author: SANBORN, Circuit Judge. TRIEBER, District Judge.

text:
    FIENUP v. KLEINMAN et al.
    (Circuit Court of Appeals, Eighth Circuit.
    March 30, 1925.)
    No. 6563.
    1. Removal of causes <@=5107(1) — Objection to jurisdiction of federal court held waived by general appearance, applying for affirmative relief, and delay.
    Objection to jurisdiction of federal court, based on diversity of citizenship, under Comp. St. § 1010, was waived, where plaintiff entered general appearance, procured injunction against delivery of sheriff’s deed in defendant’s foreclosure action, and waited eight months after removal before moving to remand case to state court.
    2. Removal of causes <®=31 — Suit to redeem from sale under foreclosure decree held controversy between citizens of different states, and sheriff not indispensable party.
    Where controversy in suit to redeem from sheriff’s sale under foreclosure decree was entirely between mortgagor and assignee of mortgage, who was citizen of another state, except that plaintiff sought to restrain sheriff from delivering sheriff’s deed pending final determination, sheriff was not indispensable party, and controversy was entirely between citizens of different states, within Comp. St. § 1010.
    3'. Removal of causes <@=>31 — Indispensable parties only considered in determining right to removal to federal court.
    In determining jurisdiction of federal courts, and right to remove causes from state to federal court for diversity of citizenship, under Comp. St. § 1010, indispensable parties only should be considered.
    4..Removal of causes <@=>31 — .“Indispensable party” defined.
    “Indispensable party” is one having such interest in subject-matter of controversy that final decree cannot be rendered between other parties without radically and injuriously affecting Ms interest, or without leaving controversy in such situation that its final determination 'may he inconsistent with equity and good conscience.
    [Ed. Note. — For other definitions, see Words and Phrases, First and Second Series, Indispensable Party.]
    5. Appeal and error <§=>760(2) — Brief challenging findings and conclusions of master and court should cite pages of record on which evidence can be found.
    Under rule 24 of the Circuit Court of Appeals brief, challenging findings and conclusions of master and court, should have cited pages of record on which evidence relating thereto could be found.
    6. Appeal and error <§=>1019 — Conclusions of master on conflicting testimony not set aside or modified, unless error clearly appears.
    Conclusions of master on conflicting testimony have every reasonable presumption in their favor, and are not to be set aside or modified unless error clearly appears.
    7. Appeal and error <§=>931 (I), 1011(1) — Court’s findings and decree on conflicting evidence not disturbed, except for obvious error in law or consideration of evidence.
    Court’s findings and decree on conflicting evidence are presumptively correct, and in absence of obvious error in application of law or consideration of evidence, decree should be permitted to stand.
    Appeal from the District Court of the United States for the District of South Dakota; James D. Elliott, Judge.
    Suit by Gustav Eienup against A. D. Kleinman and another. From the decree rendered, plaintiff appeals.
    Affirmed.
    W. L. Bohnenkamp, of St. Louis, Mo. (George Williams and Oliver Sweet, both of Rapid City, S. D., W. G. Rice, of Deadwood, S. B., and James T. Roberts, of St. Lords, Mo., on the brief), for appellant.
    E. W. Fiske, of Sioux Falls, S. D. (Buell, Denu & Philip, of Rapid City, S. D., on the brief), for appellees.
    Before SANBORN, Circuit Judge, and TRIEBER and PHILLIPS, District Judges.
   SANBORN, Circuit Judge.

This is an appeal from a decree for the defendant Kleinman in a suit by Gustav Fienup to redeem 2,080 acres of Ms land from a sheriff’s sale thereof made on July 15, 1918, under a decree of foreclosure of a mortgage of $17,-000 on tMs land made on December 1, 1914. He gave this mortgage to Elizabeth Dredge, who on May 26, 1915, assigned it to the defendant Kleinman, who brought a suit against Fienup for the foreclosure of it, and on April 6, 1918, obtained a decree that Fienup was indebted to him upon the debt secured by that mortgage in the sum of $21,-207.69, and that the land should be sold under the mortgage to satisfy tMs debt. Under the statutes of South Dakota, where this land is situated, Fienup had the right to redeem from this forclosure sale, made on July 15, 1918, on or before July 15, 1919, but not later, and, if no such redemption was made, it was the duty of the sheriff to make and deliver his sheriff’s deed of the land to the purchaser at his sale immediately after the expiration of the year of redemption.

On July 10, 1919, five da!ys before the expiration of the- year of redemption, Fienup brought this suit against Kleinman and Clyde M. Cessna, the sheriff who made the sale. He alleged in his complaint that Klein-man caused a receiver to be appointed and to take possession of 840 acres of the 2,080 acres of this land on April 6, 1918, and that the rents and profits of which he was thereby '•deprived and the damages resulting to the land therefrom amounted to about $4,000. He alleged that, under a void sheriff’s certificate of foreclosure sale under a prior mortgage on 1,240 acres of the 2,080 acres, Klein-man had taken possession of the 1,240 acres, and thereby had become liable to him for rents and profits to the amount of $6,200 and $1,815 damages. He alleged that Klein-man had wrongfully caused him to incur fees for attorneys to the amount of $1,500, and that these rents, profits, damages, and this $1,500 for attorney’s fees, aggregating about-$14,000, ought to be set off against his indebtedness to Kleinman, and that he ought to be permitted to redeem from the foreclosure sale of the 2,080 acres under the $17,-000 mortgage by paying the difference between this $14,000 and the amount of the purchase price of the land at the sheriff’s! sale. He prayed for an accounting between himself and Kleinman, and -that, until the accounting could be had and this difference could be ascertained, Cessna, the .sheriff, should be enjoined from executing or delivering Ms sheriff’s deed under Ms sale of July 15, 1918, under the $17,000 mortgage.

The defendant Kleinman by his answer denied his liability to Fienup on account of the matters set forth in the complaint. The case went to final hearing, at which all the issues were submitted to, heard, and adjudged by the court below. Its decree was to the effect that Fienup, on the accounting he prayed for and obtained, was entitled to recover of Kleinman $3,746.11; that tMs amount should be and was set off, applied, and credited against Kleinman upon the de-ficieney on the judgment in the circuit court of Pennington county, S. D., upon the debt secured by the $17,000 mortgage, which deficiency judgment was in favor of Kleinman and against Pienup for $5,459.88, leaving a balance still due under that judgment from Pienup to'Kleinman of $1,713.77; and that in all other things set forth in the complaint of Pienup he was entitled to no relief, and regarding those things his suit should be dismissed, and the title to the 2,080 acres should be and it was quieted in Kleinman.

The first and chief objection made to the decree of the court below is that the federal court had no jurisdiction of this case, and that it erred in that it denied the plaintiff’s motion to remand it to the state court. A careful examination of the record, however, discloses the fact that, if Pienup ever had the right or privilege to return this case to the state court, he had waived it long before he made his motion to remand. This suit was commenced in the circuit court for the county of Pennington, S. D., on July 10, 1919. Mr. Pienup, the plaintiff, and the defendant Cessna, the sheriff, were citizens and residents of the state of South Dakota, while the defendant Kleinman was a citizen and resident of the state of Minnesota. On August 9, 1919, the defendant Kleinman presented to the state court, on notice to the plaintiff, his petition and bond for a removal of this case to the federal court below, under section 1010, Compiled Statutes, on the ground that there was a controversy in this ease which was wholly between himself and Mr. Pienup, citizens of different states, and which could be fully determined between them. On August 9, 1919, the state court accepted his bond and ordered the case removed to the federal court below. The defendant Cessna answered the complaint of the plaintiff on August 16, 1919, and the defendant Kleinman answered it on September 9, 1919.

On November 25, 1919, Pienup applied to and obtained from the federal court below an order on the defendants Kleinman and Cessna to show cause on December 19, 1919, why Kleinman should not be enjoined from applying to Cessna, as sheriff, for, and Cessna should not be enjoined from delivering to Kleinman, the sheriff’s deed to which the latter was entitled on the foreclosure sale of July 15, 1918. On December 19,1919, upon the return of this order to show cause Pien-up secured from the federal court below an injunction against the application by Klein-man for and the delivery by Cessna to him of such sheriff’s deed, on condition that Pienup within ten days should give bond in the sum of $15,000 to pay certain possible costs, damages, and other amounts that might be due Kleinman on account of his foreclosure judgment in the state court in case the court below ultimately should permit Pienup to redeem therefrom. It was not until after the plaintiff had procured this injunction from the federal court below, nor until more than eight months after the order of removal of this case to that court was made, and on April 24, 1920, that Mr. Pienup made his motion to remand this case to the state court. Never prior to that day had he made any objection to the jurisdiction of the federal court below; never had he made any special appearance therein. Meanwhile he had applied to that court for and obtained from it an order for an injunction. That application was a general appearance by him in that court, and an invocation of the exercise by that court of its general jurisdiction on his behalf, and with his long delay constituted a complete waiver of his right or privilege, if he ever had any, to a remand of this ease to the state court and- conclusively estopped him from obtaining such relief. 1 Foster Federal Practice (5th Ed.) p. 195, § 61; In re Moore, 209 U. S. 490, 496, 28 S. Ct. 585, 706, 52 L. Ed. 904, 14 Ann. Cas. 1164; Corwin Mfg. Co. v. Henrici Washer Co. (C. C.) 151 F. 938; Philadelphia & Boston Face Brick Co. v. Warford (C. C.) 123 F. 843.

Nor would the plaintiff have been entitled to such a remand if he had presented his motion for it in a manner and at a time when he could have invoked a decision upon its merits. The act of Congress provides that “when in any suit mentioned in this section there shall be a controversy which is wholly between citizens of different states, and which can be fully determined as between them, then either one or more of the defendants actually interested in such controversy may remove said suit into the district court of the United States for the proper district” (Compiled Statutes, § 1010). The controversy in this suit was whether upon any terms the plaintiff at the time he filed his complaint was entitled to redeem the 2,080 acres of land from the sheriff’s sale of it under the $17,000 mortgage, and, if he was so entitled, upon what terms a court of equity ought to permit him to make the redemption. He claimed and pleaded that he had the right to make the redemption by paying about $14,000 less than the amount for which the land was sold at the sheriff’s sale of July 15, 1918. The remov-ability of this case resolves itself, therefore, into the simple question whether or not the controversy over the plaintiff’s claim of his right to redeem and the terms of that redemption exist wholly between the complainant, Fienup, -the citizen of South Dakota, and’ the defendant Kleinman, the citizen of Minnesota, and can be fully determined as between them without danger of loss or injury to the defendant Cessna, the sheriff.

An examination of the complaint and the petition for removal discloses the fact that all the acts and omissions on account of which Mr. Fienup seeks any relief in this suit are the acts and neglects of the defendant Kleinman, and that all the relief he prays for is against him with the single exception that he asks that Mr. Cessna, the sheriff, be restrained from delivering his sheriff’s deed under the sale of July 15,1918, until the final determination of this suit. There was no averment or claim in the complaint that the defendant Cessna either had or claimed any right, title or interest in the property in controversy or in the controversy itself. Cessna was the officer upon whom, under the statutes of South Dakota, the duty was imposed under certain circumstances to make his sheriff’s deed, the duty to perform a mere administrative act like the discharge by-the clerk of a court of the duty to file a complaint, and there can be no doubt that all the controversy there was in this ease was wholly between citizens of different states, and that it could be and has been fully determined as between them without any actual or possible injury to Mr. Cessna.

■ [3] Cessna was not an indispensable party to this suit; all the rights and claims of the plaintiff could have been protected and adjudicated without his presence and without affecting him, and an injunction against the acceptance and receipt of the sheriff’s deed in controversy by Kleinman, or any of his agents or representatives, would have been as effectual as an injunction- against the making and delivering of that deed by Cessna, the sheriff. In a determination of the jurisdiction of the federal courts and the right to remove causes of action to them, indispensable parties only should be considered, because all other parties may be dismissed and disregarded, if their presence would oust or restrict the right. Boatmen’s Bank v. Fritzlen, 135 F. 650, 658, 68 C. C. A. 288, and eases there cited; Geer v. Math-ieson Alkali Works, 190 U. S. 428, 432, 23 S. Ct. 807, 47 L. Ed. 1122.

An indispensable party is one who has such an interest in the subject-matter of the controversy that a final decree cannot be rendered between the other parties to the suit, without radically and injuriously affecting his interest, or without leaving the controversy in such a situation that its final determination may be inconsistent with equity and good conscience. Rogers v. Penobscot Mining Co., 154 F. 606, 610, 83 C. C. A. 380; Bacon v. Rives, 106 U. S. 99, 104, 1 S. Ct. 3, 27 L. Ed. 69; Wormley v. Wormley, 8 Wheat. 421, 451, 5 L. Ed. 651; Sioux City Terminal R. & W. Co. v. Trust Co. of No. Am., 82 F. 124, 126, 27 C. C. A. 73. There was no error in the denial of the motion to remand.

The court below granted to the plaintiff, Fienup, the accounting for which he prayed, appointed a master, who heard the witnesses, received and reported all the evidence to the court, and made findings of the facts relevant to the plaintiff’s various claims for allowances and offsets against his indebtedness to the defendant Kleinman. The. court below considered and adopted those findings and rendered its decree based upon them. In their brief counsel for the appellant write seven objections, which they call exceptions to the findings and conclusions of the master and the court, which practically rest on the claim that the evidence in the ease did not warrant some, of those findings and conclusions. Rule 66 in equity provides that if no exceptions are filed by either party within 20 days from the filing of the master’s report that report shall stand confirmed, and that, if exceptions are filed, they shall stand for hearing before the court. The record discloses the fact that the master filed his report on December 13,1920, that the defendant Kleinman filed exceptions to it on January 3, 1921, that the master filed his findings of fact on October 19, 1921, and that on May 16, 1922, the court below confirmed those findings and adopted them as its own. But the record discloses no exceptions by Mr. Fienup or his attorneys to any part of the report of the master, or to any of his findings of fact.

Rule 24 of this court requires the appellant to file with the clerk of this court a printed brief, specifying in what the decree is alleged to be erroneous, and, “when the error alleged is to a ruling upon the report of a master, the specification shall state the exception to the report.” That rule also requires the brief to contain, not only,a clear statement of the points of law and fact to be discussed, but “a reference to the pages of the record and the authorities relied upon in support of each point,” and this court has repeatedly warned counsel that, when they consider the errors they assert too trivial to warrant them in finding and citing the pages of the record which present them, this court will' not deem them of sufficient importance to require it to search for them. Hoge et al. v. Magnes, 85 F. 355, 358, 29 C. C. A. 564; Lexington Mill & Elevator Co. v. United States, 202 F. 615, 624, 121 C. C. A. 23; Thompkins v. Missouri, K. & T. Ry. Co., 211 F. 391, 397, 128 C. C. A. 1, 52 L. R. A. (N. S.) 791. That portion of the brief of counsel for the plaintiff, Eienup, which calls to our attention what they style exceptions in their brief, that portion whereby they challenge the findings and conclusions of the master and the court, does not cite a single page of the record on which the evidence relative to any of the matters there referred to may be found. The court, however, has not failed out of an abundance of caution to consider and compare the evidence in this case with the findings of the master and the court and their conclusions, with the assistance of the brief of counsel for the defendant Kleinman, which gives many references to the pages in.the record where the matters in dispute are referred to.

The rules under which this evidence must he considered are that the conclusions of the master, depending upon the weighing of conflicting testimony, have every reasonable presumption in their favor, and are not to be set aside or modified unless there clearly appears to have been error or mistake on his part (Tilghman v. Proctor, 125 U. S. 136, 149, 8 S. Ct. 894, 31 L. Ed. 664), and, when the court has considered conflicting evidence, and made its findings and decree thereon, they must be taken to be presumptively correct, and, unless an obvious error has intervened in the application of the law, or some serious mistake has been made in the consideration of the evidence, the decree should be permitted to stand (Warren v. Burt, 58 F. 101, 106, 7 C. C. A. 105; Stuart v. Hayden, 72 F. 402, 408, 18 C. C. A. 618, [169 U. S. 1, 14, 18 S. Ct. 274, 42 L. Ed. 639]). And our conclusion is that no such error or mistake has been made in this ease, and that the decree below should be affirmed. •

It is so ordered.

TRIEBER, District Judge.

I concur in the result, and everything that is said in the opinion of Circuit Judge SANBORN, except that part of it which states that the plaintiff, by entering a general appearance and pleading to the merits in the federal court after the removal, but before filing a motion to remand, waived his right to have the cause remanded.

The petition for removal is based upon diversity of citizenship between the plaintiff and the defendant Kleinman. The plaintiff in his action joined as a defendant Clyde M. Cessna, the sheriff, to enj'oin him from executing a deed to the premises sold by him to Kleinman under a foreclosure in pursuance of a decree of the state court. As the defendant Cessna and the plaintiff were both citizens of the state of South Dakota, plaintiff, after having entered a general appearance and taken some action in the federal court, filed a motion to remand the cause upon that ground, which was by the court denied.

The opinion sustains the order denying the petition to remand upon two grounds: Eirst, that he was estopped by reason of having entered his general appearance and had asked for affirmative relief, prior to the filing of the motion to remand; and also upon the ground that the sheriff was not an indispensable party, therefore the cause was separable, and the defendant Kleinman, a citizen of a state, other than that of the plaintiff, and a nonresident of the state of South Dakota, of which state the plaintiff was a citizen, the cause was removable.

I concur in the opinion based on the last ground, but not the first. In my opinion there can be no removal from a state to a-federal court of a cause of action in which one of the defendants is a citizen of the same state as the plaintiff, and that can neither be waived, nor can the court retain jurisdiction, even by consent of parties. M., C. & L. M. Ry. Co. v. Swan, 111 U. S. 379, 382, 4 S. Ct. 510, 28 L. Ed. 462; Chicago, Burlington & Quincy Ry. v. Willard, 220 U. S. 413, 31 S. Ct. 460, 55 L. Ed. 521; Minnesota v. Northern Securities Co., 194 U. S. 48, 24 S. Ct. 598, 48 L. Ed. 870; Chicago, R. I. & Pac. Ry. Co. v. Nebraska, 251 F. 279, 163 C. C. A. 435.

The authorities cited in the majority opinion do not apply to actions in which the jurisdiction of the court as a federal court was involved, and in this cause the jurisdiction of the court below was invoked solely upon the ground of diversity of citizenship. They only refer to actions affecting the venue. A person sued in a District Court of the United States, or an action removed to it from a state court, when neither party to the action was a citizen of and a resident of the federal judicial district to which the cause was removed, but there was a diversity of citizenship, the entry of a general appearance, or the filing of any pleading other than a motion to remand, is a waiver, and would prevent a cause being remanded.

In Ex parte Wisner, 203 U. S. 449, 27 S. Ct. 150, 51 L. Ed. 264, it had been held that a cause instituted in a state court could not be removed to a federal court, although there was a diversity of citizenship, and the Chief Justice, who delivered the opinion of the court, went even further, and held that it was jurisdictional, and could not be- waived. That' part of the opinion which held that it could not be waived was expressly overruled in Western Loan & Savings Co. v. Butte & Boston Con. Mining Co., 210 U. S. 368, 28 S. Ct. 720, 52 L. Ed. 1101, and in effect In re Moore, 209 U. S. 490, 28 S. Ct. 706, 52 L. Ed. 904, 14 Ann. Cas. 1164, the court holding that the right to remove a cause pending in a state court in a district in which neither party resided, if there was the necessary diversity of citizenship was' a mere privilege and could be waived, and was waived by entering a general appearance, or doing some affirmative act prior to the motion to remand, as this only affected the venue and not the jurisdiction of the parties. This has been followed ever since.

In Lee v. Chesapeake & Ohio Ry. Co., 260 U. S. 653, 43 S. Ct. 230, 67 L. Ed. 443, the Wisner Case is entirely overruled. In General Investment Co. v. Lake Shore Ry., 260 U. S. 261, 43 S. Ct. 106, 67 L. Ed. 244, the Wisner Case in effect was overruled, although the court did not so state, as it did in Lee v. Chesapeake & Ohio Ry., supra. But in the General Investment Co. Case the court made clear the distinction between the jurisdictional question and a mere privilege. It was there held:

“This restriction [referring to section 51, Judicial Code], as repeatedly has been held, does not affect the general jurisdiction of a District Court over a particular cause, but merely establishes a.personal privilege of the defendant, which he may insist on, or may waive, at his election, and does waive, where suit is brought in a district other than the one specified, if he enters an appearance without claiming his privilege. Central Trust Co. v. McGeorge, 151 U. S. 129; Interior Construction Co. v. Gibney, 160 U. S. 217; In re Moore, 209 U. S. 490, 501; United States v. Hvoslef, 237 U. S. 1, 12; Camp v. Gress, 250 U. S. 308, 311.

“It therefore- cannot be affirmed broadly that this suit could not have been brought against the New York Central Company in the District Court for the Northern District of Ohio, but only that it could not have been •brought and maintained in that court over a seasonable objection by the company to being sued therte. And the inability of the court to proceed with the cause in the presence of such an objection would not have resulted from any want of power to entertain and determine such a suit between such parties, if they were before it, but only because the company declined to yield the necessary jurisdiction of its person. Macon Grocery Co. v. Atlantic Coast Line R. R. Co., 215 U. S. 501, 503, 508.”

The statement in the majority opinion on the question of waiver is misleading, and, in view of the fact- that the sheriff was not an indispensable party, the defendant Klein-man had a right to remove the cause from the state to the federal court, and upon that ground the refusal to remand the cause should alone be affirmed. In'addition.to the authorities cited in the opinion, that the sheriff was not an indispensable party, See Salem v. Manufacturers Co., 264 U. S. 182, 44 S. Ct. 266, 68 L. Ed. 628, 31 A. L. R. 867, the latest authority on that subject.


source: Caselaw Access Project

author: ROGERS, Circuit Judge.

license: Public Domain

text:
    In re RUSKAY et al. Petition of CRELLIN.
    (Circuit Court of Appeals, Second Circuit.
    February 2, 1925.)
    No. 132.
    1. Bankruptcy <@=140 (3)— Claimant is entitled to trace and assert right to money given to bankrupts to purchase stock.-
    Bankrupts who received money from claimant for purchase of stock for claimant occupied fiduciary relation, entitling claimant to assert his rights against bankrupts or any one ;elaiming under them voluntarily or with notice, if claimant could trace money into specific fund or property.
    2. Trusts <@=352 — Depleted trust funds mingled with other moneys cannot be treated as reappearing in sums subsequently deposited.
    Where one has deposited trust funds in his individual bank account and mingled fund is at any time wholly depleted, trust fund is thereby dissipated and cannot be treated as reappearing in sums subsequently deposited to credit of same account.
    3. Bankruptcy <@=467 — On appeal, Circuit Court of Appeals may review both questions of fact and law.
    On appeal in bankruptcy proceedings, Circuit Court of Appeals may review both questions of fact and law.
    4. Bankruptcy <@=446 — On petition to revise, courts may review questions of law only.
    On petition to revise, court may review questions of law only, and may" not review facts except as necessary to ascertain whether order is wholly unsupported by evidence, contrary to law, a mistake, or generally for any reason for which evidence may be viewed on writ of error.
    5. Bankruptcy <@=446 — Whether bankrupts’ bank balance should include checks deposited after banking hours on that day held question of law reviewable by petition to revise.
    Whether bankrupts’ deposit, in their bank account after banking hours, of checks received from claimant for purchase of stock, should be, included in balance of their account for that day for purpose of determining whether fund was depleted, was question of law reviewable by petition to revise.
    6. Banks and banking <@=121 — “Deposit slip” defined.
    “Deposit slip” is acknowledgment that amount named therein has been received by bank; it is receipt intended to furnish evidence as between depositor and depositary that on given date there was deposited sum named therein, time of deposit, and amount deposited.
    [Ed. Note. — For other definitions, see Words and Phrases, Deposit Slip.]
    7. Banks and banking <@=121 — Issuance of deposit slip admits relation of debtor and creditor for amount stated therein.
    Issuance of deposit 'slip is admission by bank,that relation of debtor and creditor has been created as to amount stated therein, and creation of that relationship does not depend on whether bank’s agent, whose duty it is to do so, thereafter enters deposit in depositor’s account, but rights of parties must be determined by real state of accounts.
    8. Banks and banking <@=(21 — Bank elerk whose duty it is to enter deposits is agent of bank, and not of depositor.
    Bank clerk whose duty it is to enter deposits is agent of bank, and not of depositor.
    9. Banks and banking <@=121 — Rule that banks close at 3 o’clock does not prevent receipt or payment of money after that hour, nor affect legal relations of parties.
    Buie that banks close at 3 o’clock is merely regulation for convenience of bank; and does not prevent receipt or payment of money after that hour, nor affect legal relations of parties if money is received or paid out, though transaction does not appear on books of bank until subsequent day.
    10. Banks and banking <@=126 — Crediting of checks indicates that bank receives checks deposited as cash.
    Intention of parties as to effect of deposit controls, and presentation of .deposit slip with cash and checks for deposit in general account, and crediting thereof to depositor’s account, indicates intention of parties that bank receives checks as cash, in absence of contrary recital.
    11. Banks and banking <@=119 — In New York, deposit of checks or drafts-in ordinary course transfers title and creates relation of debtor and creditor.
    In New York, deposit in ordinary course of . business of money, or drafts, or checks received and credited as money, vests title thereto in bank and creates relation of debtor and creditor.
    12. Banks and banking <@=I54(6) — Burden is not on depositor to show when bank entered deposits on its books.
    Burden is not on depositor to show when bank entered deposit on its books, since it is receipt of deposit, and not time of its entry, which binds bank.
    13. Banks and banking <@=(21 — in construing deposit slips, court may consider practical interpretation given thereto by parties.
    In construing deposit slips, court may consider practical interpretation given thereto by parties before any controversy arose.
    14. Banks and banking <@=126 — Bank’s entry of deposit and depositor’s withdrawals held to show that checks were received as cash.
    Bank’s entry of deposit of checks, made after banking hours, and depositor’s checking out amount in excess of his credit balance if deposit had not been counted as cash, held to show that parties regarded deposit as cash.
    15. Bankruptcy <@=140(3) — 'Title to claimant’s checks deposited by bankrupts after banking hours vested in bank on day of receipt of checks.
    Where bankrupts, after banking hours, deposited checks received from claimant for stock to be purchased for claimant, held, in tracing fund on bankrupts’ failure to carry out their fiduciary obligation to purchase stock, that title to checks vested in bank on date of deposit, and not on following day when cheeks were entered.
    Petition to Revise Order of the District Court of the United States for the Southern District of New York.
    In the matter of Samuel S. Ruskay and others, individually and as copartners trading as S. S. Ruskay & Co., bankrupts. On petition of Robert Crellin to revise the order of the District Court denying priority of petitioner’s claim.
    Reversed, with directions.
    Patterson, Eagle, Greenough & Day, of New York City (Carroll G, Walter and J. Rhodes O’Reilly, both of New York City, of counsel), for petitioner.
    Zalkin & Cohen, of New York City (S. Marshall Kronheimer, of New York City, of counsel), for trustee-respondent.
    Before ROGERS, HOUGH, and HAND, Circuit Judges.
   ROGERS, Circuit Judge.

This is a petition to revise an order made on June 11, 1924, in a proceeding in bankruptcy.

The petitioner seeks to recover the amount of two checks given by him to the bankrupts —one a check for $620, the other for $1,-167.25. They were given for the purchase of 15 shares of American Telephone & Telegraph Company stock, which shares the bankrupts agreeed to purchase for the petitioner, but which they never delivered to him if, indeed, they ever at any time purchased them. These cheeks, it appears, the* bankrupts deposited in the Old Colony Trust Company on February 21, 1922, after banking hours, although they were actually not credited on the books of the trust company in the bankrupts’ checking account until February 23d, the next banking day.

It is claimed by the petitioner that he has traced these cheeks into the bankrupts’ account and that he is entitled to recover the amount from the receiver of the bankrupts, who was appointed on February 23d; there being a credit on the books, of the trust company in favor of the bankrupts in excess of the amount' of his claim.

The court below, confirming the report of the special master to whom the claim was referred, has denied the petitioner’s right on the ground that the trust fund had been wholly dissipated prior to the appointment of the receiver and so never reached the latter’s hands.

There can be no doubt that when the petitioner paid money to the bankrupts for the purchase of the stock they occupied a fiduciary relation to him and held the money so received solely for the purchase of the stock. Equity regards a fund so paid and received as impressed with a trust in favor of the one who paid it over and who is beneficially entitled. The latter may assert his right against those to whom he intrusted it, or any one claiming under them voluntarily or with notice. Keech v. Sanford, 1 White & Tudor, Lead. Cas. (6th Ed.) 53, and notes. And see In re See, 209 F. 172, 126 C. C. A. 120; In re A. Bolognesi & Co., 254 F. 770, 166 C. C. A. 216. But a trust fund can be followed and recovered only when it can be clearly traced and identified in some certain or specific fund or property.

The petitioner failed below because in the opinion of the court he did not succeed in tracing the trust fund into the hands of the receiver of the bankrupts, it not having been made to appear to that court’s satisfaction that the money was in the bankrupts’ account in the trust company at the time of the receiver’s appointment.

It appears that an order was entered in the District Court on May 29, 1922, requiring all creditors of the alleged bankrupts to file proofs of claim on or before July 29, 1922, or be forever barred from asserting any claim against the receiver. It referred all claims so filed to a special master with power to hear and determine them and to report his determination to the court.

Pursuant to this order, the petitioner herein filed his proof of claim on June 6, 1922. In his sworn statement he set forth that on February 17, 1922, he instructed the alleged bankrupts to purchase for his account 15 shares of stock of the American Telephone & Telegraph Company at the price of $119 a share. That he was advised by them on the same day that the stock had been purchased for his account, and that the amount due for the same was $1,787.25. That thereafter and on February 20, 1922, he delivered at the office of the bankrupts in payment of the amount due for the stock, and upon the understanding that he would receive therefor certificates representing the said stock, two cheeks — one for $1,167.25 and one for $620, the total of the two cheeks being the amount of the purchase price of the stock. That, upon information and belief, each of said cheeks was indorsed by the bankrupts for collection in their account in the Old Colony Trust Company of Boston, Mass., on February 21, 1922, and the amount of the checks credited by the trust company aforesaid to the account of the bankrupts; said cheeks being paid by the respective banks upon •which they were drawn.

The claimant further stated that he had never received from the bankrupts certificates for the shares of stock so purchased by them for him. He further stated upon information and belief that at all times, until the appointment of the receiver, the moneys paid to the alleged bankrupts by him remained on deposit to the credit of the said bankrupts in the Trust Company and came into the possession of the receiver herein. He therefore claimed that of the cash balance on deposit to the credit of the bankrupts in the trust company the sum of $1,-787.25 is money belonging to him held for him in trust by the bankrupts, and he claimed that specific amount of money out of said balance. '

At the hearing before the special master the following testimony was introduced:

“Q. I ask you to look at this transcript, Claimant’s Exhibit 3; will you tell us what the balance to the credit of S. S. Ruskay & Co. was on the 20th day of February, 1922? A. $9,705.90-at the close of business.
“Q. Can you tell us what the withdrawals were on the 21st? A. On the 21st the withdrawals amounted to $3,901.27.
“Q. That left a balance of how much? A. $5,803.63, the deposits on the 21st were $1,483.86, leaving a credit at the close of the 21st of $7,288.49, and the withdrawals on February 23d were $8,601.50.
“Q. Now, you have got the transaction as between February 20th and 23d? A. Yes, sir.
“Q. And you say on the 23d of February the withdrawals from this account were in the sum of $8,601.50? A. Yes.
“Q. What does this Exhibit No. 3 show in respect to the deposits on the 23d? A. On the 23d three deposits made one for $1,-149.29, one for $3,585, one for $30.
“Q. What does it show about the withdrawals on the 23d? A. $8,601.50.”

The master found that on February 21, 1922, the bankrupts had on deposit in the trust company $7,288.49; that February 22d was a legal holiday and on that day the petition in involuntary bankruptcy was filed; that on February 23d there was withdrawn $8,601.50; that the withdrawals were in excess of the deposit on February 21, 1922, amounting to $7,288.49; that by reason of the withdrawals the deposit of February 21, 1922, was wholly dissipated. Then he found:

“That some time during the day of February 23, 1922, the time not being shown, and no evidence being adduced on the part of the claimant to indicate just when additional moneys were deposited with the bankrupts, there was deposited a further sum of $4,764.29, leaving a balance at the close of February 23, 1922, in the sum of $3,451.28.”

He added:

“I find that the trust fund of said claimant has been wholly dissipated and the mingled fund wholly depleted and cannot be treated as reappearing in sums subsequently deposited to the credit of the same account! The bankrupts being stockbrokers, the funds on deposit were constantly fluctuating, and there is no period at which one can state definitely just what specific funds were on deposit nor whether or not the trust funds of the claimant remained intact at any particular time with the bankrupts; this burden rested upon the claimant, and it was part of his ease to establish said fact affirmatively.
“I find that claimant has not borne the burden of proof; that he has not traced the trust funds into any specific fund; and that the proceeds of said claimant’s checks did not come into the hands of the trustee, but, on the contrary, were dissipated prior to the time of the filing of the petition in bankruptcy, even though” subsequent deposits caused the balance that came into the hands of the trustees or receiver to be in excess of the amount claimed by claimant.”

If the above findings of fact stood alone, the conclusion reached was correct as a matter of law. For the rule is now well established, and is not here controverted, that where one has deposited trust funds in his individual bank account and the mingled fund is at any time wholly depleted, the trust fund is thereby dissipated and cannot be treated as reappearing in sums subsequently deposited to the credit of the same account. Schuyler v. Littlefield, 232 U. S. 707, 710, 34 S. Ct. 466, 58 L. Ed. 806; Peters v. Bain, 133 U. S. 671, 693, 10 S. Ct. 354, 33 L. Ed. 696; Knatchbull v. Hallett, L. R. 13 Ch. Div. 696.

But the difficulty in this case is that the master found certain other facts. He stated:

“I find that the 15 shares of American Tel. & Tel. stock never came into the possession of the receiver; that the sum of $1,787.25 was paid by the claimant to the Boston office of the bankrupt as per two checks deposited with the bankrupts on the 20th day of February, 1922, one in the sum of $620 and the other in the sum of $1,167.25.”

He misapprehended the legal effect of that finding, in that he states that the excess of the deposits on February 21, 1922, amounted to $7,288.49, ignoring the actual deposit on that day of $1,787.25 because of the fact that it was received after banking hours and was not actually entered in the bankrupt’s account until some time on the next banking day. And then he finds that on February 23d, which was the next banking day, there was withdrawn $8,601.50 which exhausted what he treats as the balance in the account on the prior day. But if the $1,-787.25 is in law to he regarded as held by the bank on February 21st for the bankrupts and added to their account as of the date when it was actually received, the withdrawals at no time exceeded the deposits. In other words, the master in effect held that the bank became a debtor, not from the time it received the deposit, but from the time it was actually entered on the books. And he accordingly reported adversely upon the petitioner’s claim. He recommended that the claimant’s demand and petition be dismissed, and that he be remitted as a general creditor to the general fund. He applied the doctrine that a dissipated trust fund cannot be treated as reappearing in sums subsequently deposited to the credit of the same and remitted the petitioner to the position of a general creditor against the general fund.

The petitioner excepted to the master’s report, and the District Judge overruled the exceptions and confirmed the report. And the case was brought here on petition to review, and that is the proper remedy in such a ease. See Collier on Bankruptcy (13th Ed.) p'. 838.

The remedy by petition to revise and that by appeal differ as respects the power of the court to grant relief. On an appeal this court may review both questions of fact and law. Citizens’ Loan & Trust Co. v. Eberhart (C. C. A.) 298 F. 291; In re Western Rope & Mfg. Co. (C. C. A.) 298 F. 926; Stalcup v. Jepson (C. C. A.) 289 F. 479; In re Patterson-MacDonald Shipbuilding Co. (C. C. A.) 288 F. 546; Ross v. Stroh, 165 F. 628, 91 C. C. A. 616; Hatch v. Curtin, 154 F. 791, 83 C. C. A. 495; Rush v. Lake, 122 F. 561, 58 C. C. A. 447. But on a petition to revise, the jurisdiction of the Circuit Courts of Appeals extends only to matters of law. In re Iroquois Utilities (C. C. A.) 297 F. 397; In re Laureate Co. (C. C. A.) 294 F. 668; Mohler v. Norris, (C. C. A.) 291 F. 571; Gadd v. Dawson (C. C. A.) 291 F. 327; In re B. & R. Clove Corp. (C. C. A.) 279 F. 372; In re Nagel (C. C. A.) 278 F. 105; In re Donnelly, 187 F. 121, 109 C. C. A. 39; In re Stewart, 179 F. 222, 102 C. C. A. 348. While this has been said again and again in this and the other circuits, and is the general rule, we do not understand that we are under no circumstances to look into the record at the evidence upon which the findings of fact rest. We think the rule is correctly stated in Collier on Bankruptcy (13th Ed.) vol. 1, p. 832. It is there said:

“Questions of Lato Only Considered. — The court on a petition to revise, as distinguished from an appeal in bankruptcy, does not determine the facts on conflicting affidavits or testimony, but takes the facts as found by the District Court and inquires solely into questions of law. * * 41 It was intended by conferring this power of revision to provide a summary method for revising orders and decisions of courts of bankruptcy upon questions of law, and the section does not contemplate any review of facts, except as may be necessary to ascertain whether the order is wholly unsupported by the evidence, is contrary to law, a clear mistake, or generally for any reason for which evidence may be viewed on writ, of error.”

In re Hoyne, 277 F. 668, the Circuit Court of Appeals in the Seventh Circuit has recently held that on a petition to review only questions of law can be considered. But it added that the question whether the report of a master was wholly unsupported by testimony is one of law and so reviewable on a petition to revise. And in Good v. Kane, 211 F. 956, 128 C. C. A. 454, the Circuit Court of Appeals in the Eighth Circuit held that on a petition to .revise it is a question of law whether or not there is any substantial evidence to sustain a decision or order in bankruptcy. And see Kirsner v. Taliaferro, 202 F. 51, 56, 120 C. C. A. 305; In re Frank, 182 F. 794, 797, 105 C. C. A. 226; In re Lee, 182 F. 579, 581, 105 C. C. A. 117.

We have no doubt that upon the facts in this case it is a question of law whether on February 21, 1922, the trust company had in the bankrupts’ account a balance of $7,-288.49, or whether there should be added to that amount the sum of $1,787.25 which was received by the bank on that day after banking hours, although not actually credited in the account until the next banking day. If that amount is entitled to be credited on the day it was received, the bankrupts’ credit on that day was $9,075.74. In passing on that question we are not passing on a question of conflicting evidence, for there is no conflict in the evidence. It is undisputed that the deposit was made as stated and that the credit was not actually given to the bankrupts on the books until the following day.

That the deposits were made on February 21st and after banking hours appears from the deposit slips which are in evidence. Two of these slips appear in the margin. The other differs in the amount of the deposit, being for $30 and in the exact time of the deposit, which is stated as “PM 3 13.”

It is admitted that the items entered on these slips were not included in the credit balance of the day on which they were made because the deposits were received after banking hours. That seems to have been the sole reason for their omission.

Deposit slips are an acknowledgment that the amount of money named therein has been received by the bank which gives them, They are receipts and intended to furnish evidence as between depositor and depositary that on a given date there was deposited the sum named therein. They furnish evidence as to the time of deposit and the amount deposited. First National Bank v. Clark, 134 N. Y. 368, 372, 32 N. E. 38, 17 L. R. A. 580. The issuance of a deposit slip by the bank constitutes an admission by the bank that the relation of debtor and creditor has been created between the parties as to the amount stated therein. The creation of that relationship does not depend upon whether the agent of the bank, whose duty it is to do so, thereafter enters the deposit in the account of the depositor.

The bank clerk, whose duty it is to make the entry, is not the agent of the depositor but the agent of the bank. Mechanics’, etc., Bank v. Smith, 19 Johns. (N. Y.), 115. The rights of the parties must be determined by the real state of the accounts and not by the entries actually made or negligently omitted to be made. See First National Bank of Washington v. Whitman, 94 U. S. 343, 346, 24 L. Ed. 229. Mistakes in bank accounts are not uncommon. They preclude no one from ascertaining the truth and claiming its benefit.

The rule that banks close at 3 o’clock in the afternoon is merely a regulation for the convenience of the bank and does not prevent the receipt or payment of money after that hour, nor does it affect the legal relations of the parties to the transaction if the money is received or paid out as the case may be, although the transaction does not regularly appear on the books of the bank until a subsequent day.

In Butler v. Broadway Savings Institution, 171 App. Div. 682, 157 N. Y. S. 532, the bank had a by-law which provided that “the bank shall be open for business daily from 10 o’clock a. m. to 3 o’clock p. m.” It appeared, however, that the bank was accustomed to open at 9 o’clock. The plaintiff did not know of this custom and relied on the by-law. She bought certain stock and gave in payment a draft on the bank. This draft was presented to the bank the morning after the sale at 9:30 and was paid, and the amount entered in the plaintiff’s passbook which had been left with the bank according to her custom. The plaintiff in the meantime had repented of her bargain and went to the bank on the same morning for the purpose of intercepting payment. When she arrived there at 9:40 she was informed the draft had been paid. It claimed that the payment was valid. The court sustained the bank’s contention and said:

“We have not been supplied with a precedent and we have been unable to find one. The rule quoted does not expressly prohibit the payment of a draft without fixed hours. The rule is merely a regulation for the convenience of the bank. There is no evidence that in its terms it was designed to afford special protection to the depositors.”

And in the case now under consideration-we think that the rule that a bank closes at 3 o’clock does not prohibit a bank from re-eeiving a deposit of money or the equivalent of money (ehecks and drafts) after 3 o’clock. And if it does so receive a deposit the amount so received creates the relation of creditor and debtor as effectively as though the deposit was actually received before 3 o’clock whether the entry actually appears on the books of the bank on the day when it was received or whether the actual entry is postponed until the next day.

The intent of the parties governs. And' in Morse on Banking (5th Ed.) vol. 2, p. 235, it is said that a credit on the deposit ticket is as significant an act of receiving the check as cash as is a credit on the passbook or the books of the bank. In King v. Bowling Green Trust Co., 145 App. Div. 398, 129 N. Y. S. 977, it was held that when a deposit slip contains the statement that the bank in receiving deposits assumes no responsibility for the failure of its collecting agents, and that it shall only be liable when the proceeds in actual funds shall have come into its possession, the deposit slip must be read into the contract, and the title to the check is not transferred. But the deposit slips used in the ease now before us contained no statement whatever limiting the bank’s responsibility or indicating in any way that the cheeks were not received as so much cash.

It does not appear what words, if any, passed between the parties to the transaction at the time the deposits were made. But we are entitled to consider the conduct of the parties. And it was not necessary for the depositor to say to the cashier or bank’s agent, “Credit my account with these cheeks,” and for the bank’s representative to say, “We will do so.’” They could adopt a mode of intercourse which indicated their intentions without any spoken words. The presentation of a deposit slip or slips for so much in cash and so much in checks indicating that the whole was to be placed to the general account of the depositor, and the subsequent crediting of the whole to the depositor’s general account, indicates as intelligibly as words could have done just what the parties intended. If either party had not intended such a result, but wished the bank simply to act as agent for collection, a different course would have been pursued.

As was said in Noble v. Doughten, 72 Kan. 336, 344, 83 P. 1048, 1051 (3 L. R. A. [N. S.] 1167):

■ “If the depositor had desired to establish the relation of principal and agent between himself and the depositary he should have indorsed the paper for collection merely, or otherwise should have indicated his purpose; and if the bank did not intend to accept the check as money it should have entered it as paper and not as cash, or otherwise should have made manifest its intention to collect merely.”

The deposit of a check or bill in the ordinary course of business, the depositor receiving a credit against which he can draw, has the effect of transferring the title in the cheek or bill to the bank. Briggs v. Central National Bank of New York, 89 N. Y. 182, 42 Am. Rep. 285; Metropolitan National Bank v. Lloyd, 90 N. Y. 530; Cragie v. Hadley, 99 N. Y. 131, 1 N. E. 537, 52 Am. Rep. 9.

The law on this subject was stated in Burton v. United States, 196 U. S. 283, 297, 25 S. Ct. 243, 245 (49 L. Ed. 482), where it was said:

“There was no oral or special agreement made between the defendant and the bank at the time when any one of the checks was deposited and credit given for the amount thereof. The defendant had an account with the bank, took each check when it arrived, went to the bank, indorsed the cheek'which was payable to his order, and the bank took the check, placed the amount thereof to the credit of the defendant’s account, and nothing further was said in regard to the matter.' In other words, it was the ordinary case of the transfer or sale of the cheek by the defendant and the purchase of it by the bank, and upon its delivery to the bank, under the circumstances stated, the title to the cheek passed to the bank and it became the owner thereof. It was in no sense the agent of the defendant for the purpose of collecting the amount of the cheek from the trust company upon which it was drawn. Prom the time of the delivery of the cheek by the defendant to the bank it became the owner of the check; it could have torn it up or thrown it in the fire or made any other use or disposition of it which it chose, and no right of defendant would have been infringed.”

So in Metropolitan National Bank v. Loyd, 90 N. Y. 530, 535, the court said:

“It is true no express agreement was made transferring the cheek for so much money, but it was delivered to the bank and accepted by it, and the bank gave Murray credit for the amount, and he accepted it. That was enough. The property in the cheek passed from Murray and vested in the bank. He was entitled to draw the money so credited to him, for as to it the relation of debtor and creditor was formed, and the right of Murray to command payment at once was of the very nature and essence of the transaction. On the other hand, the bank, as owner of the check, could confer a perfect title upon its transferee, and, therefore, when by its directions the plaintiff received, and gave credit for it upon account, it became its owner and entitled to the money which it represented. The check, therefore, for every purpose material upon this inquiry, as between these parties was money.”

The Supreme Court of Minnesota, in Re State Bank, 56 Minn. 119, 123, 57 N. W. 336, 45 Am. St. Rep. 454, stated the law as follows:

“There is no question but that the general rule is that, upon a deposit being made by a customer in a bank, in the ordinary course of business, of money, drafts or other negotiable paper, received and credited as money, the title vests in the bank, and the money, drafts or other paper immediately becomes the property of the bank; and the bank becomes debtor of the depositor for the amount.”

In a ease decided in 1886 in the Circuit Court for the Southern District of New York (St. Louis & S. F. Ry. Co. v. Johnston, 27 F. 243), Judge Wallace declared that, “When a sight bill is deposited with a bank by a customer at the same time with money or currency, and a credit is given him by the bank for the paper just as a like credit is given for the rest of the deposit, the act evinces unequivocally the intention of the bank to treat the bill and the money or currency, without discrimination, as a deposit of cash, and to assume towards the depositor the relation of a debtor instead of a bailee of the paper. If the customer assents to such action on the part of the bank by drawing cheeks against the credit, or in any other way, he manifests with equal clearness his intention to be treated as a depositor of money, and, as such, as a creditor of the bank instead of a bailor of the paper. Under such circumstances it should be held that the bank acquires title to the paper just as it would to a deposit of money.”

And the Circuit Court of Appeals for the Eight Circuit has held, in Security National Bank v. Old National Bank, 241 F. 1, 8, 134 C. C. A. 1, that a customer of a bank, who deposits checks or drafts upon other banks with his bank, which gives him credit therefor in his general account, which is subject to cheek, thereby transfers the title of the cheeks or drafts to the bank, and renders it his debtor to the amount credited to him therefor in the absence of an agreement to the contrary.

The simple deposit of money on a checking account in a bank transfers the ownership of the money to the bank. In legal effect it is a loan by the customer to the bank. As was said in Bank of the Republic v. Millard, 77 U. S. (10 Wall.) 152, 155 (19 L. Ed. 897):

“It is no longer an open question in this court * * K that the relation of banker and customer, in their pecuniary dealings, is that of debtor and creditor. It is an important part of the business of banking to receive deposits, but when they are received, unless there are stipulations to the contrary, they belong to the bank, become part of its general funds, and can be .loaned by it as other moneys.”

So where a cheek or draft, due at the time, is indorsed and deposited in a bank and is accepted as cash, it at once becomes the property of the bank and the bank becomes the debtor of the depositor in the amount of the cheek so deposited with the super-added obligation that the money is to be paid when demanded by cheek. Marine Bank v. Fulton Bank, 69 U. S. (2 Wall.) 252, 17 L. Ed. 785; Thompson v. Riggs, 72 U. S. (5 Wall.) 663, 678, 18 L. Ed. 704; Scammon v. Kimball, 92 U. S. 362, 369, 370, 23 L. Ed. 483; National Bank v. Burkhardt, 100 U. S. 686, 691, 25 L. Ed. 766; Davis v. Elmira Savings Bank, 161 U. S. 275, 288, 16 S. Ct. 502, 40 L. Ed. 700; Burton v. United States, 196 U. S. 283, 302, 303, 25 S. Ct. 243, 49 L. Ed. 482; Newmark Grain Co. v. Merchants’ National Bank, 166 Cal. 203, 135 P. 958; Higgins v. Hayden, 53 Neb. 61, 73 N. W. 280; Scott v. W. H. McIntyre Co., 93 Kan. 508, 144 P. 1002, L. R. A. 1915D, 139; Aebi v. Evansville Bank, 124 Wis. 73, 102 N. W. 329, 68 L. R. A. 964, 109 Am. St. Rep. 925; Wasson v. Lamb, 120 Ind. 514, 22 N. E. 729, 6 L. R. A. 191, 16 Am. St. Rep. 342; Spooner v. Donalsonville Bank, 142 Ga. 236, 82 S. E. 625. The deposit of money by a customer to his credit in a drawing account, without more, creates between the bank and the customer the relation of debtor and creditor, not of agent and principal. Taft v. Quinsigamond National Bank, 172 Mass. 363, 365, 52 N. E. 387; Carr v. National Security Bank, 107 Mass. 45, 9 Am. Dec. 6. And in the Taft Case the court said:

“Usually the cases in which a bank is held to have been only an agent for collection have as a controlling element evidence of usage, or notice, or particular agreement. In the present ease there was no evidence of usage or custom, nor was it shown that the defendant informed its customers by notices upon its pass-books or deposit slips, or otherwise, that it accepted deposits of commercial paper only as an agent for collection. Nor was it shown either that such was its general arrangement with' the plaintiff, or that he understood that it was the arrangement ordinarily made by the defendant with its depositors.”

In New .York it is not open to question that if a deposit is made hy a customer in a bank in the ordinary course of business either of money, or drafts or cheeks received and credited as money, the title to the money, or to the drafts or cheeks, is immediately vested in and becomes the property of the bank, and the relation of debtor and creditor is established. Cragie v. Hadley, 99 N. Y. 133, 1 N. E. 537, 52 Am. Dec. 9.

The order of the court below rested upon St. Louis & San Erancisco Ry. Co. v. Johnston, 133 U. S. 566, 10 S. Ct. 390, 33 L. Ed. 683. It was the only ease which the court mentioned. That was a ease in which a customer deposited on May 5th with a hank in New York a sight draft on a railway company in Boston. That bank sent the draft to a hank in Boston for collection, and on May 6th the Boston bank presented the draft to the drawee, who paid it by a check on another bank in Boston which was presented to and paid by the latter bank on May 7th. It appeared that the bank in New York in which the depositor had deposited the original draft, which it sent forward to Boston for collection, was hopelessly insolvent, to the knowledge of its officers, when it received the draft, and had been for several days prior thereto, and that it had closed its doors before the draft was paid and never reopened them. It also appeared that although the depositor’s bank book was with the New York bank at the time the deposit was received, no entry was made in it at the time of the deposit. The Supreme Court in its opinion stated:

“In five years of business between them, the San Erancisco Company had never drawn against such paper. The evidence of the bank’s clerks leaves no doubt that, as to out-of-town drafts for large amounts, the hank kept track of them and reserved the right to to charge exchange and also interest for the average time taken in collection, notwithstanding its agreement to pay interest on the daily balances. This was not consistent with the theory of an understanding between the bank'and the company that the title to this and similar drafts should pass absolutely to the bank.”

And it held that the depositor was entitled to reclaim the proceeds of the deposit. The case is authority for the proposition that when a bank is hopelessly insolvent, and known by its president to be so, it is a fraud for it to receive deposits of cheeks from an innocent depositor ignorant of its condition and he is entitled to reclaim them or their proceeds. It is to be observed that this ease was not one where a cheek had been drawn on another bank, but a sight draft drawn on a railroad company, and the Supreme Court in its opinion comments on the distinction which exists in such eases between checks and drafts. And the court also attached importance to the fact that in its course of dealing with the bank, extending over a period of five years, the depositor had never drawn against paper so deposited by it. That indicated distinctly that the depositor understood that the draft was deposited for collection and not as cash. We are unable to see that the decision in that ease justifies the conclusion reached in the court below. The two eases are plainly distinguishable in their facts.

The special master thought the.burden was on the depositor to show at what time on February 23d the entry on the books was actually made. This was error. The rights of the depositor do not depend upon the time when the bank’s clerk enters a deposit or whether he enters it at all. The clerk making the entry not being his agent, if he does not perform his duty the bank is responsible therefor, and the rights of the depositor are not thereby curtailed. It is the receipt of the deposit, and not the entry, which binds the bank. Dixon v. Jackson, 149 Mo. App. 585, 129 S. W. 481. If the deposit was actually made .on February 21st, the fact that it was accepted a few minutes after banking hours does not alter the obligation the hank assumed to the depositors. That obligation is no different from what it would have been if the deposit had been made a few minutes before 3 o’clock. And if we are wrong in holding that the entry on the books should have been made as of the day the deposit was received, about which, however, we entertain no doubt, we think it must be conceded that the entry should have been made on or before the hour when the bank next opened its doors and permitted withdrawals to be made. But we repeat it is the receipt of the deposit, and not its entry on the books, which makes the depositor a creditor and the bank a debtor.

The entry on the hooks is, however, significant of the intent with which the trust company received the cheeks when the deposit was made. Por the practical interpretation given to the deposit slips by the parties themselves, before any controversy arose, is the best indication as to what they intended and understood the transaction meant. That the practical interpretation given by the parties to an agreement while they are engaged in the performance of it may be considered by the courts is a well-established principle of law. In Chicago v. Sheldon, 9 Wall. 50, *54, 19 L. Ed. 594, the court declared that, “In cases where the language used by the parties to the contract is indefinite or ambiguous, and, hence, of doubtful construction, the practical interpretation by the parties themselves is entitled to great, if not controlling, influence, ® * in an executory contract, and where its execution necessarily involves a practical construction, if the minds of both parties concur, there can be no great danger in the adoption of it by the court as the1 true one.” And see Topliff v. Topliff, 122 U. S. 121, 7 S. Ct. 1057, 30 L. Ed. 1110; Davis v. North Bank Dock Co. (D. C.) 294 F. 336; Missouri Pacific R. Co. v. Holt (C. C. A.) 293 F. 155, 162; Indian Territory Illuminating Oil Co. v. Bartlesville Zinc Co. (C. C. A.) 288 F. 273, 276; Fitzgerald v. First National Bank, 114 F. 474, 478, 52 C. C. A. 276. The entry made on the first banking day after the deposit shows that the trust company received the deposits as so much cash, and the checks made by the depositors, and which were in excess of their balance if these deposits had not been counted as cash, show they understood that the total'amount of the deposit was regarded as so much easn'to their credit.

This court is satisfied that as matter of law when the checks were deposited by the bankrupts with the Old Colony Trust Company, although received after banking hours, the cheeks became at once the property of the trust company and that company the debtor of the bankrupts in the amount thereof from the time it received the checks; it sufficiently appearing that such was the intention of both parties. The intention was shown by the deposit slips, by the crediting of the amount in the bankrupts’ account on the next banking day, and by the checks drawn on their account by the bankrupts which would have been in excess of their credits if the cheeks had not been received as cash and the fact that there is no evidence indicating a contrary understanding on the part of either of the parties to the transaction.

The undisputed evidence shows as matter of law that the $1,787.25 paid to the bankrupts by the petitioner was paid for a specific purpose, was received by them for the use and benefit of the petitioner, was actually in the possession' of the trust company at the time of the appointment of the receiver of the bankrupts, and actually came into his hands. The petitioner, is therefore entitled to reclaim it.

The order is reversed, with costs, and the District Court is directed to allow the claim.

       Old Colony Trust Company. Deposit to Credit of S. S. Ruskay & Co.
      Boston, Mass., Feb. 21, 1922.
      Dollars Cents
      Bills.......................... 548
      Specie .........................
      Checks 5-20.............. 524 29
      5-124.......................... 50
      5-13 ............ 9 50
      1-2............................ 17 50
      1,149 29
      Early Money
      1922 Feb. 21 PM 3 12
      W. I. Mcl.
      HI-Feb. 23
      Old Colony Trust Company. Deposit to Credit of S. S. Ruskay & Co.
      Boston, Mass., Feb. 21, 1922.
      Dollars Cents
      Bills .......................... 135
      Specie .........................
      Checks ....................... 100
      2,500
      150
      100
      600
      3,585
      1922 Feb. 21 PM 3 13
      W. I. Mcl.
      L-2 Feb. 23


author: HOUGH, Circuit Judge

text:
    TRANSPORTES MARITIMOS DO ESTADO v. ALMEIDO.
    (Circuit Court of Appeals, Second Circuit.
    January 19, 1925.)
    No. 144.
    1. Seamen <s=>3 — Contract of seaman presumed valid under laws of nation under whose flag he shipped.
    Where alien shipped on foreign ship under flag of foreign nation, the. presumption is that his contract was valid under the law of such nation and that it is to be construed thereby.
    2. Seamen <$=529(5) — Foreign seaman could not bring action for wages in District Court where vessel was not in United States harbor as required by the statute.
    Foreign seaman who shipped on foreign vessel under foreign flag could not bring action for wages in District Court under Rev. St. §§ 4529, 4530 (Comp. St. §§ 8320, 8322), where vessel was not in United States harbor as required by such statutes."
    In Error to the District Court of the United States for the Southern District of New York.
    Action by Sylvia A. Almeido against the Transportes Marítimos Do Estado. Judgment for plaintiff, and defendant brings error.
    Reversed and remanded, with directions to dismiss complaint.
    Transferred from the Supreme Court, 265 U. S. 104, 44 S. Ct. '449, 68 L. Ed. 933.
    Almeida served as a waiter on the Portuguese steamship Goa. He shipped at.New York, and the agreement contained .in the articles was that he and others similarly situated should receive pay “until they reached the Port of New York.” But it was further agreed that “such members of the crew as are not to be sent back to New York shall be disembarked at Lisbon without payment of the return passage and without payment of salary for the duration of the return trip to New York.” The Goa did not return to New York after a voyage to South American ports, but went to Lisbon, and there Almeida was paid off. He subsequently returned to New York as a passenger on another vessel and then brought this action under Rev. St. § 4529 (Comp. St. § 8320), seeking recovery of wages from the time he was paid off in Lisbon until he arrived in New York.
    The complaint alleges that “defendant is a foreign corporation organized and existing under and by virtue of the laws of Portugal,” and was the owner or manager of the Goa.
    This the defendant denied, and averred that it was “a department of a sovereign foreign government,” to wit, Portugal.
    At trial the court held “that by answering generally the defendant had waived any right of immunity which it possessed.” Although, as was further held by the trial court, the Transportes Marítimos Do Estado “has been proven to be a department of the sovereign government Republic of Portugal and its ships engaged on the business of said government.”
    Thereupon a writ of error was taken under Judicial Code, § 238 (Comp. St. § 1215), to the Supreme Court, which in 265 U. S. 104, 44 S. Ct. 449, 68 L. Ed. 932, held that the defense of sovereign immunity as above presented did not present a question of federal jurisdiction reviewable in the highest court on direct appeal and therefore remanded the writ to this court.
    F. Dudley Kohler, of New York City (Frank H. Gerrodette, of New York City, of counsel), for plaintiff in error.
    Silas B. Axtell, of New York City, for defendant in error.
    Before ROGERS, HOUGH, and HAND, Circuit Judges..
   HOUGH, Circuit Judge

(after stating the facts as above). As this writ has been sent us by ruling authority, we proceed to consider it.

The principal question argued is of sovereign- immunity from suit or action, something much discussed of late, and never presented in exactly the way it appears on this record.

We cannot consider this point, because we are persuaded that the case was improperly brought and the District Court had no power to entertain it.

The action is founded on R. S. § 4529, in the sense that the wages claimed are based upon a construction of that article; but the action promoted rests on R. S. §' 4530 (Comp. St. § 8322) which reads: “And when the voyage is ended every such seaman [i. e., a seaman on a vessel of the United States] shall be entitled to the remainder of the wages which shall then be due him, as provided in section 4529 of the Revised Statutes. * * * And provided further, that this section shall apply to seamen on foreign vessels while in harbors of the United States, and the courts of the United States shall be open to such seaman for its enforcement.”

We assume, without deciding, that the wage claim promoted by a foreign seaman and for less than $3,000 might be brought on the common-law side of an appropriate court, and so brought without any showing of diversity of citizenship against one who is charged in the alternative only as owner, charterer, or manager.

But with these assumptions made it remains uncontroverted that when this was begun, and at all times since, the Goa so far as shown was not in New York or elsewhere in the United States. And it is solely upon the plaintiff's contractual relations with the Goa that his cause of action depends.

It is undeniable that plaintiff is an alien; a “foreign seaman” in every sense of the phrase. He shipped on the Goa under the Portuguese flag, and there is nothing to rebut the presumption that his contract was valid under the Portuguese law and is to be construed thereby.

He asserts a right of suit under the cited sections of the Revised Statutes; but those statutes are drawn primarily with reference to vessels of the United States. It is solely by virtue of the proviso (supra) that Al-meida and his like have any rights, and those rights are extended by the proviso “that this section shall apply to seamen on foreign vessels while in harbors of the United States.”'

The history of the amendments to the Revised Statutes by what is commonly called the “La Follette Act” (38 Stat. 1164) is well known, and the legislation was upheld in Strathearn, etc., Co. v. Dillon, 252 U. S. 348, 40 S. Ct. 350, 64 L. Ed. 607, by holding that “we have no doubt as to the authority of Congress to pass a statute of this sort, applicable to foreign vessels in-our ports and controlling the employment and payment of seamen as a condition of the right of such foreign vessels to enter and use the ports of the United States.” In the same decision '(page 357), the court speaks of the right of recovering wages under these sections as one given to the seaman while the ship is in a harbor of the United States. To the same effect, The Italier, 257 F. 712, 168 C. C. A. 662.

This is a wage claim — it can be nothing else for purposes of jurisdiction. As a suit upon a broken Portuguese contract instituted by one alien against another, it has no place on the docket of the’ District Court. But as a wage claim it belongs to a class of demands which can only be promoted by seamen on foreign vessels while their vessel is in a harbor of the United States.

For this reason the judgment is reversed and the cause remanded, with directions to dismiss the complaint.


text:
    BABCOCK v. NORTON et al.
    (Circuit Court of Appeals, Second Circuit.
    December 15, 1924.)
    No. 99.
    1. Appeal and error @=>329 — Defect in appeal for failure to join necessary party held not “mistake” within statute as to amendment of appeal.
    Defect in appeal by two of three defendants, against whom joint decree has been rendered for failure to join third defendant in appeal or procure order of severance, cannot be cured under Rev. St. § 1005 (Comp. St. § 1664), providing for amendment of writ of error “when there is a mistake in the teste of the writ.”
    2. Appeal and error @=>336(1) — Appeal dismissed where codefendant has not been joined.
    Appeal by two defendants from judgment against such defendants and a codefendant jointly will be dismissed, where codefendant has not been joined in appeal and no order of severance has been made.
    3. Appeal and error @=>322 — Appellate court has no power to determine case unless all parties substantially affected by judgment are brought before It.
    An appellate court has no power to hear and determine a case unless all the parties substantially affected by the judgment or decree are brought before it.
    4. Appeal and error @=>324 — Summons and severance or service of notification of appeal on necessary parties is essential to con-
    . fer jurisdiction on appeal from joint judgment or decree.
    On appeal from joint judgment or decree, summons and severance or service of notification of appeal on necessary parties is essential to confer jurisdiction.
    Appeal from the District Court of the United States for the Southern District of New York.
    Bill by F. It. Babcock against Eugene L. Norton and others. Decree for plaintiff, and defendants Norton and Boyle appeal.
    Appeal dismissed.
    Certiorari denied 45 S. Ct. 509, 69 L. Ed.
    Whitman, Ottinger & Ransom, of New York City (George G. Bogert, of Ithaca, N. Y., and Robert E. Coulson and Colley E. Williams, both of New York City, ft£ counsel), for' appellants Notion and Boyle.
    Hartwell Cabell, of New York City (B. F. Sturgis and Milton B. Ignatius, both of New York City, of counsel), for plaintiff-appel-lee.
    Before ROGERS, HOUGH, and MANTON, Circuit Judges.
   ROGERS, Circuit Judge.

The complainant, a citizen of the state of Pennsylvania, filed a bill in equity against Eugene L. Norton, a citizen of the state of Maryland, George L. Boyle, a citizen of the District of Columbia, Lincoln G. Valentine, a citizen of the state of New York, and the Central American Petroleum Corporation, a citizen of the state of Delaware. The last-named party is hereinafter referred to as the Petroleum Corporation. " The bill seeks to rescind the sale of 3,000 shares of stock of the Petroleum Corporation, and to recover the purchase price paid therefor.

The jurisdiction of the District Court depended upon the diversity of citizenship of the parties, and the fact that the amount involved and for which recovery is sought exceeded the sum of $3,000 exclusive of interest and costs. The bill contained the proper averments and concluded by asking judgment for the sum of $26,083 with interest from April 6, 1920, together with costs.

The suit was instituted against the corporation, and Norton, Boyle, and Valentine individually.

The bill alleged that in April, 1920, the plaintiff was induced by false and fraudulent misrepresentations made by the individual defendants, Norton, Boyle, and Valentine, to purchase 3,000 shares of the stock of the Petroleum Corporation, for which he paid the sum of $45,000; that prior to the discovery of the fraud, the complainant sold 700 shares of the stock, for which he received $18,917; and the prayer for relief is for a rescission of the .contract and a recovery of the purchase price less the amount 'received from the sale of the 700 shares.

Defendants Norton and Boyle filed a joint answer, and the defendants Valentine and the Petroleum Corporation filed separate answers. All answers were, in substance, general denials. Neither Valentine nor the corporation defended at the trial.

The decree rescinded the1 contract and awarded money judgments against the corporation and the individual defendants, Norton and Boyle, for $26,083 with interest; this amount being the difference between the purchase price paid and the amount received from the sale of the 700 shares sold by the plaintiff. The complaint was dismissed as to defendant Valentine.

Only defendants Norton and Boyle petitioned to appeal. The appeal was not taken in open court, and the defendant corporation has never been severed by order of the court.

The judgment entered reads as follows:

“Wherefore, let the said Frederick R. Bab-cock recover of the said Central American Petroleum Corporation and Eugene L. Norton and George L. Boyle, individually, the sum of thirty-two thousand eighty-two and fourteen one-hundredths dollars ($32,082.-14) as adjudged in said final decree, together with a further sum of one hundred twenty-one and forty-four one-hundredths dollars ($121.44) the costs and charges as taxed, making in the aggregate the sum of thirty-two thousand two hundred three and fifty-eight one-hundredths dollars ($32,203.58).”

The defendants Norton and Boyle alone appealed to this court and have assigned 33 errors. The defendant Petroleum Corporation did not join in the appeal and there has been no order of severance. And the plaintiff-appellee claims that the failure to join the corporation in the appeal, in the absence of an order of severance, is fatal to the jurisdiction of this court, and that the appeal must be dismissed.

In Owings v. Kincannon, 7 Pet. 399, 402 (8 L. Ed. 727), a case decided in 1833, Chief Justice Marshall writing for a unanimous court dismissed an appeal because only a part of those against whom the decree was made had joined in the appeal. The Chief Justice said:

“Upon principle, it would seem reasonable, that the whole cause ought to be brought before the court, and that all the parties who are united in interest ought to unite in the appeal. We have, however, found no precedent, in chancery proceedings, for our government in this case. But in the case of Williams v. Bank of the United States, 11 Wheat. 414, which was a writ of error, sued out by one defendant, to a joint judgment against three, the writ was dismissed; the court being of opinion that it had issued irregularly, and that all the defendants ought to have joined in it.
“By the Judiciary Act of 1789, decrees in chancery pronounced in a circuit court could be brought before this court only by writ of error. The appeal was given by the act of 1803. That act declares, ‘that such appeals shall be subject to the same rules, regulations and restrictions as are prescribed by law in cases of writs of error.’
“Previous to the passage of this act, the decree under consideration could have been brought into this court only by writ of error, in which writ all the defendants must have joined. The language of the act which gives the appeal, appears to us to require that it should be prosecuted by the same parties who would have been necessary in a writ of error. We think also, that the same principle would be applicable, from the general usage of chancery, to make one final decree binding on all parties united in interest.
. “The appeal must be dismissed, having been brought up irregularly.”

In Todd v. Daniel, 16 Pet. 521, 523, 524, 10 L. Ed. 1054, Mr. Justice Story, writing for the court, said:

“The case of Owings v. Kincannon, 7 Pet. 399, seems to have been misunderstood at the bar. The objection in that ease was not, that one or more of the defendants might not pursue an appeal, for their own interest, if the others refused to join in it, upon due notice, and process for that purpose from the Circuit Court; but that it did not appear that all the defendants were not ready and willing to join in the appeal, and that the appeal was brought by some of the appellants, without giving the others an opportunity of joining in it, for the protection of their own interest, not only against the appellee, but against the appellants, as their own interests might be distinct from, or even adverse to, that of the appellants; and it was right and proper, that all the parties should have an opportunity of appearing before the court, so that one final decree, binding upon all the parties having a common interest, might be pronounced.”

In Masterson v. Herndon, 10 Wall. 416, 417, 418 (19 L. Ed. 953) in 1870, the appeal was dismissed because taken by one of two joint defendants. The petition for the appeal stated that, “Tour petitioner says that his codefendant, Maverick, refuses to prosecute this appeal with him.” Mr. Justice Miller, speaking for the court and referring to the remedy by summons and severance and to the reason for it, said:

“We do not attach importance to the technical mode of proceeding called summons and severance. We should have held this appeal good if it had appeared in any way by the record that Maverick had been notified in writing to appear, and that he had failed to appear, or, if appearing, had refused to join. But the mere allegation of his refusal, in the petition of appellant, does not prove this. We think there should be a written notice and due service, or the record should show his appearance and refusal, and that the court on that ground granted an appeal to the party who prayed for it, as to his own interest. Such a proceeding would remove the objections made to permitting one to appeal without joining the other, that is, it would enable the court below to execute its decree so far as it could be executed on the party who refused to join, and it would es-top that party from bringing another appeal for the same matter. The latter point is one to which this court has always attached much importance, and it has strictly adhered to the rule under which this ease must be dismissed, and also to the general proposition that no decree can be appealed from which is not final in the sense of disposing of the whole matter in controversy, so far as it has been possible to adhere to it without hazarding the substantial rights of parties interested.”

In Downing v. McCartney, 131 U. S. (Appendix, p. xcviii) 19 L. Ed. 757, Chief Justice Chase, writing for the court, said:

“The decree below was joint against the three complainants. One only has appealed; and there is nothing in the record showing that the other complainants had notice of this appeal, or that they refused to join in it.”

In Hardee v. Wilson, 146 U. S. 179, 182, 13 S. Ct. 39, 36 L. Ed. 933, “the court again applied the rule and dismissed the appeal because of the failure of the codefendants to join in the appeal, and the doctrine laid down in Masterson v. Herndon, supra, was quoted approvingly.

In Garcia v. Vela, 216 U. S. 598, 30 S. Ct. 439, 54 L. Ed. 632 (1910), one of the defendants appealed, but the codefendants did not join in the appeal. The court, speaking through Justice Holmes, said:

“ * * *' But as the other defendants did not join in the appeal, and there was no summons and severance, not to speak of other possible objections, the appeal must be dismissed.”

See, too, Mason v. United States, 136 U. S. 581, 10 S. Ct. 1062, 34 L. Ed. 345; Feibelman v. Packard, 108 U. S. 14, 1 S. Ct. 138, 27 L. Ed. 634; Clifton v. Sheldon, 23 How. 481, 484, 16 L. Ed. 429; Simpson v. Greeley, 20 Wall. 152, 157, 22 L. Ed. 338.

There are an almost innumerable number of cases in the lower federal courts in which the rule has been recognized and applied. We cite a few of them: Priest v. Seaman. (C. C. A.) 266 F. 844; Bank v. Corey Bros. Construction Co. (C. C. A.) 205 F. 282; Lamon v. Speer Hardware Co., 190 F. 734, 111 C. C. A. 462; Ireton v. Pennsylvania Co., 185 F. 84, 107 C. C. A. 304; Ibbs v. Archer, 185 F. 37, 107 C. C. A. 141; Provident Life & Trust Co. v. Camden, 177 F. 854, 101 C. C. A. 68; Lewis v. Sittel, 165 F. 157, 91 C. C. A. 191; Detroit v. Guaranty Trust Co., 168 F. 608, 93 C. C. A. 604; Hol-brook, etc., Contracting Co. v. Menard, 145 F. 498, 76 C. C. A. 258; Love v. Export Storage Co., 143 F. 1, 74 C. C. A. 155.

In Whitehouse’s Equity Practice, vol. 1, p. 852, § 512, it is laid down that “All the parties against whom a joint decree is rendered and who are. jointly affected thereby must join in the appeal from such decree, or it will be dismissed unless a severance is made.” And see, to the same effect, 3 C. J. 1012.

The reasons which are assigned for the rule are two:

(1) That the successful party should be free to proceed in the enforcement of his decree against the party or parties who acquiesce in it and do not desire to appeal.

(2) That the appellate tribunal should not be required to pass upon the same question and the same record a second or more times.

The defect in the appe'al clearly is not a mistake which the court can cure within section 1005 of the Revised Statutes (Comp. St. § 1664).

As an appellate court has no power to hear and determine a case unless all the parties substantially affected by the judgment or decree are brought before it, and inasmuch as in cases of a joint judgment or decree, summons and severance, or service of notification of appeal on necessary parties is essential to confer jurisdiction (21 Encyc. of Pl. & Pr. 192, 193), we are reluctantly compelled to dismiss the appeal without a decision on the question which the appellant sought to raise. It is not to be inferred, however, that because we are reluctant to dismiss without passing on the merits we think that error was committed in the court below.

Appeal dismissed.


author: PER CURIAM.

text:
    N. P. SLOAN CO. v. CHURCHILL LINE et al.
    (Circuit Court of Appeals, Second Circuit.
    December 19, 1924.)
    No. 25.
    1. Shipping <§=>108 — Carrier excused by withdrawal of approval of French High Commission.
    Under provision of contract for transportation of cotton to France, by certain boat, that contract is subject to approval of the French High Commission, carrier is protected from liability for noncarriage by the Commission’s withdrawal of its original approval.
    2. Shipping <§=>l08-‘-Ca!rrier excused by governmental interference; “shipment.”
    Clause of contract for transportation of cotton to France, by certain boat, that owing to war conditions shipment is accepted at owner’s risk of any interference by any power, excuses carrier, where the French High Commission took all the space on the boat for the benefit of its government, and refused to allow the shipment thereon; the word “shipment” applying as fully to interference with shipment accepted but not loaded as with a shipment actually put aboard. ■
    [Ed. Note. — For other definitions, see Words and Phrases, First and Second Series, Shipment.]
    Appeal from tbe District Court of tbe United States for tbe Southern District of New York.
    Suit in admiralty by tbe N. P. Sloan Company against tbe Cbúrcbill Line, wbicb brought in Schneider & Cie. Prom an adverse decree, libelant appeals.
    Affirmed.
    Tbe opinion' of Ward, Circuit Judge, in tbe District Court, is as follows:
    December 31, 1917, tbe libelants entered into a freight contract for tbe transportation of 5,000 bales of cotton on board the Norwegian steamer Plores “expected to arrive about tbe middle of March,” to be transported from Savannah to Havre.
    Tbe material provisions of tbe contract are as follows:
    “This contract is subject to approval of tbe Preneh High Commission.”
    “Owing to conditions of war or hostilities existing and threatened this shipment is accepted at tbe sole risk of owners thereof of arrest, restraint, capture, seizure, detention or interference of any sort by any power. * & *-
    In January, 1918, the libelant did obtain permit No. 48 for tbe shipment from tbe Preneh High Commission at Washington and delivered tbe same to tbe Churchill Line. Tbe High Commissioner of tbe Preneh Republic to tbe United States wrote:
    “January 12, 1918.
    “To Messrs. N. P. Sloan & Company, 319 Chestnut Street, Philadelphia, Pa.- — -Dear Sirs: I beg to acknowledge receipt of your three letters dated January 11th, and I send you herewith permit No. 48 covering shipment of 5,000 bales of cotton to Prance.
    “I hereby certify that five thousand (5,000) bales of cotton covered by licenses 775 and 764 and consigned to Comptoir National d’Eseompte de Paris Havre, and to be shipped by Messrs. N. P. Sloan-Company, 310 Chestnut, Philadelphia, Pa., per Norwegian steamer Plores (Churchill Line), at. the rate of eleven dollars ($11) per hundred pounds, freight booked on the 31st of December, 1917, said steamer expected ready to load at Savannah about middle of March, 1918, are in compliance with the Preneh Regulations issued on November 22, 1917, and, therefore, their shipment to Prance is authorized.”
    The word “November” evidently should be “December,” reference being to the decree of that date, Exhibit la.
    January 23, 1918, the Churchill Line wrote to the J. H. W. Steele Company, who had taken space, as follows:
    “We beg to advise you that we have just received, notification that the S. S. 'Plores* has been requisitioned by the government, and therefore engagement No. 1505 for 5,000’ bales cotton made through you for account of N. P. Sloan Company is canceled. Would suggest that you inform shippers immediately by wire regarding this.
    “We regret very much to have to cancel the engagement, but, under the circumstances, there is nothing else to be done.” .
    Thereafter both parties made all possible efforts to get the French government to permit the shipment, but without success. The Preneh High Commission in the United States, appointed in pursuance of the decree of April 15, 1917, took up all freight space on the steamer for her fifth voyage from Savannah to Prance for the benefit of the Preneh government, shipping 1,700 tons of cotton for its account at a freight rate of $5 per 100 pounds instead of $11, which the libelant had agreed to pay. There could be no plainer revocation of its original permit.

      The libelant brought this suit against Churchill Line to recover damages sustained by it in shipping the cotton at a higher rate of freight, and the Churchill Line brought in Schneider & Cie, as its principal, under the fifty-ninth rule in admiralty.

       Assuming, as the libelant contends, that Steele & Co. were the agents of the Churchill Line and that the libelant did not know and were not told that the Norwegian steamer was chartered to Schneider & Cie, a French firm doing business in Paris, I think the libelant is not entitled to recover.
    All parties clearly understood that for some reason the consent of the French, government,to the shipment had to be obtained. The original permit referring to the regulations of December 22d (not November 22d) shows that the steamer was at the disposal of the French government; France could refuse to permit shipment to its ports even on neutral vessels. It is equally clear that the French High Commission withdrew its original approval. The French government made no contract with any one and could not be held if it had. It had a right to change its mind for any reason satisfactory to it. Determinations of sovereigns are absolute, whether they are right or wrong. Therefore I think the 'Churchill Line is protected from liability by the provision of the contract makifig the contract subject to the approval of the French High Commission and also by the provision that the shipment was accepted at the sole risk of the owners thereof of interference of any sort by any power. The word “shipment” applies as fully to interference with a shipment accepted but not loaded as with a shipment actually -put aboard.
    The libelant says that there is no proof that the sailing in June was the fifth voyage of the steamer. It was the fifth voyage between Baltimore and France. It was so stipulated at the trial, and there was no such voyage in March. The contract was canceled by the Churchill Company in January, and it is of that cancellation that the libel-ant complains. It makes no difference to the ease it presents whether the steamer ought to have arrived in March and did not arrive until May or June. The question is whether the Churchill Line under its terms is excused from carrying out the contract. I think it is. The libel is dismissed, as is the petition bringing in Schneider & Cie.
    June 20, 1923.
    Macklin, Brown & Van Wyck, of New York City (Horace L. Cheyney, of New York City, of counsel), for appellant.
    Haight, Smith, Griffin & Deming, of New York City (Clarence B. Smith and Frank A. Paul, both of New York City, of counsel), for appellees.
    Before HOUGH and MANTON, Circuit Judges, and LEARNED HAND, District Judge.
   PER CURIAM.

Decree affirmed, upon the opinion of Ward, Circuit Judge.