text:
West v. Smith (101 U.S. 263)/Opinion of the Court

Due removal of the suit before the court was made from the State court where it was commenced, into the Circuit Court, in which case it is no longer usual to file new pleadings, the act of Congress providing that the practice, pleadings, and forms and modes of proceeding in common-law actions shall conform, as near as may be, to the practice, pleadings, and forms and modes of proceeding existing at the time, in like causes, in the courts of record of the State within which such Circuit Court is held, any rule of court to the contrary notwithstanding. 17 Stat. 197; Rev. Stats., sect. 914.

Sufficient appears to show that the writ in the practice of the State courts contains the declaration, the command of the same to the sheriff being that he shall summon the defendant to appear and answer to the plaintiff in a certain plea, wherein is set forth the cause of action. Pursuant to that practice, the defendants in this case were summoned to appear in a plea of the case, the declaration containing two counts in assumpsit,-the the first being a court for goods sold and delivered, in the sum of $8,000, in two forms; the second being a count for work and labor done and performed, in the sum of $8,000, at the special instance and request of the defendants. Both counts are in the usual form, and the declaration concludes with the usual breach alleging non-payment, to the damage of the plaintiffs in the sum of $10,000. Personal service was made; and the defendants having appeared and removed the cause into the Circuit Court, pleaded the general issue that they never did assume and promise in manner and form as the plaintiffs in their declaration have alleged, and tendered an issue to the country.

Special matter may be given in evidence under the general issue, according to the State practice, if previous notice be given by the defendant or defendants. Such notice was given by the defendants in this case, that they would give in evidence a written agreement, and the extension of the same for one year, which is fully set forth in the transcript. Profert of the instrument was made, and the defendants averred that the supposed promises were made, if ever, in consideration of work and labor done by the plaintiffs in the pretended performance of the stipulations and agreements in said written contract contained, in respect to which the defendants allege that the plaintiffs did not keep and perform their said agreements and obligations, to the damage of the defendants in the sum of $20,000, and greatly exceeding the amount that would be due to the plaintiffs for the alleged labor and work they had performed. What they claim is to set off so much of said damages as may be sufficient to extinguish their indebtedness to the plaintiffs, and to recoup and recover the excess of the $20,000 by a judgment in their favor.

In addition to the notice of such special matter, they also pleaded the Statute of Limitations, which, it seems, would not be admissible under the general issue and notice of special matter.

Leave was asked by the plaintiffs to file two additional special counts; and the court allowed them to file the one called in the transcript the second special count, subject to the objection of the defendants. Preliminary matters being closed, the parties went to trial, and the verdict and judgment were for the plaintiffs in the sum of $7,978.84. Exceptions were filed by the defendants, and they sued out the present writ of error, and removed the cause into this court.

Two errors are assigned in this court, as follows: 1. That the Circuit Court erred in allowing the new count to be filed. 2. That the court erred in admitting parol evidence of the plaintiffs' intention in writing the letter set forth and described in the transcript.

1. Amendments to the declaration under the State statute may be made by the plaintiff to correct any defect, mistake, or informality in the same, not changing the form or ground of the action; and he may insert new counts in his declaration for the same cause of action as that alleged in the original counts. State Stats., Revision 1875, 426.

Authority is also given by the same statute to insert counts in any form of action which might have been originally inserted in the declaration. As quoted, the word 'in' before 'which,' as found in the published statute, is left out, it being regarded as a misprint, or, if not, that the word 'declaration' should follow it, which would give the provision the same meaning as if the word 'in' was omitted. Nor is it necessary in this case to construe that provision, as it is clear that the question before the court is controlled by the preceding part of the section, which authorizes the plaintiff to insert new counts in the declaration for the same cause of action as that alleged in the original counts, as well as to correct any defect, mistake, or informality in the declaration, not changing the form or ground of action.

Such amendments to the declaration are allowed in the State courts with great liberality, and it appears that the practice is carried to such an extent as to justify the remark of the court in a case cited for the plaintiffs, that the decisions of other States furnish but little guidance in expounding the meaning of their statute upon the subject. Nash v. Adams, 24 Conn. 33-38.

Their original statute was passed at a very early period, and has been several times amended so as to enlarge and extend the power of the court, and the course of the decisions in the courts has been in the same direction, so as to further the beneficial purpose intended by it, which was to prevent the plaintiff from being put to a new action when by accident, mistake, or inadvertence he had in his declaration failed to describe his claim with legal accuracy. In a great proportion of the cases, say the court, where amendments are allowed, the ground of action is in one sense changed, as where for instance the note in suit is incorrectly described; but amendments in such cases are very frequent where the court is satisfied that the error arose merely from mistake or inadvertence, and that the action was intended to be brought for the cause of action described in the amendment.

Other examples of like import are given in the opinion, and the court remarks that the phrase, 'ground of action,' is not used in the statute in any technical or narrow sense, but was intended to refer rather to the real object of the plaintiff in bringing the suit than to the technical meaning of the words; and added, that such a construction had always been given to the phrase as would further that object. Bulkley v. Andrews, 39 Conn. 523, 535.

Where power is given to the court to allow the amendment, the ruling of the court in that regard is a matter of discretion, and is not the subject of error. Stuart v. Corning, 32 id. 105, 108; Merriam v. Langdon, 10 id. 460, 472.

New counts setting forth more specifically the cause of action mentioned in the prior counts are not objectionable, as it cannot be held in such a case that the new counts describe a new cause of action. Baldwin v. Walker, 21 id. 168, 180; Hollister v. Hollister, 28 id. 178, 180.

Whenever the declaration misdescribes a writing which constitutes the cause of action, the State courts will allow the plaintiff to amend and make the description accurate, and it is even held that in an action for a breach of covenant the plaintiff may add a new count setting forth a new and distinct incumbrance not previously mentioned in the declaration. Spencer v. Howe, 26 id. 200.

Cases appealed, it is held in that State, may be amended in the appellate courts; and the rule is well settled, that if the new counts are founded upon the same transaction as the old ones, they do not change the ground of action, within the meaning of the act allowing amendments. Howland v. Couch, 43 id. 47-50.

Writs of summons or attachment in that State may be sued out in civil actions, and the defendant, as matter of argument, to show that the amendment was improperly allowed in this case, insists that its effect would be to discharge an attachment, as it would otherwise enlarge the lien which the attachment created. Two answers may be made to that suggestion in the case: 1. It is not shown that any of the property of the defendant was attached by the sheriff. 2. But if it was, the defendant will not be injured if the plaintiff sees fit to discharge his attachment.

Without more, these authorities are sufficient to show that the ruling of the Circuit Court in allowing the amendment was fully justified by the State decisions, and that it is correct.

Suppose that is so, still it is insisted by the defendants that the ruling of the court embraced in the second assignment of error was erroneous, and that the judgment for that cause must be reversed.

Articles of agreement were executed between the parties to the effect that the defendants agreed to furnish for the plaintiffs cotton of a certain description, to keep the mill of the plaintiffs supplied for a certain time, the cotton to be manufactured by the plaintiffs into yarn, two-threaded and of a certain described fineness, for thirty cents per pound, allowing sixteen per cent for waste. Cash payments the first day of each month were to be made by the defendants for manufacturing the yarn. Under that contract, as set forth at large in the transcript, the defendants delivered a large amount of cotton to the plaintiffs, who manufactured it into yarn, which they delivered to the defendants. Invoices of cotton purchased by the defendants were shipped to the plaintiffs, and when the same was manufactured into yarn by the plaintiffs, the yarn was sent back on bags, accompanied with invoices, to the defendants.

Accounts between the parties were rendered monthly, and, when adjusted, the plaintiffs drew upon the defendants for the money due for manufacturing the yarn; and it appears that the drafts were uniformly paid until the last month of the contract. Payment of the last draft being refused, the plaintiffs brought assumpsit, and furnished the defendants with the bill of particulars exhibited in the record.

It appears that the defendants were tape manufacturers, and that they procured the yarn for the purpose of manufacturing tape, and they offered evidence tending to show that when the contract terminated they had on hand a large quantity of yarn not woven into tape, which they had tested, and for the first time discovered that it was of a coarser quality than that specified in the contract, and they alleged that if the whole was of that quality they had been seriously damaged.

Opposed to that, the plaintiffs offered evidence tending to disprove that charge, and to show that during the early part of the contract they, at the request of the defendants, manufactured a certain quantity of yarn for them of a lower grade, and that if the defendants had on hand any of a lower grade than the contract required, it must be part of that so manufactured by the plaintiffs at the request of the defendants, who accepted the same with full knowledge of its defects.

Four letters upon the subject were written by the defendants to the plaintiffs, and in the course of the trial the defendants gave those letters in evidence, together with one written to them by the plaintiffs in reply to the last of their series. In that letter the plaintiffs refer to the fact that the defendants claim a deduction of five cents per pound on a specified quantity of the yarn, and state that they deduct that amount from the bill, adding to the effect that it leaves a balance due of $2,680.24, &c.

For the purpose of rebutting any alleged admission contained in that letter, the plaintiffs gave notice to the defendants to produce the letters written by the plaintiffs in reply to the other letters to them given in evidence by the defendants. Said letters not having been produced, and it appearing that no copies had been kept and that the originals were mislaid or lost, parol evidence of their contents was admitted, which showed that the plaintiffs denied the assertion of the defendants that the yarn was of a lower grade than the contract required; and they called the surviving partner of the firm, who was the writer of the letter of the plaintiffs given in evidence, and he was asked by the counsel of the plaintiffs whether he intended in and by that letter to admit that the defendants' claim for damages was valid and that the yarn was below the contract grade, to which question the counsel of the defendant objected, and the court sustained the objection and excluded the testimony.

Failing in that, the plaintiffs then asked the witness whether his acceptance of the defendants' proposition to deduct five cents per pound from the quantity of yarn named was because he admitted that the yarn was not according to contract or to settle a controversy. Seasonable objection was made to the question by the defendants; but the court overruled the objection, and the witness answered that he accepted the proposition because he did not wish to be obliged to commence a lawsuit in the city of New York, and to incur the expenses of a trial in the courts of that State; and the defendants excepted to the ruling of the court, which is the foundation of the second assignment of error.

Evidence was then introduced by the plaintiffs showing that the defendants refused to pay the draft for the balance, making that deduction, and that they demanded the same reduction in price upon all the yarn previously manufactured and delivered. Certain exceptions were also taken to the charge of the court, but they are not embraced in the assignment of errors, and for that reason will not be ex-examined.

Doubtless the general rule is that it is the province of the court to construe written instruments; but it is equally well settled that where the effect of the instrument depends not merely on its construction and meaning, but upon collateral facts and extrinsic circumstances, the inferences of fact to be drawn from the paper must be left to the jury, or, in other words, where the effect of a written instrument collaterally introduced in evidence depends not merely on its construction and meaning, but also upon extrinsic facts and circumstances. the inferences to be drawn from it are inferences of fact and not of law, and of course are open to explanation. Etting v. The Bank of the United States, 11 Wheat. 59; Barreda v. Silsbee, 21 How. 146, 167.

Other cases have been decided by this court in which the same principle was applied, and in which the doctrine is more fully explained and illustrated. Iasigi v. Curtis, 17 How. 183, 196.

Damages were claimed by the plaintiff in that case for a false representation respecting the pecuniary standing of a third person, whereby he, the plaintiff, had been induced to sell goods and had incurred loss. Letters were introduced and facts and circumstances connected with the letters proved; and this court held that it was for the jury to say, after examining the letters in connection with the facts and circumstances, whether they were calculated to inspire and did inspire a false confidence in the pecuniary responsibility of the party, to which the defendant knew he was not entitled.

Admissions by a party or by an authorized agent, either in court or out, may in general be given in evidence; but the circumstances surrounding the admission, the purposes for which it was made, and the conditions attached to it, may be fully shown. It may not infrequently happen that the party making the admission is not bound by it, and will not be estopped from denying its truth, and in view of the showing on both sides, allowing each to prove the whole truth, it will be for the jury to determine how the proof stands on the facts in controversy on which the admission is claimed to bear. Perry v. ''Suimpson Waterproof Manuf. Co.'', 40 Conn. 313, 317.

The defendants charged at the trial that the act of the plaintiffs in making the deduction proposed by the defendants was presumptive evidence that the plaintiffs admitted that they had not fulfilled their contract. This was expressly denied by the plaintiffs. On the other hand, the plaintiffs claimed that their act in making the deduction, taken in connection with the fact that they explicitly denied that they had broken their contract, was presumptive evidence, not that they admitted a breach of the contract, but that they made the deduction to avoid the expense of litigation. Neither of the presumptions was contrary to the language of the letter, and inasmuch as it was doubtful what the precise intent of the writer was, it is clear that the question of intention was open to explanation.

Parol evidence is inadmissible to contradict or vary the language of a valid written instrument, by which is meant that the language employed by the parties in making it, and no other, must be used in ascertaining its meaning. Argument to support that proposition is unnecessary, and yet it is universally admitted that it may be read in view of the subject-matter and the attendant circumstances, in order more perfectly to understand the meaning and intent of the parties. 1 Greenl. Evid. (12th ed.), sect. 277.

Written instruments as used in the rule, says Taylor, include not only records, deeds, wills, and other instruments required by statute or by the common law to be in writing, but every document which contains the terms of a contract between different parties. Text-writers everywhere support that rule; but Taylor admits that the rule will not strictly apply to certain less formal documents, of which he gives several examples. 2 Taylor, Evid. (6th ed.) 988.

Extrinsic evidence, it may be admitted, is not admissible in expounding written contracts to prove that other terms were agreed to, which are not expressed in the writing, or that the parties had other intentions than those to be inferred from it; still it is competent, said Shaw, C. J., to offer parol evidence to prove facts and circumstances respecting the relations of the parties, the nature, quality, and condition of the property which constitutes the subject-matter respecting which it was made. Knight v. The New England Worsted Co., 2 Cush. (Mass.) 271-283.

Where a party was about to publish an advertising chart, and the defendant promised in writing to pay him fifty dollars for inserting his business-card in two hundred copies of the chart, the Supreme Court of Massachusetts held, in an action to recover the amount, that parol testimony was admissible for the interpretation of the contract and its application to the subject-matter, that at the time of the making of the agreement the plaintiff represented and promised that his chart should be composed of a certain material and be publish in a certain manner. In disposing of the case, the court advert to the rule that the obligation of a written contract cannot be abridged or modified by parol evidence, but add that it is equally well settled that, for the purpose of applying the terms to the subject-matter and removing or explaining any uncertainty or ambiguity which arises from such application, parol testimony is legitimately admissible, and for that purpose all the facts and circumstances of the transaction out of which the contract arose, including the situation and relation of the parties, may be shown. Authorities in great numbers are cited in support of the proposition; and the court further say, that the purpose of all such evidence is to ascertain in what sense the parties themselves used the ambiguous terms in the writing which sets forth their contract. Stoops v. Smith, 100 Mass. 63-66.

Apply the strictest rule to the question, and it is clear that the ruling of the Circuit Court is correct, as the answer of the witness, which was admitted, did not tend in any view to contradict any thing stated in the letter; but the ruling of the court may also be sustained upon the ground that the letter was a mere offer of compromise, which could not prejudice the rights of the plaintiffs, especially as the record shows that the defendants subsequently refused to pay the draft drawn for the balance.

Offers of compromise to pay a sum of money by the way of compromise, as a general rule, are not admissible against the party making the offer; but if admitted, it is clear that the offer is open to explanation, no matter whether it was by letter or by oral communication. Gerrish v. Sweetser, 4 Pick. (Mass.) 374; Bridge Company v. Granger, 4 Conn. 142, 148; Stranahan v. East Haddam, 11 id. 507, 513.

By all or nearly all the cases the rule as established is not that an admission made during or in consequence of an effort to compromise is admissible, but that an offer to do something by the way of compromise, as to pay sums of money, allow certain prices, deliver certain property, or make certain deductions, and the like, shall be excluded. These cannot be called admissions, as they were made to avoid controversy and to save the expenses of vexatious litigation.

Decided cases may be found where it is said that the evidence is admissible unless the offer made was stated to be without prejudice; but the rule in general, both in England and the United States, is that the offer will be presumed to have been made without prejudice if it was plainly an offer of compromise. Lofts v. Hudson, 2 Man. & R. 481-484; Phil. Evid. (5th Am. ed.) 427, note 124; 1 Greenl. Evid., sect. 192.

Suffice it to say that such evidence having been admitted, it was clearly competent to give evidence to explain it, especially as the evidence given did not contradict any of the terms of the letter introduced by the defendants.

Judgment affirmed.


text: Talk:West v. Smith (101 U.S. 263)/Opinion of the Court

license: Creative Commons - Attribution Share-Alike - https://creativecommons.org/licenses/by-sa/4.0/


text:
Broder v. Water Company

ERROR to the Supreme Court of the State of California.

The facts of the case and the legislation bearing upon them are set out in the opinion of the court.

Mr. John H. McKune for the plaintiff in error.

Mr. A. P. Catlin, Mr. S. Shellabarger, and Mr. J. M. Wilson, contra.

MR. JUSTICE MILLER delivered the opinion of the court.

title: Broder v. Water Company


text: Talk:Broder v. Water Company

title: Talk:Broder v. Water Company


text:
Broder v. Water Company/Opinion of the Court

The Natoma Water and Mining Company owns a canal for conducting water and distributing the same for mining, agricultural, and other uses, which is some fifteen miles long. It was completed in the year 1853, and since then has been in constant and successful operation under the control and in the possession of the company. Its cost was about $200,000. The court of the first instance on the trial of this cause found also as a fact that the canal and branches have, ever since their construction, been uniformly acknowledged and recognized by the local customs, laws, and the decisions of the courts of the State of California, in which they lie, and that the land covered by them is indispensable to their use. At the time they were finished, and for many years after, in fact up to the passage of the Pacific Railroad Acts of 1862 and 1864, the land through which they ran was the public property of the United States. A portion of it is included in the grant made by that act to what has since, by change of name and consolidation of corporate franchises, become the Central Pacific Railroad Company, and the plaintiff in error, by proper conveyance from said company, has become the owner of it. A small part of it is traversed by the canal, and he brought this action in the proper court of that State against said water and mining company, to have the canal declared a nuisance and abated, and to recover $12,000 damages on account of its maintenance on his land.

The case was submitted to the court, which found the facts we have stated, and others that will be referred to.

The inception of the title of plaintiff to the land described in his petition, other than that derived from the railroad company, was a declaratory statement for pre-emption, filed Aug. 6, 1866, by himself for one tract, and a similar statement filed Sept. 14, 1866, by his brother, Jacob Broder, for another. But prior to either of these dates, to wit, on the 26th of July of the same year, Congress enacted a law, the purpose of which was to deal with the rights of miners who had theretofore, without objection, and with the tacit encouragement of the United States, discovered, developed, and mined the public lands. 14 Stat. 251. The ninth section of that act contains this declaration: 'That wherever, by priority of possession, rights to the use of water for mining, agricultural, manufacturing, or other purposes, have vested and accrued, and the same are recognized and acknowledged by the local customs, laws, and the decisions of courts, the possessors and owners of such vested rights shall be maintained and protected in the same; and the right of way for the construction of ditches and canals, for the purposes aforesaid, is hereby acknowledged and confirmed.' p. 253.

As to the canal of the defendant, so far as it ran at that date through the land of the United States, this act was an unequivocal grant of the right of way, if it was no more. As the plaintiff's right to the lands patented to him and his brother commenced subsequently to this statute, he took the title subject to this right of way, and cannot now disturb it.

In reference to his lands held under conveyance from the railroad company, it might be a question of some difficulty whether the right was so far vested in that company before the passage of this act of 1866, that the latter would be ineffectual as regards these lands. But we do not think that the defendant is under the necessity of relying on that statute.

It is the established doctrine of this court that rights of miners, who had taken possession of mines and worked and developed them, and the rights of persons who had constructed canals and ditches to be used in mining operations and for purposes of agricultural irrigation, in the region where such artificial use of the water was an absolute necessity, are rights which the government had, by its conduct, recognized and encouraged and was bound to protect, before the passage of the act of 1866. We are of opinion that the section of the act which we have quoted was rather a voluntary recognition of a pre-existing right of possession, constituting a valid claim to its continued use, than the establishment of a new one. This subject has so recently received our attention, and the grounds on which this construction rests are so well set forth in the following cases, that they will be relied on without further argument: Atchison v. Peterson, 20 Wall. 507; Basey v. Gallagher, id. 670; Forbes v. Gracey, 94 U.S. 762; Jennison v. Kirk, 98 id. 453.

We turn now to the act of July 2, 1864 (13 Stat. 356), which makes the final grant to the Pacific railroad companies, the acceptance of which by the companies bound them to its terms, and we find in sect 4, which enlarges the grant of lands made by the act of 1862, this clause of reservation from the general terms of the grant: 'Any lands granted by this act, or the act to which this is an amendment, shall not defeat or impair any pre-emption, homestead, swamp-land, or other lawful claim, nor include any government reservation or mineral lands, or the improvements of any bona fide settler on any lands returned or denominated as mineral lands, and the timber necessary to support his said improvements as a miner or agriculturist.' p. 358.

We have had occasion to construe a very common clause of reservation in grants to other railroad companies, and in aid of other works of internal improvements, and in all of them we have done so in the light of the general principle that Congress, in the act of making these donations, could not be supposed to exercise its liberality at the expense of pre-existing rights, which, though imperfect, were still meritorious, and had just claims to legislative protection. See Wolcott v. DesMoines Company, 5 Wall. 681; Williams v. Baker, 17 id. 144; Leavenworth, Lawrence, & Galveston Railroad Co. v. United States, 92 U.S. 733.

In construing the grant to the Pacific railroad companies this principle is eminently applicable. The lands were vastly greater in extent than those embraced in any previous grant, and surrounded by much more varied circumstances. The number and diversified character of the interests which might be affected largely exceeded any with which Congress had theretofore dealt.

Hence we have in the clause of reservation a much more liberal and extended protection of pre-existing rights than in the reservation clause which had become a formula in previous grants.

Not only are prior reservations made by the government, and rights of pre-emption excepted, but the improvements of bona fide settlers on land returned or denominated mineral lands, and the timber necessary to support the miners' improvements, and any other lawful claim, are unaffected by the grant. Of course, this means any honest claim evidence by improvements or other acts of possession.

The defendant had been in possession of the claim in question for twelve years when this act was passed, and had expended $200,000 upon it. It was of great utility, nay necessity, to a large agricultural and mining interest, and we cannot doubt that it was of the class which this section declared should not be defeated by the grant which Congress was then making.

As the judgment of the Supreme Court of California was based on this principle, it is

Affirmed.


text: Talk:Broder v. Water Company/Opinion of the Court


text:
Greenleaf v. Goodrich

ERROR to the Circuit Court of the United States for the District of Massachusetts.

The facts are stated in the opinion of the court.

Mr. Charles Levi Woodbury for the plaintiff in error.

Mr. Assistant Attorney-General Smith, contra.

MR. JUSTICE STRONG delivered the opinion of the court.

title: Greenleaf v. Goodrich


text: Talk:Greenleaf v. Goodrich

title: Talk:Greenleaf v. Goodrich


text:
Greenleaf v. Goodrich/Opinion of the Court

That the good imported by the plaintiffs were subject to a duty of thirty per cent under the act of March 2, 1861, is not denied. They belonged to the class described in that act as 'manufactures, not otherwise provided for, composed of mixed materials, in part of cotton, silk, wool or worsted, or flax.' The controversy between the parties now is over the question what was added to that duty by the act of July 14, 1862.

By the third item of sect. 13 of the act of 1862 a duty of twenty-five per cent ad valorem was imposed upon 'all delaines, cashmere delaines, muslin delaines, barege delaines, composed wholly or in part of wool, gray or uncolored, and on all other gray or uncolored goods of similar description;' 'on bunting and on all stained, colored, or printed, and on all other manufactures of wool, or of which wool shall be a component material, not otherwise provided for, a duty of thirty per cent ad valorem.'

By sect. 22 of the same act a duty of thirty per cent was levied in the mixed-material clause quoted above. A subsequent act, passed on the 5th of August, 1861, amended the third item of sect. 13 of the act of March 2, 1861, by striking from it the word 'wool' wherever it occurred, and inserting the word 'worsted' in lieu thereof.

Thus stood the law when the act of 1862 was enacted. It was an act to increase the duties leviable under the act of 1861. The ninth section enacted that in addition to the duties theretofore imposed there should be levied, collected, and paid 'on all delaines, cashmere delaines, muslin delaines, barege delaines, composed wholly or in part of worsted, wool, mohair, or goat's hair, and on all goods of similar description, not exceeding in value forty cents per square yard, two cents per square yard.

'On bunting, worsted yarns, and on all other manufactures of worsted, or of which worsted shall be a component material, not otherwise provided for, five per cent ad valorem.'

A subsequent section of the act imposed an additional duty of five per cent ad valorem also on manufactures, not otherwise provided for, composed of mixed materials, in part of cotton, silk, wool or worsted, hemp, jute, or flax.

An examination of these provisions will reveal very plainly that the classification of the articles made subject to an increased duty is not the same as it was in the act of 1861. The first clause of the third item of sect. 13 of the act of 1861, as amended in August, embraced only delaines composed wholly or in part of worsted, and goods of similar description, woven in the gray, or uncolored. The act of 1862 grouped with them delaines made wholly or in part of wool, mohair, or goat's hair, and also delaines composed wholly or in part of worsted, and goods of similar description, nor in the gray or uncolored. It was, therefore, much more comprehensive that the former act. So the second clause of the third item of the thirteenth section of the act of 1861 differs much from the corresponding clause of the act of 1862.

Similar changes of classification appear when the mixedmaterial clauses of the two acts are compared. The charges were evidently not without a purpose.

Such were the statutory provisions when the plaintiffs' importations were made. The collector exacted duties at the rate of thirty per cent ad valorem, and two cents per square yard, claiming that the goods were goods of similar description to the delaines mentioned in the ninth section of the act of 1862, and did not exceed in value forty cents per square yard. On the other hand, the plaintiffs claimed that the goods having been classed under the act of 1861, among manufactures of mixed materials, not otherwise provided for, and subjected to a duty of thirty per cent, continued in that class under the act of 1862, and were, therefore, chargeable only with a duty of thirty-five per cent. Accordingly, having paid the duty exacted by the collector, under protest, they have brought this suit to recover the difference between thirty-five per cent ad valorem, and thirty per cent and two cents per square yard.

It appeared in evidence that the goods were known in trade and were bought and sold as poil de chevres, reps, plaids, lustres, Saxony dress-goods. They were always woven in colors, the yarns being dyed or colored before weaving. They never existed in the gray or uncolored condition. But they were made, as delaines are made, with a cotton warp and a worsted weft, the difference between them and delaines (as stated in the plaintiffs' protest) being that delaines are a fabric of all-wool, or cotton warp and worsted weft, and made of yarns not dyed, the cloth being printed or dyed in the piece. It further appeared that as early as 1857 both the all-wool delaines and those with cotton warp and wool or worsted filling were known in trade by names changed from time to time, to suit the fancy of importers and purchasers. It also appeared that in several other particulars the goods of the plaintiffs differed from delaines. To these differences it is unnecessary now to refer in detail.

Now, conceding, as we may, that the plaintiffs' goods came under the mixed-material clause of the act of 1861, being excluded from the delaine clause, that embraced only goods woven in the gray, it is not perceived how that can throw any light upon the proper construction of the act of 1862, which obviously intended a different classification. Undoubtedly, acts of Congress in pari materia are to be construed with reference to each other. And it may be admitted that when, in a later act, Congress uses expressions that had a recognized meaning in a former act relating to the same subject, they intended to use them in the same sense in which they were first used, that is, with their recognized meaning. But this rule has no bearing upon a case like the present. This is not a question respecting the meaning of terms. We cannot see, therefore, that the Circuit Court erred in refusing to affirm the plaintiffs' first four points, and in declining to rule under what clause of the act of 1861 the imported goods fell. After all, the question for that court was the construction of the act of 1862, and the construction given was, we think, correct. It could not have been different if the court had undertaken to construe with it the clauses of the act of 1861. As we have said, the changes of classification and of phraseology made in the act of 1862 show an intention to take out of the mixed material clause of the former act (which was limited to manufactures not otherwise provided for) some descriptions of goods which the act placed there, and by transferring them to another class, subject them to the additional duty prescribed for that class. If not so, what was the necessity for a reclassification? Why change the language? It would have been sufficient to declare what additional duty should be paid by each class as formerly arranged. The act of 1861, therefore, ¢could furnish no aid to the construction of the act of 1862, and reference to it was unimportant, except for the purpose of discovering the percentage of duties it imposed.

The fifth point was properly refused. The words 'of similar description' in the delaine clause of the act of 1862 cannot be affirmed to have referred only to such goods as have the greater number of characteristics in common with delaines. Some common characteristics are of much more importance than others in determining resemblances.

The sixth point propounded was as follows: 'Revenue laws designate and class substances according to the general usage and known denominations of trade. The words 'all goods of similar description' in the Tariff Act of 1862 refer to a similarity for revenue purposes with goods previously enumerated, and this is determined by what was then known and classed among merchants as similar goods; and if being woven in the gray or natural color of the worsted and other materials of which they are composed is found to have been an important and pervading characteristic commonly distinguishing goods known among merchants as of similar description with delaines, then the goods on which the duties in this case were assessed were not of similar description with delaines, unless the jury find they were so woven in the gray or natural color, and unless these goods possessed all the pervading characteristics which in 1862 were commonly understood among merchants as distinguishing goods known in commerce as of a similar description with delaines, from all other goods, the plaintiffs are entitled to a verdict.' This point the court declined to affirm, and we think rightly, for several reasons.

There was no evidence, so far as it appears, to justify its presentation. The record exhibits nothing tending to show what was commonly understood among merchants as distinguishing goods, known in commerce as of a similar description with delaines, from all other goods. Nor was there any evidence that there were any goods known by merchants, or in commerce, as goods of a similar description with delaines, much less was it in proof that being woven in the gray was regarded by merchants as determining that goods so woven were not of similar description with delaines. In regard to all these matters the record is silent. Composed, as the goods were, of the same materials as delaines, having a similar general appearance, and intended for the same uses, they might well have been of similar description with colored delaines, though there were differences in the process of manufacture.

The statute does not contemplate that goods classed under the words 'of similar description' shall be in all respects the same. If it did, these words would be unnecessary. They were intended to embrace goods like, but not identical with, delaines.

The court charged the jury, in answer to a prayer of the defendant, that the similarity referred to in the expression "goods of similar description,' in the act of 1862, is a similarity in respect to the product, and its adaptation to uses, and to its uses, and not merely to the process by which it was produced, and that if a class of goods were not in 1862 commercially known as delaines, it does not follow that they were not goods of similar description, within the meaning of the statute.' And again: 'These words are to be taken and understood in their popular and received import, as generally understood in the community at large at the time of the passage of the act.' Other similar instruction was given, and the court called attention to all the alleged dissimilarities urged by the plaintiffs, including the fact that delaines are woven in the gray, and that the plaintiffs' goods were not, and summed up as follows:--

'If you find that the product or result is an article for ladies' dresses made with a cotton warp and worsted filling, the question for your determination is, whether the two kinds of goods are substantially the same and alike. The process of manufacture, the worsted in the goods of the plaintiffs being dyed previous to weaving, is an element to be considered by the jury in coming to their conclusion, but not alone and distinct from all others which may have been established. It is for the jury to determine, from all the evidence in the case, whether, by the colored filling made and woven in the way and manner described with a cotton warp, the product is or not an article substantially similar and like the delaine fabrics, whether or not, while varying more or less in some particulars from delaines, the goods were or not substantially the same or substantially different from them. If substantially the same article, then the duties were properly assessed; but if they were substantially different, and the plaintiffs' goods were not of a similar description to the delaine fabrics, then they were not subjected to the additional duty.'

Notwithstanding the strenuous objections urged against such a submission to the jury, we think it was correct. At least it was quite as favorable to the plaintiffs as they had a right to demand. Reliance is placed upon the rule, which we admit to be established, that the commercial designation of an article among traders and importers, where such designation is clearly established, fixes its character for the purpose of the tariff laws. But the present is not a case of commercial designation of articles. The phrase 'of similar description' is not a commercial term, and if it were, there is no evidence in the record to show what it is understood to mean among merchants and importers. In Maillard v. Lawrence (16 How. 251) we have an instructive case bearing upon this subject. There the question was whether shawls came under one schedule of the act of 1846, imposing a duty of twenty-five per cent, or under another charged with a thirty per cent duty. In schedule C was included 'clothing ready made and wearing-apparel of every description, of whatever material composed, made up or manufactured,' and it subjected them to thirty per cent duty. Schedule D described 'manufacturers of silk, or of which silk shall be a component material, not otherwise provided for, manufactures of worsted, or of which worsted shall be a component material, not otherwise provided for,' and imposed a twenty-five per cent duty. The Circuit Court had been requested to instruct the jury that if they should find that at the date of the act the shawls in question were commercially known as manufactures of worsted, or of which worsted was a component material, and that they were not known in trade as clothing ready made, or as wearing-apparel, they were subject only to a duty of twenty-five per cent. This instruction was refused, and this court held, correctly, holding that, while it was true that where words of art, or phrases, are novel or obscure, as in terms of art, it was proper to explain them by reference to the art or science to which they were appropriate, the rule was so when the words or phrases are familiar to all classes, grades, and occupations; and that the popular or received import of words furnishes the general rule for the interpretation of public laws as well as of private transactions. The court added, that if it could be conceded that, in the opinion of mercantile men, shawls were not considered wearing-apparel, it would still remain to be proved that this opinion was sustained by the judgment of the community generally, or that the legislature designed a departure from the natural and popular acceptation of language. The case was rested on the basis that 'wearing-apparel' was not a technical term. Much less is the phrase, goods 'of a similar description.'

Upon the whole, therefore, we think there was no error in the charge of the judge in the court below.

Judgment affirmed.


text: Talk:Greenleaf v. Goodrich/Opinion of the Court


text:
Jeffrey v. Moran

APPEAL from the Circuit Court of the United States for the Southern District of Ohio.

The facts are stated in the opinion of the court.

Mr. S. T. Crawford and Mr. Thomas S. Young for the appellant.

Mr. M. A. Daugherty, contra.

MR. JUSTICE SWAYNE delivered the opinion of the court.

title: Jeffrey v. Moran


text: Talk:Jeffrey v. Moran

title: Talk:Jeffrey v. Moran


text:
Jeffrey v. Moran/Opinion of the Court

A corporation existed in Ohio known as the Cincinnati, Wilmington, and Zanesville Railroad Company. It owned and operated a road extending from the city of Zanesville to the village of Morrow in that State. The company became insolvent, and the road was sold on the 3d of June, 1863, under foreclosure proceedings and a mortgage which the company had given. Charles Moran became the purchaser in trust for the creditors and stockholders. The original company was reorganized on the 11th of March, 1864, pursuant to a statute of the State of April 11, 1861, under the name of the Cincinnati and Zanesville Railroad Company. On the 12th of March, 1864, Moran conveyed to the new company, which thereupon executed to him and W. Shall a mortgage to secure the payment of the principal and interest of certain bonds therein described. This mortgage bore date on the 1st of April, 1864. Default having been made in the payment of the interest accruing on these bonds, Moran, on the 30th of April, 1869, filed a bill of foreclosure in the court below. On the 4th of May following, the road was put by the court into the charge of the officers of the company as receivers. On the 6th of October then next, a final decree was entered, finding the amount due, and ordering the premises to be sold unless it was paid within twenty days.

On the 2d of December following a sale was reported, and on the same day it was confirmed by the court. The proceeds of the sale were largely less than the amount intended to be secured by the mortgage. On the 22d of June, 1866, Zentmeyer, the appellant's intestate, was killed on the road. On the 16th of July, 1867, the appellant, as his administrator, sued the company in the Court of Common Pleas of Clinton County, through which the road passes, and on the 28th of February, 1871, he recovered a judgment for $5,000. On the 5th of November, 1875, he was made a party to the proceedings in the foreclosure case. He thereupon answered and filed a cross-bill, in the nature of a creditor's bill, claiming to have the judgment paid out of the proceeds of the sale of the road in the hands of Moran. The court decreed against him, and he appealed to this court.

Several objections have been taken to the claim of the crossbill by the counsel for the respondent, which they view we take of the case renders it unnecessary to consider.

The counsel for the appellant have pressed upon our attention certain provisions of the mortgage under which the road was sold. We think it too clear to require discussion, that they have no application to the point upon which the case must turn. We shall, therefore, pass them by without further remark.

The mortgage was executed under the act before mentioned, of April 11, 1861, and was subject to its provisions. The sixth section of that act is as follows:--

'The lien of the mortgages and deeds of trust authorized to be made by this act shall be subject to the lien of judgments recovered against said corporation-after its reorganization-for labor thereafter performed for it, or for materials or supplies thereafter furnished to it, or for damages for losses or injuries thereafter suffered or sustained by the misconduct of its agents, or in any action founded on its contracts, or liability as a common carrier thereafter made or incurred.'

By the law of Ohio, a judgment is a lien upon all 'the lands and tenements of the debtor within the county where the judgment is entered, from the first day of the term at which judgment is rendered,. . . but judgments by confession, and judgments rendered at the same term at which the action is commenced, shall bind such lands only from the day on which such judgments are rendered.' 2 Rev. Stat. of Ohio, Swan & Cr. 1064. If execution shall not be sued out within five years from the date of the judgment, the latter becomes dormant and the lien expires. Id. 1067. Judgment liens are the creatures of positive law, without which they cannot exist. A State may regulate them as it deems proper. Corwin v. Benham, 2 Ohio St. 36. When this judgment was rendered, there was no real estate of any kind in Clinton County belonging to the railroad company. The roadway and all its appurtenances had been sold to Moran under the decree upon the mortgage, and the sale confirmed more than a year before that time. Thereafter the relation of the property to the company was in all respects as if the company had never owned it. A lien by the judgment was, therefore, impossible.

There being no such lien at law upon the road, there could be none in equity touching the fund arising from the sale. Olcott v. Bynum (17 Wall. 44), cited by the learned counsel for the appellant, does not, therefore, affect the case.

The counsel would have us give the same construction to the terms 'the lien of judgments recovered against the corporation,' as if they were 'valid claims against the corporation,' &c. The language of the statute is clear and explicit. It has a specific meaning in the jurisprudence of Ohio, and seems to have been chosen, ex industria, to express exactly the category it defines. There is as much difference with respect to the property between a claim secured by a judgment lien, and one not so secured, as there is between a demand secured by mortgage, and one not secured at all. In such cases the mortgage and the judgment lien are equivalents. In both the binding effect is the same, and the law prescribes the consequences. Here, if the lien had subsisted, though junior in date, it would have had priority over the mortgage. The latter was subject to the statute, and the statute would have given to the lien that effect. No reasoning can successfully maintain that a claim merely in judgment and a judgment lien are the same thing in legal effect, any more than in fact. To hold otherwise would be to make the law, and not simply to apply it. The former is beyond the sphere of our authority, the letter is our duty. It is only when a claim has ripened into a judgment where there is property to be bound by it, that a lien can subsist. This element is indispensable under the law to such a result. If the legislature intended that a judgment-not a lien on the mortgaged premises-should have the same effect as one that was such lien, it would have been easy to say so, and this would doubtless have been done. No word stretching or bending can make the language employed touch the fund in dispute.

It does not appear that the foreclosure sale, from which Moran derived title, was made in the process of another reorganization under the statute. If this were so, the last clause of the first section would control the rights of the parties. It is there declared that 'every such agreement' [for reorganization] 'shall provide that the unsecured debts of the company incurred for repairs or running expenses shall be paid in money or bonds of the reorganized company, as hereinafter provided; said bonds to be of the highest class issued. A copy of the terms of said agreement shall be filed in said court before the rendition of said decree.' But as the mortgagees did not avail themselves of the act, they are not bound by its requirements. This clause, nevertheless, throws light upon the subject we have been considering, and, therefore, we refer to it in that connection.

Decree affirmed.

title: Jeffrey v. Moran/Opinion of the Court


text: Talk:Jeffrey v. Moran/Opinion of the Court


text:
Pacific Railroad v. Ketchum

APPEAL from the Circuit Court of the United States for the Eastern District of Missouri.

This case presents the following facts:--

On the 10th of July, 1875, the Pacific Railroad, a Missouri corporation, mortgaged its road and other property to Henry F. Vail and James D. Fish, trustees, citizens of New York, to secure a proposed issue of bonds amounting, in the aggregate, to $4,000,000. This mortgage will hereafter be referred to as the 'third mortgage.' The bonds were to bear date as of May 1, 1875, and become payment twenty years thereafter, with interest at the rate of seven per cent, falling due semi-annually on the first days of May and November in each year. The principal object of this new issue was to take up by exchange or otherwise outstanding income and improvement bonds of the company, amounting in all to $3,500,000. The mortgage contained a clause to the effect that, if the company should fail to pay the interest on any of the bonds thereby secured, for six months after the same became due and payable, and demand made therefor, or if the principal of any of the bonds, when payable, should not be paid for six months after demand, the trustees might, on the written request of holders of bonds to the amount of $500,000, the principal or interest of which should then be in arrear and unpaid, sell the mortgaged property at public auction, in the city of St. Louis, giving notice thereof in a manner particularly specified, and execute and deliver conveyances to the purchaser, applying the proceeds of the sale to the payment of the bonds.

The property mortgaged was covered by other mortgages. One was to Uriah A. Murdock, James Punnett, and Luther C. Clark, citizens of New York; another, to Edwin D. Morgan and Joseph Seligman, also citizens of New York; another, to Rufus J. Lackland and Dwight Durkee, citizens of Missouri; another, to James Baker, a citizen of Missouri, and Jesse Seligman, a citizen of New York; and all were prior in lien to the third mortgage.

Default having been made in the payment of the interest falling due Nov. 1, 1875, on the bonds secured by the third mortgage, George E. Ketchum, a citizen of New York, claiming to be the owner and holder of many of the bonds, commenced this suit in the court below, on the 11th of November, in behalf of himself and the other bondholders, to foreclose the mortgage. To this suit the railroad company and the trustees of all the mortgages, including Vail and Fish, were made defendants, their citizenship being fully set forth in the bill. The superior right of all the prior mortgages was conceded, and it was also admitted that the full amount of their authorized issues was outstanding, but it was alleged that the interest on all except that secured by the third mortgage had been paid promptly as it matured, and that there was then no default. It was also alleged that the value of the property was greater than the amount of all the prior liens.

The bill further stated that about $2,000,000 of the income and improvement bonds had been exchanged for the bonds secured by the third mortgage, and that about $300,000 of the last-named bonds had been negotiated otherwise than by exchange, and were then outstanding. It then alleged the nonpayment of interest falling due Nov. 1, 1875, after due demand made; that there was a large amount of money due for taxes; that the company was without means to pay them and its valid obligations in full as the later became due; that its commercial paper had been protested; that it was liable to actions, suits, and proceedings on account thereof; and that there was great danger that the property covered by the mortgage might be attached or levied upon under execution or other legal process.

The bill then proceeds as follows: 'Your orator further shows unto your honors that an application has been made by your orator, on behalf of himself and other handers of bonds secured by said mortgage to the defendants Henry F. Vail and Henry D. Fish, to take proceedings to foreclose the aforesaid mortgage, and to protect the interest of your orator and such other holders; but that no such proceedings have been taken, and as your orator is informed and believes, some doubt is expressed whether, under such mortgage, they have the right to institute such proceedings, or any proceedings thereunder, by reason of the non-payment of the interest due Nov. 1, 1875, and for such reason prefer not to take such proceedings; and your orator being apprehensive that his interest and the interests of other holders of like bonds may be seriously affected by delay in the institution of proceedings to foreclose said mortgage and to obtain possession of said property, has brought this action in his own behalf, and on behalf of all others similarly situated and holding like bonds secured by said third mortgage, and has made said Vail and Fish parties defendant herein.'

The prayer was that the mortgaged property might be sold subject to the liens of the prior mortgages, and that, if necessary, an account might be taken. There was also a prayer in the usual form for the appointment of a receiver.

Process was duly issued and served on the 13th of December, 1875, on such of the defendants as were citizens of Missouri, and on the 8th of January, 1876, an order was taken for service on the non-resident defendants in the manner required by the rules of the court; but it does not appear that any such service was actually made. On the same 8th of January, one Thomas P. Akers, representing that he was a stockholder of the company, that the mortgage sued on was a fraud, and that the corporation would not resist the suit, asked that he might be permitted to come in as a defendant to protect his interests. On the 7th of February, 1876, the company filed an answer, in which it substantially confessed all the allegations of the bill, and asserted the binding character of the bonds and mortgage. The answer concluded, however, as follows: 'But it says that it is informed that a portion of said stockholders claim that they are fraudulent and void, and that the directors of this defendant were guilty of fraud in issuing the same. Therefore, this defendant asks this honorable court to permit any of the stockholders aforesaid to become a party defendant to this suit, upon a proper showing, and make such defence in the premises as they may see proper.' James Baker signed the answer as solicitor of the company, as did also the secretary of the company, and the corporate seal was affixed.

On the 16th of February, Cornelius K. Garrison and James Seligman, citizens of New York, and Thomas W. Pierce, a citizen of Massachusetts, representing themselves to be owners of $1,797.000 of the bonds secured by the third mortgage, were admitted into the suit as complainants with Ketchum, and united with him in the allegations of his bill. On the 25th of March, 1876, Peter Marie, Frank A. Otis, Robert L. Cutting, Jr., James D. W. Cutting, citizens of the State of New York, and George R. Fearing, a citizen of Rhode Island, all stockholders in the company, asked to be made co-defendants with Thomas P. Akers, with leave to defend the suit. On the 3d of April, a receiver was appointed with the usual authority, and Vail and Fish, as trustees, were authorized to exchange the bonds secured by the third mortgage for the income and improvement bonds in accordance with the terms of the mortgage, and Akers and the county of St. Louis were given leave to file a cross-bill in thirty days. No action was taken on the petition of other stockholders to be made parties. On the 25th of April, Akers and St. Louis County filed an answer and cross-bill, in which the county of St. Louis set up a lien adverse to that of the mortgage; and both defendants alleged that the mortgage was executed in fraud of the rights of creditors and stockholders, stating particularly the defences which the company had thereto.

On the 5th of June, 1876, an adjourned term of the court was held, and all the several trustees of the prior mortgages filed answers, setting up in form their respective mortgages and stating the amounts due. Each answer concluded with the statement that the answering defendant knew of no reason why the prayer of the bill should not be granted. On the next day, Vail and Fish, as trustees, filed their answer, admitting all the allegations in the bill, and concluding as follows: 'And these defendants, as trustees of the several and varied interests of the bondholders secured by said deed of trust, submit the same to the judgment of this honorable court, that the same may be duly provided for and protected, and ask that they may have such relief, including an allowance for the costs and expenses herein, as to your honorable court may seem meet.' On the same day, Akers and St. Louis County dismissed their cross-bill and withdrew their answer without prejudice to the lien claim of the county. This being done, all the several parties appeared in court by their respective solicitors, and the court having found, among other things, the amount of income and improvement bonds of the company outstanding, and that the entire amount of the bonds secured by the third mortgage had been issued, some, however, being still in the hands of the trustees to complete the contemplated exchanges; that Ketchum was the owner of ten of the bonds, Garrison of fourteen hundred, James Seligman of three hundred and forty-seven, and Pierce of fifty, and that the interest due Nov. 1, 1875, had not been paid, although demanded, it was, 'by the consent of all parties to the suit, through their solicitors of record,' adjudged and decreed 'that the said Pacific Railroad do stand absolutely barred and foreclosed of and from all equity of redemption of, in, and to said mortgaged premises, property, and franchises,' and that the mortgaged property, &c., be sold at public auction, subject to the liens of the several prior mortgages, by a master, who was named, to pay and satisfy the amounts due by the company upon the bonds, and any other indebtedness the court might order paid out of the proceeds, 'together with the costs of suit and of said sale, including the services of said trustees, and their solicitors' and attorneys' fees in and about the management of said trust, as may hereafter be ordered by the court.' Provision was also made for notice of the time and place of sale, and a conveyance to the purchaser after confirmation. The terms of sale were fixed by the decree, and if the purchase was made by or for the bondholders, all but $200,000 of the purchase-money could be paid by a surrender of bonds, provision being made for paying such of the bondholders as did not come into the purchase their pro rata share of the proceeds. Sixty days' time was given after the sale for all bondholders to come in and associate themselves with the purchasers, if the purchase should be made on account of the bondholders. Leave was also given the trustees of the mortgage to continue exchanges for the income and improvement bonds still outstanding. It was also ordered that nothing in the decree should be construed to prejudice in any manner the claim of St. Louis County, which had been set forth in its answer and cross-bill.

The property was sold under this decree to James Baker for the benefit of the bondholders. He had acted in the cause as solicitor of the company. On the 18th of September, a motion was made to confirm the sale. On the 22d of September, N. A. Cowdrey, Robert L. Cutting, Jr., Peter Marie, Frank A. Otis, Jacob Cromwell, George L. Kingsland, citizens of New York, and George R. Fearing, a citizen of Rhode Island, stockholders in the company, filed a petition in court asking that they be made defendants in the suit, that the sale might be set aside, and that they have leave to defend, alleging the fraudulent character of the mortgage, and that the directors were acting in bad faith towards the stockholders. This motion was denied, and on the 23d of October the sale was confirmed and a conveyance to Baker, the purchaser, ordered. On the 27th of January, 1877, the Pacific Railroad took this appeal.

''Mr. Matt. H. Carpenter and Mr. N. A. Cowdrey'' for the appellant.

Mr. George F. Edmunds, Mr. James O. Broadhead, and Mr. Melville C. Day, contra.

MR. CHIEF JUSTICE WAITE, after stating the facts, delivered the opinion of the court.

title: Pacific Railroad v. Ketchum


text: Talk:Pacific Railroad v. Ketchum

title: Talk:Pacific Railroad v. Ketchum


text:
Pacific Railroad v. Ketchum/Opinion of the Court

The first question with which we are met is one of jurisdiction. It is contended on the part of the appellees that a consent decree in the Circuit Court cannot be appealed from, but we do not so understand the law. Sect. 692 of the Revised Statutes provides that an appeal shall be allowed from all final decrees in the circuit courts, &c., when the matter in dispute exceeds $5,000, and that this court 'shall receive, hear, and determine such appeals.' This makes appeals to this court, within the prescribed limits, a matter of right, and requires us, when they are taken, to hear and decide them. If, when the case gets here, it appears that the decree appealed from was assented to by the appellant, we cannot consider any errors that may be assigned which were in law waived by the consent, but we must still receive and decide the case. If all the errors complained of come within the waiver, the decree below will be affirmed, but only after hearing. We have, therefore, jurisdiction of this appeal.

This brings us at once to the inquiry whether the appellant, the Pacific Railroad, did consent to the rendition of the decree appealed from. It is stated affirmatively on the record that all parties, through their solicitors, did consent; but the appellant insists that its solicitor had no authority in that behalf. Early in the progress of the cause the company filed an answer under its corporate seal, and signed with its authority by its secretary and solicitor of record, in which every material allegation in the bill was confessed, and it was, moreover, positively stated that the bonds sued for were in all respects valid obligations of the company and the mortgage a subsisting lien. In every instance in which the stockholders attempted to get into the case as parties, so that they might defend for the corporation, it was asserted that the directors of the company were false to their trust, and that they had either consented to, or would not resist, a decree. A solicitor may certainly consent to whatever his client authorizes, and in this case it distinctly appears of record that the company assented through its solicitor. This is equivalent to a direct finding by the court as a fact that the solicitor had authority to do what he did, and binds us on an appeal so far as the question is one of fact only. The remedy for the fraud or unauthorized conduct of a solicitor, or the officers of the corporation, in such a matter, is by an appropriate proceeding in the court where the consent was received and acted on, and in which proof may be taken and the facts ascertained. We take a case on appeal as it comes to us in the record, and receive no new evidence. Here the record states in terms that the company assented to all that has been done. This is equivalent to an admission by the company on the record that the facts exist on which the decree rests. On an appeal, therefore, we must take all the facts as admitted, and consider only whether the case is one in which, under any state of facts, the decree could be entered. The record showing as it does affirmatively that the company gave its consent to the decree, we need not inquire what we could do if the case depended alone on the consent of the solicitor. It may be true also that under the peculiar provisions of this charter the stockholders have a sort of supervisory power over the doings of the directors; but they cannot avoid what has been done by the directors in a suit pending in a court against the company, except by the employment of such remedies as are consistent with the orderly course of judicial proceedings. They cannot correct errors arising from what has thus been done by appeal any more than the company can. If they have been defrauded, they must apply for relief in the first instance to the court in which the fraud was perpetrated.

This disposes of all mere errors in form which are alleged against the decree. Parties to a suit have the right to agree to any thing they please in reference to the subject-matter of their litigation, and the court, when applied to, will ordinarily give effect to their agreement, if it comes within the general scope of the case made by the pleadings. It was within the power of the parties to this suit to agree that a decree might be entered for a sale of the mortgaged property without any specific finding of the amount due on account of the mortgage debt, or without giving a day of payment. It was also competent for them to agree that if the property was bought at the sale by or for the bondholders, payment of the purchase-money might be made by a surrender of the bonds. And so of all the other provisions of the decree which are complained of. All these were matters about which the parties might properly agree; and having agreed, it does not lie with them to complain of what the court has done to give effect to their agreement. Although this appeal may have been instigated by the stockholders in opposition to the wishes of the directors, it is still the appeal of the company which was one of the parties to the agreement, and must be treated accordingly.

This leaves for our consideration under the appeal from the decree of sale only the question which was most strenuously pressed in the argument, that is to say, whether the court below had jurisdiction of the cause so as to authorize it to enter any decree. The objection is, that as Vail, Fish, Joseph Seligman, Punnett, Clark, Morgan, Murdock, and Jesse Seligman were all citizens of the same State with Ketchum and the several parties who in the progress of the cause were admitted as co-complainants with him, the suit was not between citizens of different States, and therefore not within the jurisdiction of the Circuit Court.

The first section of the act of March 3, 1875 (18 Stat., part 3, 470), provides 'that the circuit courts of the United States shall have original cognizance. . . of all suits of a civil nature at common law or in equity, where the matter in dispute exceeds, exclusive of costs, the sum or value of $500,. . . in which there shall be a controversy between citizens of different States. . . .'

The same general language is used in the second section of the same act in respect to the removal of suits from the State courts, and in Removal Cases (100 U.S. 457) we held it to mean that when the controversy about which the suit was brought was between citizens of different States, the courts of the United States might take jurisdiction without regard to the position the parties occupied in the pleadings as plaintiffs or defendants. For the purposes of jurisdiction, the court had power to ascertain the real matter in dispute, and arrange the parties on one side or the other of that dispute. If in such arrangement it appeared that those on one side were all citizens of different States from those on the other, jurisdiction might be entertained and the cause proceeded with. That ruling, we think, applies as well to the first section as to the second.

For the purposes of this appeal we need not inquire when the Circuit Court first got jurisdiction of this suit. It is sufficient if it had jurisdiction when the decree appealed from was rendered. As no objections were made by the parties in the progress of the cause to the right of the court to proceed, and the decree when rendered was consented to, it is enough for the purposes of this appeal if the record shows that when the consent was acted on by the court jurisdiction was complete. Consent cannot give the courts of the United States jurisdiction, but it may bind the parties and waive previous errors, if when the court acts jurisdiction has been obtained.

The subject-matter of this action was the foreclosure of the third, or Vail and Fish, mortgage. As the case was made by the bill there could be no controversy, that is to say, no dispute, with any of the trustees of the earlier mortgages, because their liens were admitted and their interest had been paid in full as it matured. No relief was asked against them. All that Ketchum wanted was a foreclosure of the mortgage in which he was interested, subject to their admitted prior claims. In no possible way could their interests be injuriously affected if the facts set forth in the bill were true. To the bill as filed and the case as afterwards made, these trustees were but nominal parties. They would be bound by what might be done, but all they could by any possibility claim was conceded.

This leaves only to consider the position occupied by Vail and Fish. When the suit was begun, as well as when the decree was rendered, they were trustees of the mortgage under which Ketchum and his co-complainants claimed. No allegations were made against them. All that was said about them was that they doubted their right to proceed. There was no antagonism between them and Ketchum and his associates. He wanted them to proceed; they did not know that they had the legal right to do so. In the mean time he, thinking his own rights, as well as those of his associate bondholders, would be injuriously affected by delay, commenced the suit to get done just what the trustees, if they had been willing to proceed, might have done. Whatever he did was for the trustees and in their behalf, and he really had no power to do more than they might have done if they had been so inclined. It is needless to inquire what might have been the result if they had seen fit to dispute the right of the complainant bondholders to go on. They did not do so, but, on the contrary, before the decree was rendered, came in and substantially availed themselves of the suit which had been begun, so that in the end the suit, in legal effect, became their suit. Although nominally defendants according to the pleadings, they voluntarily, in the course of the proceedings, arranged themselves on the same side of the subject-matter of the action with the complainants. This they had the legal right to do. After that, clearly the controversy was between citizens of one or more States on one side and citizens of other States on the other side, and when the decree was rendered the only thing to be done was to foreclose the mortgage sued on, as between the trustees of the mortgage acting with their beneficiaries and the railroad. Of such a suit the Circuit Court had jurisdiction, and its decree is, consequently, binding on the parties until set aside in the regular course of judicial proceedings.

This leaves only the question arising on the confirmation of the sale. The only objection here insisted on is that Baker, the purchaser, was the solicitor of the appellant company. His purchase, although nominally in his own name, was actually by and for the bondholders. He was used to hold the title until the bondholders could organize and take it. While purchases at judicial sales in the name of the solicitors and attorneys of parties whose property is sold will be scrutinized with jealous care, they will be sustained if no injustice is thereby done to the parties they represent. Here the company, whom Baker represented as solicitor, confessed its inability to pay the debt it owed, and consented that the property held as security be sold. In the decree which it assented to, special provision was made for a purchase by or for the bondholders. We can see no harm which will result from permitting the solicitor of the company to take the title for the bondholders under such a purchase. No complaint was made below of actual wrong. The only objection was that such a purchase was inconsistent with the duties of the solicitor. There was no speculation by the solicitor in the purchase. All he did was to hold the title until the real purchasers were in a condition to take it themselves. If there had been any proof of collusion or improper conduct on the part of the solicitor, resulting in wrong to the company, the case would be different. As it is, we are called upon to decide whether a purchase in the name of the solicitor of one whose property is sold is necessarily in and of itself invalid. We think it is not. It will be scrutinized closely, but until impeached must stand. Slight circumstances may impeach it, but it is not under all circumstances invalid.

After a careful consideration of the whole case, we are unable to discover any error that can be corrected by appeal.

Decree affirmed.


text: Talk:Pacific Railroad v. Ketchum/Opinion of the Court


text:
Fleitas v. Cockrem

ERROR to the Circuit Court of the United States for the District of Louisiana.

The facts are stated in the opinion of the court.

Mr. Charles Case and Mr. Robert Mott for the plaintiff in error.

Mr. William Grant, contra.

MR. JUSTICE BRADLEY delivered the opinion of the court.

title: Fleitas v. Cockrem


text: Talk:Fleitas v. Cockrem

title: Talk:Fleitas v. Cockrem


text:
Fleitas v. Cockrem/Opinion of the Court

This is an action on a promissory note for $5,000 and interest thereon at five per cent per annum from maturity, Dec. 21, 1871. Judgment was rendered for the plaintiffs with privilege upon property which was attached in the course of the proceeding, with recourse on the principal and sureties on the bond upon which the property attached was released. The defendant brought this writ of error.

It is assigned for error, first, that the issue on one of the exceptions (lis pendens) was tried by the court and not by a jury, no agreement to waive a trial by jury appearing in the record. The record, however, declares explicitly that 'the exception in this cause was called for trial by the court, the jury having been waived in writing.' In the absence of any thing to the contrary, this is conclusive that the proper agreement was made.

The next error assigned is, that after an exception had been filed by the defendant, alleging that another suit had been commenced against her for the same cause in the Sixth District Court for the parish of Orleans, and had been removed into the Circuit Court of the United States, and was still pending, the said Circuit Court allowed the plaintiffs to elect whether they would, within a time limited, discontinue that suit, which was first brought, and pay the costs of the same. The record shows that the court below did order that the plaintiffs might elect to proceed in the present suit upon paying the costs in the first suit, and discontinuing the same, otherwise the exception would be maintained. The plaintiffs did so elect, paid the costs, and discontinued the first suit. The defendant objected to this course, insisting that she was entitled, upon her exception, to have the present suit absolutely dismissed.

The exception of lis pendens is given by the Code of Practice, art. 335, as follows: 'There are two kinds of declinatory exceptions: 1. When the exception is taken to the competency of the judge, pursuant to the rules above provided; 2. When it arises from the fact of another suit being pending between the same parties, for the same object, and growing out of the same cause of action, before another court of competent jurisdiction. In both cases the suit must be dismissed, and the plaintiff decreed to pay costs.'

The former suit in the present instance not being pending in 'another court,' but in the same court, the case is not within the words of the article. It has been held, however, to be within its spirit. Dick v. Gilmer, 4 La. An. 520. But in other cases, the pendency of the former suit in another court has been deemed material. Weeks v. Flower, 9 La. 385; Succession of Ludwig, 9 Rob. (La.) 92. And the exception is not necessarily a peremptory one in any case; for if before the trial thereof the former suit be terminated, the exception, it is said, will fail. Schmidt v. Braunn, 10 La. An. 26.

Since the exception in the case of suit pending in the same court is not within the words of the code, but rests upon its equity, and since in such cases both suits are under the control of the court in which the exception is made, we think the court might well exercise the discretion which was done in the present case, in compelling the plaintiffs to elect whether they would submit to judgment on the exception, or discontinue the first suit and pay the costs thereof.

The remaining assignments of error relate to the issue of an attachment in the case, and to the privilege given by the judgment upon the attached property, with recourse against the sureties on the bond given for its release.

The attachment was issued upon a supplemental petition filed in the case, and sworn to by one of the plaintiffs, stating the amount of the debt ($5,000 and interest thereon from Dec. 21, 1871), and that the defendant resided out of the State of Louisiana. The judge below made an order that an attachment be issued upon the plaintiffs giving bond in the sum of $3,200, with solvent surety, &c. The writ was issued, and under it the marshal, on the 11th of January, 1877, attached a plantation and sugar-house thereon, with its contents, consisting of sugar and other property sufficient to satisfy the claim; and on the 13th of January released the property by the claimant giving a bond for its release in the sum of $9,100. On the same day, the defendant entered a rule to show cause why the attachment should not be set aside, upon the ground, amongst others, that it was issued without the plaintiffs giving the bond required by law as a prerequisite therefor. This rule was subsequently dismissed by the court below, and a bill of exceptions was taken by the defendant.

The fact that the amount of an attachment bond is fixed by an order of a judge makes no difference in Louisiana as to the effect of the invalidity of an insufficient bond upon the subsequent proceedings. Graham v. Burckhalter, 2 La. An. 415.

The question is whether the bond in this case was sufficient, being for only $3,200, when the debt exceeded $6,000. The law on the subject is based on article 245 of the Code of Practice, which is in the following words:--

'ART. 245. A creditor, his agent, or attorney in fact, praying such attachment, must, besides, annex to his petition, his obligation in favor of the defendant for a sum exceeding one-half that which he claims, with the surety of one good and solvent person residing within the jurisdiction of the court to which the petition is presented, as a security for the payment of such damages as such defendant may recover against him in case it should be decided that the attachment was wrongfully obtained.'

This law has stood in the same form in the Code of Practice since its first promulgation in 1825. But the words 'for a sum exceeding one-half that which the claims' are an incorrect translation of the French copy of the code. The correct translation would be 'for a sum exceeding by one-half that which he claims.' And the Supreme Court of Louisiana has always construed the law as though the word 'by' had been inserted, as required by the correct translation, numerous cases being reported in which judgment has been reversed because the attachment bond did not exceed by one-half the amount of the debt claimed, and no case being found to the contrary. See Williams v. Barrow, 3 La. 57; Jackson v. Warwick, 17 id. 436; Graham v. Burckhalter, 2 La. An. 415; and cases referred to in the code. It would seem that this settled construction ought to prevail. The reason for an attachment bond, as explained by the Supreme Court of Louisiana, requires the construction which was adopted. Prior to the adoption of the code, a bond for double the amount of the demand was required. 'Its object, and the object of all such laws,' says the court, 'is to secure the absentee from all damages he may sustain by illegal seizure of his property. An interpretation such as the plaintiff contends for would in many instances defeat the purpose of the legislature. Damage is sometimes sustained by the debtor to the whole amount of the sum claimed from him, and a bond to half that amount would only be half security.' 3 La. 59.

As the law has never been changed, but stands now as it has stood for more than fifty years, and as no decision to the contrary of those referred to has ever been made, we think that we must be governed thereby.

This view receives support from the law which requires the plaintiff to give bond as a condition of arresting the person of the defendant. Originally no bond was required; but in 1856 an act was passed to amend article 214 of the code respecting process of arrest, and prescribed a bond to be given by the plaintiff 'for a sum exceeding by one-half the amount of that which he claims.' In this case the French copy is exactly the same as in the case of attachments.

So with regard to appeal bonds (art. 575), the Code of Practice from the first prescribed a bond 'for a sum exceeding by one-half,' &c.; the French being the same as in the other cases.

It is true that in 1868 an amendment of article 575 was passed changing the above words to 'a sum exceeding one-half the amount.' This amendment was abrogated in 1870 in the new code; but whilst it was in force a case occurred in which the court followed the altered reading, and considered a bond for 'one-half the amount' sufficient. But this may have been on account of the seemingly designed alteration of the law.

No such design can be asserted in the present case. The law stands in the same words in which it has always stood, and we think it must have its long-accepted meaning.

For this cause the judgment of the Circuit Court must be reversed, so far as it gives a privilege upon the property attached, with recourse on the principal and sureties on the bond upon which the property attached was released. The rest of the judgment, not being affected by the error in question, should be affirmed. The suit was not commenced by attachment, but by citation, which was personally served upon the defendant, who appeared and filed the exception of lis pendens before the supplemental petition for an attachment was filed. Under these circumstances, it would be unjust to reverse the personal judgment for the amount of the debt. We are only required to reverse that portion of it which depends upon the attachment.

The judgment is therefore affirmed, except as to the last clause thereof, which gives a 'privilege upon the property attached, with recourse on the principal and sureties on the bond upon which the property attached was released;' and as to that part it is reversed with costs.

So ordered.

title: Fleitas v. Cockrem/Opinion of the Court


text: Talk:Fleitas v. Cockrem/Opinion of the Court


text:
Ketchum v. St Louis

APPEAL from the Circuit Court of the United States for the Eastern District of Missouri.

The facts are stated in the opinion of the court.

Mr. Melville C. Day and Mr. James O. Broadhead for the appellants.

Mr. Philip Phillips, Mr. Henry A. Clover, Mr. Britton A. Hill, Mr. Leverett Bell, and Mr. Frank J. Bowman, contra.

MR. JUSTICE HARLAND delivered the opinion of the court.

title: Ketchum v. St Louis


text: Talk:Ketchum v. St Louis

title: Talk:Ketchum v. St Louis