintiffs have appealed.

Summarized, the facts are that appellants, on March 30, 1918, filed income tax returns for the year 1917, and on March 20, 3923 (No. 5996), and March 21, 1923 (No. 5997), additional assessments, without notice, were made. Claims in abatement were filed March 28, 1923, and the statutory period for the collection of the taxes expired March 30, 1923. To avoid distraint, appellants signed an escrow letter, and on June 13, 1923, in compliance therewith, deposited Liberty bonds with the Revenue Department. The additional assessments were abated in part and balance paid. This action is to recover the paid unabated tax.

Appellants contend that the collection of the additional assessment was not stayed within the meaning of section 611 of the 'Revenue Act of 1928 (26 USCA § 2611), and that the tax would not have been collected within the two days remaining after the claims in abatement were filed. The assessments complained of were jeopardy assessments, made on March 20, 21, respectively, one week before the claims in abatement were filed. Appellants may not lessen the limitation period for collection even two days. The revenue officers were active in the discharge of their official duty, as evidenced by the jeopardy assessments; and when the claims in abatement were filed the limitation was stayed;

The issue at bar was decided by the Supreme Court in an elaborate opinion by Chief Justice Hughes, Graham & Foster v. Goodcell, 282 U. S. 409, 51 S. Ct. 186, 75 L. Ed. -, affirming this court 35 F.(2d) 586, and others. At page 420 of 282 U. S., 51 S. Ct. 186, 190, the court said: “The concern of the Congress lay with the fact that payments had been made after the statute of limitations had run and with the particular situation of taxpayers where claims in abatement had been filed and the collection stayed. Section 611 was to prevent refunding the money if collection had thus been postponed.”

As to the contention that the stay must be more than a voluntary stay, the court said (page 421 of 282 U. S., 51 S. Ct. 186, 190): “ ‘Stay’ is said to be a term of art, with a meaning opposed to a mere voluntary postponement of action. .* * * A ‘stay’ compelled, rather than voluntarily granted, would be either under a judicial order or by virtue of statutory compulsion. Section 3224 of the Revised Statutes (26 USCA § 154) provides that ‘no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in* any court/ * * * Section 611 expressly applies where a claim in abatement was filed ‘with or without bond/ The word ‘stay’ cannot therefore be taken to be limited to a mandatory stay. * * * In the ease of a taxpayer, believed to be solvent, who had filed a claim in abatement, the postponement of collection would normally take place without agreement. * * * The filing of such claims did not require that there must be a postponement of collection pending decision.”

It is thus seen that every phase of the word “stay” appears to be emphasized and applied, and all have effective relation to its application in this case.

Affirmed.


author: CHASE, Circuit Judge.

text:
    THE HERBERT L. PONTIN. THE RED ASH NO. 2. PONTIN LIGHTERAGE & TRANSPORTATION CO. v. RED ASH TOWING LINE, Inc.
    No. 376.
    Circuit Court of Appeals, Second Circuit.
    May 18, 1931.
    Single So Single, of New York City (Thomas H. Middleton, of New York City, of counsel), for appellant.
    William F. Purdy, of New York City (John E. Purdy, of New York City, of counsel), for appellee.
    Before MANTON, L. HAND, and CHASE, Circuit Judges.
   CHASE, Circuit Judge.

The libelant’s steam lighter Herbert Pon-tin attempted to land at the end of the Thirtieth street pier Brooklyn, when the steam tug Red Ash No. 2 was hacking out of the slip between that pier and the one at Thirty-First street. As the slip was congested, the Red Ash had had to back and fill once or twice in endeavoring to get out before the Pontin nosed up to the end of the slip in a diagonal direction off the end of the Thirty-First street pier which extended farther out than did the pier at which she intended to land and the Pontin had seen the Red Ash so maneuvering to get out. She did not, however, signal until afterwards, and when she was actually going into the end of the slip. She was found at fault, and, as on argument her fault was conceded, we shall take no time with that now.

The Red Ash answered the Pontin’s signal when it was given, but had so much stern-way that, in spite of her effort to cheek it by going ahead, was unable to prevent drifting back into collision with the Pontin.

The District Court found that the Red Ash did all she could to prevent the collision after the signals were exchanged and found the Pontin solely at fault. It appeared, however, that the Red Ash had no stern lookout. While we agree that she acted to the best of her ability to prevent the accident after the proximity of the Pontin was called to her attention, we do not agree that that was enough to excuse her. When backing out of that slip she was not justified in blindly trusting to good fortune and the warnings of others. It was her duty to have a stem lookout, and her failure in that respect was prima ■facie evidence that the collision was due to her fault. The Genesee Chief, 12 How. 443, 13 L. Ed. 1058; The Ariadne, 13 Wall. 475, 20 L. Ed. 542. And it was encumbent upon her, if she would avoid the consequences which usually attach to such a fault, to show that the lack of a lookout did not contribute to the cause of the collision. The Madison (C. C. A.) 250 F. 850. No one now can tell what would have happened had a lookout been present. Yet it is plain that, if one had been where he should have been and had done his duty, the captain of the Red Ash .would have been warned that the Pontin was coming into the slip before that vessel gave its own .tardy signal. It is fair to believe that a warning as timely as would, or should, have been given by such a lookout would have prevented the collision. Certainly the claimant failed to show that it would not.

The decree is reversed, with directions to enter a decree for the libelant for half damages.


author: MANTON, Circuit Judge.

text:
    GLAZOW v. UNITED STATES.
    No. 398.
    Circuit Court of Appeals, Second Circuit.
    June 1, 1931.
    Olcott, Holmes, Glass, Paul & Havens, of New York City, for appellant.
    George Z. Medalie, U. S. Atty., of New York City (George B. Schoonmaker, Asst. U. S. Atty., of New York City, of counsel), for the United States.
    Before MANTON, L. HAND, and AUGUSTUS N. HAND, Circuit Judges.
   MANTON, Circuit Judge.

Appellant held a $5,000 war risk insurance policy while in the army service. He paid monthly premiums thereon up to and including February, 19191. He entered the military service August 27, 1918, and was discharged January 22, 1919. Within three months after his entrance in the service, he contracted a tubercular condition, suffered from night sweats, dizziness, coughing, and spitting up green sputum and streaks of blood, and had pains in his chest. The record of the War Department shows that he was sick while in-the service, and, when he left the service, he continued to suffer from this •malady. The physician who treated him said (that in 1919 he diagnosed his case as pulmo;nary tuberculosis, and that it was past the in.cipient stage; he was in the moderately ad- ' vanced class in 1919. A specialist in tuberculosis, examining him for the appellee in 1923, said that he was totally disabled, suffering from tuberculosis, and that he believed he could not recover. The testimony clearly establishes appellant’s claim of total disability suffering from tuberculosis.

Section 400 of the Act of October 6, 1917 (40 Stat. 409), provides for granting insurance against death or total and permanent disability of one employed in the active service in the War or Navy Department for not less than one thousand or more than ten thousand dollars upon the payment of premiums as fixed. Section 200 of the World War Veterans’ Act of 1924 as amended by section 7 of the Act of July 2, 1926 (44 Stat. 793 [38 USCA § 471]), provides that “for the purposes of this act every * * * enlisted man * * * employed in the active service under the War Department * * * who was discharged or who resigned prior to July 2, 1921 * * * shall be conclusively held and taken to have been in sound condition when examined, accepted, and enrolled for service; * * * Provided, That an ex-service man who is shown to have or, if deceased, to have had, prior to January 1,1925 * * * (an active tuberculosis disease * * * developing a 10 per centum degree of disability or more in accordance with the provisions of subdivision (4) of section 202 ■ of this Act, shall be presumed to have acquired his disability in such service between April 6, 1917, and July 2, 1921, or to have suffered an aggravation of a preexisting * * * tuberculosis * * * in such service between said dates, and said presumption ishall be conclusive in eases of active tuberculosis disease. * * *”

* [2] With the appellant found suffering from a tuberculosis condition at the time he testified to, and with the aid of the presumption of the statute, it is reasonably certain that the condition existed for some period prior to 1919, and it is conclusively presumed that the disease of tuberculosis from which he was suffering was acquired while he was in the military service of the United States. Brandaw v. United States, 35 F.(2d) 181; Mulivrana v. United States, 41 F.(2d) 734 (C. C. A. 9).

The World War Veteran’s Act is to be liberally construed in favor of the veterans. White v. United States, 270 U. S. 175, 46 S. Ct. 274, 70 L. Ed. 530; United States v. Cox, 24 F.(2d) 944 (C. C. A. 5). In this state of the proof, the verdict should have been directed for the appellant, for he was totally and permanently disabled on January 22, 1919, when discharged.

Judgment reversed.


text:
    THE HAROLD J. REICHERT. AMBROSE LIGHTERAGE & TRANSPORTATION CO. v. REICHERT TOWING LINE, Inc.
    No. 389.
    Circuit Court of Appeals, Second Circuit.
    June 1, 1931.
    Single & Single, of New York City (Thomas H. Middleton, of New York City, of counsel), for appellant.
    William E. Purdy, of New York City (John E. Purdy, of New York City, of counsel), for appellee.
    Before MANTON, SWAN, and CHASE, Circuit Judges.
   CHASE, Circuit Judge.

The libelant’s steam lighter Admiral was bound down Gowanus Canal, on December 20, 1926, with the lighters Ambrose No. 311 and Ambrose No. 161 in tow on short haw*sers. The No. 161 was towed stern first on the port side abreast the No. 311. When the Admiral was at the cove off Court street, the claimant’s tug, Harold J. Reichert, with the dredge Samson in tow, was observed coming up the canal at a speed of about one mile an hour against the ebb tide. The Reichert was then opposite Twenty-Seventh street and continued on. The Admiral stopped, noted that the Reichert was coming, on, blew a one-whistle signal which the Reichert answered, and then started ahead. When they were passing, the dredge in 'tow of the Reichert and port lighter in the Admiral’s tow came into collision.

The evidence on both sides as to the cause of the collision leaves much to be desired. It is utterly impossible to determine satisfactorily how the trouble occurred. The claimant’s testimony was to the effect that the Admiral came out of the cove at Court street and ran into collision, but the District Court held, we think rightly, that this was highly improbable and the evidence too weak to justify such a finding of fact. The libelant alleged that the Reichert was at fault for not having a competent person in charge; for failing to have a proper lookout; for navigating at excessive speed; for negligently allowing her tow to swing across the channel; and for failing to keep her tow under control. None of these allegations was proved. As this appeal is wholly on the facts, it will give some color to the situation, to quote the following from the court’s opinion: “I confess to being more troubled by accepting the libelant’s version than I am in disbelieving the respondent’s.”

The court did find, however, that the canal was so congested at the time the Reichert entered it that she was at fault for going in then at all, and predicated her liability upon that circumstance. With this we are unable to agree. Such a thing was neither claimed when the libel was filed nor, so we think, adequately shown by the proof. No good purpose will be served by discussing when a canal is too congested to enter, and when it is not, or the question of proximate cause of a collision which occurs in congested waters. Each ease involves proof of negligence, and must stand or fall on its own facts. The li-belant this time has failed to prove a cause of action.

Deeree reversed.


author: GALSTON, District Judge.

text:
    THE K-5691.
    No. 2520.
    District Court, E. D. New York.
    May 8, 1931.
    Howard W. Ameli, U. S. Atty., of Brooklyn, N. Y. (Alfred C. McKenzie, Asst. U. S. Atty., of Brooklyn, N. Y., of counsel), for the United States.
    Louis Halle, of, New York City (Milton Kroopf, of New York City, of counsel), for claimant.
   GALSTON, District Judge.

On June 22, 1930, officers in charge of Coast Guard patrol boat C. G. 125, at about 2:30- a. m., sighted a dark object at sea, and were compelled to alter her course in order to prevent collision with it. The officer in command turned a searchlight on the object, and sighted two vessels, a smaller vessel tied to the larger one.- On the smaller vessel he saw a gunny sack. There were no lights on either vessel. After the searchlight had been turned on them, the vessels separated, and the C. G. 125 pursued the smaller vessel for about half a mile, when this vessel came to a halt as the result of a warning shot.

This point was twenty-eight miles off shore on the high sea south of Fire Island and thirty-two miles southeast of Ambrose Lightship. The officer in charge of the Coast Guard vessel boarded the motorboat K-5691, the vessel in question, and asked for the master. From one Stenzel in the pilot house he obtained the registration certificate of the vessel, Libelant’s Exhibit No. 1, which bore the information, “the principal occupation of vessel — pleasure.” At the time of the seizure, there were found on board the vessel seventy-seven sacks of assorted liquor containing more than one-half of 1 per cent, of alcohol by volume.

The government seeks a forfeiture of the, vessel under section 4377 of the Revised Statutes (U. S. C., title 46, § 325 [46 USCA § 325]). The relevant provisions of this section are: “Penalty for Violation of License. ■ — Whenever any licensed vessel * * * is employed in any other trade than that for which she is licensed, * * * sueh vessel * * * shall be forfeited.”

The vessel having a cargo of seventy-seven sacks of assorted liquor was one evidently engaged in a commercial purpose, and thus was employed beyond the limitation of her license.

It is contended by the claimant that this vessel was illegally seized, in that she was boarded beyond the twelve-mile limit. Both parties to the action rely on Maul v. United States, 274 U. S. 501, 47 S. Ct. 735, 71 L. Ed. 1171, and United States v. Lee, 274 U. S. 560, 47 S. Ct. 746, 71 L. Ed. 1202. From these eases it appears that officers of the Coast Guard are authorized “to seize on the high seas beyond the twelve mile limit an American Vessel subject to forfeiture for violation of any law respecting the revenue.”

It would seem to me, in view of the foregoing authorities, that the sole question to determine here is whether there was probable cause to believe that our revenue laws were being violated by an American vessel.

I think the circumstances preceding the seizure justified grave suspicion on the part of the Coast Guard officers. Here were two vessels, the smaller one 'tied to the larger, in the dead of night, unlighted, twenty-eight miles off shore at the nearest point, one a small vessel of but forty feet over all and ten feet beam. Even before the adoption of the Eighteenth Amendment to the Constitution, such circumstances might reasonably have justified the inference that the boats thus stationed were there for no lawful purpose.

A fortiori since the enactment of the National Prohibition Law, the common knowledge of the Coast Guard patrol and doubtless of many others that liquor is smuggled into this country by rum runners operating in circumstances similar to those disclosed herein warranted those on board the C. G. 125 in suspecting that the motorboat K-5691 was engaged in an effort to violate the revenue laws. Moreover, though these officers had no direct knowledge prior to the seizure that she was an American vessel, they were justified in believing that a small boat of her dimensions, found, as she was, at 2:30 a. m. so far out at sea, and unlighted, was an American vessel.

Claimant also contends that the dismissal of the indictment against the crew of the motorboat K-5691 for conspiracy to violate the National Prohibition Act is a bar to this libel proceeding, and relies on United States v. 2,180 Cases of Champagne (C. C. A.) 9 F.(2d) 710, 712, urging that the case stands for the proposition that a civil forfeiture cannot be incurred in a libel proceeding based upon the same state of facts urged in the criminal trial. I do not interpret the case as sustaining that broad contention, and I think that authority is readily distinguishable from the case in point, for in that ease it appeared that, while the criminal charge, as in this case, was an attempted violation of the Prohibition Act (27 USCA), the defense was that the vessel, one of foreign origin, was seeking merely a harbor of refuge. Judge Hough wrote: “A necessary consequence of acquitting on this charge, after such a defense was a holding in substance that on December 7th the crew of the Zeehond (including appellant) had no crim-' inal intent and were running for refuge, instead of running rum. Under the cases cited (see, also, U. S. v. Salen [D. C.] 244 F. 296, Sierra v. U. S., 233 F. 37, 147 C. C. A. 107, and U. S. v. Gully [D. C.] 9 F.[2d] 959, 1923 A. M. C. 279), it is impossible for the government to say (as it substantially attempts to do in one portion of this libel),— You may have been running for a harbor of refuge without present intention of violating the Volstead Act, but we will hold you civilly for not having a manifest (R. S. § 2806) and trying to smuggle liquor into the country.”

In the ease at bar there was no acquittal. The indictment was dismissed because of an unlawful arrest.

The ultimate question involved in this suit is whether the motorboat violated the terms of its license. The determination of that question need not in any way be related to the lawful or unlawful activities of those in charge of the vessel. It is sufficient to show that the boat was not a pleasure boat, but engaged in a commercial activity contrary to its license. Ford v. Kline (D. C.) 42 F.(2d) 558.

Decree for libelant. Settle decree on notice.