text:
    OKLAHOMA CITY, OKL., et al. v. DOLESE et al.
    No. 367.
    Circuit Court of Appeals, Tenth Circuit.
    April 2, 1931.

      J. H. Jarman and A. L. Hull, both of Oklahoma City, Okl. (M. W. McKenzie and Joe Bailey Allen, both of Oklahoma City, Old., on the brief), for appellants.
    D. A. Richardson, of Oklahoma City, Okl. (John Tomerlin, Tomerlin & Chandler, and Hayes, Richardson, Shartel, Gilliland & Jordan, all of Oklahoma City, Okl., on the brief), for appellees.
    Before COTTERAL, PHILLIPS, and McDERMOTT, Circuit Judges.
   COTTERAL, Circuit Judge.

The city of Oklahoma City joined by its mayor and other officials appeal from a decree of the District Court which, in a suit of Peter Dolese and Dolese Bros. Company against them, enjoined the enforcement of Ordinance No. 3584, passed by the city on March 12, 1929, declaring the business of the company located within the city on the right of way of the Atchison, Topeka & Santa F6 Railway Company and adjacent lots to be a public nuisance, and directing its discontinuance by the owner, or, on its failure so to do, then by city officers. The jurisdiction of the District Court was based on diversity of citizenship and the complaint that the ordinance Was invalid under the due process and equal protection clauses of the Federal Constitution.

The issues were made up by bill and answer. From the evidence introduced at a trial, the following facte were shown without dispute:

The plant of the company is located in a residential section between Thirteenth and Sixteenth streets, xrunning east and west — as many blocks north from the business center of the city, on certain lots leased from Peter Dolese and an adjacent leased portion of the right of way on the west side of the railroad.

Since 1910 the company has carried en there the business of buying, storing, and selling coal, gravel, stone, sand, and other contractors’ supplies and has constructed spur tracks for its use, at a cost of $12,000. The leases are worth $10,000, the buildings $25,-000, and the entire plant $100,000. The retail business yields over $750,000 per annum, at a net profit of $59,000.

By a zoning ordinance passed on September 24, 1923, property between Tenth and Twenty-Sixth streets and lying from one half to a full block west of the railroad right of way, was designated as district U-3, in which retail business, light manufacturing, storage of builders’ supplies, maintenance of tracks, etc., were permitted. Various other industries are located along the west side of the railroad throughout the zone, and two of them are of the same kind as the Dolese Company. There are apartment and dwelling houses in the blocks west of and adjacent to all those industries.

There was a protest of citizens to the city council against the business of the Dolese Company. A committee appointed by the council recommended corrections in operating the plant, and they were made, and are still continued, by oiling the yards, sprinkling cars and materials, and muffling cranes. The company also offered to comply with any other reasonable ordinance for reduction of noise in operating the plant. Another committee appointed by the council reported that no other suitable location could be found for the company.'

The ordinance in question was adopted on March 12, 1929, after four complaining parties had indemnified the city against costs in case of aetion- in eourt. It contains preliminary recitals, in substance, that the dust, dirt, noise, danger arising from, and the unsightly appearance presented by, the plant and its operation create and constitute injury to the health, comfort, and peace of the inhabitants as well as to the property in the -vicinity; that great noise is made by the machinery and trucks in handling materials, and dirt, dust, fine sand, and stone are blown throughout the residence community; that great mounds of materials and railroad cars parked there are unsightly, obstruct the view of travel over the Fourteenth street crossing, and create a dangerous condition; that the trucks used interfere with the general use of the streets; that the scattering of materials impairs the street paving; that by reason of the foregoing the comfortable and peaceable enjoyment of the homes in the locality is seriously affected; and that the conditions are a constant menace to the health, peace, and safety of the city and the adjacent community, and diminish the use and value of the property in the district. The ordinance then proceeds to declare the plant and its operation a public nuisance and to direct that it be abated on notice within 120 days, and, if this should not be done by the company, then the chief of the fire department or chief of police, at the instance of the mayor, was directed to abate and remove it. Provisions are added that each obstruction thereto and an attempt each day to operate the plant are punishable by fine.

There was evidence on both sides bearing on the question of objectionable results from the operation of this plant. It showed some conflict, but it may be fairly summed up as estáblishing that the findings in the ordinance concerning them are by no means sustained, and that the results were no more than were due unavoidably to the nature of the business. Counsel for the city describe the conditions in their brief as follows: “The Dolese Com? pany had done everything possible to abate the nuisance in the operation of its plant, but had been unable to relieve the situation to the extent that there could be comfortable enjoyment of the homes in the vicinity.”

It is not questioned in this ease that the city is invested with the police power, in a-legislative capacity only, to abate nuisances by the state Constitution and laws, and by the city charter. The state Supreme Court has decided that a legislative determination by a city that a nuisance exists is conclusive on the courts if it is one where there may be an honest difference concerning it in impartial minds, and it is not unreasonable or arbitrary in character. Calkins v. Ponca City, 89 Okl. 100, 214 P. 188. In that ease, the ordinance condemned two buildings because as maintained they were a menaee to the health and safety of the community, and the contention that the city sought to exercise judicial powers and its remedy was in the courts was rejected. Other decisions followed this precedent. Finkelstein v. City of Sapulpa, 106 Okl. 297, 234 P. 187; Wood v. City of Chiekasha, 125 Okl. 212, 257 P. 286. These decisions are said to control the present ease. We observe at the outset that we are bound by the construction the state eourt gives to the state laws, but not by its conclusion in determining their constitutional validity. Truax v. Corrigan, 257 U. S. 312, 325, 42 S. Ct. 124, 66 L. Ed. 254, 27 A. L. R. 375.

Counsel for the city also cite decisions from the Supreme Court of the United States to sustain the power of the city to enact the ordinance in question. They announce the principle that fairly debatable questions as to the reasonableness, wisdom, and propriety of legislative action within the scope of police power is not for determination by the courts, but for that of the legislative body which has the duty and responsibility of decision. Standard Oil Co. v. City of Marysville, 279 U. S. 582, 49 S. Ct. 430, 73 L. Ed. 856. But the inquiry remains whether the action by the city in this case was within the scope of its powers.

Coneededly, a business which is neither necessary nor useful, or is inherently dangerous at a given location, may summarily be abated. But the Dolese plant belongs to neither of those classes.

Here was a business that was pursued in a zone allotted for it by the city. It is both useful and necessary in character, and vitally important to the development of the city. There are considerations which entitle a city to restrict industries to zones, and such action is valid unless it is clearly arbitrary and unreasonable and has no substantial relation to the public health, safety, morals, or general welfare. Euclid v. Ambler Realty Co., 272 U. S. 365, 395, 47 S. Ct. 114, 71 L. Ed. 303, 54 A. L. R. 1016; Washington v. Roberge, 278 U. S. 116, 49 S. Ct. 50, 73 L. Ed. 210. But there has been no change in this zone. In that situation, has the city the legislative power to abate the operation of the plant and foreclose judicial inquiry ?

In Dobbins v. Los Angeles, 195 U. S. 223, 25 S. Ct. 18, 20, 49 L. Ed. 169, the appellant had begun the erection of gas works in a zone to which by an ordinance such an industry was confined. A second ordinance by which the zone was contracted so as to exclude his plant was held to be invalid, and it was said: “It may be admitted that every intendment is to be made in favor of the lawfulness of the exercise of municipal power, making regulations to promote the public health and safety, and that it is not the province of courts, except in clear eases, to interfere with the exercise of the power reposed by law in municipal corporations for the protection of local rights and the health and welfare of the people in the community. But notwithstanding this general rule of the law, it is now thoroughly well settled by decisions of this court that municipal by-laws and ordinances, and even legislative enactments undertaking to regulate useful business enterprises, are subject to investigation in the courts with a view to determining whether the law or ordinance is a lawful exercise of the police power, or whether, under the guise of enforcing police regulations, there has been an unwarranted and arbitrary interference with the constitutional rights to carry on a lawful business, to make contracts, or to use and enjoy property.”

There were citations to prior decisions and a quotation from Lawton v. Steele, 152 U. S. 133, 14 S. Ct. 499, 501, 38 L. Ed. 385, in part as follows: “The legislature may not, under the guise of protecting the public interests, arbitrarily interfere with private business, or impose unusual and unnecessary restrictions upon lawful occupations; in other words, its determination as to what is a proper exercise of its police powers is not final or conclusive, but is subject to the supervision of the courts.”

In Yates v. Milwaukee, 10 Wall. 497, 505, 19 L. Ed. 984, the question was whether an ordinance of the city, passed under its power to establish and clear wharf lines, was valid in declaring a wharf built by Yates on the shore of the Milwaukee river was an obstruction to navigation and a nuisance. It was held: “ * * * The mere declaration by the city council of Milwaukee that a certain structure was an encroachment or obstruction did not make it so, nor could such declaration make it a nuisance unless it in fact had that character. It is a doctrine not to be tolerated in this country, that a municipal corporation, without any general laws either of the city or of the State, within which a given structure can be shown to be a nuisance, can, by its mere declaration that it is one, subject it to removal by any person supposed to be aggrieved, or even by the city itself. This would place every house, every business, and all the property of the city, at the uncontrolled will of the temporary local authorities.”

In Re Smith, 143 Cal. 368, 77 P. 180,181, it was ruled; “ * * * when the police power is exerted to regulate a useful business or occupation, the Legislature is not the exclusive judge as to what is a reasonable and just restraint upon the constitutional right of the citizen to pursue any trade, business, or vocation, which in itself is recognized as innocent and useful to the community.”

As the business of the Dolese Company was lawful and it was conducted at a lawful place, it is clear the power of the city extended only to regulation and not to suppression. The former existed to reduce interference with others to a minimum of detriment. The community must abide the consequences necessarily incident to the business, for otherwise the company would be deprived of the rightful enjoyment of its property. Washington v. Roberge; supra; 2 Tiedeman, St. and Fed. Control, § 147; Indian Refining Co. v. Berry, 226 Ky. 123, 10 S.W.(2d) 630; Houghton v. Kendrick, Mayor, 285 Pa. 223, 132 A. 166; Adams v. Kalamazoo I. & F. Co., 245 Mich. 261, 222 N. W. 86; Weaver v. Kuehler, 17. Okl. 189, 87 P. 600.

The ordinance, instead of being a legislative determination to which by law it was limited, was an unauthorized judicial pronouncement. Legislation consists of formulating a rule for the future. A judgment applies the law to past or present facts. Prentis v. Atlantic Coast Line Co., 211 U. S. 210, 29 S. Ct. 67, 53 L. Ed. 150; In re County Commissioners, 22 Okl. 435, 98 P. 557. But no future rule was declared which was applicable to the like industries. There was only an adjudication on the facts pertaining to one of them, which is required to- be on notice and hearing prescribed by law. Wuchter v. Pizzutti, 276 U. S. 13, 48 S. Ct. 259, 72 L. Ed. 446, 57 A. L. R. 1230. The ordinance fails as a legislative proceeding.

From the foregoing considerations, we readily conclude the ordinance is invalid, because its enforcement would effect a taking of the property of the Dolese Company without due process of law.

The ordinance was also invalid in denying to the company the equal protection of the laws. There was'manifestly-an arbitrary and unreasonable discrimination as between that company and others of the like kind surrounded by the same conditions in the locality. It was entitled to be treated by the same rule and could not be singled out for attaek without some reasonable difference between them having a fair and substantial relation to the object sought to be attained. Louisville Gas & Elec. Co., v. Coleman, 277 U. S. 32, 48 S. Ct. 423, 72 L. Ed. 770; Frost v. Corporation Commission, 278 U. S. 515, 49 S. Ct. 235, 73 L. Ed. 483.

The company was entitled to a remedy by injunction in this ease. It was not obliged to face the penalties imposed by the ordinance in testing its validity. Ex parte Young, 209 U. S. 123,28 S. Ct. 441, 52 L. Ed. 714, 13 L. R. A. (N. S.) 932, 14 Ann. Cas. 764; Oklahoma Operating Co. v. Love, 252 U. S. 331, 40 S. Ct. 338, 64 L. Ed. 596.

The decree of the District Court was right, and it is accordingly affirmed.


source: Caselaw Access Project

author: COTTERAL, Circuit Judge.

license: Public Domain

text:
    WESTON et al. v. POLAND et al.
    No. 366.
    Circuit Court of Appeals, Tenth Circuit.
    April 2, 1931.

      Guy H. Sigler, of Ardmore, Okl. (P. M. Jackson, of Ardmore, Okl., on the brief), for appellants.
    W. D. Potter, of Ardmore, Okl., and Samuel W. Hayes, of Oklahoma City, Okl. (Potter & Potter, of Ardmore, Okl., James A. Veasey and L. G. Owen, both of Tulsa, Okl., and Hayes & Richardson, of OHahoma City, Okl., on the brief), for appellees.
    Before COTTERAL, PHILLIPS, and McDERMOTT, Circuit Judges.
   COTTERAL, Circuit Judge.

The appellants, plaintiffs below, brought this action in the district court of Carter county, OH., against individual defendants and their successors, to recover certain interests claimed to have been inherited in an allotment, and they sought the cancellation of deeds and an oil and gas lease, together with an accounting of rents and profits. The case was removed to the federal court for the Eastern District of OHahoma. It was there tried to the court, upon an agreed statement of facts, and a final decree- was rendered dismissing the bill, from which the plaintiffs appeal to this court.

The land was allotted on March 4,1905, to Mary Weston, a full-blood Choctaw Indian. She died a minor, survived by her parents, Mitchell and Sarah Weston. He died in 1906, and she died in 1911. One of their heirs was a daughter, Nora Weston, a plaintiff in this case. She was bom on January 26, 1906. Sarah Weston was remarriedj to Israel Gage. They left a son, Lyman Gage, who was two years old at his mother’s death. He also inherited an interest in the allotment, but it is not directly involved in this suit. Mitchell and Sarah Weston had a son, Julius Weston, who was born April 3, 1897, and died September 29, 1918. He married Edith Cole, a white woman, and one of his heirs is a daughter, Julia Marie Weston, who is the other plaintiff. The present interests of the heirs in the allotment, if not divested, would be as follows: Julia Marie Weston, one-fourth; Nora Weston, five-twelfths; Israel Gage, one-sixth; Lyman Gage, one-sixth.

There were guardians’ sales, through the county court of Haskell county, OH., of the interest of Julius Weston, a portion of which Julia Marie Weston claims descended to her, and of the interest of Nora Weston. These plaintiffs attack the validity of the sales. The defendants as grantees of the purchasers uphold it. This is the controversy between the parties.

The sales are challenged in each instance upon the grounds that notice of the petition therefor was not served personally on the next of kin of the minors as required by the state law, wherefore the decree of sale and the subsequent proceedings were void for want of jurisdiction in the county court, and that there was no compliance with rule 5 of the Probate Court Rules of the OHahoma Supreme Court.

We refer to the court proceedings. Joseph Folsom was appointed as guardian of Julius Weston in 1908 and continued as such until his ward reached his majority. Dan Perry was appointed as guardian of Nora Weston in March, 1910; and after her mother’s death in 1911 had the care and custody of his ward until she reached her majority. Israel Gage was appointed as guardian of Lyman Gage and has since had the care and custody of him.

. In March, 1915, these guardians, deeming it advantageous to sell the three interests together, employed the same attorney and filed a separate like petition for each sale, on statutory grounds which are not questioned, in the county court of Haskell county, OH. Thereupon the court ordered a hearing of each petition, directing notice by publication for two weeks, posting at five public places in the county, and mailing to the next of kin. Proofs of the notices were filed. At the hearings, on April 29,1915, the guardians appeared with their attorneys, and in each case a decree was entered, reciting the service of notice and submission of the matter “and after a full hearing and upon due examination and consideration of the proofs” the sale was necessary as stated in the petition and the guardian was authorized and directed to make private sale of the real estate, and it was further ordered that notice of the sale be given by publication for two weeks and by posting as required by law. Returns were made showing proofs of notice and sales to R. P. Poland. The sales were confirmed and deeds were ordered to be’made to the purchaser. Since the delivery of the deeds, the purchaser and his successors have had opea, notorious, adverse possession of the property.

Coneededly, the record does not show personal notice of the petitions for the sales on the next of kin of the wards. This was required by section 6559, of the Revised Laws of 1910, in force at the time of the court proceedings.

The ease of Rock Island Implement Co. v. Pearsey, 133 Okl. 1, 270 P. 846, is cited to show the absence of personal notice to the next of kin rendered the sale invalid for want of jurisdiction to order it. One answer to the contention is that service of process against a minor is required on a guardian, and he may waive any process, notice, or order to show cause. Section 6568, Rev. Laws 1910; section 1481, C. O. S. 1921. The only purpose of serving notice on the minors would be to enable the guardian to appear and represent them at the hearing. But the guardians appeared and applied to sell the land. The only persons interested were the minors themselves and Lyman Gage, whose guardian also represented him, and was a party to all the proceedings. Notice was effectually waived by the guardians.

Another answer is that the Pearsey Case was decided in October, 1928, long after the proceedings in question and the same court had held before they occurred that the filing of a petition which set out sufficient facts to justify the sale vested the court with jurisdiction to order it, that the subsequent steps were procedural, and while omission of them might render a sale voidable on appeal, it did not, after confirmation, open the sale to collateral attack. The leading decision to that effect is Eaves v. Mullen, 25 Okl. 679, 107 P. 433. It followed the doctrine of Grignon’s Lessee v. Astor et al., 2 How. (43 U. S.) 319, 11 L. Ed. 283, and Mohr v. Manierre, 101 U. S. 417, 25 L. Ed. 1052, and it has been repeatedly approved in later decisions. Spade v. Morton, 28 Okl. 384, 114 P. 724; Roth v. Union National Bank, 58 Okl. 604, 160 P. 505; Winters v. Oklahoma Portland Cement Co., 65 Okl. 132, 164 P. 965; Tiger v. Drumright, 95 Okl. 174, 217 P. 453; Foreman v. Chapman, 95 Okl. 132, 219 P. 692; White v. Cheatham, 101 Okl. 264, 225 P. 533; Abraham v. Homer, 102 Okl. 12, 226 P. 45; Dill v. Stevens et al., 141 Okl. 24, 284 P. 60.

The Pearsey Case does not avail the appellants, as á settled construction of a statute when titles are acquired becomes a rule of property and protects a purchaser. Dill v. Stevens et al., supra; Jones v. Prairie Oil & Gas Co., 273 U. S. 195, 47, S. Ct. 338, 71 L. Ed. 602; Kuhn v. Fairmont Coal Co., 215 U. S. 349, 30 S. Ct. 140, 54 L. Ed. 228; Jackson v. Harris (C. C. A.) 43 F.(2d) 513; Welch v. First Trust & Sav. Bank (C. C. A.) 15 F.(2d) 184. By this principle, the. title of the defendants is established.

The case of Dill v. Stevens et al., supra, was decided on June 12, 1928. A rehearing was denied in February, 1929, and January, 1930. In that case a publication notice was questioned. The doctrine of Eaves v. Mullen was reaffirmed and it was declared to be a rule of property. The Pearsey Case is therefore wedged in between the original decision and the denial of rehearing in the Dill Case, and stands alone with decisions to the contrary before and after it. The other cases show a settled construction of the statute in question, and it is accepted in the federal courts. See eases last cited.

The probate proceedings do not expressly show a compliance with Probate Rule 5 'of the state Supreme Court, which provides as follows: “On the hearing on petitions for sale, the guardian, person in custody, and the ward himself, when over fourteen years of age, must be present and must be examined as to the necessity for said sale and the truth of the allegations of the petition, and furnish such additional evidence as the court may require. The evidence offered must be taken down and transcribed and a copy thereof filed with the papers in the case. * * *”

I The rule could apply only to Julius Weston, as Nora Weston was but nine years old. While it contains valuable' safeguards and should be always observed, yet being procedural its observance is not a jurisdictional requisite to the validity of the sales.

Í But we need not so decide. The orders on the petitions for the sales in question recite that they were based “upon due examination and consideration of the proofs.” They therefore refute the assertion that the rule was not observed, 'it has been repeatedly held by the Oklahoma Supreme Court that the county courts are courts of record and their orders have the same force as those of courts of general jurisdiction. Hunter v. Wittier, 120 Okl. 103, 250 P. 793; Powers v. Brown, 122 Okl. 40, 252 P. 27; Dill v. Anderson, 124 Okl. 299, 256 P. 31; Manuel v. Kidd, 126 Okl. 71, 258 P. 732. The decree of sale in this case is challenged by a collateral attack. The presumption is therefore conclusive that all facts were found by the court which were necessary to the decree. Continental Gin Co. v. DeBord, 34 Okl. 66, 123 P. 159; Blackwell v. McCall, 54 Okl. 96,153 P. 815; Manuel v. Kidd, supra. The last-cited ease is directly in point, and holds that the presumption is there was compliance with the rule.

The deeree of the District Court should be, and it is, affirmed.


text:
    In re OTTO-JOHNSON MERCANTILE CO. GILL v. NACHTRIEB.
    No. 352.
    Circuit Court of Appeals, Tenth Circuit.
    April 1, 1931.
    Joseph Gill, of Albuquerque, N. M., for appellant.
    J. O. Seth, of Santa Fe, N. M., for appellee.
    Before COTTERAL, PHILLIPS, and McDERMOTT, Circuit Judges.
   COTTERAL, Circuit Judge.

Appellant complains of the partial dis-allowance by the District Court of a claim for attorney’s fees and expense in connection with services rendered by him to the bankruptcy estate of Otto-Johnson Mercantile Company, formerly engaged in business at Clayton, N. M. The rejected claim was for the period while D. G. Dwyer was trustee, and appellant was not employed by him. This action is assigned as error. The remainder of the claim is not in dispute.

The question presented is whether the claim in question was a valid charge against the estate by virtue of clause 2, of section 64b of the Bankruptcy Aet (11 USCA § 104 (b) (2), which allows as one of the priority debts “* * * where property of the bankrupt, transferred or concealed by him either before or after the filing of the petition, shall have been recovered for the benefit of the estate of the bankrupt by the efforts and at the expense of one or more creditors, the reasonable expenses of such-recovery.”

There was no dispute in the evidence as to the facts bearing on this claim. Appellant was employed by numerous creditors and advised by them of the misappropriation of assets by members of the bankrupt company. At the same time Mr. Tatum, an attorney for Mr. Dwyer, then the trustee, suggested an investigation by appellant and asked him to undertake it. The referee favored it by his letter to appellant. Appellant went from his home at Albuquerque to Clayton, wired Mr. Douglas, an accountant, to join him there, and they made a preliminary audit of the books of the bankrupt. Tatum obtained an order to remove them to Albuquerque. Appellant assisted Douglas in finishing the audit. He filed a petition to remove the trustee, which resulted in a conference with him, his attorney and creditors, -and a stipulation to dismiss the petition and authorize appellant to select a special attorney for the trustee to make investigation and prosecute suits against the Johnsons, Ottos, and a bank. Mr. Seth was selected as the attorney,. after a conference with the District Judge. Appellant brought to the attention of the judge his status and his prospective compensation. He' was in frequent eoiiference with Seth, furnished him an elaborate brief, and aided him in his investigation, which revealed misappropriations of $150,000, some of which were by insolvent parties, and others were barred by limitation. Seth brought a suit against the Ottos and recovered $5,854.45 for the estate. Appellant was not employed by trustee Dwyer.

Appellant’s claim was rendered for his entire services amounting to $3,022.90. They were valuable. The referee reported that his fees were reasonable and should be allowed. Seth testified his work was necessary and his charges reasonable. Dwyer’s attorneys were allowed $1,400 as fees and expense of $258.-37. After Dwyer’s death, appellee was appointed trustee, appellant was employed by him and was paid for his services $337.50, and for expense $120.

Prom the facts it appears that the services of appellant in question were such as he would naturally render to his employers, the creditors of this estate, for the benefit that would accrue to them by way of dividends. This is emphasized by the fact that appellant was not employed by trustee Dwyer, but secured the appointment of another attorney to represent the trustee in recovering assets.

Section 64b should not be construed as allowing compensation to creditors who may through their attorneys merely assist without employment a trustee in Ms efforts to augment an estate. It contemplates they should be paid therefor where before the appointment of a trustee they bring assets into an estate, but not after he has been appointed and employed other attorneys to represent him. Collier on Bankruptcy (13th Ed.) vol. 2, pp. 145,147,148; In re Floore (C. C. A.) 16 F.(2d) 113; In re Felson (D. C.) 139 F. 275; In re Medina Quarry Co. (D. C.) 182 P. 508; Id. (C. C. A.) 191 F. 815. The section is, however, broad enough to justify an allowance to creditors where the trustee has refused and they proceed to sue for the recovery of assets. In re Little River Lumber Co. (D. C.) 101 F. 558; In re Cheney (D. C.) 300 P. 465. But the trustee represents all persons concerned, and has the duty to sue and uncover assets for the estate. In re Bothe (C. C. A.) 173 P. 597.

Appellant invokes the rule that compensation should be allowed where an attorney of creditors creates or secures a fund and brings it into court for the benefit of all of the same class. Trustees of Internal Improv. Fund v. Greenough, 105 U. S. 527, 26 L. Ed. 1157; Hempstead v. Meadville Theological School, 286 Pa. 493, 134 A. 103, 49 A. L. R. 1149. But the rule does not apply in this case, for the reason that another attorney employed by the trustee filed and prosecuted the suit whereby the fund in question was acquired for the estate. American Engineering Co. v. Metropolitan By-Products Co. (C. C. A.) 275 P. 40; Guaranty Trust Co. of New York v. Chicago R. Co. (C. C. A.) 185 P. 411. Besides the claim of appellant appears to have been against the fund which was recovered, although it is a charge for his entire services.

The Bankruptcy Act in its aspects of economy cannot be regarded as generally allowing compensation to attorneys of creditors, when the trustee is functioning in their behalf and has employed other counsel to represent him. The practice would open the door to excessive liability. The result is illustrated by the charges legally allowed against this estate and the reduction it would sustain from payment of appellant’s claim.

We conclude that the order of the District Judge was right and it is accordingly affirmed.


author: STONE, Circuit Judge.

text:
    COCA-COLA CO. v. JOSEPH C. WIRTHMAN DRUG CO.
    No. 8986.
    Circuit Court of Appeals, Eighth Circuit.
    March 24, 1931.
    Frank Troutman, of Atlanta, Ga., and W. C. Michaels, of Kansas City, Mo. (Harold Hirsch & Marion Smith, of Atlanta, Ga., on the brief), for appellant.
    D. A. Murphy, of Kansas City, Mo. (John T. Harding and R. C. Tucker, both of Kansas City, Mo., on the brief), for appellee.
    Before STONE and GARDNER, Circuit Judges, and WOODROUGH, District Judge.
   STONE, Circuit Judge.

This is an action to restrain alleged unfair competition. Prom a decree dismissing the petition upon a hearing on the merits, this appeal is brought.

Plaintiff manufactures a soda water syrup known as “Coca-Cola,” which it sells to operators of soda water fountains for use in making a drink which is known by the same name or, popularly, as “Coke.” The unfair competition charged is that defendant, a purchaser from it of such syrup for the above use, in response to orders for Coca-Cola, is delivering and selling at its fountain a spurious and substituted product as genuine Coca-Cola. The answer admits the sale of the drink called Coca-Cola made from the syrup produced by plaintiff, but denies any substitution. Thus the major issue in the.case was whether the syrup used in the drinks sold by defendant was genuine or spurious. The evidence reveals that the theory of plaintiff was that the defendant had altered the genuine syrup — probably by dilution with water or plain syrup.

The theory upon which the trial court disposed of the case was that the burden of proof was on appellant (plaintiff) to prove that the article sold was not genuine Coca-Cola, and that the appellee knew the spurious character of the thing sold, and that appellant had failed to prove either.

Appellant presents here two matters. The first has to do with the proof that the article sold by appellee was spurious; the second with the burden of proof of- guilty knowledge. We find it necessary to examine only the first, as that is determinative of this-appeal.

Appellant’s proof as to spurious article sold was as follows: Genuine Coca-Cola contains phosphorous pentoxide, phosphoric acid, eaffein, and a coloring agency made from burnt sugar or caramel which gives the syrup a reddish brown color. The coloring matter is no part of the “structure” of the mixture, but is decorative and useful in enabling a purchaser of the drink to recognize it. At various times between January 27, 1925, and February 7, 1927, agents of appellant called for and purchased, at appellee’s soda fountain, small quantities of the Coca-Cola syrup which was being dispensed there. These purchases, after being carefully bottled and labeled, were sent to chemists, who made analytical examinations thereof. These analyses were as to specific gravity and as to character and percentages of ingredients. Under agreement of counsel, the evidence of these chemists was in the form of affidavits. Such evidence showed in detail the results of such analyses as to each sample, giving the specific gravity and the content percentages of phosphorous pentoxide, phosphoric acid, and caffein. Also the chemists testified as to the color, which was defined in comparison with two grades of Coca-Cola syrup (bottles and fountain) as so many degrees “lighter” than each of these grades. All of the analyses revealed the presence of all the chemical ingredients of genuine Coca-Cola. The differences, according to the analyses, between these samples and genuine Coca-Cola, is claimed to be found in the content percentages of the chemicals, in the gravity and in the color. Ascertainment of difference between two things obviously must be based upon a comparison of those two things. Here the comparison must be made between these samples of what appellee sold and genuine Coca-Cola. The analyses furnished the characteristic elements of the samples necessary for such comparison of them with the genuine Coca-Cola. The natural and direct way to compare these chemical and gravity results would be to set them alongside similar data from the genuine Coca-Cola. However, this was not done by appellant. Desiring to protect its trade secret in the mixture, it sought to accomplish this comparison and establish the difference in another way. This was by two pieces of evidence. The first is contained in the affidavit of C. E. Caspari, one of the two chemists (the other being A. L. Chason), who analyzed these samples. Chason had analyzed seven samples, and this witness had analyzed the same •samples, as well as eight other samples. His testimony was: “I have examined the affidavit of Mr. A. L. Chason, filed in this case. Taking his analytical examination as correct, I have given most careful consideration to the analytical examination made of samples set out in his affidavit, as well as examination of samples made by me, and being thoroughly familiar with the product ‘Coca-Cola,’ I state that the samples referred to in the affidavit of Mr. Chason and the samples referred to in, and attached to this affidavit, are not'Coca-Cola.”

The other evidence was by the main chemist in charge of all chemists of appellant. It was his duty to see that “the syrup made and sold under the name of Coca-Cola, is at all times made uniform so that the syrup at each time it is manufactured be of the same consistency, appearance, have the same ingredients therein and the same quantities of each ingredient.”

He testified to long experience with and thorough familiarity with “the ingredients and the proportions thereof, the color and the taste” of Coca-Cola. His affidavit contained the following:

“I have examined the affidavit of A. L. Chason particularly in regard to his analyses results obtained from examining the samples referred to in his affidavit, and I have examined the affidavit of C. E. Caspari particularly in regard to his analyses of the samples therein referred to. From my experience as hereinbefore described and from my knowledge of Coca-Cola from an analytical point of view and from knowing the ingredients that go .into the product, ‘Coca-Cola,’ I state that all the samples referred to in the affidavit of Dr. Caspari and Mr. Chason are not Coca-Cola as made and manufactured by The Coca-Cola Company, the plaintiff in this case; that these samples show from the analytical examination that the contents are not the same as the contents of Coca-Cola syrup made and manufactured by The Coca-Cola Company, and in my opinion that the syrup so obtained and described in all of the said affidavits is not the syrup as made and manufactured by The Coca-Cola Company.
“Referring now specifically to the affidavit of A. L. Chason and particularly to the sample, Closet No. 17878 Mr. Chason finds from an analytical examination that the specific gravity is 26.25 degrees Baume. The specific gravity of Coca-Cola as made and manufactured by The Coca-Cola Company is higher than the specific gravity found in the sample. He fixes the phosphorous pent-oxide content at .165%. This is lower than the phosphorus pentoxide content of Coca-Cola. He finds the caffein content to be .077%. This is lower than the caffein content of Coca-Cola.
“Referring to Sample No. 17880, the specific gravity Baume is found to be 26.45 degrees. This is lower than is the specific gravity of CocarCola. The phosphorus pent-oxide content was found to be .167%. This is lower than the phosphorus pentoxide content of Coca-Cola. He found the eaffein content to be .078%, and this is lower than the eaffein content of Coca-Cola.
“Referring to Sample No. 17881, Mr. Chason found the specific gravity Baume at 25.95 degrees. This is lower than the specific gravity of Coca-Cola. He found the phosphorus pentoxide content to be .163%. This is lower than the phosphorus pentoxide content of Coca-Cola. He found the eaffein content to be .075%, This is lower than the eaffein content of Coca-Cola.
“Referring now to Sample No. 22341— Mr. Chason found the Baume specific gravity to be 25.46 degrees. This is lower than the specific gravity for Coca-Cola. He found the phosphorus pentoxide content to be .171%, and this is lower than the phosphorus pentoxide content of Coca-Cola.. He finds the eaffein content to be .079%, which is lower than the eaffein content of Coca-Cola.
“Referring to Sample No. 22342 — Mr. Chason found the specific gravity Baume at 26.85 degrees. This is lower than the specific gravity of Coca-Cola. He found the phosphorus pentoxide content to be .172%, which is lower than the phosphorus pentoxide content of Coca-Cola. He found the eaffein content to be .080%, which is slightly less than the eaffein content of Coca-Cola.
“Referring now to Sample No. 22343— Mr. Chason found the specific gravity at 25.95 degrees Baume, which is lower than the specific gravity for Coca-Cola. He found the phosphorus pentoxide content to be .171%, which is lower than the phosphorus pentoxide content of Coca-Cola. He found the eaffein content to be .080%, which is less than the eaffein content of Coca-Cola.
“Referring to Sample No. 24913 — Mr. Chason found specific gravity at 29.83 degrees Baume, which is higher than the specific gravity of Coca-Cola. He found the phosphorus pentoxide content to be .174% which is lower than the phosphorus pentoxide content of Coca-Cola. He found the eaffein content to be .089%. This eaffein content would not depict that the sample was not Coca-Cola.
“From an examination of comparisons as herein made and described, it is my opinion that there has been added to the Coca-Cola syrup, simple syrup or that it was diluted with water prior to the time that it was sold at the soda fountain.
“Referring to the affidavit, of C. E. Caspari, and particularly to. Sample No. 17878 —I find that the specific gravity was lower than that found in Coca-Cola; as was found the phosphorus pentoxide content, and as was .the eaffein content.
“Referring to Sample No. 17880 — I find that the specific gravity is lower than for Coca-Cola; as is the phosphorus pentoxide content.
“Referring to Sample No. 17881 — I find that the specific gravity is lower than that found for Coca-Cola; as is the phosphorus pentoxide content.
“Referring to Sample No. 22341 — I find specific gravity lower and the phosphorus pentoxide content lower than for Coca-Cola.
“Referring to Sample No. 22342r — I find specific gravity lower and the phosphorus pentoxide content lower than for Coca-Cola.
' “Referring to Sample No. 22343 — I find specific gravity lower and the phosphorus pentoxide content lower than for Coca-Cola.
“Referring to Sample No. 24913 — I find specific gravity is higher, and the phosphorus; pentoxide content lower than for Coca-Cola..
“Referring to Sample No. 27229 — I find! specific gravity lower, and the phosphorus, pentoxide content lower, and I also find; eaffein content lower than for Coca-Cola.
“Referring to Sample No. 27237 — I find? specific gravity lower, and phosphorus pent-oxide content lower and the eaffein content, lower than for Coca-Cola.
“Referring to Sample No. 27288 — I find! specific gravity lower than for Coca-Cola.
“Referring to Sample No. 27289 — I find! specific gravity lower, and phosphorus pent-oxide content lower than for Coca-Cola.
“Referring to Sample No. 27291 — I find specific gravity lower, and phosphorus pent-oxide content lower than for Coca-Cola.
“Referring to Sample No. 27292 — I find specific gravity lower, and phosphorus pent-oxide content lower than for Coca-Cola.
“Referring to Sample No. 27295 — I find specific gravity lower, and phosphorus pent-oxide content lower than for Coea-Cola.
“Referring to Sample No. 27296 — I find that the phosphorus pentoxide content is lower than the phosphorus pentoxide content of Coca-Cola.
“Referring again to the affidavits of Messrs. Chason and Caspari, and the color contents thereof, insofar as it relates to the samples referred to therein, I find that by taking the findings of Messrs. Chason and Caspari as a correct basis, that the color of the samples so taken are not in keeping with the color of samples of Coca-Cola, and that the variations is as explained in the two affidavits.
“From all the samples and from ¿11 the examinations, and from my experience and knowledge concerning Coca-Cola, in my opinion, either simple syrup or water was added to the syrup as manufactured and made by The Coca-Cola Company.”

As to this evidence to the effect that the analyses showed the samples were not genuine Coca-Cola, the trial court said:

“They went no further in the testimony than to say that a certain ingredient which they discovered by analysis in samples purchased from the defendant was either less or more than the like ingredient in the genuine product of the plaintiff. Upon the basis of this comparison made by them they testified that what the defendant sold was not genuine. Was this conclusion competent proof of the fact ?
“It seems to me it was not. The desirability from a business standpoint of preserving the secrecy of its formula cannot change the rules of 'evidence by which a plaintiff is bound in proving its cause of action. The law of evidence does not permit a witness to testify to a mere conclusion. That the syrup sold by the defendant was not genuine Coca-Cola syrup certainly was a conclusion. That some one -ingredient in the syrup sold by the defendant was more or less than the same ingredient in the genuine product of the plaintiff also was a conclusion. It is for the witness to testify to facts. It is for the trier of the facts, whether court or jury, to draw from the facts such conclusions as they support. A witness cannot say ‘I have knowledge that one of the ingredients of genuine Coca-Cola syrup is phosphoric acid but I will not state the percentage of phosphoric acid in genuine Coca-Cola. I have examined -a sample alleged to be spurious Coca-Cola and I find that it contains phosphoric acid in the amount of .232%. That is more than the percentage in the genuine article. My conclusion, therefore, is that the article I have examined is spurious.’ For that is the very issue, whether the article is spurious and that is to be determined upon the facts in evidence, not upon a comparison of one fact in evidence with another which is not in evidence.”

The issue here is as to the competency of this evidence of these two witnesses as to these claimed differences. Appellant supports the competency in two contentions: First, that such evidence is not mere conclusions but is evidence of a fact; that, if such are conclusions, the evidence was competent as expert testimony.

As to the first contention. Whether two things are alike or different certainly is a conclusion to be reached 'from a comparison of them.-. If the differences or similarities are such as an ordinary man may observe, there is no reason why the trier of fact should not make the comparison, and, independently therefrom, reach -the conclusion. Appellant sought here to prove that the syrup sold was not Coca-Cola by making analyses of the syrup. - It is not claimed that the corresponding elements in the genuine Coca-Cola are not known or that they cannot be ascertained by like analyses. In fact, the evidence shows that they are known to the witnesses who sought to make these comparisons and to state therefrom that the syrup was not genuine. Where all of the facts upon which a determination is based can be placed before the trier of fact and proper deduction of the determination therefrom does not require special training to adequately understand the significance of the facts, the determination thus made is a “conclusion” within the meaning of rules of evidence and, as such, is not admissible. The vice of such evidence is accentuated where such conclusion is of an ultimate fact to be determined by the trier of fact. **4 The Supreme Court has directly spoken on this matter of comparison in Schmeider v. Barney, 113 U. S. 645, 648, 5 S. Ct. 624, 625, 28 L. Ed. 1136, where the court said: “The effort was to put the opinion of commercial experts in the place of that of the jury upon a question which was as well understood by the community at large as by merchants and importers.”

We think admissibility of this evidence cannot be justified on the ground that it is the statement of a fact as distinguished from a conclusion.

In this connection, appellant urges that to compel it to reveal the percentages of ingredients in true Coca-Cola would result in divulging a valuable trade secret, and therefore this character of evidence should be received in order to protect its business f ounded on this trade secret. It relies upon Jacobs v. Beeeham, 231 U. S. 263, 31 S. Ct. 555, 55 L. Ed. 729. The situation in that case was essentially different from the one here. There a manufacturer was making pills which he was, to all intents, selling under the trade-name of a long-established and widely advertised brand of pills made by the complainant under a secret formula. The court (page 271 of 221 U. S., 31 S. Ct. 555, 556) said: “If, in a technical sense, the burden of proof is on the plaintiff to prove that the defendant’s pills are not made by his formula, there is at least a prima facie presumption of difference, just as in the ease of slander there is a presumption that slanderous words are false. A different rule would prevent the owner of a secret process from protecting it except by giving up his secret. Again, when the defendant has to justify using the plaintiff’s tradename, the burden is on him. Finally, as the case presents what is a fraud on its face, it is more likely that the defendant is a modern advertiser than that he has discovered the hidden formula of the plaintiff’s success.”

Here the situation is that of a purchaser of a product made under a secret formula who is accused of diluting the product. Presumably the purchaser is ignorant of the contents of the secret formula and with the chemical adherence thereto of the commercial product made therefrom. There is no basis in such a situation for any “prima facie presumption of difference”. Nor does the appellee, accused of fraud, have to justify the sale of the product dispensed by it which was purchased from the appellant. Nor does the case present “what is fraud on its face”. Obviously the case is one where the burden is upon the appellant to prove the dilution by competent evidence. Where that character of evidence is within its control it cannot avoid producing it solely because to do so would reveal its trade secret. This is essentially different from the situation in the Jacobs Case. It is easy to appreciate the desire of appellant to retain the secrecy of its formula. It can do so by refraining from selling its product to those who improperly use its product. There is no necessity to alter basic rules of evidence to secure this protection. However, when it comes into a court to restrain alleged fraudulent-conduct by a purchaser from it in relation to its product and, it might be, to secure damages therefor, it is amenable to the ordinary rules of evidence, and one of those rules is that obtainable evidence of the facts to prove its contention cannot be supplied by conclusions drawn, in essential parts, from those withheld facts.

The vice of relaxing the rule in the manner here sought is illustrated by the evidence in this ease. That evidence is the divergent results reached by the two chemists (Chason and Caspari) who examined the same seven samples of syrup bought from appellee. These analyses were as to five matters (specific gravity, Baume, phosphorus pent-oxide, phosphoric acid, and caffein) and involved two color comparisons (with genuine bottling and genuine fountain syrup). This involved forty-nine results for the seven samples. In only three instances out of these forty-nine were the same results reached by the two chemists employed by appellant. In two samples- there was agreement as to specific gravity and, in one sample, as to Baume degrees. Guided by the Chason analyses, witness Heath concludes that all but one of these samples were deficient in specific gravity in phosphorus pentoxide content and in caffein content. Guided by the analyses of the same samples by Caspari, he finds the same six samples • deficient only in specific gravity and in phosphorus pentoxide. As to the other sample, analyzed by both, he concludes that the Chason result as to caffein would not depict that the sample was not Coca-Cola- and, that both analyses show a “higher” specific gravity than Coca-Cola. As to the eight samples analyzed by Caspari alone, Heath concludes that the specific gravity and the phosphorus pentoxide are lower as to all and the caffein as to two. There is no evidence that the phosphoric aeid content in any of the samples was deficient. As to caffein there .is somewhat of a standard to use for comparison, since one sample which showed .089 per cent, caffein content was not disapproved as to the caffein and that percentage may be taken as approximately that in the genuine syrup. Out of six other samples analyzed by Chason the caffein content percentages found by him were .075, .077, .078-, .079, .080, and .080. For the same1 samples, Caspari found, respectively, .084, .083, .086, .085, .087, and .088, and for the eight samples examined by him alone the caffein content percentages were .076, .077, .080, .081, .081, .082, .082 and .082. A comparison of these analyses figures with the .089 per cent, standard shows, in the main, very slight variations therefrom. If we are to accept the only theory shown by the evidence as to how this corruption Of the true syrup was accomplished — that “either simple syrup or water was added” to the genuine syrup — • these slight deviations are not unreasonably as explainable by variations in the mixture of the commercial product put out by appellant as they are by any deliberate dilution by appellee. In this connection it is pertinent that these samples were bought in 1925, 1926, and 1927, and that during 1925 appellant sold 20,111,134 gallons of syrup 'and in 1926, 21,158,450 gallons — there are no figures for 1927. It is true that Heath testified that no syrup was permitted to go out until analysis thereof showed it was up to standard, but the consistently divergent results of analyses by two of its own chemists as to the seven samples of this alleged diluted syrup speak rather louder than his bare ipse dixit on that subject. At least they show the fallibility of analysis of this character of syrup. We have not adverted to this evidence for the purpose of commenting upon its weight but to-show the absolute necessity of having evidence of the actual contents of the true syrup, as commercially put out by appellant, if there is to be any certainty whatever in these comparisons and to emphasize that to do otherwise would- place the appellee completely at the mercy of the appellant without opportunity, even though entirely innocent, to meet the ease so made against it. It would have to meet opinions not facts, and would not be able even to test those opinions by inquiry as to the essential facts upon which they were based by witnesses introduced by its opponent.

Another reason why appellant contends this character of evidence is admissible is because it is testimony of experts. The question here was whether appellee had altered the syrup bought by it from appellant. Appellant claimed there was a difference caused by dilution. This involved the matter of whether there was a difference between the syrup sold by appellee and that bought by him. Appellant sought to show this difference by analyses of the syrup sold by appellee and, based upon the results of such analyses, the statement of its witnesses that these results showed differences. They based this conclusion upon their knowledge of the constituents of the genuine syrup. Confessedly there is a chemical formula in accordance with which the genuine commercial syrup is made and to which it is supposed to conform. The statement of this formula and of the facts as to adherence thereto in the commercial product when compared with the analyses of these purchased samples comprised all of the data from which these witnesses concluded that the above differences existed. No reason is shown in the evidence why any layman, with the same data before him, could not readily determine therefrom whether such differences existed and , do so as well as these witnesses. If this data carries a meaning not clear to the layman, then there may be place for expert testimony but this is in explanation of facts before the court and not by way of substitution therefor. The province of an expert is to aid in understanding facts already in evidence. It does not take an expert to know that there is a difference between .089 per cent, of eaffein and .075 per cent, or .088 per cent, of eaffein, although the significance of such differences may possibly be the subject of such expert testimony. But, before the significance can be explained, the difference must be shown. The misfortune of appellant here is that it does not wish to show this difference in the only clear way it can be shown by facts.

The situation here may be unfortunate for appellant, but such is often the position of a litigant. Except where there is some announced reason of public policy — such as incrimination or privileged communication— the rules of evidence have never bent to permit a party to a suit to refrain from divulging facts pertinent to the issues before the court simply because he might be injured by such facts becoming public. In saying this, we do not wish to be understood as meaning that under any and all circumstances, where secret trade formulas or trade secrets might have a bearing upon issues before a court, they must be revealed. As far as is consistent with a fair administration of justice, such secrets should be protected. But where such hold the essential facts of a controversy and no equally good evidence is obtainable, we see no reason why they should not be required. Certainly the most that could be properly asked would be the privilege of silence. To go further and permit opinion evidence based thereon to be used as a substitution therefor is going further than the courts have gone as to any other character of privileged testimony.

The deeree should be and is affirmed.

       Spokane & Inland Empire R. Co. v. U. S., 241 U. S. 344, 351, 36 S. Ct. 668, 60 L. Ed. 1037; Milwaukee & St. P. Ry. Co. v. Kellogg, 94 U. S. 469, 472, 24 L. Ed. 256; Chenery v. Employers’ Liab. Assur. Corp. 4 F. (2d) 826, 827 (C. C. A. 9) ; Parker v. Elgin, 5 F. (2d) 562, 564 (C. C. A. 6); Hirning v. Live Stock Nat. Bank, 1 F.(2d) 307, 310 (C. C. A. 8); Shwab V. Doyle, 269 F. 321, 333 (C. C. A. 6); National Biscuit Co. v. Nolan, 138 F. 6, 8 (C. C. A. 8); Gentry v. Singleton, 128 F. 679, 680 (C. C. A. 8).


author: WALKER, Circuit Judge.

text:
    CHEATHAM v. STATE OF TEXAS.
    No. 6076.
    Circuit Court of Appeals, Fifth Circuit.
    April 9, 1931.
    Rehearing Denied May 5, 1931.
    D. D. McDonald, of Galveston, Tex., and E. A. Berry and Robert L. Henry, both of Houston, Tex., for appellant.
    E. T. Branch, of Houston, Tex., for the State of Texas.
    Before FOSTER, SIBLEY, and WALKER, Circuit Judges.
   WALKER, Circuit Judge.

The appellant was convicted under the first of the two counts of an indictment found against him in the criminal district court of Harris county, Tex. The first count charged that appellant “on or about the 10th day of May, A. D. 1930, in said county and State did then and there commit the offense of transporting intoxicating liquor, as an accomplice, in this, to-wit: Ivy T. Wharton on or about said May 10th, 1930, in said county and State, did then and there transport intoxicating liquor; and the grand jury aforesaid, upon their oaths, in said Court, at said term, further present, that said D. R. Cheat-ham did then and there before said Ivy T. Wharton did so transport said liquor, advise and encourage said Ivy T. Wharton to so transport said liquor, and that said D. R. Cheatham did then and there agree with said Ivy T. Wharton to aid him, the said Ivy T. Wharton, in committing said offense so committed by the said Ivy T. Wharton; and that the said D. R. Cheatham was not then and there present at the commission of the offense of transporting the said intoxicating liquor so transported as aforesaid by said Ivy T. Wharton.”

The second count charged the unlawful transportation of intoxicating liquor by the appellant. Pursuant to a petition of the appellant which alleged that he was aeting in the performance of his lawful duties as a federal prohibition agent in the transaction upon which the charges contained in the indictment were based, and which asserted the right to remove provided for by statute (28 USCA § 76), the cause was removed to the court below. Upon the conclusion of the evidence introduced by the state, the announcement was made by the state that it elected to stand on count 1 of the indictment.

There was testimony to the following effect : The appellant, while he was a federal prohibition agent, for the purpose of “framing” one Edwards, or having him falsely charged with unlawfully transporting intoxicating liquor, arranged with C. H. Smith for the latter to get E. T. Wharton, who was called Curly Wharton, to transfer an old automobile from his name to the name of Edwards, to get Ivy T. Wharton to place whisky in that ear, and leave it with the whisky in it at some parking place in the city of Houston, for Smith, then informing appellant of the location of the ear; and appellant promised to pay to' Smith and to each of the Whartons a stated sum of money for taking part in the transaction arranged for. After the things so arranged for had been done, appellant seized the car mentioned, had the liquor it contained brought to the prohibition office, and had Edwards charged with a violation of the National Prohibition Act (27 USCA). A few days later, when Edwards was claiming that he-had been framed, appellant asked Smith over the telephone to make the Whartons keep their, mouths shut. Appellant did not know either of the Whartons personally,, and did not deal directly with either of them in regard to the transaction mentioned. Assignments of error are based on rulings of' the court on objections to evidence and on its refusal to give requested instructions to the jury.

Appellant complains of the admission of testimony as to E. T. Wharton leaving town after the frame-up. It does not appear from the record that the question calling for that testimony was objected to before a responsive answer to such question was made. Furthermore, it does not appear that the action of the court in overruling the objection-to that question was excepted to. That ruling is not presented for review.

Appellant Objected to testimony as to his having in his possession a diamond ring which had belonged to Smith. The record' indicates that that objection also was not made until after questions as to his having-the ring had been answered. We think there-is no merit in the assignment of error based on that ruling. It seems that that testimony was admissible in rebuttal of testimony of the appellant to the effect that he had not been-intimate with- Smith and had not had dealings-with him which were inquired about and testified to by Smith.

The court’s refusal to give a requested-instruction to the jury to find a verdict of not guilty is challenged on the ground that there-was a fatal variance between the allegations of. count. 1 of the indictment and the evidence offered in support thereof. The charge-made by that count is to be considered in the light of the following provision of the Texas-Penal Code:

“Art. 70. (79) Who is an Accomplice.— An accomplice is one who is not present at the commission of an offense, but who, before-the act is done, advises, commands or encourages another to commit the offense; or-
“Who agrees with the principal offender to aid him in committing the offense, though he may not have given such aid; or,
“Who promises any reward, favor or other inducement, or threatens any injury in order to procure the commission of the offense;, or,
“Who prepares arms or aid of any kind, prior to the commission of an offense, for the-purpose of assisting the. principal in the execution of the same.”

For the appellant it was contended that count 1 of the indictment charged him with-becoming an accomplice of Ivy T. Wharton only in one or more of the ways specified in the first and second subdivisions of the above set out statute, and that the only evidence as to appellant becoming an accomplice of Ivy T. Wharton was testimony to the effect that he did so in the way specified in the third subdivision of that statute by promising a reward, favor, or other inducement for the commission of the crime alleged. There was evidence tending to prove that appellant, acting through Smith as his agent, selected for the purpose of bringing about the transportation of prohibited liquor, before the act was done, advised or encouraged Ivy T. Wharton to commit the offense. What one does through another he does himself, though the thing done is a crime. Carlisle v. State, 31 Tex. Cr. R. 546, 21 S. W. 358. There is no material variance between an allegation that one committed a described criminal aet and evidence that another as his agent and acting at his instance successfully advised or encouraged a third person to commit that crime, as an allegation of an indictment that one did an act is supported by proof that he caused it to. be done by another. Commonwealth v. Part & Reed, 1 Gray (Mass.) 553; 1 Wharton on Criminal Evidence (10th Ed.) § 102. In support of the last-mentioned contention, reference was made to expressions contained in the opinion in the case of Cooper v. State, 69 Tex. Cr. R. 405, 154 S. W. 989. The report of that ease does not indicate that it involved the question whether one is or is not guilty as an accomplice as a result of his having his agent induce a third person to commit a crime.

Another ground on which the court’s refusal to direct a verdict of not guilty is assailed is that there was no evidence tending to prove that the liquor in the bottles, which testimony showed were transported in the ear mentioned, was intoxicating. The claim that the evidence was not such as to support a finding that the liquor in the bottles was intoxicating is based principally upon the testimony on cross-examination of one Graf, a prohibition agent, who after the seizure of the car took the bottles from the ear and stored them. He stated that he destroyed that liquor after the death of Edwards; that all of it was labeled liquor; that there were nine quarts labeled “Bacardi Rum,” two quarts labeled “Gin,” two quarts labeled “Cognac,”' and two quarts of White Label whisky; that the liquor he poured from those bottles smelled like whisky, but he did not taste it or analyze it; that he would not be positive that any of the stuff that came out of that ear was whisky, but everything, including other seized liquors that he poured out on that occasion, smelled like whisky, and it all had the same color. There was testimony to the effect that the liquor which was transported in that car was supplied by bootleggers who were engaged to put intoxicating liquor in it. The circumstance that those persons were to be paid for what they were engaged to do after the contemplated seizure of the ear because of its use in transporting intoxicating liquor was one proper to be considered by the jury in determining whether the liquor found in the ear was or was not intoxicating. Frequently throughout the testimony witnesses, without objection, referred to that liquor as whisky. The evidence was such as to make the question whether the bottles found in the car did or did not contain intoxicating liquor one for the jury. It may be added that the appellant, in his petition for the removal of the case to the court below; stated under oath, with reference to the car mentioned after its seizure, that “petitioner and the agent with him searched the ear and found intoxicating liquor in it.”. We conclude that the ruling under consideration was not erroneous.

After the conclusion of the court’s charge to the jury, counsel for appellant asked the court to charge the jury that, although they might convict upon the uncorroborated testimony of an accomplice, nevertheless they must scrutinize that testimony very carefully and consider the fact that he is an accomplice and a self-confessed perpetrator of the same crime with which the defendant stood charged. The court declined to comply with that request, stating that he had in effect charged as requested. The proposition embodied in that request was fully covered by the charge given to the jury, which pointedly called to the attention of the jury the duty of carefully scrutinizing incriminating testimony of witnesses who were implicated in the commission of the crime charged. Furthermore, a Texas statute provides that a purchaser, transporter, or possessor of prohibited liquor is not to be held an accomplice, when a witness in any trial. Vernon’s Anno. Penal Code of Texas, Supp. 1922, art. 588% a 3 (now Rev. St. 1925, art. 5079).

Assignments of error are based on the alleged refusal of the court to give requested special charges which are set out in the transcript, but are not referred to in the bill of exceptions. Nothing contained in the record indicates that any action of the court with reference to those requested charges was excepted to. No ruling thereon is presented for review.

The record shows no reversible error.

The judgment is affirmed..


author: SAWTELLE, Circuit Judge.

text:
    JUE YIM TON v. NAGLE, Com’r of Immigration.
    No. 6291.
    Circuit Court of Appeals, Ninth Circuit.
    April 6, 1931.
    Stephen M. White, of San Francisco, Cal., for appellant.
    Geo. J. Hatfield, U. S. Atty., and Lucas E. Kilkenny, Asst. U. S. Atty., both of San Francisco, Cal.
    Before RUDKIN, WILBUR, and SAWTELLE, Circuit Judges.
   SAWTELLE, Circuit Judge.

This is an appeal from a denial of a writ of habeas corpus in an immigration case. Petitioner sought entry into the United States as the foreign-born son of Jue Sam Teu, whose status as a citizen of the United States is conceded.

The question before the immigration authorities was to determine if the claimed relationship existed. Jue Sam Teu, the alleged father, was born in California, went to China at an early age, and returned to the United States in 1904. He made one subsequent trip-to China 1910-11, and on his return stated’ that he had one son, Jue Fay Ton. The-latter was admitted as the son of a .citizen in 1921, and at that time the father stated' that he had two other sons, Jue Yim Ton, the applicant, and his twin brother, Jue Wee-Ton, who had been born after the alleged-father’s departure from China. ‘

The question presented to this eourir is solely “whether the evidence submitted on-the application for admission so conclusively established the alleged relationship that the-order of exclusion should be held arbitrary or capricious.” Jew Theu v. Nagle (C. C. A.) 35 F.(2d) 858, 859. The question is not. whether this court, acting on the evidence-submitted, might have found differently from, the executive branch of the service; the question is whether or not the latter granted a-fair hearing and abused their discretion.. Tang Tun v. Edsell, 223 U. S. 673, 32 S. Ct. 359, 56 L. Ed. 606; U. S. v. Ju Toy, 198 U. S. 253, 25 S. Ct. 644, 49 L. Ed. 1040; Low Wah Suey v. Backus, 225 U. S. 468, 32 S. Ct. 734, 56 L. Ed. 1165.

The instant case must be distinguished' from the case of Louie Poy Hok on behalf' of Louie Fung Leung v. Nagle (C. C. A.) 48 F. (2d) 753, this day decided. In the latter■’ ease the claimed relationship was supported by at least seven entries on the records of’ the immigration service extending over a period of twenty years, by the fact that the alleged father had paid two extended visits-to China and had lived in the same house-with the applicant during those visits, and; by the testimony of two previously entered-brothers. In the instant case, the alleged:' father has never seen the applicant and identification. by mutual recognition is impossi— ble; there is only one entry on the immigration records concerning the existence of a son of Jue Yim Ton, the testimony that was made on the entrance of Jue Fay Ton in 1921. In the former case the records and the identification were as complete as one could possibly expect and offered substantial reasons for believing that the claimed relationship existed, and the discrepancies that were developed had to be viewed in that light; in the instant case the records and identification are not conclusive and the piaterial discrepancies must be given a greater prominence in arriving at a decision.

The discrepancies on which the Board of Special Inquiry and the Secretary of Labor based their order in denying admission to the applicant were as follows:

The alleged brother, Jue Fay Ton, testified that the graves of three of the paternal ancestors, his paternal grandfather and his paternal grandparents, are located side by side with a space of about a foot between them; the applicant testified that his paternal grandfather’s grave is alone and that there are no other ancestors of his buried near by.

The prior landed alleged brother testified that on his trip to China in 1925-26 he went a number of times with his brother, whom appellant claims to be, from the home village to the neighboring Lee Toon Market which was 1 li (654 yards) away from the home village; the applicant says that he never went to the Lee Toon Market with any one, and insists that until he started to the United States he never left his home village to go anywhere, even to the Lee Toon village, which was less than half a mile away. There are discrepancies with regard to the schoolhouse : The alleged brother testified that the schoolhouse where both of them attended had and has two entrances, dirt floors in all the rooms, and no skylights; the applicant testified that this schoolhouse had and has only one entrance, tile floors in all the rooms, and two skylights. It must be remembered that the previously landed alleged brother has not been, in China since 1926, and it is quite conceivable that the schoolhouse might have been changed in that time, but there is nothing introduced to show that such a change took place.

The prior landed alleged brother says that when he was in China on his last visit applicant and his twin brother slept in a room partitioned off from the sitting room where the paternal grandmother slept; applicant testified that while his alleged brother was ■last in China he slept with his mother and twin brother in the bedroom on the east side of the house, and that after his brother’s marriage he slept in a loft, in the parlor.

These discrepancies all have regard to domestic arrangements and to things within cognizance of members of the same family, they are matters commonly accepted as bases of questioning, and in the absence of more conclusive proof they are facts on which two brothers should be in accord if the alleged relationship is real.

In view of the fact, then, that there could be no mutual recognition between father and alleged son, that the relationship must be determined largely from the correlation of the testimony of the prior entered alleged brother and the applicant, and that serious discrepancies are developed therein, the findings of the immigration officials are not arbitrary and capricious.

The judgment of the lower court is affirmed.


text:
    LOUIE POY HOK v. NAGLE, Com’r of Immigration.
    No. 6349.
    Circuit Court of Appeals, Ninth Circuit.
    April 6, 1931.

      Dion R. Holm, of San Francisco, Cal., for appellant.
    Geo. J. Hatfield, U. S. Atty., and Herman A. Van Der Zee, Asst. U. S. Atty., both of San Francisco, Cal.
    Before RUDKIN, WILBUR, and SAWTELLE, Circuit Judges.
   SAWTELLE, Circuit Judge.

Petitioner, Louie Fung Leung, has twice made application for admission into the United States on the ground that he is a minor blood son of Louie Poy Hok, a person of Chinese descent, whose status as a resident merchant is conceded. Appellant first applied for admission December 1, 1927. His application was denied by a Board of Special Inquiry and by the Department of Labor on appeal, and a writ of habeas corpus, refused by the District Court for the Southern Division of the Northern District of California, whereupon petitioner was deported: to China. He again sought admission on April 1, 1930, and presented as additional witnesses Louie Doo Yin, who has twice visited his home in China, and Louie Fung On, an alleged brother, who was admitted as the son of Louie Poy Hok in 1920. The Special Board of Inquiry made the following finding: “In view of the fact that no new evidence has been introduced by any of the principals in this ease I cannot see that the present situation has in any way been changed from the one that existed in.Deeember, 1927.”

This finding was affirmed by the Department of Labor on appeal. On June 26, 1930, a petition for writ of habeas corpus was again applied for in the District Court in this circuit and the .petition was denied. This is an appeal from that decision, appellant contending that petitioner was not accorded a fair hearing (and that the findings and excluding decision were not supported by substantial evidence).

Louie Poy Hok, the alleged father, has lived in the United States since 1880; and his status as a merchant is acknowledged. Since his original entry he has made four trips to China. The first was from October 28, 1898, until September 4, 1900, during which time he was married and his oldest son, Louie Fung Chong, was bom on November 7, 1899. A second son, Louie Fung On, was bom on February 23, 1901, after his father’s return to this country. Both of these sons have been admitted to the United States, the former in 1919 and the latter in 1920. The father’s second trip to China lasted from October 27, 1908, to October 28, 1910, during which time the petitioner Louie Fung Leung was bom on October 1, 1909. There have been two subsequent trips to China, one from 1915 to 1917 and the other from 1922 to 1924.

On his return from China in 1910, Louie Poy Hob, the alleged father, testified as follows:

“Q. How many children have you? A. Three sons, no daughters, Louie Fung Cheong, 12, bom KS 25-10^5 (November 7, 1899), now in China. Luie On, 10, bom KS 27-1-5 (February 23, 1901), now in China. Luie Leung, 2, born ST 1-8-18 (October 1, 1909), now in China.
“Q. Are these the only children you ever had? A. Yes.”

On no less than six occasions since that date, in fact, on every occasion on which he has been called upon to testify before the immigration officers, Louie Poy Hob has stated that he had three sons, the third of whom was Louie Fung Leung, born October 1, 1909. The alleged father so reiterated in 1915 on his departure for China; in 1917, on his return; in 1919; on the admission of Louie Fung Chong, his oldest son; in 1920, on the admission of Louie Fung On, his second son; in 1927, on the first application for admission of the present petitioner; and in 1930, on the present application of Louie Fung Leung, alleged third son. Added to this testimony have been the statements of the two previously entered alleged brothers, on their respective admissions, in 1919 and in 1920, that they had a third brother in China who bore the name of the applicant. The oldest alleged brother, Louie Fung Chong, said upon "his admission to the United States in 1919 that he- had 'a third brother, Louie Fung Leung, who was bom October 1, 1909; the second alleged brother, Louie Fung On, said upon his admission to the United States in 1920 that he had a third brother, Louie Fung Leung, who was 11 years old (American reckoning) and who was bom on October 1, but that he did not remember the year.

A similar case arose in Ng Yuk Ming v. Tillinghast, 28 F.(2d) 547, 548 (0. C. A. 1). There, “13 years before * * * the alleged father * * * testified before the immigration authorities that he had a son bearing the name of the applicant, * * * which he confirmed on every other occasion upon which he was called upon to testify.” The decision of the court was that the decision of the immigration officials was not supported by the evidence and the prisoner was ordered released from custody. See, also, Gung You v. Nagle, 34 F.(2d) 848 (C. C. A. 9th). In the instant case the cumulative effect of the repeated assertions by the father and the previously entered alleged brothers that there was a third son, Louie Fung Leung, born October 1, 1909, certainly go farther than a mere indication that the three were suffering from a delusion; the effect of the testimony in the mind of any reasonable man must be to create the belief that there was a third son somewhere in the offing.

The present applicant is admitted by Louie Poy Hok to be the son to whom the latter has consistently referred for twenty years; his photographs have been identified as that of the third brother by Louie Fung Chong and Louie Fung On, admittedly the sons of Louie Poy Hok; the applicant is in as consistent agreement with the testimony of his alleged father as were the two previously admitted brothers; he has received passage money to the United States on two occasions from Louie Poy Hok and received $500 Hongkong money from him on the occasion of his marriage. All of these matters have to do with the ultimate question, that of relationship, and tend to prove that the claimed relationship is true as alleged. “There is no conflicting evidence, direct or indirect, on the question of relationship.” Mason ex rel. Lee Wing You v. Tillinghast, 27 F.(2d) 580 (C. C. A. 9th); also, Gung You v. Nagle, 34 F.(2d) 848 (C. C. A. 9th). The discrepancies developed, therefore, must be considered in the light of the testimony adduced to prove the relationship. “Mere discrepancies do not necessarily discredit testimony. * * * Testimony must be understood in the light of the reason upon which they rest, * * * otherwise all testimony would be self-impeaching.” Wong Tsick Wye v. Nagle, 33 F.(2d) 226, 227 (C. C. A. 9th).

The government contends that no new evidence has been presented on this second hearing to warrant admission. The testimony of Louie Doo Yin was dismissed as of little probative value, because he visited the home of the applicant at the request of the alleged father, who admitted that he intended to use him as a witness in the ease.

But we cannot view the testimony of the second alleged brother, Louie Fung On, in that light. The whereabouts of this alleged brother in the United States were unknown when the present applicant applied for admission in 1927, and so he was not produced as a witness, but in 1930, on the second application of Louie Fung Leung, the alleged brother, Louie Fung On, made a deposition on his behalf in New York State, where the latter resides. In that deposition he recognized the photograph of the present applicacant, and identified him as Louie Fung Leung, the third brother whose name he had given in 1920 when he, Louie Fung On, was admitted into the United States.

It is true that the testimony of Louie Fung On with regard to the date of his alleged brother’s birth does not accord with the statements of others,-but it does not for that reason discredit the texture of the rest of the testimony. On his admission to the United States in 1920, Louie Fung Ok testified that he had a third brother, Louie Fung Leung, 12 years old, born ST 1-18 — and he did not remember the year. ST 1 — 18 corresponds to our date October 1, and so is in accord with the rest of the testimony. And it must be remembered that according to Chinese reckoning “12 years old” is equivalent to our “11 years old.” Accordingly, the brother “12 years old” would have been bom in 1909. At that time,, therefore, Louie Fung On’s testimony was in accord with that of the alleged father, that of the previously entered brother Louie Fung Chong, and that of the applicant. In 1930 Louie Fung On stated with emphasis that his younger brother was born on October 1, 1912; that he remembered the date because he had been in China at the time it occurred; and thatTds father had not written him to that effect. There is no reason for giving credence to the statement of a witness who has been away for ten years from the people and surroundings of which he speaks, if other things being equal, he gave a statement of facts substantiated by other witnesses when such things were fresh in his memory. There are few Americans who could give the exact dates of birth of their brothers and sisters, particularly if they had not seen them for ten years. To believe Louie Fung On’s statement that his third brother was born October 1, 1912, and to disregard his former statement in 1920 that said third brother was at that time 11 years old, which would make the year of his birth 1909, is simply to destroy the whole texture of the testimony that allowed the admission of Louie Fung On himself and his older brother Louie Fung Chong. To hold that the year of birth 1912 is correct is to imply that in 1910 the alleged father, Louie Poy Hok, swore falsely that he had a son by the name of Louie Fung Leung who was bom in 1909, and that the alleged father has persisted in a perjury ever since. There is nothing in the record to establish such a position and to show that the immigration officers believed such to be the ease.

With respect to the date of birth of the applicant, therefore, the testimony of the alleged brother, Louie Fung On, is not corroborative. But the testimony of the latter is new evidence tending to support applicant’s claim in that it adds one more link to the chain of identifying a real flesh and blood person with the shadowy “Louie Fung Leung, bom October 1, 1909,” whose existence has been indicated on official records for at least twenty years. Louie Fung On identified the photograph of the applicant as that of his third brother. This is new material, must be considered and given its due weight.

The discrepancies developed are immaterial. Applicant was able in 1927 to identify photographs of his alleged father and his oldest brother, whom he had seen only three years previously, but he was unable in 1930 to identify photographs of Louie Fung On, whom he had not seen for ten years. An examination of the-photographs of Louie Fung On as he was when the applicant last saw him in China, as he was upon his arrival in 'the United States in 1920, and as he is at the present day shows striking differences. It is not to be wondered that the applicant, who was-only eleven years old when his alleged brother came to the United States, should fail to recognize portraits of him taken ten years later with the differences that must necessarily arise from changes in hair-dress, changes • in clothes, and the general Americanization in appearance of the older brother. Failure to recognize the photograph is not to be considered as proof that the claimed relationship does not exist.

Applicant and his alleged father agree on the name of the maternal grandmother, but Louie Fung On disagrees. At the time of the latter’s admission in 1920 there was a disagreement' as to the length of time which she had been dead, but notwithstanding that fact the latter was admitted. It is difficult to understand that where one applicant who disagreed with the father and was admitted, another applicant who agreed with him should be excluded.

The exact details as to the date on which applicant went to a neighboring village to enter a higher school are of minor importance and failure to agree does not discredit the testimony of the father or of the alleged son. Upon such particulars discrepancies are bound to occur.

“If the circumstances respecting which the testimony is discordant be immaterial, and of such a nature that mistakes may easily exist, and be accounted for in a manner consistent with the utmost good faith- and probability, there is much reason for indulging the belief that the discrepancies arise from the infirmity of the human mind rather than from deliberate error.” Nagle v. Dong Ming, 26 F.(2d) 438, 439 (C. C. A. 9th).

Of similar character is the discrepancy between the testimony of Louie Poy Hob, the alleged father, and the applicant as to where the latter slept. The alleged father claimed that during his last visit to China the son slept in the room with his father and mother, whereas the alleged son claims that he slept at school during that time. It is interesting that such a discrepancy arises very often in the course of questioning of Chinese applicants for admission and the disagreement in so many cases seems inexplicable. The weight given to this discrepancy, however, must be considered only in its relation to the texture of the testimony as a whole. Wong Tsick Wye v. Nagle, supra; Ng Yuk Ming v. Tillinghast, supra; Horn Chung v. Nagle, 41 F.(2d) 126 (C. C. A. 9th).

In view of the very minor character of the discrepancies developed, the refusal of the immigration officers to admit the applicant is in abuse of their discretion and is purely arbitrary.

The order denying the writ of habeas carpus is reversed, and the cause remanded with orders to grant the writ as prayed.


author: DENISON, Circuit Judge.

text:
    EUCLID CANDY CO. v. WHITNEY-CENTRAL TRUST & SAVINGS BANK.
    No. 5360.
    Circuit Court of Appeals, Sixth Circuit.
    April 8, 1931.
    A. 0. Dickey, of Cleveland, Ohio (Cal-fee & Fogg, of Cleveland, Ohio, on the brief), for appellant.
    Clan Crawford, of Cleveland, Ohio (Squire, Sanders & Dempsey, of Cleveland, Ohio, on the brief), for appellee.
    Before DENISON, MOORMAN, and HICKENLOOPER, Circuit Judges.
   DENISON, Circuit Judge.

This case grows out of a supposed contract for the sale of sugar during the runaway market of 1920, in which" contract the Euclid Candy Company (defendant below and appellant here) was the vendee, and Sea-go (assignor to the Whitney Bank, plaintiff below) was vendor. During this market, the high prices brought into this country foreign sugars not very well known here. Among these was what was called “brown Panela lump,” a relatively rough and unrefined product of some of the Central American countries. The lumps were in the form of cones, four or five inches high and about the same b.ase diameter. Seago acquired a quantity of this sugar, which he proposed to resell. Accordingly, he sent a circular letter to merchandise brokers handling sugar in several cities. One of these letters came to Rankin, a merchandise broker in Cleveland, who was then employing Barrett as his agent and solicitor. This Seago circular letter, after reciting the world shortage of sugar and the high prices and the exhaustion of the supply, even in Central America, from which the writer had just returned, proceeded: “I was fortunate enough to buy 10,000 bags of brown lump sugar called Panela, packed in bags of about 200 lbs., and as you doubtless know this sugar runs irregular, some very light lumps and some very dark. However, it is sugar, and can he shipped immediately. Today’s price is 18 cts. f. o. b. here. Terms: —as we are compelled to pay cash in Central America we must insist on cash with order or banker’s letter of credit. Better wire your orders, as the lot will go in a hurry and before we can send samples.”

Barrett presented this letter to the managers of the Euclid Company. There was some discussion, as the result of which they and Barrett expressed their understanding that these lumps were in the form of small cubes or tablets one or two inches in size. Thereupon they gave Barrett their order for 1,000 bags, and a little later provided for the necessary letter of credit. He wired this order to Seago, making no mention of the size of the lumps, and Seago made immediate shipment. Upon arrival of the sugar in Cleveland, the vendee rejected it, because —as the vendor says,- — the lumps were too large to be suitable for its use,' or, — as the vendee says, — because the market had broken. The vendor sold the sugar at a later market, and his assignee brought this action to recover its damages. No question was made as to the proper amount. At the conclusion of the jury trial, the court instructed a verdict for plaintiff.

Upon the trial it was not denied that the sugar shipped was the same sugar which had been offered by the vendor and ordered by -the vendee. The plaintiff was therefore entitled to a verdict, unless for some defense which had been both pleaded and proved. Under the peculiar facts of this ease, involving controlling distinctions between closely similar situations, it is of unusual importance to know what defenses are pleaded. There were, perhaps, two. The first is: “By way of defense, this defendant says that on or about the 8th day of June, 1920, it gave its order for 1,00ft bags of brown lump Panela sugar to the local agent of W. K. Seago and .Charles A. Levy 16 * * that said order was given and purchase made by description; that at the time said order was given said Seago and Levy, partners, through their agent, represented that said lump sugar was in the form of cubes and tablets, similar to those used in ordinary table use, but varying in color and said representation was made for the purpose of inducing, and did induce, defendant to place the order.” This we take to be a distinct admission of the existence of a contract of purchase, and a claim that the vendee was excused from performance by reason of the (later stated) breach of the vendor’s warranty as to the character of the goods sold. The. answer clearly states a contract which would have entitled the vendees to claim damage by reason of a breach of warranty, — if damage there had been. The trial below and the argument here proceeded, in part, upon the theory that there had been no meeting of minds of the principals nor any actual contract, because the vendee’s acceptance was accompanied by a material modification or condition, to which condition the vendor never had agreed. No amendment of the defendant’s pleading was asked for; and we think this theory was not open to. it in the court below, or here. It planted itself upon the theory of a completed contract and a breach of the warranty therein contained. It must stand or fall upon that theory. Rankin and Barrett were known to the vendee to be what they were, — mere merchandise brokers, and not, in any general or further sense, salesmen or agents of the vendor. Merchandise brokers making an offer may have authority to close a sale, and thus to represent the vendor for that purpose. Not so where, — as here, — they must report to the vendor any offer by the vendee, and the offer must, expressly or impliedly, be accepted by the vendor before there is any contract. In such a case, merchandise brokers are messengers, carrying back and forth the 'statements or offers of the prospective parties. They are not agents, save in a very limited sense. They have no authority to carry any message except the one they have received. They have no actual authority to bind the vendor by representations as to the quality of the thing offered. Benjamin on Sales (6th Ed.) 319-321; Smith v. Tracy, 36 N. Y. 79, 83; Politziner v. Vanech, 101 Conn. 265, 125 A. 630.

There was no apparent authority beyond the actual. Barrett laid before the vendee the Seago letter, and it was read in full. This was the whole story. Put with the vendee’s knowledge that Barrett was a mere broker, it leaves no basis for any rightful supposition that Barrett had power to represent that brown Panela lump sugar was something it was not. . The record strongly suggests that what happened was a mistake by the vendee, rather than either a condition or a warranty; that the vendee applied to Barrett for information as it might have gone to a cyclopedia, and that Barrett stated his understanding, with an express disclaimer of any real knowledge; but, even if there were a warranty in form or effect, it was not supported by actual or apparent authority. It might be conceded that, if there were an underlying agency, the limited extent of which vendee did not know, a representation by the vendor’s agent, without actual authority, but which induced the contract, might justify the vendee in refusing to go on, even though it would not support an action thereon (Williston on Contracts [2d Ed.] vol. 2, p. 1102); but, when the absence of authority is known to the vendee, both by the denomination “broker” and by inspection of the vendor’s letter, we see no room to apply this principle.

The second defense, if it were really intended as a separate one, recites a promise to send samples. This is hardly intended to present the defense of a sale by sample, because there is no complaint that the sugar, when it arrived, did not correspond with the sample, and the existence of such a defense is not argued in this court. It should not be construed as an alternative defense, denying the existence of any contract until the samples were seen, because that would be inconsistent with the first defense, and a second defense should not be so construed, unless it is clearly so intended, — as this is not. We take it rather to be an explanation and amplification of the main defense of breach of warranty, and therefore to present no further or different question.

The judgment of the court below is. affirmed.