author: McCREE, Circuit Judge. WEICK, Circuit Judge

text:
    The OHIO CASUALTY INSURANCE CO., Plaintiff-Appellant, v. FORD MOTOR COMPANY, Defendant-Appellee.
    No. 73-1435.
    United States Court of Appeals, Sixth Circuit.
    Submitted Dec. 7, 1974.
    Decided Aug. 23, 1974.
    Paul C. Weick, Circuit Judge, dissented and filed opinion.

      Charles N. Myers, Jr., Hamilton, Kramer, Myers & Summers, Columbus, Ohio, on brief, for plaintiff-appellant.
    Vorys, Sater, Seymour & Pease, Edgar A. Strause, Columbus, Ohio, on brief, for defendant-appellee.
    Before WEICK, McCREE, and MILLER, Circuit Judges.
   McCREE, Circuit Judge.

This appeal requires us to decide whether, under Ohio law, the six-year statute of limitations, governing actions upon contracts, express or implied, or the two-year statute of limitations, governing actions for bodily injury or injury to personal property, applies in an action for indemnification against an automobile manufacturer brought by an insurance company, subrogated to the rights of its insured, who was compelled to respond to third persons for personal injury and property damage allegedly caused by a defect in one of the manufacturer’s vehicles. The district court held that the two-year statute of limitations applied and dismissed the complaint on defendant’s motion. We determine that the six-year statute of limitations is applicable and reverse.

Under Ohio decisional law, which is applicable in this diversity case, “The period of limitation within which an action must be commenced is determined from the nature of the demand and the ground of the action as set out in the pleadings.” State ex rel. Lien v. House, 144 Ohio St. 238, 58 N. E.2d 675 (1944). See also Ohio Casualty Insurance Co. v. Capolino, 44 O.L. Abs. 564, 65 N.E.2d 287, 289 (1945).

The complaint alleged that the brakes on the insured’s truck failed ■ because of a defect, and that the truck went out of control and caused extensive personal injury and property damage to third persons; that Ford Motor Company, the manufacturer, was “primarily liable” for all damages; and that appellant is entitled to indemnification for payments it made in settlement of damage claims when Ford failed to act after having been given notice and an opportunity to defend.

All the settlement payments were made more than two years before the complaint was filed, but, with one exception, all were made within six years of the commencement of the action. Although the parties disagree about which statute of limitations applies, they agree that the applicable statute began to run when each payment was made. Appellant’s Brief at 6; Appellee’s Brief at 24. See 28 O.Jur.2d, Indemnity § 2. See generally 20 A.L.R. 2d 925. Of course, the insurance company, as subrogee, has no greater rights against Ford — no longer time in which to commence an action — than the insured would have had if he, instead of the insurance company, had paid the claims and sued appellee for indemnification. 50 O.Jur.2d, Subrogation § 26.

The “ground of the action pleaded,” see State ex rel. Lien v. House, supra, is “[if] one secondarily liable for a wrongful injury is compelled to respond in damages to the injured person, he may recoup his loss, upon an implied contract of indemnity, from the one who actually created the danger or perpetrated the wrong.” 28 O.Jur.2d Indemnity § 12 (emphasis added). This rule applies not only when a formal judgment is rendered, Maryland Casualty Co. v. Frederick, 142 Ohio St. 605, 53 N.E.2d 795 (1944), but also when the party vicariously or secondarily liable is compelled to settle a claim, after giving notice and an opportunity to defend to the party primarily liable. Globe Indemnity v. Schmitt, 142 Ohio St. 595, 53 N.E.2d 790 (1944). And an action for indemnification based upon primary and secondary liability may be brought in Ohio whether or not there exists in fact a contractual relationship between the parties. Burns v. Pennsylvania Rubber & Supply Co., 117 Ohio App. 12, 189 N. E.2d 645, 22 Ohio Op.2d 451 (1961). See also Aetna Casualty & Surety Co. v. Buckeye Union Casualty Co., 157 Ohio St. 385, 105 N.E.2d 568 (1952).

The cause of action for indemnification based on primary and secondary liability is considered to be an action arising under an “implied contract.” Maryland Casualty Co. v. Frederick, supra; 28 O.Jur.2d Indemnity § 12. And the Ohio courts have held that an action arising under an “implied contract” for indemnification is governed by the six-year statute of limitations. Poe v. Dixon, 60 Ohio St. 124, 54 N.E. 86 (1899); Ohio Casualty Insurance Co. v. Capolino, 44 O.L.Abs. 564, 65 N.E.2d 287 (1945); 28 O.Jur.2d Indemnity § 19, p. 326. We conclude that these authorities require reversal of the district court’s decision.

We are not persuaded by appellee’s argument that this action is governed by the two-year statute of limitations because the “real purpose” of the action is to recover for personal injury and property damage. See, e. g., Andrianos v. Community Traction Co., 155 Ohio St. 47, 97 N.E.2d 549 (1951); Mahalsky v. The Salem Tool Company, 461 F.2d 581 (6th Cir. 1972); Tomle v. New York Central Railroad, 234 F.Supp. 101 (N. D.Ohio 1964). These cases were actions to gain compensation for personal injury or property damage. Here, the “real purpose” of the action is not to recover compensation for damage incurred in the automobile accident but, instead, to obtain indemnification for monies paid to the injured third persons who suffered the damage. This difference is dispositive. In Ohio Casualty Insurance Co. v. Capolino, supra, for example, the plaintiff insurer agreed to indemnify an employer for any loss caused by the negligence of his employees acting in the scope of their employment. Following a motor vehicle accident involving the negligence of employee Capolino, the insurance company paid a damage claim to an injured third person and then proceeded to bring an action against Capolino for indemnification on the theory that he was primarily liable. The court held the action was governed by the six-year statute of limitations for implied contracts and was not barred by the two-year limitations period governing actions for personal injury or property damage. See also Schulz v. Allstate Ins. Co., 17 Ohio Misc. 83, 244 N.E.2d 546 (1968). As in this case, the underlying basis for the implied contract of indemnification was the payment of a tort claim for personal injury and property damage arising from an automobile accident.

We reject appellee’s argument that the six-year statute of limitations governs an action for indemnification only when there is contractual privity between the parties. Although the court in Capolino mentioned the contractual relations between the negligent employee and the insured employer as one basis for the “implied contract” of indemnification, the court also relied upon the broader rule that “A person who, without fault, has become subject to tort liability for the unauthorized act and wrongful conduct of another, is entitled to indemnity from the other for expenditures properly made in the discharge of such liability.” Ohio Casualty Insurance Co. v. Capolino, supra 65 N.E.2d at 289 ,quoting Restatement of Restitution, p. 418. We have found nothing in Ohio law indicating that, for purposes of determining the applicable statute of limitations in indemnification actions based on primary and secondary liability, a distinction should be drawn between eases involving parties in privity of contract and those where the parties in fact have no contractual relationship. In either case, the reason for recognizing an “implied contract” of indemnification is not that an agreement to indemnify is implied in fact but, instead, that equitable principles of fairness require the party primarily liable to compensate a party only secondarily or vicariously liable who has been compelled to pay damages that the former should in equity bear. In either case, the existence or non-existence of privity of contract is immaterial in determining the applicable statute of limitations. Cf. Perry County v. Newark S. & R. Co., 43 Ohio St. 451, 2 N.E. 854 (1885); Hansen v. City of New York, 43 Misc.2d 1048, 252 N.Y.S.2d 695 (1964).

Accordingly, we hold that under Ohio law, the six-year statute of limitations applies to an action for indemnification arising where a party secondarily liable has been compelled to pay damages that should have been borne by a party primarily liable, even if the parties are not in fact in privity of contract.

Reversed and remanded for proceedings not inconsistent with this opinion.

WEICK, Circuit Judge

(dissenting).

I respectfully dissent because in my judgment the majority opinion has not correctly applied Ohio law, and that decision conflicts with prior holdings of this Court.

The applicable Ohio statute of limitations in actions for bodily injury or injuring personal property reads in pertinent part as follows:

An action for bodily injury or injuring personal property shall be brought within two years after the cause thereof arose. (Ohio Rév.Code § 2305.10).

The cases settled by Ohio Casualty, which formed the basis for its present action in subrogation, were all actions to recover damages for bodily injury or injuring personal property. These injuries were sustained on September 11, 1963, when Ohio Casualty’s insured, David Wilson, was operating his truck on a public highway, and the truck left the public road, proceeded across a public sidewalk into a private parking lot, striking several parked ears and finally coming to rest against the side of a building (App. pp. 5-8 Stip.). The collisions resulted in bodily injury and injuring personal property.

Suits for damages for bodily injury and injuring personal property were filed in the state court against Wilson. Ohio Casualty, Wilson’s insurer, made the following settlements with the plaintiffs, on the dates indicated:

Date Name Amount
1/23/67 Mary K. Brown and husband (For bodily Injury and loss of consortium) $ 75,000.00
9/13/68 Elvarie Rose (For bodily injury) 3,000
2/11/70 Aetna Insurance Co., et al 3,000
9/11/67 Nationwide Mutual Insurance Co. 750.00
4/29/68 Oak Hill Foundry & Machine Works 2,500.00
11/13/63 Charles E. Wilson, (For collision claim) 1,234.30

The suit in the present case was not filed against Ford until August 4, 1972, more than eight years after the accident.

It is clear that all of these suits were for bodily injury or injuring personal property. Had they not been filed in the state court within the two years’ period they would all have been absolutely barred by Section 2305.10, Rev.Code of Ohio.

Ohio Casualty contends, however, that its action was for subrogation, and that it was subrogated to the rights of its insured Wilson against Ford; that Ford was the indemnitor, and Wilson the in-demnitee; that Ford was primarily liable to the injured parties and that Wilson was secondarily liable. Ohio Casualty contends that its action is governed by the six-year statute of limitations which provides in pertinent part as follows :

An action upon a contract not in writing, express or implied, shall be brought within six years after the cause thereof accrued. (Ohio Rev.Code § 2305.07).

The trouble with this contention is that Ohio Casualty’s suit for subrogation was not an action upon a contract, not in writing, express or implied. There was no contractual relationship between Ford and Wilson, or between Ford and any of the injured persons with whom Ohio Casualty made settlements. Their claims against Ford were based solely on negligence and “implied warranty in tort.” In Ohio such a remedy is provided and privity is not necessary. Lonzrick v. Republic Steel Co., 6 Ohio St.2d 227, 218 N.E.2d 185 (1966).

This remedy is not based upon “a contract not in writing.” There was no contract, either oral or written, here. Hence the six-year statute by its plain language does not apply.

The leading case in Ohio on the application of Section 2305.10 is Andrianos v. Community Traction Co., 155 Ohio St. 47, 97 N.E.2d 549 (1951). In that case the plaintiff sustained bodily injury while riding as a passenger on one of defendant's buses. He attempted to avoid the Ohio two-year statute of limitations by pleading a violation of an oral contract to provide him with safe passage. In Ohio the law of the case is contained in the syllabus, and it reads as follows:

A special statutory provision which relates to the specific subject matter involved in litigation is controlling over a general statutory provision which might otherwise be applicable. (Syl. 1).
Section 11224-1, General Code, providing that an action for bodily injury shall be brought within two years after the cause thereof arose, governs all actions the real purpose of which is to recover damages for injury to the person and losses incident thereto and it makes no difference whether such action is for a breach of contract or strictly in tort. The limitation is imposed on the cause of action and the form in which the action is brought is immaterial. (Syl. 2).
Where a fare-paying passenger sustains bodily injury during his transportation by a common carrier of passengers and thereafter institutes an action against the carrier to recover damages for such injury and the results thereof based on a claimed breach of the implied contract for safe carriage, the two-year limitation for bringing an action prescribed by Section 11224-1, General Code, is controlling and not the six-year limitation contained in Section 11222, General Code, relating to an action on an implied contract. (Syl. 3).

In United States Fid. & Guar. Co. v. Truck & Concrete Equip. Co., 21 Ohio St.2d 244, 257 N.E.2d 380 (1970), the Supreme Court of Ohio, following An-drianos, held:

In order to maintain an action in contract for injury to personal property based upon a contract of sale, which injury is alleged to be caused by a “breach of an implied warranty of merchantability” under the provisions of the Ohio Uniform Commercial Code covering contracts of sale, the plaintiff must establish a contractual relationship with the defendant. (Syl. 1).
An action in tort for damage to personal property, which is based upon the breach of a duty assumed by the manufacturer-seller of a product by reason of the manufacturer’s implicit representation of good and merchantable quality and fitness for the intended use when he sells the product, is limited as to the time in which it shall be brought by the provisions of Section 2305.10, Revised Code, which provides that “An action for * * * injuring personal property shall be brought within two years after the cause thereof arose.” (Syl. 2).

Under this decision the six-year statute of limitations is not applicable in the absence of a contract. The Court distinguished our decision in Val Decker Packing Co. v. Corn Prods. Sales Co., 411 F.2d 850 (6th Cir. 1969), where we applied the four-year statute of limitations, Ohio Rev.Code § 1302.98 in the Uniform Commercial Code, relating to contracts of sales.

There was no contract in the present case. If any of the injured persons in the present case had sued Ford in tort, for breach of implied warranty, or for negligence, the applicable statute of limitations would be two years. Ohio Casualty’s claim for subrogation can rise no higher than its source. 50 Ohio Jur.2d Subrogation, § 26, p. 413. If the subro-gor’s claim has already been barred, the subrogee is subject to the same limitation.

We followed Andrianos in Mahalsky v. Salem Tool Co., 461 F.2d 581 (6th Cir. 1972), and in Sears, Roebuck & Co. v. Cleveland Trust Co., 355 F.2d 705 (6th Cir. 1966).

In Mahalsky the action was for breach of contract and of express and implied warranties arising out of the sale of an alleged defective augering machine by one of defendant’s distributors to plaintiff. In Mahalsky, as in the present case, there was no contractual relationship between the plaintiff and the defendant.

We held that we were bound by the decision of the Supreme Court of Ohio in Andrianos and in United States Fid. & Guar. Co., supra, and we applied the Ohio two-year statute of limitations despite the claim of breach of contract and of express and implied warranties.

In Sears, Roebuck & Co. v. Cleveland Trust Co., 355 F.2d 705 (6th Cir. 1966), we followed Andrianos in a suit brought by a lessee against a lessor to recover damages for breach of the provisions of a lease by the terms of which the lessor agreed to keep the premises in good repair, including the plasterings of all walls and ceilings. The ceiling collapsed. We there quoted from Andri-anos, as follows:

The issue as to which statute of limitations is applicable in actions for personal injuries arising out of a claimed breach of contract was considered by the Ohio Court in Andrianos v. Community Traction Co., 155 Ohio St. 47, 97 N.E.2d 549, in which the Court determined that Ohio Revised Code Sec. 2305.10, cited above, applies, regardless of the form of the action brought.

The Court there stated:

“Surely the General Assembly did not intend to create different periods of limitation for the recovery of damages growing out of bodily injury, depending on the form of the action brought. No matter what form is adopted, the essence of the action is the wrongful injury, and that it arose from the breach of an express or implied contract is immaterial.
“In other words, the term, ‘action’, as used in Section 11224-1, General Code [now Ohio Revised Code § 2305.-10], refers to the nature of subject matter thereof and not to its form as a matter of remedial procedure. Whether the action is strictly in tort or for breach of contract, it is nonetheless an action to recover damages for bodily injury and is governed by the two-year limitation prescribed by Section 11224-1, General Code.
“Because in Ohio we have but one form of action, designated a civil action, cases from other jurisdictions the decisions in which turned upon a distinction in the form of action brought, are not pertinent. In those cases, the results depended on whether the suits were in reality tort or contract actions. As has already been pointed out, under the express wording of Section 11224-1, General Code, it makes no difference whether the action to recover damages for bodily injury is in theory ex contractu or ex delicto, nor does it matter that plaintiff may elect between the two types of action.” (355 F.2d at 707).

Wilson was not a vendor of Ford products. Therefore he could not be held liable for implied warranty on a contract. He could be held liable only for his own negligence.

The appellate decisions relied on by the majority either involve contracts or they conflict with the decisions of the Supreme Court.

The District Judge in the present case was an experienced Ohio lawyer. In my opinion he correctly applied Ohio law. I would affirm.

      . Ohio Revised Code § 2305.07.

      . Ohio Revised Code § 2305.10.


source: Caselaw Access Project

author: WEICK, Circuit Judge.

license: Public Domain

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Frank WADE, Defendant-Appellant.
    No. 74-1199.
    United States Court of Appeals, Sixth Circuit.
    Argued June 17, 1974.
    Decided Aug. 27, 1974.
    Jerry Weiner, Columbus, Ohio, for defendant-appellant; Weiner, Lippe & Cromley, Columbus, Ohio, on briefs.
    Curtis Griffith, Jr., Asst. U. S. Atty., Columbus, Ohio, for plaintiff-appellee; William W. Milligan, U. S. Atty., Columbus, Ohio, on briefs.
    Before WEICK, EDWARDS and Mc-CREE, Circuit Judges.
   WEICK, Circuit Judge.

Appellant Wade was charged in Count I of an indictment with unlawfully possessing with intent to distribute approximately .8 grams of heroin (a Schedule I controlled substance), and in Count II with unlawfully possessing with intent to distribute 3.9 grams of cocaine (a Schedule II controlled substance), all in violation of Title 21 United States Code, Section 841(a)(1).

In his trial by jury Wade was convicted only of the lesser included offense of possession on each count. He was sentenced to one year’s imprisonment on each count, to be served consecutively.

Wade contends that the District Court erred in denying his motion to suppress evidence procured in a search authorized by warrant issued by a United States Magistrate. The affidavit for the search warrant was sworn to by a Special Agent employed by the United States Department of Justice, Bureau of Narcotics and Dangerous Drugs, and was based not only on information supplied by an informer who had been proven reliable, but also on surveillance of a house by a police officer, which house was not the residence of Wade. On the basis of all of this information the Special Agent swore as to his belief that controlled substances, namely, heroin were currently being concealed on the premises.

Pursuant to the authority of the search warrant, the officers entered the house and observed Wade “getting up off the couch” in the living room, and Wade “stuck something down into the end of the couch where he was sitting.” A tin foil packet containing heroin powder, a one dollar bill and a five dollar bill each folded and containing powdered cocaine, and Wade’s car keys were recovered from the end of the couch.

In our opinion the affidavit sufficiently afforded probable cause for the search, and the Magistrate was fully authorized to issue the search warrant. The District Court properly denied the motion to suppress.

Wade’s counsel next claims that he was misled by the Court on the basis of incorrect information furnished to him by the Judge’s law clerk, on which information he relied, and which information was to the effect that the Judge was not going to instruct the jury on the lesser included offense of possession; in other words, that the Judge would charge the jury only on possession with intent to distribute. Counsel claims that had he known the District Judge would charge the jury on the lesser offense, the defendant would not have waived his privilege and would not have taken the witness stand and admit that from time to time, although he was not addicted, he did snuff both heroin and cocaine.

At the close of the Government’s evidence in chief, counsel for Wade moved for judgment of acquittal, which motion was denied by the Court.

Counsel then moved the Court “that the question of possession with intent to distribute be eliminated, and that a sole question for the jury to consider would be the question of possession.” The Court stated that his previous ruling included the motion which counsel had just made, and overruled it.

Counsel then asked the Court to reconsider the question whether or not the jury should consider three verdicts, indicating that he did not know whether possession was an included offense. The Court then stated:

The Court: I think you should do that by way of a special request for instructions rather than by motion. At this time the only matter before the Court at this time is whether or not we shall go on with the evidence in this case, and under my denial of your motion for a judgment of acquittal we go on.
That doesn’t mean that you have to put on any evidence. You can simply rest, and that is in the presence of the jury, if you tell this Court you rest, you see, then you can renew your motion for a judgment of acquittal for the record1’and then if I deny that again, the jury gets the case and at that point you can ask this Court to instruct on possession alone or possession with intent to distribute. (Tr. at 139-140)

Counsel then asked for an early adjournment to consider “whether or not we intend to present any defense. I might say to the Court that if we did at this time, most of the witnesses that I had supplied names of will not be used other than three character witnesses and the defendant.” Court was then adjourned until the following morning.

When the trial resumed three character witnesses testified for the defendant. Wade then testified as the last witness. He testified as to his educational background; that he attended the Columbus School System and graduated from Bowling Green State University in August, 1959; that he majored in Education. He testified that after graduation he worked as an athletic director for the Columbus Recreation Department; that he was Program Director at Franklin Village for two years; that he went to Model Cities as Education Coordinator until the funds ran out; and that he then went to work for Mr. Bootery, where he is now employed as Assistant Manager.

Wade testified further that he uses narcotics; that he “snorts” cocaine, and occasionally heroin; he defined “snorting” as putting the powdered narcotics up to his nostrils and sniffing them. He could have used the word “snuff”. He identified the folded one dollar and five dollars bills as containing powdered cocaine, and the tin foil packet as containing heroin, and testified as to the quantity ; and testified that the narcotics were placed in the one dollar and five dollar bills for the reason of “snorting”.

Wade further testified:

Q. Would you explain why you say that that was probably put in there for the reason of snorting?
A. Well, this is what you usually find, you know, stuff in, is dollar bills that you are passing around.
Q. When you say passing around, would you explain what you mean by passing it around?
A. Well, in other words, if I was blowing and another person—
Q. When you say blowing, I am going to stop you right there. What do you mean ?
A. Snorting.
THE COURT: Take that exhibit out of his hand and fold it up the way it was before and put it on that desk here.
BY MR. WEINER:
Q. Would you explain what you mean by blowing?
A. Well, snorting it, in other words.
Q. Snorting it?
A. Right.
Q. Continue your answer from your definition of what you meant by blowing.
A. I am saying the bill would probably be passed from one person to another, that’s all, and like when I got through with it I would just give it to the next person; that’s all, just no more than just a way to put it, to use it to snort off of.
Q. Is that a common way of doing that?
A. Yes. (Tr. at 162-163)

At the close of all the evidence the Court called counsel for the parties into a conference, stating:

The Court: The record may further show that the Court has conferred with counsel for the parties at a prior time during the course of this trial and in respect of either the necessity or the appropriateness of the Court giving instructions on lesser included offenses.
The record may show further that counsel for the Government has asked the Court to give instructions on the lesser included offense of unlawful possession of heroin and cocaine, whereas counsel for the Defendant has advised the Court that it will object to the Court’s giving a charge on lesser included offenses. (Tr. at 183-184)

The Court also advised counsel that he would submit to the jury eight forms of verdict, four for each count, which would cover guilty of not guilty of possession with intent to distribute, and the lesser included offense on each count. The judge also went over with counsel the instructions which he proposed to give to the jury.

It was at this point that defense counsel moved for a mistrial, stating that on the prior day when the Government had closed its case in chief and the Court had recessed until the following day, he received a call from the Judge’s law clerk.

Although counsel for appellant, when he initially moved for judgment of acquittal, professed ignorance as to whether possession was an included lesser offense, the law is settled so that there is no question about it. Simple possession of a controlled substance is made an offense by Section 844 of Title 21. A person who violates that section shall be sentenced to imprisonment for not more than one year. Violation of Section 841 (a)(1) carries with it a sentence to imprisonment of not more than fifteen years.

Rule 31(c) Federal Rules of Criminal Procedure provides:

The defendant may be found guilty of an offense necessarily included in the offense charged or of an attempt to commit either the offense charged or an offense necessarily included therein if the attempt is an offense.

This rule was applied in Sansone v. United States, 380 U.S. 343, 85 S.Ct. 1004, 13 L.Ed.2d 882 (1965).

Rule 30 Federal Rules of Criminal Procedure provides that any party may file written requests that the Court instruct the jury on the law set forth in the requests. The Court is required to inform counsel of its proposed action thereon prior to counsels’ arguments to the jury. This judicial function should never be delegated to a law clerk.

In t{ie present case the Assistant United States Attorney had indicated to the Court during his argument resisting the motion for a judgment of acquittal at the close of the Government’s case that possession was an included offense and that he wanted the issue submitted to the jury. The record does not reveal that he knew anything about the call of the law clerk to the attorney for the defendant.

While counsel for the defendant indicated that he did not know whether possession was an included offense, he could have looked it up easily within a few minutes’ time when the Court adjourned early to permit him to consider what evidence he desired to offer. It would have been error for the Court not to have instructed the jury on the lesser included offense.

The facts as disclosed by the record are insufficient to enable us to pass intelligently upon the issue whether defendant’s counsel was misled by the call from the Court’s law clerk. The law clerk did admit that he made the call, but he was not questioned as to what he told the defense attorney, or what the attorney told him. All we have is the unsworn statement of the defense attorney to the Court. We do not know whether the law clerk had express or implied authorization from the Court to make the call. We do not know whether the law clerk also called the Government’s attorney handling the case to inform him as to the Court’s alleged ruling.

It will be necessary for us to remand the case to the District Court to conduct an evidentiary hearing and to adopt findings of fact and conclusions of law relative to this issue, and to report to this Court. We are required to do this even though it may appear that the claim of being misled is improbable. Machibroda v. United States, 368 U.S. 487, 496, 82 S.Ct. 510, 7 L.Ed.2d 473 (1962).

We have considered the other issues raised by appellant but we do not believe that they merit discussion.

Remanded for the evidentiary hearing and report. Jurisdiction is reserved to consider and pass upon it.

      . MR. AVEINER: I would then go on to state that at approximately 5 :00 to 5 :30 I was called by an individual who—
      TIIE COURT: Did you call him?
      CLERK SCHNEIDER: Yes.
      THE COURT: By the law clerk?
      AIR. AVEINERJudge Kinneary’s clerk called me some place between 5:00 and 55:30. I might preface this with the fact that I would say to the Court that very frankly we had some discussion as to whether or not possession was a lesser included offense, and I believe I stated to tbe Court at the time I really don’t know, and I believe tbe Cotirt said well, we would ask—
      TIIE COURT: Go on and get to the point of your motion.
      MR. AArEINER: Getting to tbe point of what I am getting to at this particular time, the call came between 5 :00 and 5 :30 from Judge Kinneary’s law clerk, and that was to the effect that the Court would not charge on simple possession, therefore this placed a totally different trial strategy upon the Defense as to whether or not to go on, and as a result we then, based on tbe conversation last evening, put the Defendant on and allowed him to admit the use of narcotics, including both heroin and cocaine, which is something that had not come out in evidence, did not necessarily have to come out, however based on the belief that the Court was not at that point going to charge on simple possession, we felt that this would not be detrimental to the Defendant, and to get on the stand and make these types of admissions I seriously doubt if we liad not gone into it, I think both by rules of evidence in Federal Court and the prosecution of the Government would not have cross-examined in relation to whether or not the Defendant did in fact use any narcotic drugs.
      AA’e feel at this point that the charge on the lesser included offense—
      THE COURT: AVait a minute. You have made a motion for a mistrial. Go ahead and submit that. Let me rule on it.
      MR. AVEINER: Based on that, and the fact that that affected — and I think preju-dicially to the Defendant’s harm — that we proceeded to put the Defendant on and go into areas that did not have to be gone into; that could have completely been avoided.
      By simply not asking the question, just asking the Defendant: Is that, the exhibits that we are referring to, 2, 3 and 4, that the Government' has introduced into evidence, yours? And stopped period, of which the Court heard, regardless of the fact that the Defendant did in fact deny that they were his.
      The introduction of evidence as to his use had, though I am sure—
      , THE COURT: Let’s say based upon the whole testimony of the Defendant you have been prejudiced, and therefore there is a mistrial, because what you are saying is, you have been misled by the Court to put on the defense that you did by way of the testimony of the Defendant; is that correct?
      MR. AVEINER: That’s correct.
      THE COURT: The motion is overruled. (Tr. at 190-192)
      The record does not indicate whether the law clerk ever called the Assistant United States Attorney and advised him of the Judge’s alleged ruling not to charge on possession.
      The defendant was not entitled to be advised as to the proposed instructions of the Court until after the close of all the evidence and prior to argument to the jury. Rule 30, Federal Rules of Criminal Procedure. Indeed the Court might have difficulty in formulating his instructions to the jury before all the evidence was in.

      . It may have been good trial strategy for the defendant to take tbe witness stand after offering his three character witnesses. It afforded the defendant the opportunity to tell the jury about his fine educational background, the good positions which he has held since, and the fact that he was never convicted of a felony. Had he not taken the witness stand he could have been convicted of the main offense of possession with intent to distribute, which carried with it imprisonment for not more than fifteen years.


author: CUMMINGS, Circuit Judge.

text:
    UNITED STATES of America, Plaintiff-Appellee, v. David John ODLAND, Defendant-Appellant.
    No. 73-2124.
    United States Court of Appeals, Seventh Circuit.
    Argued June 4, 1974.
    Decided Aug. 21, 1974.
    Certiorari Denied Dec. 23, 1974.
    See 95 S.Ct. 679.

      John H. Lauerman, Franklyn M. Gim-bel, Milwaukee, Wis., for defendant-appellant.
    David B. Bukey and William J. Mulligan, Asst. U. S. Attys., Milwaukee, Wis., for plaintiff-appellee.

      Before CLARK, Associate Justice, and CUMMINGS and TONE, Circuit Judges.

       Associate Justice Tom C. Clark of tlie Supreme Court of the United States (Retired) is sitting by designation.

   CUMMINGS, Circuit Judge.

Defendant was indicted for importing 8.8 grams of cocaine into the United States from Colombia, in violation of 21 U.S.C. §§ 952(a) and 960. After a bench trial he was convicted and received a two-year sentence; in addition a special parole term of three years was imposed under 21 U.S.C. § 960.

Defendant’s first argument is that about May 1, 1973, New York customs officials acted improperly in opening an envelope addressed to Patsy Klein, c/o Danial Schwartzman, 11990 Long Lake Drive, ‘Wind Lake, Wisconsin 53185, U. S.A. from Medellin, Colombia. The envelope was found to contain 8.8 grams of a substance suspected to be cocaine. According to the record, this inspection occurred during the routine examination of mail parcels and envelopes arriving in the United States from abroad. We have examined the first class envelope in question and note that it is a thick red envelope enclosing a cardboard greeting card.

In denying reconsideration of its earlier order refusing to suppress evidence, the district court stated: “I think the right of a Customs authority to inspect at random is implicit in the way the country protects itself from untaxed invasions [importations]. It’s also a proper way, in my judgment, for the Government to protect itself from the intervention of contraband. So I find no — I have no difficulty with the original opening of the letter at New York.” We agree that the United States Bureau of Customs in New York was empowered to open this envelope as part of its continuing investigation of narcotics smuggling from foreign countries into the United States.

Defendant contends that the search was impliedly forbidden by 19 U.S.C. § 482. That statute provides:

“[Ojfficers * * * authorized to * * * search vessels may * * * search any trunk or envelope, wherever found, in which he may have a reasonable cause to suspect there is [dutiable goods or contraband].”

We need not decide what constitutes “reasonable cause to suspect.” This statute authorizes border searches; it also authorizes the search of trunks and envelopes “wherever found.” It may be that when conducting searches away from the border, customs officials can rely only on this statute, and that the requirement of “reasonable cause to suspect” is then a limitation on their powers. But when searching at the border, customs officials may also rely on other statutes. For example, 19 U.S.C. § 1582 provides:

“The Secretary of the Treasury may prescribe regulations for search of persons and baggage * * * and all persons coming into the United States from foreign countries shall be liable to detention and search * * * under such regulations.”

The implementing regulation is 19 CFR § 162.6, which reads in part:

“All persons, baggage, and merchandise arriving in the Customs territory of the United States from places outside thereof are liable to inspection and search by a Customs officer.”

International mail is subject to a similar scheme of regulation. The statute guaranteeing confidentiality to first class mail applies only to mail “of domestic origin.” 39 U.S.C. § 3623(d). The relevant regulation is 39 CFR § 61.-1, which provides:

“All mail originating outside the customs territory of the United States is subject to customs examination, except [certain mail addressed to diplomats, international organizations and government officials.]”

It is clear that this regulation authorized the search involved here. The envelope was subject to search at the border merely because it was entering the United States from abroad; no other fact, and no suspicion particular to this envelope, is necessary under the regulation.

We also conclude that this sweeping power to search is constitutional. Surprisingly, it appears that the Supreme Court has never been required to determine the permissible scope of searches of persons or goods entering the United States from abroad. Nor has this Court had many occasions to consider the issue, though we have indicated that border searches are different from other searches. See United States v. Kurfess, 426 F.2d 1017, 1020 (7th Cir. 1970); United States v. De La Cruz, 420 F.2d 1093, 1095 (7th Cir. 1970). We therefore turn to the settled law of the Circuits which deal with border searches regularly.

There is substantial authority in those Circuits stating the power to search at international borders in the same sweeping terms as the regulation. Any person or thing coming into the United States is subject to search by that fact alone, whether or not there be any suspicion of illegality directed to the particular person or thing to be searched. Klein v. United States, 472 F.2d 847, 849 (9th Cir. 1973); United States v. McDaniel, 463 F.2d 129, 132 (5th Cir. 1972); United States v. Stornini, 443 F.2d 833, 835 (1st Cir. 1971). This rule is supported by dicta in Supreme Court opinions:

“It would be intolerable and unreasonable if a prohibition agent were authorized to stop every automobile * * *. Travelers may be so stopped in crossing an international boundary because of national self protection reasonably requiring one entering the country to identify himself as entitled to come in, and his belongings as effects which may be lawfully brought in.” Carroll v. United States, 267 U. S. 132, 153-154, 45 S.Ct. 280, 285, 69 L.Ed. 543.
“[I]t is clear that the [First Congress] did not regard searches and seizures [to collect duties] as ‘unreasonable,’ and they are not embraced within the prohibition of the [fourth] amendment.” Boyd v. United States, 116 U.S. 616, 623, 6 S.Ct. 524, 528, 29 L.Ed. 746.

See also Almeida-Sanchez v. United States, 413 U.S. 266, 272, 93 S.Ct. 2535, 37 L.Ed.2d 596.

We conclude that the • 1st, 5th and 9th Circuit cases cited above correctly state the law of border searches, and that mail is not exempt. Accordingly, the Government is free to spot-check incoming international mail at the port of entry, or to inspect all such mail, or to inspect any such mail which attracts the inspector’s attention. We therefore do not reach the Government’s alternative contention that this envelope and greeting card appeared suspicious. In holding that crossing a border is sufficient under the Fourth Amendment to justify this search, we of course express no view on what have been termed extended border searches or intrusive personal searches. See generally Note, “Border Searches and the Fourth Amendment,” 77 Yale L.J. 1007 (1968).

We note that other courts which have considered searches of incoming international mail have reached similar results, although the Government advises that no previous case involved opening a first class letter. United States v. Doe, 472 F.2d 982 (2d Cir. 1973); United States v. Galvez, 465 F.2d 681 (10th Cir. 1972); United States v. Beckley, 335 F.2d 86 (6th Cir. 1964); State v. Gallant, Me., 308 A.2d 274 (1973); United States v. Feldman, 366 F.Supp. 356 (D. Haw.1973) (collecting cases).

Defendant’s next point is that the affidavits were insufficient to support the search warrant for the Wind Lake, Wisconsin, residence where the incriminating materials were found.

The first affidavit was of Special Agent Wingert of the Bureau of Customs in Milwaukee. The affidavit stated that for eleven years part of his duties consisted of investigating the smuggling of narcotics into the United States. About May 1st, his Milwaukee office was advised by the New York office of the Bureau of Customs that the previously discussed envelope “was found to contain approximately 8.8 grams of suspected cocaine.” Also about May 1st, according to the affidavit, the envelope was forwarded in a certain locked mail pouch to the Postal Inspector in Madison, Wisconsin. Win-gert examined the envelope and obtained a positive result upon testing it for cocaine content.

The second supporting affidavit was by Lee Wittke, a detective for the Racine County, Wisconsin, Sheriff’s Department. Wittke reported that on May 15th he observed the residence to which the envelope was addressed and noted that its mailbox was located by the road. He concluded by stating he knew that the envelope in question was to be delivered to the residence on May 16th.

Based on these two affidavits, a search warrant was issued on May 15th by a Racine County Court Commissioner, requiring return of the warrant within 48 hours thereafter and authorizing a search of the premises at 11990 Long Lake Drive on the basis of the foregoing information. The Commissioner stated in the warrant that he had been informed by Wingert and Wittke that in the cottage in question “there will be located and concealed certain things, to wit: an envelope addressed to Patsy Klein, care of Danial Schwartz-man, 11990 Long Lake Drive, Wind Lake, Wisconsin 53185 U.S.A. containing 8.8 grams of suspected cocaine (possessed for the purpose of evading or violating the laws of the state of Wisconsin and contrary to section 161.-41(2)(R)[(2r)] of the Wisconsin statutes) * *

Since Wittke’s affidavit had stated on his own knowledge that the envelope was to be delivered to “11990 Long Lake Drive” on May 16th, it was permissible for the Commissioner’s warrant to state his understanding that it would thereafter be “located and concealed” in the cottage. Therefore, we cannot subscribe to defendant’s argument that the Commissioner would have to assume the envelope would be deposited in the roadside mailbox rather than delivered to the door of the residence. From the Wittke affidavit, the Commissioner was justified in concluding that the Government contemplated a controlled, personal delivery to the residence. Even if he thought that the delivery was to be to the mailbox, he could properly find probable cause to believe that the residents would pick up their mail and carry it into the cottage.

We hold that the two affidavits contained probable cause for the Commissioner to authorize the search of the residence within 48 hours from the issuance of the search warrant. United States ex rel. Beal v. Skaff, 418 F.2d 430 (7th Cir. 1969); United States v. Feldman, 366 F.Supp. 356 (D.Haw.1973) (collecting cases).

During their search of the Wind Lake residence, Agent Wingert and' Detective Donald Parker discovered three opened letters (Exhibits 3, 4 and 5) in a bedroom of the residence. Two of the letters were postmarked Medellin, Colombia, the same postmark as on Exhibit 2, the envelope opened in New York; the third bore postage from Curacao. The handwriting on all three was also similar to the New York one.

Immediately thereafter, they recovered Exhibit 2, the subject of the indictment, in the top drawer of a dresser in the same bedroom. Exhibit 6, a similar envelope postmarked Medellin, Colombia, addressed to Patsy Klein, c/o Danial Schwartzman at the Wind Lake residence, was discovered with Exhibit 2. When opened, it was found to contain 5.83 grams of cocaine with another greeting card.

Defendant objected to the seizure of Exhibits 3, 4, 5 and 6, and their subsequent admission into evidence on the ground that their seizure was beyond the scope of the search warrant. However, Exhibits 3, 4 and 5 were discovered prior to finding Exhibit 2, the letter specifically described in the search warrant. Exhibit 6 was found alongside Exhibit 2 in the same room as Exhibits 3, 4 and 5. Once the item particularly described in the search warrant is found, the search must end, but other evidence or contraband found in the course of a proper search for the item particularly described may be seized. Here all four contested exhibits appeared on their face to have a nexus with the crime under investigation. Therefore, they were properly seized and, when they proved to be incriminating, admitted into evidence. Coolidge v. New Hampshire, 403 U.S. 443, 465, 91 S.Ct. 2022, 29 L.Ed.2d 564 (1971); United States v. Kane, 450 F.2d 77, 85 (5th Cir. 1971).

Defendant’s final point is that he was not sufficiently identified to sustain the conviction. The district judge concluded from the evidence that “there is a very definitive web that envelopes Mr. Od-land.” He explained his conclusion that Odland was sufficiently identified as follows:

“I think the coincidence of the name on Exhibit 4, being addressed to ‘Danial Schwartzman’ on the envelope and being addressed to ‘David’ in the content, is part of a, as Mr. Bukey [the prosecutor] very cogently argued —part of a web which suggests that the Dabong identities and the Danial Schwartzman identities are but pseudonyms or ‘phony names,’ as they are called in the correspondence for defendant.
“The expression in Exhibit 4, saying ‘Your letter was a true Dabong Letter,’ tends to support the belief that this was a calculated technique to avoid using correct names and to use pseudonyms; nevertheless, the Court has given great attention to the fact of the question as to whether Danial Schwartzman and Dabong are in fact Mr. Odland. The two principal pieces of evidence that suggest that he is, are the fact that he did receipt for the letter addressed to Patsy Klein, and he did so by signing ‘Patsy Klein by Schwartzman.’
“ * * * But when we add to that the ‘David’ on the Exhibit 4 and add to that the coincidence of David Od-land being the man who received the letter and who bears the name David, we get what I consider to be a irresistibly persuasive web which has so enveloped David Odland as to justify, in my judgment, a finding of proof by the Government beyond a reasonable doubt.
“I have no reasonable doubt that the defendant, David John Odland, is indeed the addressee of these five communications, 2 through 5 — 2 through 6, excuse me. Accordingly, thA Court finds the defendant guilty and enters a judgment of conviction.”

Our review of the evidence satisfies us that the trier of fact could properly find the defendant was the same person as Danial Schwartzman and “Dabong.” Since three of the letters (Exhibits 3, 4 and 5) set out the scheme for defendant’s importation of the cocaine in the envelopes enclosing the two greeting cards (Exhibits 2 and 6), sufficient evidence was presented to support the conviction.

Affirmed.


author: HAYNSWORTH, Chief Judge:

text:
    EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Appellant, v. CLEVELAND MILLS COMPANY, Appellee.
    No. 73-2298.
    United States Court of Appeals, Fourth Circuit.
    Argued Feb. 8, 1974.
    Decided Aug. 19, 1974.

      Beth L. Don, Atty., Equal Employment Opportunity Commission (William A. Carey, Gen. Counsel, Joseph T. Ed-dins, Acting Associate Gen. Counsel, Beatrice Rosenberg, Charles L. Reischel, Attys., Equal Employment Opportunity Commission, on brief), for appellant (Milton Smith, Gen. Counsel, Richard Berman, Labor Relations Counsel, Chamber of Commerce of the United States of America, Francis V. Lowden, Jr., Richmond, Va., Anthony J. Obadal, Washington, D. C., Hunton, Williams, Gay & Gibson, Richmond, Va., on brief for Chamber of Commerce of the United States of America, as amicus curiae).
    Whiteford S. Blakeney, Charlotte, N. C. (Blakeney, Alexander & Machen, Charlotte, N. C., on brief), for appellee.
    Before HAYNSWORTH, Chief Judge, and RUSSELL and FIELD, Circuit Judges.
   HAYNSWORTH, Chief Judge:

In the District Court, summary judgment was entered for the defendant upon the ground that this action by the Equal Employment Opportunity Commission to remedy allegedly discriminatory employment practices could not be maintained because of time limitations. It construed the Equal Employment Opportunity Act of 1972, amending Title VII of the Civil Rights Act of 1964, which for the first time gave the Commission the right to institute judicial enforcement proceedings, as limiting the newly created right to proceedings commenced within a period of 150 days following the expiration of a period of 30 days after the filing of the adminstrative charge. We reverse, for we do not find the Commission’s right to seek judicial enforcement so circumscribed.

I

These proceedings were begun administratively on August 2, 1968 when one of its members filed with the Commission a charge of racial discrimination against Cleveland Mills. The proceedings did not move with rapidity. Cleveland was not notified of the filing of the charge until November 28, 1968, and the first conciliation conference was held only on July 15, 1970. On August 17, 1971, more than three years after the filing of the charge, the Commission made a finding of probable cause to believe the charge of past and continuing discrimination by Cleveland. Still, conciliation attempts were continued until November 28, 1972, when the Commission notified the “aggrieved parties” of their right under 42 U.S.C.A. § 2000e-5(f)(1) to commence a private action within 90 days. No such action having been commenced within the allowable time, the Commission commenced this action on March 2, 1973, over four and one-half years after the filing of the charge.

II

During most of the pendency of the administrative proceedings, the Commission had no enforcement powers. After an investigation and a determination of probable cause to believe the respondent was in violation of Title VII of the Civil Rights Act of 1964, the Commission was authorized only to seek voluntary compliance. Its roles were those of the conferee, conciliator and uncoercive persuader. If those processes failed, the Commission was required to notify the aggrieved parties, who, within 30 days after such notice, could file an action for the enforcement of their rights. There was no provision for judicial enforcement except such a private action in the name and at the instance of an aggrieved party filed within the 30-day period.

The enforcement scheme was substantially altered in March 1972 when the administrative proceedings in this case had been pending for more than three and one-half years. The Equal Employment Opportunity Act of 1972 amended 42 U.S.C.A. § 2000e-5(f) (1) to read in pertinent part:

If within thirty days after a charge is filed with the Commission * * *, the Commission has been unable to secure from the respondent a conciliation agreement acceptable to' the Commission, the Commission may bring a civil action against any respondent not a government, governmental agency, or political subdivision named in the charge. * * * The person or persons aggrieved shall have the right to intervene in a civil action brought by the Commission * * *. If a charge filed with the Commission pursuant to subsection (b) of this section is dismissed by the Commission, or if within one hundred and eighty days from the filing of such charge "• * * the Commission has not filed a civil action under this section * * * or the Commission has not entered into a conciliation agreement to which the person aggrieved is a party, the Commission * * * shall so notify the person aggrieved and within ninety days after the giving of such notice a civil action may be brought against the respondent named in the charge (A) by the person claiming to be aggrieved or (B) if such charge was filed by a member of the Commission, by any person whom the charge alleges was aggrieved by the alleged unlawful employment practice. * * * Upon timely application, the court may, in its discretion, permit the Commission * * * to intervene in such civil action upon certification that the case is of general public importance. * * *

The text of the section contains no expressed or clearly implied time limitation upon the Commission’s right to file a civil action once it has accrued. The first part of the section confers the right of action upon the Commission subject to conditions only, that at least 30 days shall have elapsed from the filing of the charge and that the Commission shall have failed to obtain a conciliation agreement acceptable to it. The latter part of the section confers a private right of action upon the aggrieved person, and that private right of action is closely confined within defined time periods. The private right of action may not be exercised, until after the lapse of 180 days from the filing of the charge and the aggrieved person has received notice from the Commission that (1) the charge has been dismissed by the Commission, or (2) that the Commission has not filed a civil action, and (3) that the Commission has not entered into a conciliation agreement to which the aggrieved person is a party. Once the time within which a private action may be filed commences to run, it survives for a period of 90 days, after which it is forever extinguished. This confinement of the private right of action is consistent with the earlier provisions of Title VII of the Civil Rights Act of 1964, in which an aggrieved person had only a 30-day period following the “suit letter” in which to commence a proceeding in court. The newly created right of the Commission to seek judicial enforcement had no such prior history, and the presence of strictures upon the individual’s private right of action does not necessarily import a congressional intention to impose strict time limitations of a comparable nature on the Commission. The 180-day period serves its apparent purpose when it limits the time before which a private action may not be filed and thus avoids potential interference with the Commission in the performance of its primary duties of conciliation and enforcement. One would suppose that if the Congress had intended to cut off the Commission’s right of action, it would have included clear language to that effect, just as it did when it clearly expressed its intention to cut off the individual’s private right of action.

Ill

A literal reading of the statute is consistent with its legislative history.

When Congress was considering the Equal Employment Opportunity Act of 1972, it is clear that it was of the opinion that the voluntary system of enforcement, supplemented only by the strictly confined private right of action, had proven inadequate to achieve the objectives of Title VII. There was general agreement upon the need of legislation conferring enforcement powers upon the Commission, and the large area of debate was over the question of whether the Commission should be given the power to enter enforceable orders or whether it should be authorized to maintain actions in the district courts. By whatever means, however, the congressional contemplation was that there should be primary reliance upon the powers of enforcement to be conferred upon the Commission, and not upon private lawsuits, to achieve equal employment opportunity.

Congress was well aware of the fact that it was taking the Commission from eighteen to twenty-four months to administratively process a majority of the complaints. It knew of the Commission’s accumulated backlog of cases and of the likelihood that the number of filings would continue on the increase. Nor was there any likelihood that the grant of enforcement powers to the Commission would accelerate its performance in seeking the disposition of complaints in the administrative process by voluntary compliance.

These conditions make it highly unlikely that the Congress would have considered the imposition of narrow and precise time limits upon the Commission’s right to file an action for judicial enforcement. If it had intended to impose a 180-day cut off on the Commission’s right of action, and administrative proceedings dragged on as they had been doing, most of the aggrieved parties would be denied Commission representation in court and left to their own devices to seek judicial enforcement of their rights. This was the situation the 1972 Act was designed to remedy. On the other hand, if the Commission were driven to commence judicial proceedings before the expiration of 180 days after the receipt of each complaint, attainment of the expressed congressional goal of obtaining voluntary compliance through conciliation and persuasion in most of the cases would be seriously prejudiced. In the administrative process careful study of an employer’s employment practices and thorough exploration of all reasonable bases for agreement and compromise may require time. Great haste in filing judicial proceedings before the administrative procedures are mature would result in burdens and disruptions to the Commission and to employers which would hardly be calculated to further the effectiveness of procedures directed toward voluntary compliance. The congressional purpose that the possibilities of voluntary compliance by agreement be first thoroughly explored and the congressional purpose that judicial enforcement proceedings be primarily the province and responsibility of the Commission may be harmonized but not if a 180-day period, from the filing of the charge is imposed for the filing of judicial proceedings.

It is suggested by Cleveland that if an employer is engaged in a continuing violation of the Act, the expiration of a 180-day period of limitations would not prevent the filing of a new charge and the commencement of a judicial proceeding founded upon the second charge within 180 days thereafter. This, however, would necessitate the filing of multiple charges and would further complicate the Commission’s work with technicalities serving no useful purpose. If the processes of investigation and conciliation are proceeding actively 180. days after the filing of the charge, the Act’s purposes are served by permitting the administrative processes to proceed to completion as rapidly as possible. Discontinuance and disruption in commencing new proceedings would serve no such purpose.

References in the Report of the Conference Committee of March 6, 1972 to the private right of action seem to support our literal reading of the amended section:

* * * The retention *of the private right of action, as amended, is intended to make clear that an individual aggrieved by a violation of Title VII should not be forced to abandon the claim merely because of a decision by the Commission or the Attorney General, as the case may be, that there are insufficient grounds for the Government to file a complaint. Moreover, it is designed to make sure that thé person aggrieved does not have to endure lengthy delays if the Commission or Attorney General does not act with due diligence and speed. Accordingly, the provisions described above allow the person aggrieved to elect to pursue his or her own remedy under this title * * *. * * * It is hoped that recourse to the private lawsuit will be the exception and not the rule * * *. However, * * * it is necessary that all avenues be left open for quick and effective relief.

118 Cong.Rec. S. 3462 (March 6, 1972).

The Conference Committee’s allusions to the “individual’s election” to pursue his or her own remedy if there are long delays in the administrative process and to the necessity “that all avenues be left open for quick and effective relief” support an inference that the Commission’s right to sue continues after the individual’s right has matured. The allusions indicate that individual standing to sue is designed to let the individual choose between pursuing his own remedy and relying on the representation of the Commission. Clearly, that choice would be illusory if the Commission’s right of action had already been extinguished.

IV

A number of district courts have considered this question with varying results. We do not have the benefit of any decision from another court of appeals, but we are persuaded that the dual congressional purpose, first, to encourage compliance through conciliation and persuasion, and, second, to place upon the Commission primary responsibility for judicial enforcement proceedings, is inconsistent with Cleveland’s contention that the Commission, under the section, loses its right to seek judicial enforcement when the 180-day period following the filing of the charge expires. The text of the statute, what light we can glean from the legislative history and the basic legislative purposes sought to be served all trend against the rigid restriction of the Commission's enforcement power which Cleveland urges upon us.

V

Cleveland understandably expresses concern that if the Commission’s right to sue survives the 180-day period, the Commission and the aggrieved individual will have concurrent rights of suit for 90 days. Cleveland argues that this would be inconsistent with congressional and judicial aversion to duplicative litigation, and that only by construing § 706(f)(1) as providing consecutive, limited rights of action can this danger of duplicitous lawsuits be avoided. We need not now undertake the resolution of all of the problems that would arise if the Commission and an aggrieved party each filed an enforcement action during the 90-day period during which private actions are conditionally authorized. It is obvious, however, that the imposition of a 180-day limitation on the Commission’s right to sue is not the only answer or even the best means of implementation of a policy against duplicative lawsuits. In fact, of the alternatives available, imposition of such a limitation is the most difficult to reconcile with the language of the Act and its remedial purposes. Other approaches, more in keeping with the Act and its purposes and equally effective in preventing duplicitous lawsuits, have been adopted by other courts when called upon to meet the problem of duplicitous actions. We need not now choose between those other alternatives, but their existence and apparent harmony with the legislative scheme refutes Cleveland’s contention that only by imposing a 180-day limitation on the Commission’s right to sue can the danger of duplicitous actions be avoided.

We thus conclude that the 180-day period contained in 42 U.S.C.A. § 2000e-5(f) (1) is referable to the beginning of the time within which an aggrieved party may file a private action, but that its expiration does not finally terminate the Commission’s right of action. The decision of the District Court dismissing the Commission’s complaint for failure to timely file, therefore, is reversed and the case remanded for further proceedings.

Reversed and remanded.

      . I\L. 92-261, 86 Stat. 103 (1972).

      . 42 U.S.C.A. §§ 2000e et seq.

      . EEOC v. Cleveland Mills Co., W.D.N.C., 364 F.Supp. 1235.

      . 1972 U.S.Code Cong. & Admin.News pp. 2137, 2139-2141.

      . Id. at 2167-2176.

      . See tlie Conference Committee Section-by-Section Analysis of the Equal Employment Opportunity Act of 1972, 118 Cong.Rec.S. 3462 (March 6,1972).

      . See, House Report No. 92-238, 92d Cong., 1st Sess. 3-5, 12 (1971); and Senate Report No. 92-415, 92d Cong. 1st Sess. 5-6, 87 (1971).

      . 1972 U.S.Code Cong. & Admin.News 2137, 2139-2143.

      . Cases finding no limitation include: EEOC v. E. I. duPont de Nemours & Co., 373 F. Supp. 1321 (D.Del.1974); EEOC v. U. S. Industries, Civil No. 73-283 (W.D.Tenn.Jan. 1974); EEOC v. Huttig Sash and Door Co., 371 F.Supp. 848 (S.D.Ala.1974); EEOC v. Bartenders Int’l Union, Local 41, 369 F. Supp. 827 (N.D.Cal.1973); EEOC v. Eagle Iron Works, 367 F.Supp. 817 (S.I).Iowa 1973); EEOC v. Duff Brothers, Inc., 364 F.Supp. 405 (E.D.Tenn.1973); EEOC v. Mobil Oil Corp., 362 F.Supp. 786 (W.D.Mo. 1973). Cases finding a time limitation on the Commission’s right to sue include: EEOC v. Kimberly-Clark Corp., Civil No. 73-42 (W.D.Tenn.Mareh 27, 1974); EEOC v. Griffin Wheel Co., Civil No. 73-II-429-S (N.D.Ala.Feb. 5, 1974); EEOC v. Union Oil Co. of Cal., 369 F.Supp. 579 (N.D.Ala. 1974); EEOC v. Louisville & N. R. R., 368 F.Supp. 633 (N.D.Ala.1974); and EEOC v. Container Corp. of Am., 352 F.Supp. 262 (N.D.Fla.1972). Furthermore, another court within this circuit, when faced witli the identical issue here reached a conclusion at odds with the District Court in this case. EEOC v. Christianburg Garment Co., 376 F.Supp. 1067 (W.I).Va.1974).

      . Some have held that the Commission’s right to sue terminates only when an individual action is actually brought and restrict the individual to intervention as of right once a Commission action has commenced, even during the 90-day period. Others have indicated that the Commission is altogether barred from bringing suit during the individual’s 90-day period, but that the Commission’s right revives upon expiration of that period should the individual fail to act. See, EEOC v. Missouri Pac. R.R., 8 Cir., 493 F.2d 71 (1974); EEOC v. Huttig Sash & Door Co., 371 F.Supp. 848 (S.D.Ala.1974); EEOC v. Cronin, 370 F.Supp. 579 (E.D.Mo. 1973); and EEOC v. Union Oil Co., 369 F. Supp. 579 (N.D.Ala.1974).


author: McCREE, Circuit Judge.

text:
    In the Matter of ARMSTRONG GLASS COMPANY, INC., Bankrupt. Gladstone H. WHITE, Trustee, etc., Petitioner-Appellant, v. Edwin M. LUEDEKA et al., Respondents-Appellees.
    No. 73-1875.
    United States Court of Appeals, Sixth Circuit.
    Aug. 29, 1974.

      Ferdinand Powell, Jr., Johnson City, Tenn., for petitioner-appellant.
    Edward L. Summers, Knoxville, Tenn., for respondents-appellees; Stone & Bozeman, Knoxville, Tenn., on briefs.
    Before PHILLIPS, Chief Judge, McCREE, Circuit Judge, and ROSENSTEIN, Senior Judge.

       The Honorable Samuel M. Rosenstein, Senior Judge, United States Customs Court, sitting by designation.

   McCREE, Circuit Judge.

This is an appeal by the trustee in "bankruptcy from the district court’s order affirming the order of the referee in bankruptcy determining that appellees’ claims for legal and accounting services rendered before bankruptcy at the request o| an equity receiver and asserted against the estate in a superseding bankruptcy administration had priority as “expenses of administration” under Section 64(a)(1) of the Bankruptcy Act, 11 U.S.C. § 104(a)(1). We must decide whether the district court exceeded its authority in appointing the equity receiver; whether the bankruptcy court erred in granting the claims priority as “administrative expenses;” and whether the bankrupt corporation was deprived of due process of law in the determination of the precedence to be accorded the claims. We hold that the district court had authority to appoint the equity receiver and did not abuse its discretion in so doing. We determine that because the claims for legal and accounting services were not incurred “subsequent to filing the petition,” they are not “expenses of administration” within the meaning of Section 64(a)(1); but to the extent that the services benefited the estate, the claims were entitled to receive, through an equitable lien, a “preferential” status, Randolph v. Scruggs, 190 U.S. 533, 23 S.Ct. 710, 47 L.Ed. 1165 (1933), at least equivalent to the priority given administrative expenses of the bankruptcy proceeding under Section 64(a)(1), 11 U.S.C. § 104(a)(1). We also hold that the bankrupt corporation was not denied due process of law in the determination of the status of appellees’ claims.

The significant facts as related in the referee’s memorandum are not disputed. Armstrong Glass Company, Inc., now the bankrupt, and its shareholders sued TTC Industries, Inc. and certain individuals in the Tennessee Chancery Court to rescind an agreement to sell all the Armstrong stock to defendants. The defendants removed the suit to tfie United States District Court for the Eastern District of Tennessee, where jurisdiction was based on diversity of citizenship. Charges and countercharges in the pleadings indicated that the assets of Armstrong were in danger of becoming dissipated. To protect the interests of the parties and of the town of Erwin, Tennessee, which had issued almost one-half million dollars in bonds for the construction of a manufacturing plant for Armstrong, the district court, by Order on November 18, 1969, appointed an equity receiver to protect and preserve Armstrong’s property. The receiver was specifically authorized to employ agents and employees “necessary or desirable for the continued operation of the business.” In the same order, the district court dismissed Armstrong as a party in the action for rescission, determining that the corporation was not a “real party in interest.” Fed.R.Civ.P. 17(a).

Subsequently, the receiver employed appellee Siegel to perform accounting services for the corporation and appellee Luedeka to represent the corporation in a pending civil action. The receiver was discharged on March 18, 1970. Thereafter, appellees attempted to intervene in the rescission action to assert their claims for services. Siegel claimed $5,404.87 and Luedeka claimed $4,073.97 for services rendered before the equity receiver’s discharge. Also, Luedeka claimed another $1,528.08 for legal services performed for the corporation after the receiver’s discharge. On December 9, 1970, the district court denied appel-lees intervention, but held that the claims were subject to the court’s general equity powers and directed Siegel and Luedeka to file with the court their claims against the former receiver.

About one month earlier, on November 5, 1970, Armstrong had filed, in the United States District Court for the Eastern District of New York, a petition for an arrangement under Chapter XI, of the Bankruptcy Act. On motion of certain creditors, the case was transferred to the Eastern District of Tennessee, where the rescission action was pending. However, the plan of arrangement was not filed, and as the referee’s memorandum recites, on March 9, 1971, the bankruptcy court entered an adjudication in bankruptcy. Thereafter, appellant trustee was appointed.

On September 14, 1971, the district court entered a memorandum opinion and order in the rescission action, determining that the claims of Siegel and Luedeka “are the ranking claims against the estate in receivership and that this Court has an obligation to see to it that the claimants are paid their just demands,” and that “the services of these claimants to the receivership will be allowed as a preferred claim in the administration of the bankrupt property and the distribution of its proceeds to the extent that such services benefited the estate.” He referred the claims “specially” to the bankruptcy referee for further determination.

Appellant trustee urged before the referee the following fiv,§ objections to the claims of Luedeka and Siegel:

(1) The bankrupt is not indebted to claimants in that the order entered in Civil Action No. 2459 insofar as it appointed Rex Marsh receiver of Armstrong Glass Company, Inc., and authorized him to-employ agents, employees and attorneys deemed by him necessary or desirable for the continued operation of the business of Armstrong Glass Company, Inc., was coram, non judice and void as against the bankrupt because by the same order entered appointing Rex Marsh receiver it was adjudged by the District Court that as to Armstrong Glass Company, Inc., the action was dismissed.
(2) That the receiver Rex Marsh in Civil Action No. 2459 was without jurisdiction and authority to onerate the bankrupt for any costs and expenses arising out of or resulting from said action subsequent to the entry of the order entered November 18, 1969, because the bankrupt was not a party to said action, either plaintiff or defendant.
(3) The order entered on September 14, 1971, by the District Judge in Civil Action No. 2459 referring the Luedeka and Siegel claims to the referee for determinations is coram, non judice and void because neither the bankrupt nor trustee was party to the proceedings at the time of the making of said order.
(4) The estate of the bankrupt was not benefitted by the services and disbursements claimed.
(5) There is no warrant by the rules of law or principles of equity or any statute of the United States for priority of the claim as a cost of the bankruptcy proceeding.

However, because of what the referee considered to be the limited “scope of [the district court’s] order of reference,” the referee considered only the issue of benefit to the estate and none of the other contentions. On this issue, he found that Siegel performed, at the receiver’s request and during the receivership, accounting services including bookkeeping, special cash flow studies, and a year-end audit and prepared tax returns; fend he also found, specifically, “that such services benefited the estate and that the amount requested [$5,404.-87] is reasonable.” He found that Lue-deka’s legal services, including the preparation of an appeal and the defense against a cross-appeal in a pending action, before the termination of the receivership “benefitted the estate and that the amount requested [$4,073.97] is reasonable.” However, he determined that the fees for legal services after termination of the receivership [$1,528.08] were not “chargeable against the receivership” and not entitled to any special priority. He concluded:

(1) Judge Neese has heretofore determined that the claims of Luedeka and Siegel are the ranking claims against the bankruptcy estate of Armstrong Glass Company, Inc., to the extent that they benefitted the estate. Sec. 64(a)(1), Bankruptcy Act (11 U. S.C. 104(a)(1)).
(2) I find and conclude that the services of Luedeka and Siegel, performed at the request of the receiver, Rex B. Marsh, in Civil Action No. 2459 (Armstrong Glass Company, Inc. v. TTC Industries, Inc.) were beneficial in said receivership in the following amounts: Mr. Luedeka, $4,073.97; Mr. Siegel, $5,404.87.
(3) I find and conclude that the claim of Mr. Luedeka for services performed after the termination of the receivership is a general claim against the estate of the bankrupt in the amount of $1,528.08.
(4) Upon distribution of funds realized from liquidation of the bankrupt’s assets, the claims of Luedeka and Siegel will be recognized as indicated herein as priority claims, Sec. 64(a)(1). The balance of Mr. Lue-deka’s claim is allowed as a general claim.
IT IS SO ORDERED.
ENTER: December 7, 1972.

The trustee petitioned for review of this order and it was affirmed by the district court.

Appellant does not contest the referee’s findings of fact on the extent to which appellees’ services benefited the bankruptcy estate. These findings, adopted by the district court, are not “clearly erroneous.” Fed.R.Civ.P. 52(a). Instead, appellant contends: (1) that appellees’ claims are invalid because the district court had no authority to appoint a receiver in the rescission action while simultaneously dismissing the corporation from the suit; (2) that the claims, in any event, should not receive any priority under the bankruptcy laws; and (3) that the bankrupt corporation was denied due process of law.

The first contention is based on appellant’s argument that under Tennessee law a court may appoint a receiver only when the person in possession of the property is before the court, and for that reason, the district court could not appoint a receiver and simultaneously dismiss the corporation as a party. We are unconvinced by this argument and we have found nothing in Tennessee law suggesting that the appointment of the receiver was improper. In Tennessee, a receiver may be appointed in equity when necessary “for the purpose of preserving the property in controversy, pending the litigation, for the benefit of the successful party.” Johnston v. Hanner, 70 Tenn. 8, 11 (1878); Roberson v. Roberson, 71 Tenn. 50, 52 (1879). This was the very reason why the district judge decided to appoint an equity receiver, to preserve the property of the Corporation pending the outcome of the action for rescission. And we are not persuaded otherwise by the fact that the district court dismissed the corporation as a party in the rescission action when it appointed the receiver. Before this order was entered the corporation was before the court as a party to the suit; after its entry, all the corporation’s shareholders, including the contesting shareholders, remained parties in the pending action. Since the owners of all shares in the corporation were before the court, their property, the corporation, could be placed under a receiver. The Tennessee cases cited by appellant, Mays v. Wherry, 3 Tenn.Ch., Cooper, 34 (1875), and Crosby v. Morristown & G. G. R. Co., 42 S.W. 507 (Tenn.Ch.App. 1897), are distinguishable from this one because here the district court had jurisdiction over the corporation and all of its property when the receiver was appointed.

We consider, next, appellant’s contention that even if appellees’ claims are valid against the bankrupt, they are not entitled to priority. We agree that the services appellees rendered the receivership are not “expenses of administration” within the meaning of Section 64(a)(1), 11 U.S.C. § 104(a)(1), because the expenses were not incurred “subsequent to” formal commencement of the bankruptcy proceedings. See, e. g., Wheeling Electric Co. v. Mead, 177 F.2d 718 (4th Cir. 1949). See generally Collier On Bankruptcy, 14th Ed., Vol. 3A, fí 64.102[2]. Nevertheless, it has long been settled that services such as those rendered by appellees before bankruptcy may give rise to a “preferred” claim in the administration of a superseding bankruptcy to the extent that the, services benefited the estate. Randolph v. Scruggs, 190 U.S. 533, 23 S.Ct. 710, 47 L.Ed. 1165 (1903). In Chase Bag Co. v. Schouman, 129 F.2d 247 (6th Cir. 1942), we stated the rule and its rationale in the following manner:

The rule stated in Randolph v. Scruggs, supra, to the effect that one contributing to the preservation or benefit of an estate in bankruptcy, by performing services or advancing credits, under certain conditions, in case of an assignment prior to bankruptcy, is to be preferred is well established. This is on the theory that the assignee has preserved the estate and by his action in so doing has incurred obligations which the subsequent trustee in bankruptcy would have had to incur. As pointed out in the Scruggs case, that is the rule in the state courts universally applied on the theory that “beneficial services are allowed for they are to be regarded as deductions from the property which the assignee is required to surrender, and in that way they gain a preference.”

And, although Randolph v. Scruggs, supra, concerned services rendered by a general assignee for the benefit of creditors, the rule applies, as well, to expenses incurred by a prior equity receiver and asserted against the estate in a superseding bankruptcy. Chase Bag Co., supra, at 248. See generally Collier On Bankruptcy, 14th Ed., Vol. 3A, fl 62.32 [3]. Accordingly, appellees’ claims were entitled to a “preferred” status not because of the priority granted by Section 64a(l) to administrative expenses of the bankruptcy but, instead, under the equitable “benefit” doctrine of Randolph v. Scruggs, supra.

There remains to be considered the claimed due process violation. Appellant trustee argues that neither Armstrong, which had been dismissed from the rescission action when the receiver was appointed, nor the trustee had notice and an opportunity to be heard before the district court recited in its memorandum and order of September 14, 1971, that appellees’ claims for services rendered the receivership were to be “preferred claims in the administration of the bankrupt property ... to the extent that such services benefited the estate.” He also complains that, although the trustee had a hearing in the bankruptcy court, the referee determined only the factual issue of benefit to the estate and declined to consider appellant’s other arguments contesting the validity of the claims and their priority.

Of course, due process requires that “deprivation of life, liberty or property by adjudication be preceded by notice and opportunity for a hearing appropriate to the nature of the case.” Mullane v. Central Hanover Trust Co., 339 U.S. 306, 313, 70 S.Ct. 652, 656, 94 L.Ed. 865 (1950) (Jackson, J.). See also Armstrong v. Manzo, 380 U.S. 545, 85 S.Ct. 1187, 14 L.Ed.2d 62 (1965). Here, the September 1971 order and memorandum entered without notice and a hearing for appellant, describes appellees’ claims as the “ranking” and “preferred” claims. But, because that order issued from the rescission action, we believe the court was necessarily speaking only as the equity court that appointed the prior receiver and not as a court of bankruptcy, even though it observed that “in this case the equity court and the bankruptcy court are one and the same.” The rule is settled that a bankrupt’s property rights can be affected only by an order issued from the bankruptcy court. As stated in Taylor v. Sternberg, 293 U.S. 470, 472, 55 S.Ct. 260, 261, 79 L.Ed. 599 (1934), by the Supreme Court:

Upon adjudication in bankruptcy, all the property of the bankrupt vests in the trustee as of the date of the filing of the petition. Upon such filing, the jurisdiction of the bankruptcy court becomes paramount and exclusive; and thereafter that court’s possession and control of the estate cannot be affected by proceedings in other courts, whether state or federal.

Applying these principles, the Court in Taylor held that, after the filing of the petition in bankruptcy, a state equity court’s “order fixing the compensation of the receiver and his counsel was a nullity because made without jurisdiction, such jurisdiction then having passed to the bankruptcy court.” Taylor, supra at 473, 55 S.Ct. at 262. Similarly, we do not believe that the district court in its September 1971 order, issued in the rescission action, could establish authoritatively the validity of appellees’ claims or their right to a preferred treatment, even though conditional upon the referee’s subsequent determination of the extent to which the services may have benefited the estate. Because the order entered in September 1971, had, in our view, no legal effect on the bankrupt’s property, we conclude that the lack of notice and hearing for the bankrupt before this order issued was immaterial.

However, there is more substance in appellant’s argument that he did not receive a hearing on all the pertinent issues he presented to the referee before the order issued in the bankruptcy court. To be sure, appellant had notice and a hearing, and urged all his arguments before the referee. But, regarding himself bound by the September 1971 order, the referee considered only the issue of benefit. Yet, it does not follow necessarily that the bankrupt’s due process rights were violated. Whether due process was afforded here depends on the scope and effect of subsequent proceedings. Here, apart from the factual determination of benefit that was made by the referee, appellant’s other contentions required for determination no additional proofs or findings of fact and, on the contrary, raised only issues of law that were considered by the district court on review before it affirmed the order of the referee. The record, moreover, does not demonstrate that the bankrupt corporation was prejudiced by the referee’s failure to consider these issues in the first instance. Accordingly, we conclude that appellant, under the totality of circumstances, was not denied due process of law.

The judgment is affirmed for the reasons stated herein, and the case is remanded to the district court for further proceedings not inconsistent with this opinion.

      . The referee stated :
      The trustee overlooks the scope of Judge Neese’s order of reference dated September 14, 1971. The reference is not for the purpose of determining whether the order appointing Rex D. Marsh as receiver of Armstrong Glass Company, Inc., is void or for the purpose of determining whether the receiver had jurisdiction and authority to onerate Armstrong Glass Company, Inc., for costs and expenses arising out of or resulting from such appointment or for the purpose of determining the validity of the order of reference.
      “Court” is defined in Sec, 1(9) of the Bankruptcy Act (11 USC § 1(9) to mean “the judge or the referee of the court of bankruptcy in which the proceedings are pending; . . . . ” It is thus clear that in general the function of the bankruptcy court may be fulfilled by either a judge or the referee and even after a general order of refer-enoe has invested the referee with jurisdiction to discharge the statutory duties of the court of bankruptcy in which the case is pending, the judge and the referee have “coordinate powers.” Collier on Bankruptcy, 14th Ed., Vol. 1, Sec. 1.09.

        Judge Neese has heretofore determined that the claims of Luedeka and Siegel “are the ranking claims

         against the estate in receivership [Armstrong Glass Company, Inc.] ; and, that this Court [the bankruptcy court] has a duty to see to it that claimants are paid their just demands.” Judge Neese’s order of reference to this referee is for the sole purpose of determining “the extent that such services [Luedka’s and Siegel’s] bene-fitted the estate.” See Judge Neese’s Order, Sei)tember 14, 1971. lienee my determination will be limited to that issue only, (emphasis added).
      1. Therefore a Sec. 64(a) (1) priority.

      . This contention rests on the unstated assumption that if the receivership was void, appellees’ claims for services that benefited the estate in bankruptcy and that were rendered in good faith could not be asserted against the trustee. Appellant has ignored the possibility that even if the receivership were void, the appellees might nevertheless seek compensation from the estate on the basis of quasi-contractual principles. In fact, there appears to be a split of authority on the question whether services rendered a void equity receivership in good faith are, like services rendered a valid equity repeiversliip, entitled to preferential treatment in a superseding bankruptcy to the extent that the services benefited the estate. See generally Collier On Bankruptcy, 14th Ed., Vol. 3A, If 62.32 [3]. We find it unnecessary to decide this question because we conclude, infra, that the district court had authority to appoint the receiver and did not abuse its discretion in making the appointment.

      . AVe are not called upon in this case to decide whether the preferred status arising under the “benefit” doctrine of Randolph v. Scruggs, supra,, is superior or is only equivalent to the priority accorded expenses of administration for the superseding bankruptcy under Section 64(a)(1), 11 U.S.C. § 104(a) (1).

      . In the affirming memorandum and order of June 26, 1973, the court expressly stated that it had “reviewed all the errors alleged” and had found “no error was committed.” Although factual determinations made by the referee are not to be set aside unless “dearly erroneous,” Fed.R.Civ.P. 52(a), the district court’s review of legal issues is not so circumscribed. The Supreme Court has observed: “[T]lie referee is not in any sense a separate court, nor endowed with any independent judicial authority, and is merely an officer of the court of bankruptcy, having no power except as conferred by the order of reference . . . and that his judicial functions, however important, are subject always to the review of the bankruptcy court.” Weidhorn v. Levy, 253 U.S. 268, 271, 40 S.Ct. 534, 535, 64 L.Ed. 898 (1920).