author: PER CURIAM.

text:
    FRIEDMAN v. UNITED STATES.
    (Circuit Court of Appeals, Sixth Circuit.
    May 7, 1925.)
    No. 4272.
    1. Forgery <s=>5 — Indictment charging sale of altered Liberty Bonds with intent to defraud others to whom they might be sold held to state offense.
    Indictment, charging sale and delivery of Liberty Bonds which had been altered with intent to defraud others to whom purchaser might sell them, stated violation of Criminal Code, § 151, notwithstanding person to whom accused sold bonds was not deceived; intent to defraud being sufficient, if it is to operate against future transferees.
    2. Criminal law <§=»l 167(2) — Where conviction on one count of indictment is sustainable, defects in other counts are immaterial.
    Where conviction under one count is sustainable, and sentence is not excessive under that count, defects in other counts are immaterial.
    3. Forgery <®=»I0 — Uttering or selling altered Liberty Bonds is an offense.
    Uttering or selling altered Liberty Bonds violates Criminal Code, § 151, notwithstanding alteration makes bonds void.
    4. Forgery <S=>44('/2) — Accused’s knowledge that Liberty Bonds sold by him had been altered held proved.
    Evidence helé to warrant finding that accused delivered Liberty Bonds to purchaser, knowing that they had been altered, in violation of Criminal Code, § 151.
    In Error to the District Court of the United States for the Western District of Kentucky; Charles H. Moorman, Judge.
    Sol Eriedman was convicted of uttering and selling Liberty Bonds which had been altered, and he brings error.
    Affirmed.
    Leopold Saltiel, of Chicago, Ill., for plaintiff in error.
    Claude Hudgins, Asst. U. S. Atty., of Louisville, Ky. (W. S. Ball, U. S. Atty., and Lilburn Phelps, Asst. U. S. Atty., both of Louisville, Ky., on the brief), for the United States.
    Before DENISON, DONAHUE, and KNAPPEN, Circuit Judges.
   PER CURIAM.

Eriedman was convicted under two counts of an indictment charging that he violated section 151 of the Criminal Code by uttering and selling Liberty Bonds which had been altered. The bonds in question had been in fact stolen, and then altered by erasing the name of the registered holder and substituting therefor another and fictitious name. They were then transferred by Eriedman in connection with an assignment by the purported registered holder.

One count charged that he had sold and delivered these bonds to Erey, with intent to defraud Frey. The 'other count charged the same delivery with intent to defraud others, to whom Erey might sell them. It is now said that Erey had knowledge of the alteration, and so the proofs do not sustain a conviction under the first count, while the second count does not state an offense. We think the second count is not defective in this respect. The intent to defraud is sufficient, if it is to operate against a future transferee, even though the person to whom delivery is made is not deceived. U. S. v. Nelson, 27 Fed. Cas. 80. The conviction under one count being sustainable, and the sentence being not excessive under that count, defects under other counts are immaterial.

It is urged that, upon the making of the alteration, the bonds became void and were no longer an obligation of the United States and that to utter or sell a void paper is not within the statute. We cannot accept this construction. It would leave nothing for the statute to operate upon, since every “forged, counterfeited or altered obligation or other security of the United States” is in fact void.

There was sufficient evidence to support the jury’s finding that Friedman, when delivering the bonds, knew of the alteration. The bonds were in evidence, and there was undisputed testimony that the fact of alteration was obvious. Further, Friedman’s story of how he came into possession of them was not convincing.

In the rulings as to the admission of evidence, we find no reversible error, if any.

The judgment is affirmed.


source: Caselaw Access Project

license: Public Domain

text:
    CRAWFORD v. UNITED STATES.
    (Circuit Court of Appeals, Sixth Circuit.
    April 7, 1925.)
    No. 4258.
    Criminal law <§=»394 — Searches and seizures (®=»7 — Search held not made by federal authority.
    The fact that prohibition agents, at the request of the police accompanied them while executing a search warrant procured by them, but took no part in the search, did not render It one made under federal authority, so as to render evidence obtained thereby inadmissible under Const. Amend. 4.
    In Error to the District Court of the United States for the Western District of Kentucky; Charles H. Moorman, Judge.
    Criminal prosecution by the United States against A. T. Crawford. Judgment of conviction, and defendant brings error.
    Affirmed.
    Walter P. Lincoln, of Louisville, Ky. (Edwards, Ogden & Peak, of Louisville, Ky., on the brief), for plaintiff in error.
    Lilburn Phelps, Asst. U. S. Atty., of Louisville, Ky. (W. Sherman Ball, U. S. Atty., and Claude Hudgins, Asst. U. S. Attys., both of Louisville, Ky., on the brief), for the United States.
    Before DENISON and DONAHUE, Circuit Judges, and WESTENHAVER, District Judge.
   PER CURIAM.

Police officers of the city of Louisville procured a search warrant from a justice of the peace and with it “raided” Crawford’s premises. They searched his house and found nothing. In the cellar of a garage building on the same lot, 75 feet away, finding a hidden trap-door in the floor, they opened it and in a subeellar found a distilling outfit and a large quantity of intoxicating liquor and the materials for its manufacture. In this prosecution, later brought in the court below for the unlawful possession of this liquor, the only substantial question was whether the search and seizure were so wrongful that the evidence was inadmissible.

Two federal prohibition agents were along on the raid at the request of the police, but they did not go into the house nor enter the garage until after the discovery was made. There was no display of federal authority, nor any claim of such authority, nor any yielding, in fact or in supposition, to such authority. Even if the search and seizure in the garage were assumed to be of an unreasonable character, which would have brought them within the inhibitions of the Fourth Amendment, if made by federal officers, it is clear that there was no such, participation by them as to bring these prohibitions into effect. Weeks v. U. S., 232 U. S. 383, 389, 34 S. Ct. 341, 58 L. Ed. 652, L. R. A. 1915B, 834, Ann. Cas. 1915C, 1177; Timonen v. U. S. (C. C. A. 6) 286 F. 935; MacDaniel v. U. S. (C. C. A. 6) 294 F. 769, 772.

If the question of the effect of violation of the state Constitution by the police officers were open in this court, we would, of course, be obliged to follow the Kentucky Court of Appeals, and we could not be sure that there was any such violation. Goode v. Com., 199 Ky. 755, 252 S. W. 105; Wilkerson v. Com., 200 Ky. 399, 255 S. W. 76. And see Carroll v. U. S., 267 U. S. 132, 45 S. Ct. 280, 69 L. Ed. -.

The judgment is affirmed.


text:
    GATTERDAM et al. v. UNITED STATES. GATTERDAM v. SAME.
    (Circuit Court of Appeals, Sixth Circuit.
    April 6, 1925.)
    Nos. 4247-4249.
    1. Intoxicating liquors <©=>13 — Provision of Prohibition Act making possession offense held not unconstitutional.
    The provision of the National Prohibition Act (Comp. St. Ann. Supp. 1923, § 10138% et seq.) making possession of liquor an offense is not unconstitutional, as going beyond the scope of the Eighteenth Amendment.
    2. Indictment and information <s=>196(5) — Allegation of third offense held sufficient.
    Any lack of particularity in allegations of a third offense is cured by proof of a conviction of a “second offense,” and by the presumption that such conviction was rightful.
    3. Searches and seizures <@=>7 — .Search by police not made under federal authority because of presence of prohibition agent.
    The mere presence of a prohibition agent at a search made by the police under a search warrant procured by them did not make the search one under federal authority, to which the Fourth Amendment applies.
    4. Searches and seizures <g=>3 — Search with consent of defendant not illegal.
    A defendant cannot assert the illegality of a search made with his consent, though given in response to threat to procure search warrant.
    In Error to the District Court of the United States for the Western District of Kentucky; Charles H. Moorman, Judge.
    Criminal prosecutions by the United States against Clayton Gatterdam and John Dixon and against Clayton Gatterdam. Judgment of conviction on each indictment, and defendants, bring error.
    Affirmed.
    Rowan Hardin, of Louisville, Ky., for plaintiffs in error.
    W. S. Ball, U. S. Atty., of Louisville, Ky. (Claude Hudgins and Lilburn Phelps, Asst. U. S. Attys., both of Louisville, Ky.,-on the brief), for the United States.
    Before DENISON, MACK, and DONAHUE, Circuit Judges.
   PER CURIAM.

In 4248, the writ of error covered convictions upon two indictments. At the last session we sustained the conviction upon indictment No. 1138, retaining for further consideration the conviction under indictment No. 1137. This conviction and Nos. 4247 and 4249 can now be disposed of together.

While the sentences of imprisonment on the four convictions were concurrent, and while the fine imposed in each of the four cases was the same in amount, we interpret the records as meaning that the fines were intended to be separate and distinct, and to require payment of the total sum. The three remaining convictions, therefore, cannot be treated as involving no results not disposed of by the former affirmance.

In all three cases it is urged that, in so far as the Volstead Act (Comp. St. Ann. Supp. 1923, § 10138% et seq.), prohibits possession, it goes beyond the Eighteenth Amendment and is unconstitutional. This contention is overruled on authority of Everard v. Day, 265 U. S. 545, 44 S. Ct. 628, 68 L. Ed. 1174. In all three eases it is also urged that the indictment was not sufficient to support a conviction for a third offense. This contention is overruled, upon authority of our opinion in Dolan v. U. S., 4 F.(2d) 251, filed March 2, 16, 1925.

In 4247 and 4248, it is claimed that the existing general arrangement in Louisville between prohibition agents and the police made the latter the agents of the former, and so far charged the federal government with the responsibility for the acts of the police that a search and seizure by the latter would be considered in a federal court as if made by the former, 'the proofs do not show any general arrangement between federal and city officers sufficient to support the argument. They show only thatu the instructions and practice of the police officers were that, when by their raids and searches they found what they considered rather serious infractions of the federal law, they should take those eases to the federal courts for prosecution, and that accordingly they took up each such ease by consultation with the district attorney, and a federal warrant was issued or not as the district attorney advised. The record fails to show any responsibility on the part of the federal authorities for what the police officers may have done in their preliminary activities.

In-4248 (indictment 11377), no prohibition agent participated in any way in the raid. In 4247 Prohibition Agent Morley was present. The police had procured their search warrants and then-asked him to go along. It does not appear that Morley assumed any authority or took any part, more than would have been taken by a citizen assisting the police, or that Gatterdam knew or supposed that the search had any federal character. This fell short of the minimum of participation by the federal officer which could justify invoking the Fourth Amendment. Crawford v. United States, 5 F.(2d) 672, opinion filed to-day.

In 4249, the search and seizure were by Prohibition Agent Roberts. He first examined a truck standing in the yard and found three stills. It does not seem to have been an unreasonable search, and, if it was, that would not be important. He then searched the house, and found 40 gallons of whisky. This search was with Gatterdam’s consent, pursuant to Roberts’ request. The only dispute is as to whether, when the request was made, Gatterdam said: “All right, If I do not consent, you will go and get a search warrant, and you might as well search now” — or whether he consented after one of . the prohibition officers , had said: “You might as well consent, because, if you do not, we will go and get a search warrant.” In either case there was such consent that Gatterdam cannot complain.

In 4247, the proof against Dixon, while circumstantial, was not insufficient in law to justify the jury in inferring his substantial participation.

In 4249 objection is made that a witness for defendant was not required to answer, in spite of his statement that an answer would incriminate him, and section 30 of title 2 of the National Prohibition Act (Comp. St. Ann. Supp. 1923, § 10138%q) is invoked. The record does not show that the witness was attending “in obedience to a subpoena.”

The three judgments are affirmed.


author: WOLYERTON, District Judge.

text:
    CAMPBELL v. LUCKENBACH S. S. CO.
    (District Court, D. Oregon.
    May 11, 1925.)
    1. Admiralty <@=321 — Libel in admiralty lies for death of seamen.
    Act March 4, Í915, § 20, as amended by Act June 5, 1920, § 33 (Comp. St. Ann. Supp. 1923, § 8337a), gives right of action to personal representatives of seaman for his death from negligence of vessel, its officers or agents, by libel in admiralty, notwithstanding seaman died on land.
    2. Admiralty <@=s44 t- Respondent appearing generally ilviil not be permitted to withdraw its answer to obviate waiver of jurisdiction.
    General appearance, where venue is laid, waives jurisdiction, and respondent having so appeared will not be permitted to withdraw its answer to obviate such waiver.
    In Admiralty. Libel by Michael J. Campbell, administrator of the estate of John Campbell, deceased, against the Luekenbaeh Steamship Company. On exceptions to li-' bel. Exceptions denied.
    M. B. MeaCham and W. K. Royal, both of Portland, Or., for libelant.
    Wood, Montague & Matthiessen and Gunther F. Krause, all of Portland, Or., for respondent.
   WOLYERTON, District Judge.

This is a libel in admiralty to recover damages resulting from the death of John Campbell, alleged to have been caused through the neglect and carelessness of the respondent, its officers and agents, in permitting a certain hatchway to remain open, unguarded, and uncovered, between ports, and in failing to warn Campbell of the danger and to provide him with" a flashlight, or other means of lighting the deck.

The accident occurred while the steamship F. J. Luekenbaeh was proceeding up the Columbia river to Portland, Or. Campbell died in Portland, the following day, from the injuries sustained. The respondent excepts to the libel, on the ground and for the reason that it does not state a cause within the jurisdiction of admiralty.

The question involved is whether libel in admiralty will lie to recover damages for death in pursuance of section 20 of the Act of March 4, 1915 (chapter 153, 38 Stat. 1185), as amended by section 33 of the Act of June 5, 1920 (chapter 250, 41 Stat. 1007) [Comp. St. Ann. Supp. 1923, § 8337a]).

This section gives to any seaman who shall have suffered personal injury in the course of his employment, at his' election, a right of action for damages at law, with the right of trial by jury. In such action, all statutes of the United States modifying or extending the common-law right or remedy in eases of personal injury to railway employees are made applicable. So, in case of the death of any seaman as a result of such personal injury, the personal representative of the seaman is given a right of action for damages at law, with trial by jury, and in such ease also all statutes of the United States conferring or regulating the right of action for death in eases of railway employees is likewise made applicable. It has been held by the Supreme Court that the act giving the right of action at law, with right of trial by jury, is not inimical to the Constitution. Panama R. Co. v. Johnson, 264 U. S. 375, 44 S. Ct. 391, 68 L. Ed. 748.

This was a case where the seaman sued at common law, on the law side of the .court, for personal injuries sustained. It was not. one in admiralty by personal representativés to recover damages arising on account of the death of the seaman. So the precise question here is whether libel will lie where death results from the injuries.

The essential fact that both the statute and the court were dealing with a matter wholly maritime, being that concerning seamen, puts it beyond question that, generally speaking, libel will lie. The purpose of the statute was to alter, qualify, and supplement the maritime rules, and to bring them into relative conformity to the common-law rules, or some modification of the latter. This, the court declares, could be done without impinging upon the Constitution, “if the change be country-wide and uniform in operation,” and so upheld the statute. In upholding the statute, the court upheld all of its parts and provisions, including, of course, the right of action, either in admiralty, or, at the election of the personal representatives, at common law, for damages resulting from the death of the seaman. The opinion of the court is so clear, comprehensive, and pertinent, that I take the liberty of quoting quite at length from it:

“The course of legislation, as exemplified in section 9 of the Judiciary Act of 1789, sections 563 (par. 8) and 711 (par. 3) of the Revised Statutes, and sections 24 (par. 3) and 256 (par. 3) of the Judicial Code, always has been to recognize the admiralty jurisdiction as open to the' adjudication of all maritime eases as a matter of course, and to permit a resort to common-law remedies through appropriate proceedings in perso-nam as a matter of admissible grace. It therefore is reasonable to believe that, had Congress intended by this statute to withdraw rights of action founded on the new rules from the admiralty jurisdiction and to make them cognizable only on the common-law side of the courts, it would have expressed that intention in terms befitting such a pronounced departure; that is to say, in terms unmistakably manifesting a purpose to make the resort to common-law remedies compulsory, and not merely permissible. But this was not done. On the contrary, the terms of the statute in this regard are not imperative' but permissive. It says 'may maintain! an action at law 'with the right of trial by jury/ the import of which is that the injured seaman is permitted, but not required, to proceed on the common-law side of the court with a trial by jury as an incident. The words 'in such action’ in the succeeding clause are all that are troublesome. But we do not regard them as meaning that the seaman may have the benefit of the new rules if he sues on the law side of the court, but not if he sues on the admiralty side. Such a distinction would be so unreasonable that we are unwilling to attribute to Congress a purpose to make it. A more reasonable view, consistent with the spirit and purpose of the statute as a whole, is that the words are used in the sense of 'an action to recover damages for such injuries/ the emphasis being on the object of the siut rather than the jurisdiction in which it is brought. So we think the reference is to all actions brought to recover compensatory damages under the new rules as distinguished from the allowances covered by the old rules, usually consisting of wages and the expense of maintenance and cure. See The Osceola, 189 U. S. 158, 23 S. Ct. 483, 47 L. Ed. 760; The Iroquois, 194 U. S. 240, 24 S. Ct. 640, 48 L. Ed. 955; Chelentis v. Luckenbach S. S. Co., 247 U. S. 372, 38 S. Ct. 501, 62 L. Ed. 1171. In this view the statute leaves the injured seaman free under the general law — sections 24 (par. 3) and 256 (par. 3) of the Judicial Code — to assert his right of action under the new rules on the admiralty side of the court. On that side the issues will be tried by the court, but if he sues on the common-law side there will be a right of trial by jury. So construed, the statute does not encroach on the admiralty jurisdiction intended by the Constitution, but permits that jurisdiction to be invoked and exercised as it has been from the beginning.”

Whether the statute be styled a survival statute, or what not, it clearly gives a right of action to the personal representatives of the seaman for his death resulting from the negligence of the vessel, its officers or agents.’

The coincidence that the seaman died on land does not affect the right of relief accorded to his personal representatives.

It is insisted that Congress did not intend to give libel for death by this act, as it follows so recently after the adoption of the Act of March 30,1920 (chapter 111, 41 Stat. 537 [Comp. St. Ann. Supp. 1923, §§ 1251%-1251%g]), relating to the maintenance of actions by personal representatives, for death occurring on the high seas. This is not essentially a seamen’s act, although seamen are entitled to the benefits awarded. It is general in its scope, and relates to death on the high seas beyond a marine league from the shore of any state, etc. The present statute relates to seamen, and gives the right of action wherever death occurs in appropriate admiralty jurisdiction.

It is suggested that respondent should he allowed to withdraw its answer and thereby obviate waiver of jurisdiction. It is the general appearance where venue is laid that waives jurisdiction, and, respondent having so appeared, the reason ascribed for withdrawal does not seem to be adequate.

The exceptions are denied.


author: KENNAMER, District Judge.

text:
    BENNETT v. RIVERLAND CO.
    (District Court, N. D. Oklahoma.
    May 18, 1925.)
    No. 4102.
    1. Brokers <@=86 (5) — Single sale of three properties by owner no evidence that broker found purchaser., for one on terms satisfactory to owner. '
    It could not be found that plaintiff broker found a purchaser willing and able to purchase, on terms satisfactory to defendant, the one property listed with plaintiff, merely because defendant made a single sale of three properties, including that listed, to a company to which plaintiff offered it at-a price not acceptable to it.
    2. Corporations <@=432(12) — President authorizing stockholder to contract must himself be shown to have been authorized.
    Testimony that the president of a company authorized E., a stockholder, to contract with a broker on behalf of the company, in the absence of proof that president was authorized to so contract, was no evidence of authority of E. to so contract.
    3. Corporations <©==432(12) — Ratification by corporation of unauthorized employment of broker held- not shown by subsequent sale by corporation.
    "Unauthorized employment of a broker on behalf of a corporation by one of its stockholders to sell one of its properties having been repudiated, and he notified thereof, by its officers-, as soon as they learned thereof, the mere fact that such property, with two others belonging to the corporation, were afterwards sold by it to the individual with whom the broker had communicated, is insufficient to show ratification.
    4. Brokers <@=55(l) — Broker first approaching buyer held not procuring cause of salei
    Broker who merely negotiated with M., by stating an -unacceptable price, for sale of a property of defendant, before his assumed authority w,as repudiated, and thereafter ceased to actively procure, the sale, was not the procuring cause thereof; another broker having approached M. in ignorance of the previous negotiations of the first broker, and subsequently brought about the sale of such property with other properties.
    At Law. Action by George E. B. Bennett against tbe Riverland Company. Judgment for defendant.
    F. E. Riddle, of Tulsa, Old., for plaintiff.
    Edgar A. De Meules, of Tulsa, Okl. (Ramsey, De Meules & Martin, of Tulsa, Okl., of counsel), for defendant Riverland Co.
   KENNAMER, District Judge.

Tbe plaintiff in this action is a broker in oil properties and sues for certain commissions be claims because of a sale of dil properties made by tbe defendant to tbe Mutual Oil Company. The testimony of tbe various witnesses discloses that tbe defendant company possessed eex’tain oil properties that it wished to sell. Tbe px-esident of tbe defendant company discussed the advisability and possibility of such a sale with one of tbe stockholders, a Mr. Elson, who, subsequent to tbe conversation, listed tbe properties for sale with a broker, but no sale resulted. Tbe conduct of Elson in listing tbe property with Bennett met with tbe disapproval-of'the officers of tbe Riverland Company, and Elson was informed that tbe defendant company did not want their properties placed with brokers for sale and did not want tbe properties peddled about promiscuously. Without authorization from tbe managing officers of tbe defendant company, and without as much as informing such officials, tbe stockholder, Mr. Elson, listed tbe property with Bennett, tbe plaintiff herein, for sale. Tbe plaintiff was instructed to secure any additional information be might need in making tbe sale from tbe stockholder; he was not to go to tbe officers of tbe Riverland Company, which it seems to me should have constituted the proper source for such information. Tbe plaintiff communicated with tbe manager of tbe Mutual Oil Company and ascertained that-it would be interested in the property since it was in tbe market for some producing properties. Plaintiff sent a description of tbe property to tbe local manager of the Mutual Company and communicated with him several times in regard to it, stating a price for tbe property which was not acceptable to tbe Mutual Company, which fact was indicated to tbe plaintiff at tbe outset. Plaintiff advised tbe manager of tbe Mutual Company that be thought it possible to purchase tbe px’opexdy for less than tbe price be bad named, but requested him not to talk to tbe officials of tbe Rivex’land Company about it.

At tbe request of tbe plaintiff, tbe manager for tbe Mutual Company inspected the one property mentioned to him by tbe plaintiff, but no communication or negotiation was bad with tbe officials of tbe Riverland Company in regard to the property.

Subsequently, tbe Riverland Company through a broker by name of Sheridan, sold the property Bennett had attempted to sell to the Mutual Company with two other smaller properties. Sheridan called upon the manager of the Mutual Company and offered him the properties, and was informed that Bennett had previously offered one of the properties for sale. Just why Sheridan presented these properties to the Mutual Company as a prospective purchaser was not disclosed by the testimony in the ease, but the evidence shows that this was Sheridan’s first information that Bennett had attempted to sell the property. Sheridan conveyed this information to the officers of the Riverland Company, and they were unacquainted with Bennett. They inquired of Bison, and were informed that he had listed the property with Bennett. Elson was then told that he had no authority to so contract for the Riverland Company, and Bennett was immediately notified that Elson had no authority to employ him, and that they did not wish him to have anything further to do with the property. Subsequent to these conversations within about 20 days, through the efforts of Sheridan, the Mutual Company secured an option for the purchase of the three properties, which included the one property Bennett had offered to the Mutual Company.

After the option had been extended a short period of time, through the efforts of Sheridan, the Mutual Oil Company purchased the three properties from the Riverland Company at a price less than the price named by Bennett for the one property. It is Bennett’s contentiofi that although he ceased to further complete the sale after he was informed by the officials of the Riverland Company that he was to have nothing to do with the sale of the property, by the subsequent sale the Riverland Company ratified the contract of agency made by the stockholder El-son, with plaintiff, and that he (the plaintiff) was the procuring cause of the sale and is entitled to the commission Elson agreed should be paid him for sale of the property.

Counsel for the plaintiff insist that Bennett’s contract with Elson, in listing the one property with him for sale, was that the plaintiff was only to find a purchaser able and willing to purchase the property, on terms to be agreed upon by negotiation between the purchaser and the seller. When the plaintiff presented the property for sale to the Mutual Oil Company and requested it to look at the property, and the Mutual Company did inspect the property pursuant to the request of the plaintiff, and a sale resulted from these negotiations, then the plaintiff had performed all.fhe services for which he was employed and he is entitled to recover his commission.

With this contention I 'cannot agree. The testimony of the plaintiff himself is to the effect he was to find a purchaser that would buy the one property alleged to have been listed with him on terms satisfactory to the Riverland Company. No contract of sale was ever consummated on the one property which the plaintiff contends was listed with him. Thus it would be impossible to find from the evidence that the plaintiff ever found a purchaser willing and able to purchase the property listed with him on terms satisfactory to the Riverland Company. The uneontradieted testimony shows that the only sale consummated between the Mutual Company and the Riverland Company was of three properties including the one which the plaintiff alleges was listed with him. Such sale was made after the Riverland Company, on its first information had that the plaintiff claimed Elson had listed one of the properties with him, had repudiated his alleged authority to sell.

Furthermore, that Elson was not authorized to contract with a broker in behalf of the Riverland Company is beyond doubt. Plaintiff offered testimony tending to prove that the president of the defendant company authorized Elson, the stockholder, to contract with a broker on behalf of the Riverland Company, but no proof that the president was authorized by the Riverland Company to so contract was offered. The plaintiff’s attempt was to establish a ratification by the defendant company of the contract of employment, and I am of the opinion that in this he has failed. The undisputed evidence proves that as soon as the oficiáis of the Riverland Company ascertained that Bennett was attempting to sell the property, they immediately indicated their opposition to his assumed authority and immediately repudiated it, and such repudiation was conveyed to Bennett. The mere fact that the property was sold with two other properties to the same company that Bennett had communicated with is not sufficient to show a ratification. The Supreme Court of Oklahoma, in the recent case of Skelly Oil Co. v. Pruitt, 94 Okl. 232, 221 P. 709, considered a situation similar in many respects to the one in question, and held, at page 233, 221 P. 711, that “the fact that the principal or vendee of real estate may have knowledge that a volunteer or stranger has assisted his agent in procuring the purchase, if unauthorized in the first instance, -will not bind the principal or. vendee, in receiving the conveyance.”

In Loving v. Hesperian Company, 176 Mo. 253, 75 S. W. 1102, where a like condition of the record was shown upon the facts, the court said: “Another claim is advanced, to wit, that even if the letter of March 12th was a revocation of the agency, and plaintiff did not have authority to procure and introduce Richards to defendant as a purchaser, still the acceptance by deféndant of Richards as a prospective buyer with knowledge that plaintiff had sent him- operated as a ratification, and rendered defendant liable for plaintiff’s commission. This claim, like that of estoppel, is dehors the pleadings in the case. No such issue is raised. Wade v. Hardy, 75 Mo. 399. Moreover, with defendant constantly repudiating plaintiff’s right to sell its ranch, and advising it all the time, and long before it entered into negotiations with Richards, that it would not recognize its claim for a commission, we think that it is plain that, even if pleaded, the facts would not have amounted to a ratification, so as to render defendant liable to plaintiff. One cannot, make another his debtor in this manner.”

In many cases, a clear intent to ratify is required before a ratification may be found. 74 App. Div. 397, 77 N. Y. S. 501. It is very evident from the evidence that there was no intent to ratify in the instant ease; the only intent expressed was that of repudiation, and it was expressed to both the broker and the stockholder who purported to employ the broker.

There was neither allegation nor proof-that the defendant company had acted in bad faith in repudiating the action of the plaintiff in regard to the sale of the property, or in its employment of Sheridan, the other broker. The evidence clearly established that Sheridan was employed before the Riverland Company had knowledge of Bennett’s action in regard to the property. It is likewise undisputed that Sheridan approached the Mutual Company in an effort to sell them the properties without knowledge that Bennett had previously offered them the one property. Sheridan, no doubt, possessed information that the Mutual Company was in the market for some producing properties just as Bennett did, and there can be no inference raised that he appropriated Bennett’s services.

Had it been established that Bennett was properly authorized to sell the property for the defendant company, which indeed it was not, I am of the opinion that he would not be entitled to the commission he here seeks. Where an owner of property places it for sale in the hands of a second agent after the relations with the first have terminated, if the second agent makes a sale, though possibly on'different terms, to a customer with whom the first agent had merely negotiated, not resulting directly in the purchase of fhe property, the owner is liable for commissions to the agent who finally effected the Sale. The cases establishing this proposition are numerous, and collections of them are to be found in notes in 25 L. R. A. (N. S.) 164 and 27 L. R. A. (N. S.) 195.

In other words, Bennett was not the procuring cause of the sale; he merely negotiated with the Mutual Company before his assumed authority was repudiated, and thereafter he ceased to actively procure the sale. Sheridan, the other broker, approached the Mutual Company in ignorance of the previous negotiations of Bennett, and subsequently brought about the sale of the properties, which entitled him to the commission he has been paid by the Riverland Company.

For the reasons that the plaintiff has failed to establish that he was properly authorized to sell the property for the defendant company, and for his failure to show that he was the procuring cause of the sale, judgment is entered for the defendant, the River-land Oil Company.


author: WILLIAMS, District Judge.

text:
    GALLARDO v. UNITED STATES.
    (District Court, E. D. Oklahoma.
    April 14, 1925.)
    No. 4360.
    1. Army and navy <®=>51 (/2, New, vol. I2A Key-No. Series — War risk insurance held to date from time of entry into the service.
    Under War Risk Insurance Act, § 401, as added by Act Oct. 6, 1917, § 2 (Comp. St. 1918, Comp. St. Ann. Supp. 1919, § 514uu), where a soldier inducted into the service September 4, 1918, made application for insurance within 120 days thereafter and while still in the service, his insurance related back to the time of his entry and covered an injury and disability which occurred between that time and the date of his application. ’
    2. United States <§=al25 — Jurisdiction of District Court of claim for war risk insurance attaches only on denial by bureau.
    • Under the World War Veterans’ Act June 7, 1924, § 19, and the regulations thereunder, a District Court is given jurisdiction of a suit against the United States on a contract of war risk insurance only after the claim has been denied by tbe Director of the Bureau or tbe United States Veterans’ Bureau.

      At Law. Action by Joe Gallardo, by Ms guardian, Tessie Edge, against tbe United States. On demurrer to petition, motion for judgment on the pleadings, and objection to jurisdiction. Demurrer and motion overruled. Objection to jurisdiction sustained, and action dismissed without prejudice.
    Geo. B. Reinhardt, of Kansas City, Mo., for plaintiff.
    O. H. Graves, Asst. U. S. Dist. Atty., of Muskogee, Okl., and L. A. Lawlor, of Washington, D. C., for the United States.
   WILLIAMS, District Judge.

Plaintiff was inducted into service on September 4, 1918, and made application for Ms insurance on October 7,1918, witMn 120 days from the date of enlistment.

Section 401 of article 4 of the War Risk Insurance Act, as added by Act Oct. 6, 1917, § 2 (40 Stat. 409 [Comp. St. 1918, Comp. St. Ann. Supp. 1919, § 514uu]), is as follows:

“That such insurance must be applied for within one hundred and twenty days after enlistment or after entrance into or employment in the active service and before discharge or resignation, except that those persons who are in the active war service at the time of the publication of the terms and conditions of such contract of insurance may apply at any time within one hundred and twenty days thereafter and wMle in such service. Any person in the active service on or after the sixth day of April, nineteen hundred and seventeen, who, while in such service and before the expiration of one hundred and twenty days from -and after such publication, becomes or has become totally and permanently disabled or dies, or has died, without having applied for insurance, shall be deemed to have applied for and to have been granted insurance, payable to such person during his life in montMy installments of $25 each. If he shall die either before he shall have received any of. such monthly installments or before he shall have received two hundred and forty of such montMy installments, then $25 per month shall be paid to his wife from the time of Ms death and during her widowhood, or to his child, or widowed. mother if and while they survive him: Provided, however, that not more than two hundred and forty of such monthly installments, including those received by such person during Ms total and permanent disability, shall be so paid; and in that event the amount of the montMy installments shall be apportioned between them as may be provided by regulations.”

By Act Dee. 24, 1919, § 12 (41 Stat. 374 [Comp. St. Ann. Supp. 1923, § 514uu]), said section was amended so as to read as follows:

“See. 401. That such insurance must be applied for within one hundred and twenty days after eMistment or after entrance into or employment in the active service and before discharge or resignation, except that those' persons who are in the active war service at the time of the publication of the terms and conditions of such contract of insurance may apply at any time within one hundred and twenty days thereafter and while in such service: Provided, that any person in the active service on or after the 6th day of April, 1917, and before the 11th day of November, 1918, who while in such active service made application for insurance after the expiration of more than one hundred 'and twenty days after October 15, 1917, or more than one hundred and twenty days after entrance into or employment in the active service, and whose application was accepted and a policy issued thereon, and from whom premiums were collected, and who becomes or had become totally and permanently disabled, or dies or has died, shall.be deemed to have made legal application for such insurance .and the policy issued on such application shall be valid. Any person in the active service on or after the 6th day of April, 1917, and before the 11th day of November, 1918, who, while in such service, and before the expiration of one hundred and twenty days after October 15, 1917, or one hundred and twenty days after entrance into or employment in the active service, becomes or has become totally and permanently disabled, or dies or has died, without having applied for insurance, shall be deemed to have applied for and to have been granted insurance, payable to such person during his life in monthly installments of $25 each; and any person inducted into the service by a local draft board after the 6th day of April, 1917, and before the 11th day of November, 1918, who, while in such service, and before being accepted and enrolled for active military or naval service, becomes or has become totally and permanently disabled, or dies or has died, without having applied for insurance, shall be deemed to have applied for and to have been granted insurance, payable to such person during his life in monthly installments of $25 each. If he shall die either before he shall have received any of such monthly installments or before he. shall have received two hundred and forty of such monthly installments, then $25 per month shall be paid to his widow from the time of his death and during her widowhood; or if there is no widow surviving him, then to his child or children; or if there is no child surviving him, then to his mother; or if there be no mother surviving him, then to his father, if and while they survive him: Provided, however, that no more than two hundred and forty of such monthly installments, including ■those received by such person during his total and permanent disability, shall be so paid. The amount of the monthly installments shall be apportioned between children as may be provided by regulations: Provided further, that each officer and enlisted man attached to the United States ship Cyclops of the 4th day of March, 1918, and every officer and enlisted man who on said date was a passenger on said vessel shall be deemed to have been granted insurance in the sum of $5,000 permitted under the War Risk Insurance Act.”

Congress did not intend to provide for protection under the contingencies contained in the different provisos in said section and leave no protection for plaintiff who enlisted on September 5, 1917, and made application for insurance on October 7, 1917, within 120 days, and receiving an injury and disability whilst in service during the intervening time. The legislative interpretation is favorable to plaintiff’s contention that when he was granted insurance on his application within the •120 days, it related back to the date of his enlistment.

The defendant, the United States of America, has interposed not only a demurrer to plaintiff’s petition, but also a motion for judgment on the pleadings, raising the question that no liability exists under said policy for any disability occurring after enlistment but prior to time of application for such insurance, though made within 120 days from date of enlistment. Said demurrer and motion, each, are overruled.

The defendant further insists that this court has no jurisdiction of this action. Section 19, World War Veterans’ Act June 7, 1924 (43 Stat. 612), provides:

« • * * That in the event of disagreement as to claim under a contract of insurance between the bureau and any beneficiary or beneficiaries thereunder an action on the claim may be brought against the United States either in the Supreme Court of the District of Columbia or in the District Court of the United States in and for the district in which such beneficiaries or any one of them resides. * * * ”

See Cassarello v. U. S. (D. C.) 265 F. 326.

Under the statutes and rules promulgated pursuant thereto, this .claim must be denied by the Director of the Bureau of War Risk Insurance or the United States Veterans’ Bureau before this action may be maintained against the defendant, which does not appear to have been done. See Helmholz v. Horst (C. C. A.) 294 F. 417.

x This action is therefore dismissed, without prejudice.


author: BREWSTER, District Judge.

text:
    MANIGLIA v. COMMANDER OF THE GUISEPPE VERDI et al.
    (District Court, D. Massachusetts.
    April 30, 1925.)
    No. 3035.
    1. Habeas corpus <S=7 — Court will not allow writ refused by another District Court unless substantial change of circumstances has intervened.
    Where one District Court has decided that no grounds exist for judicial interference with administrative deportation proceedings, another court will not allow writ of habeas corpus unless substantial change in circumstances has intervened.
    2. Aliens <§=»54 — Application fo'r rehearing in deportation proceedings should be presented to local immigration authorities, and court has no authority to control their discretion.
    Under rules and regulations of Department of Labor, application for rehearing in deportation proceedings should be presented to local immigration authorities, and court has no control of department in exercise of its discretion in passing on such application.
    Application for writ of habeas corpus by Antonio Maniglia, as next friend of Calo-gero Maniglia, against the Commander of the Steamship Guiseppe Verdi and the Commissioner of Immigration. Writ discharged, alien remanded to immigration authorities, and petition dismissed.
    • H. S. Avery, of Boston, Mass., for plaintiff.
    Harold P. Williams, U. S. Atty., and John W. Schenck, Asst. U. S. Atty., both of Boston, Mass., for defendants.
   BREWSTER, District Judge.

Calogero Maniglia came to this country on Aug,ust 18, 1923. After hearing, held by the immigration authorities at Ellis Island, the alien was refused admission; the exclusion order being based on three grounds, viz.: (1) that he was physically defective; (2) that he was likely to become a public charge; (3) that he obtained admission on an irregular passport improperly issued to him as a citizen of the United States.

The alien’s father is a naturalized citizen of the United States, but the alien is not. The Department of State has refused to waive the irregularities of the passport.

Appeal was taken to the Commissioner of Labor at Washington, and after proper proceedings the excluding decision was affirmed, and arrangements were being made to deport the alien when a writ of habeas corpus issued out of the District Court for the Southern District of New York. The court, after summary hearing, dismissed the petition for the writ and ordered the alien remanded to the immigration authorities for deportation. An appeal was granted to the Circuit Court of Appeals and the alien was released on bail pending the appeal. About January 31, 1925, this appeal was withdrawn, and in March, 1925, the alien was surrendered to the authorities at Ellis Island for deportation, and he was placed on board the steamship Guiseppe Yerdi on April 4, 1925.

In the meantime his counsel had undertaken by correspondence and personal interview at Washington to have the deportation stayed in order that the ease might be again presented to the Department of Labor at Washington, and on April 2, 1925, the Department wired the attorney as follows:

‘'Answering letter and -telegram regarding Maniglia no possibility of further hearing or different ruling. Manditorially deported deportable under law and having been through court the case cannot again come to this Department for consideration. Secretary of Labor utterly without discretion and since court ruling without jurisdiction.”

Shortly thereafter application was made to this court for a writ of habeas corpus. The writ having issued, the alien was taken from the steamship Guiseppe Yerdi. This statement of facts is sufficient to indicate clearly that the ease is not one that fails within the somewhat limited jurisdiction of this court in matters arising under the .immigration laws. The District Court for the Southern District of New York has, in effect, decided that no. grounds existed for judicial interference with the administrative proceedings taken with reference to Maniglia, and while this decision may not be res judicata, it has long been the established practice that one court will not allow a writ when some other judge has refused it unless a substantial change in the circumstances has intervened. Ex parte Moebus (C. C.) 148 F. 39. When a party has had his day in court in one jurisdiction, he should not be heard on the same issues in another jurisdiction, unless it appears much more clearly than it does in the present ease that a substantial injustice will be done by refusing to entertain his petition.; A practice that will permit an alien to try one federal court after another for the same remedy should not be encouraged. Eor that reason I have refused in any way to review the ease, as it came before Judge Hough in the District Court for the Southern District of New York.

A motion to amend the petition for - the writ has been presented and allowed. -I have considered the case on the amended petition, statements, and briefs of counsel, and I am wholly unable to see any justification for further interference by the court.

The alien contends that the Department of Labor at Washington has proceeded upon an erroneous conception of its powers and jurisdiction amounting to an error of law. The telegram, above quoted, may well be held to amount to a refusal to reopen the case, had the Department authority so to do.

Without undertaking to determine just what the powers and duties of the Department of Labor are in the premises, it is clear from the rules and regulations' of the Department that any application for a rehearing should be presented to the local immigration authorities at Ellis Island, who may stay deportation and request permission to reopen the ease. Paragraph 1, subd. G. Immigration Rules of February 1, 1924. Such application would be addressed entirely to the discretion of the department charged with the duty of administering the immigration laws. The court has no authority to control the department in the exercise of this discretion.

The writ therefore will be discharged, the alien remanded to the immigration authorities, and the petition dismissed. I have no doubt that ample opportunity will be given the alien to request of the proper authorities, before deportation, a stay and rehearing.


author: MEEK, District Judge.

text:
    OLDHAM v. PARKER.
    (District Court, N. D. Texas, at Abilene.
    May 19, 1925.)
    1. Words and phrases — Debt created by contractual relations between debtor and creditor.
    The relation of debtor and creditor springs from and is always the result of contractual obligations either expressed or implied, and the result of the contract is the debt created.
    2. Bankruptcy <@=223 — Referee held entitled to commission on attorney’s fees paid by trustee; “debt”; “creditor.”
    Attorney’s fees paid by trustee in bankruptcy under Bankruptcy Act, § 64b(3) being (Comp. St. § 9648), field “moneys disbursed to creditors' by the trustee” within section 40a (section 9624), entitling referee as compensation to 1 per cent, on all moneys so disbursed, since the attorney is a “creditor” and the fee is a “debt,” in view of section 1, subds. (9) and (11), being Comp. St. §§ 9585 and 64b (2).
    [Ed. Note. — For other definitions, see Words and Phrases, First and Second Series, Creditor; Debt.]
    3. Bankruptcy <@=II — Bankruptcy court is “court of equity.”'
    Court of bankruptcy is a “court of equity.” [Ed. Note. — For other definitions, see Words and Phrases, First and Second Series, Court of Equity.]
    4. Bankruptcy <©=223 — Referee is entitled to fair construction of provisions of Bankruptcy Act fixing compensation.
    Referee in bankruptcy is entitled to a fair construction of Bankruptcy Act, § 40 (Comp. St. § 9624), fixing referee’s compensation in connection with all provisions of the act affecting' compensation.
    In Bankruptcy. Petition by D. M. Old-ham, Jr., referee in bankruptcy, against George W. Parker, clerk of court, for return of amount alleged to have been wrongfully collected from referee. Order for referee.
    D. M. Oldham, Jr., in pro. per.
   MEEK, District Judge.

This referee in bankruptcy, D. M. Oldham, Jr., seeks an order from the court directing and commanding George W. Parker, clerk of the court, to return and repay to him, D. M. Oldham, Jr., referee in bankruptcy, the sum of $44.45, which amount he says he was wrongfully compelled to pay to the clerk of the court by the action of one D. D.'Lamond, who examined his office at Abilene for the Department of Justice in the month of March of this year.

The said agent of the Department of Justice contended that this referee had illegally and unlawfully appropriated the sum of $44.45 to his use and benefit, in that said referee had collected the sum of 1 per cent, commission on amounts paid to attorneys as provided in section 64b of the Bankrupt Act (Comp. St. § 9648); said examiner contending and maintaining that the referee was not entitled to a commission of 1 per e.ent. on amounts paid to attorneys as attorney’s fees under section 64b of the act; that said attorneys were not creditors of the estate within the meaning of section 40a (section 9624) of the National Bankruptcy Act, relating to ’commissions paid to the referees for their services.

This petitioner and-referee contends and insists that he is entitled to the said sum of 1 per cent, commission on amounts paid as attorney’s fees, and that said sum of $44.45 is legally due and owing to him, and that it was unlawful for the said examiner to require and compel petitioner to pay into the registry of this court said sum; that acting under the advice and coercion of said examiner, this referee did on April 7, 1925, deliver to said examiner his cheek for this amount, which was payable to George W. Parker, clerk of this .court, which cheek was cashed by said clerk on the 23 d day of April, 1925, and is- now in the registry of this court.

The question raised by the petition of this referee in bankruptcy for my consideration and decision is as follows: Is a referee in bankruptcy entitled to a commission of 1 per cent, as provided by section 40 of the act on the sums disbursed by the trustee in bankruptcy in the form of attorney’s fees paid, as provided for under section 64b (3) of the Bankruptcy Act?

Section 40a of the Bankrupt Act, relating to commissions of<referees, provides: “Referees shall receive as full compensation for their services, payable after 'they are rendered * * * from estates which have been administered. before them one per centum commissions on all moneys disbursed to creditors by the trustee.”

Section 1, subd. 9, of the Bankrupt Act (section 9585), defining the meaning of words and phrases, reads: “ ‘Creditor’ shall include any one who owns a demand or claim provable in bankruptcy, and may include his duly authorized agent, attorney, or proxy.” Subdivision 11 provides: “ ‘Debt’ shall include any debt, demand or claim provable in bankruptcy.”

Section 64 of the Bankrupt Act, relating to debts which have priority, and section 64b (3), provide that among the debts which shall • have priority are: “One reasonable attorney’s fee, for the professional services actually rendered, irrespective of the number of attorneys employed, to the petitioning creditors in involuntary cases, to the bankrupt in involuntary eases while performing the duties herein prescribed, and to the bankrupt in voluntary eases, as the court may allow.”

Under the act as originally passed in 1898, it provided that referees should receive “one per cent, commission on all sums paid as dividends and commissions.” This was changed by the amendment of 1903 in order to increase the pay of referees, as it was found the compensations, when figured on dividends and commissions paid to creditors, were wholly insufficient to remunerate them for their services. Therefore Congress, in order to increase their pay, struck out “as dividends and commissions,” and enacted in lieu thereof the term “one per cent, as commissions on all sums of money disbursed to creditors by the trustee in bankruptcy,” thereby showing the clear intention on the part of Congress that the referees should not be restricted, in the narrow sense, to common creditors who receive dividends on their debts, but the commissions should be paid on all sums disbursed by the trustee in bankruptcy, whether as dividends to creditors, secured or unsecured, priority or preferred, in no wise limiting the class of creditors upon which commissions should be figured. This brings up the question, “Who are creditors of the estate?”

The relation of debtor and creditor springs from and is always the result of contractual obligations either expressed or implied, and the result of this contract, expressed or implied, is the debt created, or the attorney’s fee; therefore, when we have a debt, we necessarily have a creditor and a debtor, one is correlative of the other, and the legal status of the two produce the obligation. In ' ascertaining the creditors to whom disbursements have been made by the trustee, we naturally look to and find a debt created by the voluntary act of the parties, which is usually as follows: The bankrupt seeks an attorney and engages the attorney’s services to put him into bankruptcy. The attorney, for a reasonable compensation, promises and agrees to do so. The amount of compensation may be agreed upon between attorney and client and if it is reasonable, it is the duty of the court administering the estate to pay, out of the funds belonging to the estate, this attorney’s fee. If the amount agreed on is unreasonable, the statutes' provide the court shall allow only a reasonable fee. If there are no assets in the case and nothing for the court to pay this debt, the bankrupt continues to owe the same until he is relieved by his discharge in bankruptcy. It is an obligation brought into existence solely by the voluntary act°of the parties, whether it be bankrupt or the petitioning creditors and an attorney agreeing to perform the services. The relation of debtor and creditor is thereby established, and the sum to be paid for these services is a debt. This is a debt arising from, and independent of, the bankrupt court, and before the bankrupt court takes any cognizance of the situation, and before the procedure of the law is put into operation. This is usually followed by the appointment of a receiver and later a trustee; then, liquidation of the estate.

Now, reverting to the definitions laid down by the act: section 1, subd. 11: “ ‘Debt’ shall include any debt, demand or claim provable in bankruptcy.” This law provides that an attorney must file a duly sworn proof of debt with the referee, the same to be passed upon and allowed and its payment by the trustee from the estate ordered. In other words, the trustee is required to disburse funds belonging to the estate to satisfy the debt. Hence we have a disbursement of funds and a debt satisfied. Section 1, subd. 9: “ ‘Creditor’ shall include any one who owns a demand or claim provable in bankruptcy.” By reason of the attorney’s prior obligation incurred by the bardnupt or the petitioning creditors, he has a demand which should be paid out of the estate in bankruptcy ; hence, he presents a claim in bankruptcy and therefore becomes a creditor of the estate.

Reverting to section 64b (3), we find that this claim of debt is classified by law and given a standing superior to the ordinary common creditor and is made a debt which has priority of payment. It is directed to be made in advance of dividends to creditors, wage-earners, workmen, etc. This section does not provide attorney’s fees are prior to the costs of - administration provided for in section 64b (1), but only provides this debt may be included and given priority or equal standing with costs of administration and will take its classification along with actual costs of administration. Of course, this is not any part of expenses or costs of administration incurred by the court in administering the estate. There are frequent cases in which an attorney is employed to put a man in bankruptcy, and after he has advised his client concerning transfers of his properties he has made, and concerning all the business affairs of his client, it will be the attorney’s judgment that it is his best interest to remain out of bankruptcy; yet no one would say that the attorney was not entitled to compensation for this advice and services preformed for his client. Therefore, this debt is brought into existence, the relation of debtor and creditor established, yet no ad-administration in bankruptcy results.

Under the Bankruptcy Act as originally enacted, commissions to the referee and trustee on sums disbursed by the trustee “as dividends and commissions,” it was held that this restricted the referee and trustee to the specified per cent, on the sums available and distributed to the general or unsecured creditors. Under the law as first enacted, the payment in full of the claims which under the act were entitled to priority (tax claims, labor claims, etc) was not the payment of a “dividend,” and that commission could not he figured either on the amount so paid out or on sums over to mortgagees or other secured creditors or lien holders. It was also held that the setting apart of a homestead exempt to the bankrupt from the proceeds of property sold hy the trustee was not making of a “dividend” so as to entitle the referee and trustee to a commission on such amount.

Under this rule it sometimes occurred that the whole of the assets of an estate in bankruptcy would be consumed in the payment of the claims of secured debts and that nothing whatever would be left on which commissions for the referee and trustee handling the estate could be calculated. In such eases their services would have to go uncompensated except for the small filing fees.

The amendatory act of 1903 changed and altered these conditions and allowed commissions on money “disbursed to creditors,” and this was still further enlarged by the amendment of 1910, which allows the commission on “all moneys disbursed or turned over to any person, including lienholders.”

From the foregoing it is seen that it was clearly the intention of Congress to increase the pay of referees. This court of bankruptcy being also a court of equity, my attention is called to the fact by this referee that by far the greater percentage of bankruptcy eases are no asset eases or small asset eases. It is true that the small asset eases are more than consumed in payment of the costs, trustee and referee’s commissions, and attorney’s fees paid to the bankrupt’s attorney. If the referee should be deprived of the 1 per cent, commission allowed him, as I view it, by the terms of the act it would wrongly reduce his compensation and should hot be done. Referees are entitled to a fair construction of section 40 of the act in connection with all provisions of the act affecting their compensation. See In re Cramond (D. C.) 145 F. 966, 972; In re Breakwater Co. (D. C.) 220 F. 226; In re Lowell Textile Co. (D. C.) 288 F. 989.

An order will be entered directing George W. Parker, clerk of the court, to return and repay to said D. M. Oldham, Jr., referee in bankruptcy, this sum of $44.45 which in my view he was and is entitled to under the provisions of the Bankruptcy Act.


author: TUTTLE, District Judge.

text:
    HAYES v. SMITH et al.
    (District Court, E. D. Michigan, S. D.
    May 13, 1925.)
    No. 7562.
    Removal of causes <©=595 — On federal officer’s petition for transfer to federal court of action against him, suit becomes pending in District Court without specific order f.or removal.
    Under Judicial Code, § 33 (Comp. St. § 1015), and National Prohibition Act, tit. 2, § 28 (Comp. St. Ann. Supp. 1923, § 10138%o), when prohibition officer petitions for removal to federal court of action against him on account of acts done in performance of his duty as such officer, cause is “thereupon” automatically pending in District Court without entry of specific order to that effect, and under Judicial Code, § 37 (Comp. St. § 1019), propriety of such removal cannot be determined until motion is made to remand.
    ■ At Law. Action by Edward J. Hayes against Delos G. Smith and others. On petition by defendants for removal of cause from state court to federal District Court. Cause held pending in District Court without specific order therefor.
    Louis W. McClear, of Detroit, Mich., for plaintiff.
    Delos G. Smith, U. S. Atty., of Detroit, Mich., for defendants.
   TUTTLE, District Judge.

A petition has been filed herein in the name of the United States, on the relation of the above-named defendants, praying for a removal of the above-entitled cause from a state court to this court under section 33 of the Judicial Code, as amended (section 1015, West’s United States Compiled Statutes), on the ground •that said defendants have been sued in said state court on account of acts done by them in the performance of their duties as federal officers within the meaning of said section.

The petition states in substance.that for the past year the defendants have occupied the following offices, respectively, defendant Smith, United States attorney for this district and an officer of this court, defendant Newton, United States marshal for this district and an officer of this court, defendant Beamer, deputy United States marshal and an officer of this court, defendant Yellowley, chief general prohibition agent of the United States, acting under the Secretary of the Treasury and the Commisisoner of Internal Revenue, and defendant Stone, divisional chief of the Tenth division of prohibition agents, acting under the Secretary of the Treasury and the Commissioner of Internal Revenue; that said cause was instituted by. the above-named plaintiff on April 30, 1925, in the circuit court for the county of Wayne, Mich., claiming damages in the sum of $100,000 against said defendants for the alleged false arrest and detention of said plaintiff while he was resorting at a certain specifically described saloon and restaurant ip. the city of Detroit in said county and state, and within the jurisdiction of this court, commonly known as “Paul’s Place,” maintained and conducted by one Paul Mirabile in violation of the federal prohibition law; that said saloon and restaurant had been maintained and conducted as a place for the sale of intoxicating liquor for three years and its character and reputation were well-known to all patrons who visited the same, and that nightly during every night in the year large numbers of patrons visited said saloon, which customarily during said period remained open all night and engaged in the business of selling intoxicating liquor and supplying music for dancing, and the furnishing of food was a subterfuge and constituted no real and substantial part of the business of said saloon and dance hall; that said saloon and dance hall for the past two years during every night constituted a common nuisance under the National Prohibition Law (Comp. St. Ann. Supp. 1923, § 10138% et seq.) and was known to all of its patrons, including the said plaintiff, to be such common nuisance; that at numerous times during the past year said place was entered and raided by police officers of- said city of Detroit for violation of the Michigan laws prohibiting the sale of intoxicating liquors; that on each of said raids patrons in large numbers, from 50 to 100 and upwards, were openly consuming intoxicating liquor which they had purchased in said place, and in spite of said raids said nuisance continued to be maintained down to the date set forth in plaintiff’s declaration, April 21, 1925; that on said date a federal search warrant was duly issued by a United States commissioner directing certain federal officers to search said place for intoxicating liquor unlawfully possessed by the proprietor; that defendant Beamer, in discharge of his duties under the federal laws, accompanied said officers and in their company entered said premises at about midnight and there saw 50 and upwards of patrons and employees, among whom was said plaintiff; that said plaintiff, in company with two ladies whom he had brought to said saloon, were seated at a table therein, and said parties had before them glasses containing beer, and that before each of said parties was a glass of partly consumed beer containing more than one-half of 1 per cent, of alcohol, and that said parties were under the influence of intoxicating liquor; that other parties, including said plaintiff, were there for the purpose of purchasing intoxicating liquor and had then and there purchased- such intoxicating liquor and had consumed the same, and that' plaintiff thereby violated the National Prohibition' Law and was also guilty of assisting to maintain a common nuisance; that thereupon said defendant Beamer arrested said plaintiff and his two companions and brought them to the office of the United States attorney, said defendant Smith, for disposition of the case; that said Smith then interrogated said plaintiff and other patrons, as he desired to have full and complete evidence of the violation of law by said proprietor in order that an indictment might be successfully prosecuted and said place be declared a common nuisance, and he then released said patrons, including said plaintiff and his companions, taking their names and addresses and advising them that they might be called as witnesses against the proprietor of said place, and thereupon directed said officers to set the said plaintiff and other patrons at liberty; that said plaintiff was subject to arrest and was lawfully taken into custody for the violation of the National Prohibition Law and for assisting in maintaining a nuisance, and that all 'of the acts of said defendants Beamer and Smith were in the exercise of good faith in the discharge of their duties, and aimed at the abatement and prosecution of a nuisance which had long been maintained and resorted to by plaintiff and other patrons on numerous occasions for the unlawful purchase of intoxicating liquor, and that they thereby became parties to violation of the federal laws; that said cause was in-stitutéd by said plaintiff for the recovery of damages for the acts and doings of said defendants in the premises aforesaid; an¡i that on the application o£ said plaintiff in said circuit court a writ of capias was issued for said defendants Beamer and Smith, each of whom has, in compliance with said writ, furnished bail in said circuit court in the sum of $1,000, the bonds for which are now in the possession of the sheriff of said county, and said defendants are informed and believe that they will be required to furnish another bond in accordance with the laws of said state and the rules of said circuit court. The prayer of the petition is that said cause be removed from said circuit court to this court, and that writs of certiorari and habeas corpus cum causa be issued and served as provided by the federal statutes, to the end that said cause, proceedings, and records and jurisdiction over said defendants may be transferred to the jurisdiction of this court for trial and disposition. The petition is verified and accompanied by the certificate of counsel required by the statute hereinafter referred to.

Section 33 of the Judicial Code, as above cited, provides in full as follows:

“When any civil suit or criminal prosecution is commenced in any court of a state against any officer appointed under or acting by authority of any revenue law of the United States now or hereafter enacted, or against any person acting under or by authority of any such officer, on account of any act done under color of his office or of any such law, or on account of any right, title, or authority claimed by such officer or other person under any such law, or is commenced against any person holding property or estate by title derived from any such officer and affects the validity of any such revenue law, or against any officer of the courts of the United States for or on account of any act done under color of his office or in the performance of his duties as such officer, or when any civil suit or criminal prosecution is commenced against any person for or on account of anything done by him while an officer of either House of Congress in the discharge of his official duty in executing any order of such House, the said suit or prosecution may at any time before the trial or final hearing thereof be removed for trial into the District Court next to be holden in the district where the same is pending upon the petition of such defendant to said District Court and in the following manner: Said petition shall set forth the nature of the suit or prosecution and be verified by affidavit and, together with a certificate signed by an attorney or counselor at law of some court of record of the state where such suit or prosecution is commenced or of the United States stating that, as counsel for the petitioner, he has' examined the proceedings against him and earefully inquired into all the matters set forth in the petition, and that he believes them to be true, shall be presented to the said district court, if in session, or if it be not, to the clerk thereof at his office and shall be filed in said office. The cause shall thereupon be entered on the docket of the District Court and shall proceed as a cause originally commenced in that' court; hut all bail and other security given upon such suit or prosecution shall continue in like force and effect as if the same had proceeded to final judgment and execution in the state court. When the suit is commenced in the state court by a summons, subpoena, petition, or any other process except capias, the clerk of the District Court shall issue a writ of certiorari to the state court requiring it to send to the District Court the record and the proceedings in the cause. When it is commenced by capias or by any other similar form of proceeding by which a personal arrest is ordered, he shall issue a writ of ha-beas corpus cum causa, a duplicate of which shall be delivered to the clerk of the state court or left at his office by the marshal of the district or his deputy or by some other person duly authorized thereto; and thereupon it shall be the duty of the state court to stay all further proceedings in the cause, and the suit or prosecution, upon delivery of such process, or leaving the same as aforesaid, shall be held to be removed to the district court, and any further proceedings, trial, or judgment therein in the state court shall be void. If the defendant in the suit or prosecution be in actual custody on mesne process therein, it shall be the duty of the marshal, by virtue of the writ of habeas corpus cum causa, to take the body of the defendant into his custody, to be dealt with in the cause according to law and the order of the district court, or, in vacation, of any judge thereof; and if, upon the removal of such suit or prosecution, it is made to appear to the district court that no copy of the record and proceedings therein in the state court can be obtained, the District Court may allow and require the plaintiff to proceed de novo and to file a declaration of his cause of action, and the parties may thereupon proceed as in actions originally brought in said District Court. On failure of the plaintiff so to proceed, judgment of non prosequitur may be rendered against him, with costs for the defendant.”

Section 28 of title 2 of the National Prohibition Act (Comp. St. Ann. Supp. 1923, § 10138%o) provides that “the commissioner, his assistants, agents, and inspectors, and all other officers of the United States, whose duty it is to enforce criminal laws, shall have all the power and protection in the enforcement of this act or any provisions thereof which is conferred by law for the enforcement of existing laws relating to the manufacture or sale of intoxicating liquors under the law of the United States.”

It will be noted that the above-quoted statute does not in terms require nor provide for the entry of any order of removal by the District Court in the cases to which such statute is applicable. It was apparently the intention of Congress to make it the duty of the clerk of the District Court, upon the filing of the petition there referred to, to “thereupon” enter the cause on the docket of the District Court, which cause should thereafter “proceed as a cause originally commenced in that court.” The clerk has already performed this duty, as appears from the files and records of this cause and from the title thereof as endorsed upon the petition filed. It seems clear that this cause is, by operation of this statute, now automatically and without the entry of any specific order to that effect, pending in this court, under the provisions of this statute. The petition itself (all of the allegations of which have been above stated substantially in the exact language of the petition) does not pray for an order of the court, but merely for a removal of the cause. There appears, therefore, to be no necessity for the court to make any order at the present stage in the proceedings under the statute.

Section 37 of the Judicial Code (section 1019, West’s United States Compiled Statutes), provides as follows:

“If in any suit commenced in a District Court, or removed from a state court to a District Court of the United States, it shall appear to the satisfaction of said District Court, at any time after such suit has been brought or removed thereto, that such suit does not really and substantially involve a dispute or controversy properly within the jurisdiction of said District Court, or that the parties to said suit have been improperly or collusively made or joined, either as plaintiffs or defendants, for the purpose of creating a case cognizable or removable under this chapter, the said District Court shall proceed no further therein, but shall dismiss the suit or remand it to the court from which it was removed, as justice may require, and shall make such order as to costs as shall be just.”

It was evidently the intent and design of Congress to provide, by section 33, a summary proceeding for the protection of federal officers by the automatic removal to the federal court of suits brought against them in the state courts, without the delay which might be incident to a regular judicial hearing and decision on the right of removal, and then to provide, by section 37, an opportunity for such a hearing and decision in the manner specified in said section. State v. Sullivan (C. C.) 50 F. 593; Mutual Life Insurance Co. v. Langley (C. C.) 145 F. 415; Atlantic Coast Line Railroad Co. v. Bailey (C. C.) 151 F. 891; McAlister v. Chesapeake & Ohio Railway Co., 157 F. 740, 85 C. C. A. 316, 13 Ann. Cas. 1068 (C. C. A. 6).

Applying these statutory provisions to the present case, I reach the conclusion that this is not the proper time or stage of the proceedings for a consideration or disposition of the questions involving the right of the defendants to have this cause tried in this court. Any such questions, therefore, are reserved for consideration if and when a motion to remand is made under the statute.

The clerk of this court will perform his duty under the applicable statutes.


text:
    In re MELLEA.
    (District Court, E. D. Michigan, S. D.
    April 23, 1925.)
    No. 7448.
    1. Constitutional law <§=>62, 77 — Rule as to power of executive tribunal or official to make regulations, stated.
    Executive tribunal or official may constitutionally be empowered by Congress to make regulations reasonably necessary to the proper execution of a statute, so long as regulations are merely administrative in character and relate only to enforcement of statute, but cannot, constitutionally, either with or without sanction of Congress, make rule or regulation which would add to, take from, or otherwise change such statute, since such rule or regulation would be encroachment upon legislative functions.
    2. Constitutional law <§=77 — Regulation requiring certificate of arrival to accompany declaration of intention held void as encroachment on legislative power.
    Regulation of naturalization bureau, providing that declaration of intention shall not be filed or accepted unless accompanied by certificate of arrival, held invalid because not authorized by Naturalization Act, §§ 1, 12, 27, 28 (Comp. St. §§ 963, 4371, 4382, 4383), and section 4 as amended in 1910 and 1918 (Oomp. St. 1918, Oomp. St. Ann. Supp. 1919, § 4352), and therefore constituting an attempt to legislate.
    At Law. Application for writ of mandamus by Pietro Mellea to require Elxper W. Voorheis, Clerk of the District Court, to file and receive declaration of intention for naturalization. Writ issued.
    Frank C. Sibley, of Detroit, Mich., for petitioner.
    Elmer W. Voorheis, of Detroit, Mich., in pro. per.
   TUTTLE, District Judge.

This is a petition filed by Pietro Mellea, an alien, as petitioner herein, for a writ of mandamus requiring Elmer W. Voorheis, clerk of this court, as respondent herein, to forthwith, and without requiring a certificate of arrival, accept from petitioner and file his declaration of intention to become a citizen of the United States. On the filing of the petition, an order to show cause why it should not be granted was entered and the cause is now before the court on said petition and order.

The allegations of the petition are: That petitioner resides, and has continuously for more than two years resided, in the city of Detroit in this district; that he is of the age of 38 years, was born in, and is a subject of, Italy, and emigrated from Naples, Italy, on the vessel Patria to the United States, and arrived at the port of New York on or about November 1, 1922; that his entry into the United States was legal, and that he has complied with all of the laws and regulations of the United States pertaining to such entry; that he is a married man, and for the last 18 months has been, and is, steadily employed with the Detroit Street Railway of the city of Detroit; that he is desirous of becoming a citizen of the United States and that on February 16, 1925, he duly requested the said respondent, clerk of this court, to receive and file petitioner’s declaration of intention to become such citizen; that said respondent refused to comply with such request solely on the ground that petitioner did not furnish a certificate of his arrival in the United States, said respondent stating that such' declaration of intention would not be received nor filed until and unless such certificate of arrival should be furnished to respondent by petitioner; that such action on the part of respondent is contrary to law and will impose a hardship on petitioner, as it will cause a delay of several months in the filing of said declaration of intention, since it requires that time within which to obtain such certificate, which delay is jeopardizing his position of employment and is likely to cause him irreparable injury; that he is without remedy unless this court will issue its writ of mandamus requiring said respondent to file said declaration of intention forthwith according to law; wherefore he prays'the issuance of such writ.

The facts thus alleged in the petition are not disputed by respondent, and the question involved is solely one of law.

It appears that the refusal of the respondent clerk to file or accept the declaration of intention in question was prompted by, and based upon, a certain ruling, in the nature of a regulation, issued by the Naturalization Bureau on or about August 1,1924, providing in substance that such a declaration shall not be so filed nor accepted from an alien unless accompanied by a certificate of arrival of such alien. Whether such a regulation is authorized by the applicable statutes, and is therefore valid, or is not so authorized, and is therefore invalid, is the question presented for decision.

Soetion 1 of the Naturalization Act (the Act of Congress of June 29, 1906, chapter 3592, 34 Statutes at Large, 596 [Comp. St. § 963] requires the Immigration Bureau to “provide, for use at the various immigration stations throughout the United States, books of record, wherein the commissioners of immigration shall cause a registry to be made in the ease of each alien arriving in the United States,” containing certain prescribed and specified information, including the date of arrival of said alien, and, if entered through a port the name of the vessel in which he comes, and provides that such commissioners shall “cause to be granted to such alien a certificate of such registry, with t]ie particulars thereof.” This certificate is generally known and referred to as the certificate of arrival.

Section 4 of the Naturalization Act (being the Act of Congress of June 29, 1906, chapter 3592, 34 Statutes at Large, 596, as amended by the Act of June 25, 1910, chapter 401, 36 Statutes at Large, 830, and as further amended by the Act of May 9, 1918, chapter 69, 40 Statutes at Large, 542 [Comp. St. 1918, Comp. St. Ann. Supp. 1919, § 4352]), which is the statute governing the naturalization of aliens, provides that “an alien may be admitted to become a citizen of the United States in the following manner and not otherwise: First. He shall declare on oath before the clerk of any court authorized by this act to naturalize aliens “ ' ”' that it is bona fide his intention to become a citizen of the United States and to renounce forever” all allegiance to any foreign sovereign. It is therein further provided that “such declaration shall set forth the name, age, occupation, personal description, place of birth, last foreign residence and allegiance, the date of arrival, the name of the vessel, if any, in which he came to the United States, and the present place of residence in the United States of said alien.” Section 4 then proceeds as follows: “Second. Not less than two years nor more than seven years after he has made such declaration of intention he shall make and file, in duplicate, a petition in writing, signed by the applicant in his own handwriting and duly verified, in which petition such applicant shall state .his full name, his place of residence (by street and number, if possible), his occupation, and, if possible, the date and place of his birth; the place from which he emigrated, and the date and place of his arrival in the United States, and, if he entered through a port, the name of the vessel on which he arrived,” and certain other information therein specified. The section then prescribes that “at the time of filing his petition there shall be filed with the clerk of the court a certificate from the Department of Commerce and Labor, if the petitioner arrives in the United States after the passage of this act, stating the date, place, and manner of his arrival in the United States, and the declaration of intention of such petitioner, which certificate and declaration shall be attached to and made a part of said petition.” Provision is then made for the further and subsequent proceedings prescribed for the naturalization of the alien, but there are no other statutory provisions relative to the requisites of the declaration of intention, either as to the form or substance of its contents or as to the mode of its making or filing, except as hereinafter mentioned.

Section 12 of the act (Comp. St. § 4371) makes it “the duty of the clerk of each and every court exercising jurisdiction in naturalization matters under the provisions of this act to beep and file a duplicate of each declaration of intention made before him.”

Section 27 of the act (Comp. St. § 4382) prescribes forms for various documents, including the required declaration of intention and petition for naturalization, prefacing such forms with the following provision: “Substantially the following forms shall be used in the proceedings to which they relate.” The form prescribed for the declaration of intention contains no' reference to any certificate or other document, as being attached thereto or otherwise. The form prescribed for the petition for citizenship concludes with the statement that “attached hereto and made a part of this petition are my declaration of intention to become a citizen of the United States and the certificate from the Department of Labor required by law.”

Section 28 of the act (Comp. St. § 4383) provides that “the Secretary of Labor shall have power to make such rules and regulations as may be necessary for properly carrying into execution the various provisions of this act.”

The» statutory provisions just quoted include all of the statutes applicable to this case which have been brought to my attention or discovered by me.

Did the making of the departmental regulation here in question come within the power conferred by the last-quoted statutory provision? It is settled law that while an executive tribunal or official may constitutionally be empowered by Congress to make such regulations as are reasonably necessary to the proper execution of a statute, so long as such regulations are merely administrative in character and relate only to the enforcement of the statute, yet such an executive tribunal or official cannot, constitutionally, either with or without the sanction of Congress, make any rule or regulation the effect of which would be to add to, take from, or otherwise change such statute, for that would be to permit the executive department to encroach upon and usurp the function of the legislative department, to which alone belongs the power to legislate.

It will be noted that although the first of the foregoing statutes governing naturalization proceedings begins with the provision that “an alien may be admitted to become a citizen of the United States 'in the following manner and not otherwise,” yet nowhere is there any requirement nor suggestion (nor language from which such a requirement or suggestion can be inferred) that a declaration of intention must be accompanied by a so-called certificate of arrival or by any other document or instrument in order to entitle the alien presenting such declaration to have it filed. Indeed, the statutory forms prescribed for the declaration of intention and for the naturalization petition already quoted would seem to remove any doubt which might otherwise exist as to the intent of Congress to permit the declaration of intention to be filed without the coincident filing of the certificate of arrival and to require the filing of such certificate later for the first time, as a part of the petition for naturalization when subsequently filed.

After giving to the conclusion of the executive officials by whom the regulation involved was promulgated the careful consideration and respect due to the action of officers of a co-ordinate branch of the government, I cannot avoid the conclusion that such regulation is not a reasonable regulation — in fact, is not a regulation at all — within the scope of the powers of said officials, but is an attempt to legislate and, as such, is in excess of such powers and void.

For the reasons stated, the writ of mandamus will issue as prayed, and an order will be entered in accordance with the terms of this opinion.