text:
Knapp v. Western Vermont Railroad Company/Opinion of the Court

In the consideration of the question whether or not the Circuit Court had the right to try the case, we are confined to the papers sent up with the order for removal and the papers filed in support of the motion to remand. If anything occurred on the hearing of this motion, which ought to have been preserved, it has not been done, for there is neither a bill of exceptions nor an agreed case in the record. It is true, the clerk makes a recital, running through nearly three pages of the transcript, of the various matters which, he says, were proved on the hearing of this motion, and of certain stipulations and admissions. These recitals form no part of the record and cannot be considered by us. They are not even authenticated by the signature of the judge, nor could they be, to be made available here, except through the mode of a bill of exceptions.

Although this manner of making entries by the clerk is improper and unauthorized, yet the party to the record in whose favor they are made cannot gain by them, or the party against whom they are made be injured by them. If either party, in an action at law, is desirous of preserving the evidence, either at the trial or on a preliminary motion, in order to raise a question of law upon it, he must ask to have it incorporated in a bill of exceptions. This is the only way in which it can be done, unless the parties choose to make an agreed statement of facts. Neither mode was adopted in this case, and we are, therefore, without the means of knowing what evidence was introduced on either side on the motion to remand. The question of jurisdiction is, therefore, to be decided on the papers properly in the record.

The motion of the plaintiffs to remand the case to the State court was denied, and the Circuit Court rested its decision on the ground that Knapp, the surviving plaintiff, was only a nominal party to the suit. But it is difficult to see how a party who makes a contract and is charged with duties and responsibilities in connection with it can be treated, when he sues for the breach of it, otherwise than as the real plaintiff. In a court of law legal rights alone can be recognized, and in determining the point of jurisdiction, we will not make inquiry outside of the case in order to ascertain whether some other person may not have an equitable interest in the cause of action.

It is conceded on the argument that Knapp and Briggs were trustees of a mortgage upon the property of the Western Vermont Railroad to secure the bonds of the company, and that upon a strict foreclosure of the mortgage their title became absolute in trust for the bondholders. After this they leased the road to the defendants for a term of years, and at the expiration of the lease brought their suit upon the covenants of the lease. It would seem that they not only had the right to sue, but that nobody else could sue. It is said, however, that before the expiration of the lease a new corporation, called the Bennington and Rutland Railroad Company, was organized by a majority of the bondholders of the defunct corporation, under the laws of Vermont, who had converted their bonds into stock, and that the new corporation was, by the provision of the statute under which it was formed, substituted as trustee for the other bondholders in place of the plaintiff in error, and had thus become the real party in this suit. It is not necessary to discuss the question whether the statute of Vermont can bear the construction claimed for it, for manifestly it is not in the power of the State legislature, without the consent of the cestuis que trust, to substitute a new trustee in place of the persons named in the mortgage. This would impair the obligation of the contract. The salability of railroad bonds depends in no inconsiderable degree upon the character of the persons who are selected to manage the trust. If these persons are of well-known integrity and pecuniary ability the bonds are more readily sold than if this were not the case. It is natural that it should be so, and on this account the trustees usually appointed in this class of mortgages are persons of good reputation in the cities where these bonds are likely to sell. To change them is to change the contract in an important particular, and this cannot be done without the consent of the parties for whose benefit the trust was created.

The trustees in this case, so far as the record discloses, have not been discharged from the obligations of their trust or divested of their right of action on this lease by judicial proceeding or otherwise, nor has the trust in fact been closed, for there are bonds outstanding which have never been paid or converted into stock of the new corporation. It can make no difference whether these bonds are few or many. The trust is continued until all are paid, unless in the meantime the trustees are discharged.

They are the real plaintiffs in any suit brought to enforce a claim accruing to them in the execution of their trust, as much so as executors and administrators are, who also sue for the benefit of others and not themselves. Like them they control the litigation, and are charged with the responsibility of conducting it. The true line of distinction between nominal and real parties to an action is pointed out by this court in the recent case of Coal Company v. Blatchford. The court, in commenting on the cases of Browne v. Strode and McNutt v. Bland, where the plaintiffs of record were treated as nominal parties merely, say, 'There is no analogy between those cases and the case at bar (one of trusteeship). The nominal plaintiffs in those cases were not trustees, and held nothing for the use or benefit of the real parties in interest. They could not, as is said in McNutt v. Bland, prevent the institution or prosecution of the actions, or exercise any control over them. The justices of the peace in the one case and the governor in the other were the mere conduits through whom the law afforded a remedy to the parties aggrieved.'

The position of Knapp as surviving plaintiff is very different. He is not a mere passive instrument in the litigation. On the contrary, he is active in promoting it, and would be remiss in his duty if he failed in using all proper means to bring it to a successful issue. As the cause of action is vested in him the court looks to his citizenship in determining the question of jurisdiction, and not to the residence of those persons who are beneficially interested in the subject-matter of the litigation. The cases are numerous to this point, and it would be a needless work to cite all of them.

It may be proper to say that the act of 1867, on the subject of the removal of cases from the State to the Federal courts, which extends the provisions of the act of 1789, so as to allow either the plaintiff or defendant to remove the cause for the reasons stated, at any time before final judgment, does not change the settled rule that determines who are to be regarded as the plaintiff and the defendant. As the plaintiff and the defendant in this action were both citizens of New York, the Circuit Court had no jurisdiction to entertain it.

JUDGMENT REVERSED, with instructions to the Circuit Court to remand the case to the County Court for the County of Bennington, in the State of Vermont, from whence it was improperly removed to the Circuit Court.

Mr. Justice BRADLEY did not sit during the argument, and took no part in this decision.


text: Talk:Knapp v. Western Vermont Railroad Company/Opinion of the Court

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


text: Burton v. Driggs

title: Burton v. Driggs


text: Talk:Burton v. Driggs

title: Talk:Burton v. Driggs


text:
Burton v. Driggs/Opinion of the Court

ERROR to the Circuit Court for the District of Vermont; the case being thus:

A certain O. A. Burton, of Vermont, in April, 1859, meeting in New York with one William Driggs, of Michigan, offered to sell to him a claim on the Bank of Tioga County, Pennsylvania, which he, Burton, alleged that he had against it; and by way of showing the reality of his claim exhibited to Driggs a paper, under seal, executed by him, Burton, and three other persons, bearing date October 20th, 1858, whereby it was recited and agreed as follows:

'That the parties had severally furnished to the Tioga Bank, to enable it to redeem its bills promptly, certain sums of money, to wit, O. A. Burton, $7060.18, &c.; that the bank was to refund said moneys as soon as it was in a condition to do so, and that it would lend to said parties, not exceeding $10,000 at any one time, on paper payable in New York, with interest at the rate of five per cent. per annum; that the Tioga Bank had advanced, to be paid in on the stock of the Pittston Bank, of Pennsylvania, $9870, which money belonged to the four parties to the instrument, and it was agreed that each of the parties owned one-fourth part thereof, less cost and expenses.'

Driggs bought the claim, paying $7060.18 for it; and Burton made this assignment on the back of the paper which he had shown Driggs:

'For and in consideration of the sum of $7060.18, I do hereby sell, assign, transfer, and set over to William Driggs, my interest of an equal amount in the Tioga County Bank, paid in according to a certain contract made October 20th, 1858, between O. A. Burton, and others, which is hereto attached, with all the rights and privileges therein which I have, or should have had, if this sale had not been made.

'Witness my hand and seal this 29th day of April, 1859.

'O. A. BURTON.' [L. S.]

Upon presenting his newly purchased claim soon afterwards at the Tioga County Bank, Driggs was informed that Mr. O. A. Burton had no claim whatever on the bank; that he was not a stockholder in it; that his name was not to be found on its books, and that in the alleged sale a gross fraud had been practiced.

Hereupon, Driggs sued Burton in the court below in assumpsit. The narr. contained certain counts setting out the instrument which Burton had shown to him as inducement, and averred that the recitals which it made were wholly false; that Burton bad no claim whatever on the bank, and that the plaintiff had got nothing whatever from it.

Burton, admitting that he had no such claim against the bank as was recited in the paper, set up in defence that he did in fact own certain powers of attorney to transfer stock in that bank, executed by parties who owned such stock, and for which he paid $10,000; that he had explained to Driggs at the time of the assignment to him that such was the real nature of the claim transferred to him, and he delivered to him these powers of attorney; and that Driggs had received them and subsequently acted under them, participated in an election of directors, and assisted in redeeming the notes of the bank in circulation.

In reply, Driggs gave evidence tending to prove that this allegation was as false as had been the other, and that he never received any consideration, benefit, or return whatever, directly or indirectly, for the money paid for it.

The powers were not produced by Burton, nor did he give any evidence to show from whom he obtained them, by whom or how they were signed, in what amount, or what became of them.

Driggs gave evidence tending to prove that no such powers to transfer stock had ever been issued by the bank.

Upon these facts Driggs sought to recover back the money paid by him upon the grounds:

1. Of the warranty of Burton, both expressed and implied, that the claim assigned to the defendant in error was genuine:

2. That the money was obtained from him by Burton, through fraud, and without equivalent:

3. That the consideration upon which the money was paid and received, had totally failed.

The case being closed, the court-refusing several requests of the defendants for instructions, and among them a request to charge that the plaintiff was not entitled to recover on his special counts nor to recover in the action-intimated an opinion in favor of the plaintiff, upon the first and third points. But for the purposes of the trial instructed the jury to find whether the sale and representations made by Burton were such as he alleged, or whether they were such as were alleged by Driggs, and that if they were such as were alleged by Burton that the verdict should be in his favor.

That if they were such as were alleged by Driggs, then to find whether or not they were true; that if true, the verdict should be in favor of Burton.

That if untrue, the jury should then find whether Driggs received any interest in the bank whatever by the assignment, or in the transaction, either such as that described in the paper, or such as Burton alleged that he had transferred to him. If he did, the verdict should be for Burton.

But that the payment of the money and the execution of the assignment being admitted, if the jury found the representations to have been such as Driggs alleged; that they were untrue in fact; that Burton had no such claim as he sold, and that Driggs received nothing whatever under the assignment or in the transaction, then that the verdict should be for the plaintiff, Driggs, for the money which he had paid.

The jury found in favor of the plaintiff, for the amount paid and interest, being $12,078.64; and judgment having been entered accordingly, the defendant brought the case here on error.

In the course of the trial the plaintiff offered to read a copy of the deposition of one Vine De Pue, a person who lived in another State, and more than one hundred miles from the place of trial; and whose deposition had been taken under the act of Congress authorizing depositions to be taken, 'when the testimony of any person shall be necessary in any civil cause. . . who shall live at a greater distance from the place of trial than one hundred miles.' No proof was given that the said De Pue was dead. The bill of exceptions said:

'The plaintiff proved, to the satisfaction of the court, that the original deposition was regularly and properly taken in this cause, sealed up, transmitted to the clerk of this court, and by him properly opened and filed, all in accordance with the provisions of the act of Congress; that said deposition was lost and could not be found; that the copy offered was a true copy, taken under the direction of the clerk, and by him compared with the original and certified.

'The defendant objected to the admission of the copy on the ground that it was not the original. The court overruled the objection and admitted the deposition, to which decision the defendant excepted.'

This was the first exception.

The plaintiff then proved that the books of the Bank of Tioga County were in Tioga, Pennsylvania, where the bank itself was situated; that he had endeavored to obtain them for use on this trial; but that the officers of the bank who had them in their keeping refused to let them go away from the bank. He then offered the deposition of one C. P. Steers, and of A. C. Turner.

Steers had been cashier of the bank from the 15th of September, 1858, up to the 29th day of April 1859. He thus testified:

'During the entire period that I was cashier I had charge of the financial affairs of the bank, and was well acquainted and familiar with all the financial business and matters of the bank. O. A. Burton did not, at any time during that period, loan, advance, or furnish to the said Tioga County Bank the sum of $7060.18, nor any other sum of money. The name of O. A. Burton was never on the books of the bank, nor did the bank at any time during the said period owe the said Burton for advance or otherwise; and don't think that the name of said Burton appeared upon the books of the bank as a stockholder during said period of time.'

Turner, former cashier of the bank, and who had served as cashier from December, 1859, to August 18th, 1867, thus testified:

'In July, 1859, I made a careful examination of the books and papers of the bank for the purpose of ascertaining its condition, assets, and liabilities. I examined all the books and papers in the bank relating to its affairs from the time of its organization down to July, 1859, and on that examination I found no evidence in the bank of any kind that O. A. Burton ever had any connection with the bank, either as debtor, or creditor, or stockholder, or any interest of any kind whatever in the bank. I afterwards examined the books of the bank again at the request of the plaintiff in this suit, and with direct reference to the matters involved in this suit, and I did not find that on the 20th day of October, 1858, or on the 29th day of April, 1859, or at any other time, that the bank was indebted to O. A. Burton in the sum of $7060.18, or in any other sum. I did not find the name of O. A. Burton on the books of the bank in any way.'

The counsel of the defendant objected to the admission in evidence of such parts of these depositions as referred to what appeared, or did not appear, on the books of the Tioga County Bank. But the court allowed the depositions as above set forth to be read.

Mr. L. P. Poland, for the plaintiff in error:

I. The court erred in admitting the paper said to be a copy of the deposition of Vine De Pue.

The Federal courts have ever held parties to strict conformity to the statutes authorizing and prescribing the occasions, mode, and form of taking depositions. No statute of Congress-no decision-authorizes the use, as evidence, of a copy of a deposition, where the original is lost. The action of the court below must rest, for its justification, upon the common-law doctrine, that secondary evidence is admissible, when the primary cannot be had-as, parol evidence of the contents of a lost writing. But there are good reasons why this doctrine should not be extended to the case of lost deposition; as—

1st. The statutes authorizing the use of depositions in cases at law, are variant from common law, and imply the existence of a better kind of evidence, viz., the testimony of the witness in open court; and allow depositions only in peculiar cases, and to prevent a possible failure of justice. As far, therefore, as the statute goes we may follow, but no further. Depositions themselves are regarded as only secondary evidence.

2d. The rule requiring the best evidence attainable to be used in the cause, demands that the witness, who is apparently in life, should be produced, not to testify to what he once testified to in a deposition, but what he at the time of the trial knows of the matter. For this (the best evidence) the statute allows, in peculiar cases, an inferior grade, viz., a deposition made out of court; but goes no further. The common rule then should exclude evidence of a still inferior grade (as, a copy of a deposition), so long, at least, as the testimony of the witness in court or a new deposition can be obtained.

3d. It might be safely admitted, that if the witness had died, the contents of his deposition, being lost, might be proved; for, in such case, this would have been the best attainable evidence. But it would be of dangerous precedent and practice to allow secondary evidence of the contents of depositions, except in case of such absolute necessity. If proof of what the witness swore could be made by a copy of his deposition, it could be made by any other evidence of contents, as by the recollection of a witness, since there are no degrees in secondary evidence.

Here, too, the court erroneously determined not only the question of loss of the original, but the accuracy of the copy.

Two Vermont decisions, Follett v. Murray and Low v. Peters, are decisive of this question.

II. The depositions of Turner and Steers were wrongly received.

1st. The books of the bank were but private writings, and were not evidence per se-certainly not as to strangers-though admissible perhaps as memoranda, in aid of the testimony of the party making them. They were used purely as substantive evidence.

2d. Before the admission of secondary evidence of the contents of the books, more especially evidence of what does not appear upon the books, it should have been proved that the bank had and kept books, and their authenticity; that those books had upon them, in regular entry, items, and all items of the class represented by the said defendant's claims. It is only in such case that the absence of an entry representing the defendant's claim could furnish an inference of the non-existence of the claim.

No preliminary evidence of this kind was given, but these preliminary facts were assumed.

Turner's deposition is limited to what he found, and to what he did not find upon what he calls the books of the bank, kept, not by himself, but before he became cashier. This witness's interpretation of the meaning of the books to his mind was clearly not evidence, nor was his construction of the contract, which was exhibited to him. If the contents of these bank books were evidence, and they could be proved without production of the books themselves, then the proof should be by an examined and sworn copy of the books. Instead of this, Turner swears only to the result of his examination. As clearly the statements of Steers were not admissible evidence.

III. As to the charge.

The contract in this case, as well as the assignment, were under seal. The action proceeds upon an assumpsit of the defendant, that he was the lawful owner of a claim of $7060.18, mentioned in the sealed instrument, against the Tioga County Bank. It is for a breach of this agreement that the suit is brought. Now, if the contract has this force, and there is any such agreement in it, whether expressed or implied, it is a covenant and not a simple assumpsit, and the action should be covenant. Upon this idea, the first request of the defendant below should have been answered; certainly the first branch of it.

In the charge as given, the case was put wholly upon the ground of want of consideration, or of an implied warranty; grounds which we must suppose may not have entered into the argument for the defence.

This was a double error: 1st. This position was inconsistent with the form of action, as applied to a sealed contract. 2d. It was misleading in the argument of the case, working a surprise and a mistrial.

Mr. E. J. Phelps, contra.

Mr. Justice SWAYNE delivered the opinion of the court.

The first assignment of error relates to the admission in evidence of a copy of the deposition of Vine De Pue. The bill of exceptions sets forth that the original deposition was regularly taken, sealed up, and transmitted to the clerk of the court where the cause was pending, and by him properly opened and filed; and that thereafter it was lost and could not be found; and that the copy offered was a true copy, taken under the direction of the clerk, and by him compared and certified. The exception is as follows: 'The defendant objected to the copy on the ground that it was not the original. The court overruled the exception and admitted the deposition, to which decision the defendant excepted.'

It is a rule of law that where a party excepts to the admission of testimony he is bound to state his objection specifically, and in a proceeding for error he is confined to the objection so taken. If he assign no ground of exception, the mere objection cannot avail him. In Hinde's Lessee v. Longworth this court said: 'As a general rule, we think the party ought to be confined, in examining the admissibility of evidence, to the specific objection taken to it. The attention of the court is called to the testimony in that point of view only.' Here the objection was that the copy was not the original. This, as a fact, was self-evident; but as a ground of objection it was wholly indefinite. It does not appear to have been suggested that the place of the lost deposition could only be supplied by another one of the same witness retaken, and that secondary evidence was inadmissible to prove the contents of the former. If the contents of the one lost could be proved at all by such evidence, that offered was certainly admissible for that purpose. But the objection was presented in the argument before us in the latter shape, and we shall consider it accordingly.

It is an axiom in the law of evidence that the contents of any written instrument lost or destroyed may be proved by competent evidence. Judicial records and all other documents of a kindred character are within the rule. But it is said a different rule as to depositions-unless the witness be dead-obtains in Vermont, and the cases of Follett v. Murray and Low v. Peters are referred to as supporting the exception.

Those cases are unlike the one before us. In Follett v. Murray the witness resided within the State, and there being no copy of the caption it did not appear that the deposition had been regularly taken. In the other case the witness was dead, and no question was raised as to any defect in the lost original. The copy was, therefore, admitted as of course. If a deposition be not properly taken it is not made admissible by the death of the witness. In Harper v. Cook, it was held that the contents of a lost affidavit might be shown by secondary evidence. The necessity of retaking it was not suggested. In the present case the witness lived in another State and more than one hundred miles from the place of trial. The process of the court could not reach him; for all jurisdictional purposes he was as if he were dead. It is well settled that if books or papers necessary as evidence in a court in one State be in the possession of a person living in another State, secondary evidence, without further showing, may be given to prove the contents of such papers, and notice to produce them is unnecessary. Here there was nothing to prevent the operation of the general rule as to proof touching writings lost or destroyed. The deposition was one of the files in the case. The plaintiff was entitled to the benefit of the contents of that document. Having been lost without his fault, he was not bound to supply its place by another and a different deposition, which might, or might not, be the same in effect with the prior one.

There was no error in admitting in evidence the copy to which this exception relates.

The next assignment of error is the admission in evidence 'of such parts of the depositions of A. L. Turner and C. P. Steers as refer to what appeared or did not appear on the books of the Tioga County Bank.' It was shown by the plaintiff in this connection that the books in question were in the village of Tioga, Pennsylvania, that the plaintiff had endeavored to obtain them for use on this trial, and that those having the custody of them refused to permit them to go. The testimony of Turner was, in substance, that he was the cashier, that he had examined the books and papers in the bank relating to its affairs from its organization down to July, 1859, and that he found no evidence of any kind that the defendant ever had any connection or transaction with the bank, or any interest in it whatever; and that subsequently, at the request of the plaintiff and for the purposes of this suit, he repeated the examination with the same result. Steers testified that he was cashier of the bank from about the 15th of September, 1858, to about the 29th of April, 1859, and that during that time the defendant, Burton, did not furnish to the bank $7060.18, or any other sum of money, that his name was never on the books of the bank, nor did the bank owe him anything on any account during that period, and that the witness did not think his name appeared on the books of the bank as a stockholder during that time. The books being out of the State and beyond the jurisdiction of the court, secondary evidence to prove their contents was admissible.

When it is necessary to prove the results of voluminous facts or of the examination of many books and papers, and the examination cannot be conveniently made in court, the results may be proved by the person who made the examination. Here the object was to prove, not that the books did, but that they did not show certain things. The results sought to be established were not affirmative, but negative. If such testimony be competent as to the former, a multo fortiori must it be so to prove the latter.

The last assignment relates to the charge of the court.

The examination of this subject renders it necessary to refer briefly to the cause of action. The defendant, Burton, and three others, executed an instrument, under seal, bearing date October 20th, 1858, whereby it was recited and agreed as follows: That the parties had severally furnished to the Tioga Bank, to enable it to redeem its bills promptly, certain sums of money, to wit, O. A. Burton, $7060.18, &c.; that the bank was to refund said moneys as soon as it was in a condition to do so, and that it would lend to said parties, not exceeding $10,000 at any one time, on paper payable in New York, with interest at the rate of five per cent. per annum; that the Tioga Bank had advanced, to be paid in on the stock of the Pittston Bank of Pennsylvania, $9870.00, which money belonged to the four parties to the instrument, and it was agreed that each of the parties owned one-fourth part thereof, less cost and expenses. To this paper was annexed a further instrument, under seal, dated April 29th, 1859, whereby the defendant assigned to the plaintiff, for the consideration of $7060.18, his interest in that amount paid by him to the Tioga Bank, according to the instrument first mentioned, with all the privileges relating thereto which the assignor would have had if the assignment had not been made. The declaration contained several counts, setting out the instrument as inducement and averring the utter falsity of its recitals. The common money counts were added. The defendant admitted the receipt of the $7060.18, stated in the assignment, as the consideration for making it, but gave no evidence tending to prove that the recitals in the instrument to which the assignment related were true. Both parties submitted prayers for instructions. Both sets were refused. Those of the defendant sought to defeat the action because it had not been brought upon the written instrument and the assignment. The court instructed the jury in effect, with full and proper explanations, that if the transaction on the part of the defendant had been a fraud, and there had been an entire failure of consideration, the plaintiff was entitled to recover.

The defendant excepted to these instructions, and to the refusal to give those which he had asked to be given. The former were correct in point of law. The instructions given covered the whole case. It was not, therefore, the duty of the learned judge to give others suggested by either party. If wrong, they were inadmissible, and if otherwise, unnecessary. We are satisfied with the charge as it appears in the record.

JUDGMENT AFFIRMED.

title: Burton v. Driggs/Opinion of the Court


text: Talk:Burton v. Driggs/Opinion of the Court


text: 1911 Encyclopædia Britannica/Fibrin

title: 1911 Encyclopædia Britannica/Fibrin


text:
Tioga Railroad v. Blossburg and Corning Railroad

ERROR to the Circuit Court for the Northern District of New York.

The Tioga Railroad Company was a corporation duly organized under the laws of Pennsylvania, and was the proprietor of a railroad extending from Blossburg, a town in that State, a little south of the line between Pennsylvania and New York, up to that said line. The Blossburg and Corning Railroad Company was a corporation organized under the laws of the State of New York, and was the proprietor of a railroad connecting with the abovementioned road at the State line and extending thence to Coring in New York; the two roads forming a complete line of railroad from Blossburg to Corning. The latter company had acquired its part of the road by purchase in 1855, succeeding to the rights of a former company called the Corning and Blossburg Railroad Company. By contract made in 1851 the Corning or New York end of the line was leased to the Tioga Railroad Company under certain terms and stipulations, amongst which was the following:

'For the use of the said railroad of the said Corning and Blossburg Railroad Company, and the use of their depots, enginehouses, machine-shops, grounds, water-stations, &c., the Tioga Railroad Company agrees to pay to the Corning and Blossburg Railroad Company two-thirds of the receipts for passengers, mails, and freights which shall be taken for the said Corning and Blossburg Railroad, the expenses charged customers for the loading and unloading coal, lumber, and other freights, and for the warehousing, and such additional charges, by way of discrimination, as shall be made for short distances for motive power, not to be included in the term receipts, as abovementioned.'

The parties soon disagreed as to the meaning of the words italicized. The lessees asserted that they were entitled to keep any excess of way-fares and freights for intermediate places and short distances above the through rates for those places, and did not account for, but retained the same; and for this difference, running through many years, the Blossburg and Corning company, on the 6th of May, 1864, sued the other company in the court below.

Previously to the bringing of this, the present suit, that is to say, in January, 1855, the Blossburg company had brought a suit in the Supreme Court of New York against the Tioga company on the contract in question, in which this question of difference was litigated. The record of that case, which went to final judgment (see 1st Keyes, 486), was given in evidence in this one.

The present suit was brought for the same class of receipts which had accrued since the commencement of the former action. Besides the defence abovementioned, the Tioga company in this case pleaded the statute of limitations as to all receipts which accrued more than six years before the commencement of the suit. The plaintiff replied that the defendant was a corporation organized under the laws of Pennsylvania, and not created or existing under the laws of the State of New York, and that when the supposed cause of action accrued in favor of the plaintiff, the defendant (the Tioga company) was out of the State of New York, and so remained until this action was commenced. The defendant denied that at or since the commencement of the action it had been out of the State.

The significance of these pleadings was derived from the New York statute of limitations. The period limited for bringing an action of this kind is six years. But by the one hundredth section of the Code of Practice it is enacted as follows:

'If, when the cause of action shall accrue against any person, he shall be out of the State, such action may be commenced within the terms herein respectively limited after the return of such person into this State; and if, after such cause of action shall have accrued, such person shall depart from and reside out of this State, the time of his absence shall not be deemed or taken as any part of the time limited for the commencement of such action.'

The Blossburg company insisted that as the Tioga company was a Pennsylvania corporation, it could have no legal residence or existence in any other State than Pennsylvania, and hence that it was not in the State of New York when the action accrued, and had not been therein at any time since; and, therefore, could not claim the benefit of the statute of limitations. This the Tioga company disputed; and its counsel relied on certain sections of the Code of Practice of New York, which showed that foreign corporations might be sued in New York under certain circumstances, as where they had property in the State, or where their officers, agents, or directors are found within it, and were served with process. Thus, by act of 1851 (§ 134 of the Code), after providing for service of process on a corporation by delivering a copy to the president, secretary, treasurer, director, or managing agent, it is said:

'Such services can be made in respect to a foreign corporation only where it has property within this State, or the cause of action arose therein.'

Or, by the act of 1859,

'Where such service shall be made within this State personally upon the president, treasurer, or secretary thereof.'

The case, according to the New York practice, in cases which it is anticipated may involve the examination of long accounts, was referred to and tried by a reference.

Evidence was given which, as the counsel of the defendant asserted, showed-what he alleged was not denied-'that during all the time of the existence of the contract of 1851, the Tioga company had property within the State of New York, an office at Corning, directors, officers, and agents, constantly within that State and at all times amenable to the process of its courts, and in fact, in 1855, that the Blossburg company availed itself of this condition of things by bringing a suit against the defendant for a portion of the demand claimed under the contract now in controversy, recovered judgment and collected the same, and that in fact this suit was commenced by personal service of a summons upon the defendant's agent at Corning.'The referee refused to find as facts what is above stated in regard to the Tioga company, and found generally in favor of the plaintiff. Judgment being entered on the finding the case was now here on error.

Mr. J. H. Reynolds, for the plaintiff in error (after arguing the case on merits):

I. The same matter disposed of in the Court of Appeals of New York, in 1855, does not come in question here. No portion of the claim there made is embraced in this action. It is true that the claim arises under the same contract, but that circumstance is not of consequence if this court is not concluded by its construction in the courts of New York, which it clearly is not under the decision in Swift v. Tyson, and Chicago v. Robbins. Moreover, it is not easy to see that the same question was decided in the New York courts. A reference to the cases will show this.

II. The antiquated rule that a corporation cannot migrate must now be regarded as a legal fiction rather than a substantial reality. In actual practice, corporations created by the laws of one State do travel into other States, carry their property, establish offices, locate agents, transact business, and accumulate money, and they are recognized outside of the territorial limits of their creation as legal beings, having legal rights.

It was at one time questioned in this court, whether a corporation created by the laws of a State, made the corporate body a citizen of the State creating it, when the corporators actually resided beyond its territorial jurisdiction, within the meaning of the act of Congress in respect to the removal of causes from a State to a Federal court for trial. It is now the settled law of this court, that a corporation is a citizen of the State creating it, and entitled to all the rights and immunities accorded to a citizen by the Constitution and the law.

If it be, as it must be, assumed that a corporation is a citizen of the State by which it is created, then it must be accorded the rights of a citizen in all courts and places.

We are aware of certain decisions in New York not in accordance with these views. But there is no greater reason for this court's following the decision of State courts in respect to the limitation of actions, than for its following the laws and decisions respecting the validity of bonds in aid of railroads or any other local improvements. These, certainly, it has not followed.

It was proved and conceded that during all the time of the existence of the contract of 1851, the defendant had property within the State of New York, an office at Corning, New York, directors, officers, and agents constantly within this State, and at all times amenable to the process of its courts; and in fact in 1855 the plaintiff availed itself of this condition of things by bringing a suit against the defendant for a portion of the demand claimed under the contract now in controversy, recovered judgment, and collected the same, and that in fact this suit was commenced by personal service of a summons upon the defendant's agent at Corning. It is, therefore, apparent that the Tioga company has been at all times subject to a suit at law, for any debt it owed to the Blossburg company or any other party.

Mr. D. Rumsey, contra.

Mr. Justice BRADLEY, having stated the case, delivered the opinion of the court.


text: Talk:Tioga Railroad v. Blossburg and Corning Railroad


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Tioga Railroad v. Blossburg and Corning Railroad/Opinion of the Court

Some attempt has been made to show that in the suit brought in January, 1855, in the Supreme Court of New York by the Blossburg company against the Tioga company, on the contract now in question, the matter of the difference for which the present suit is brought was not a question decided. But we have looked at the record and proceedings therein, which were in evidence in this case, and are satisfied that it was decided. The report of the case in 1st Keyes, 486, shows that it was the only question before the Court of Appeals, to which court the case was carried. This point, then, is res judicata between the parties. It cannot be litigated again on the same contract.

We pass, then, to the matter of the statute of limitations.

The counsel for the plaintiff in error (the defendant below) insists 'that it was proved and conceded that during all the time of the existence of the contract of 1851, the defendant had property within the State of New York, an office at Corning, New York, directors, officers, and agents, constantly within this State, and at all times amenable to the process of its courts; and, in fact, in 1855, the plaintiff availed itself of this condition of things by bringing a suit against the defendant for a portion of the demand claimed under the contract now in controversy, recovered judgment and collected the same, and that in fact this suit was commenced by personal service of a summons upon the defendant's agent at Corning; and that it is, therefore, apparent that the Tioga company has been, at all times, subject to a suit at law for any debt it owed to the Blossburg company or any other party,' and he argues that the statute of limitations is therefore a defence.

If the facts appeared as stated by the counsel, it could not avail the plaintiff in error. The courts of New York have decided (and two of the decisions were made upon the case of this very company), that a foreign corporation cannot avail itself of the statute of limitations of that State. And this, notwithstanding the defendant was the lessee of a railroad in New York, and had property within the State, and a managing agent residing and keeping an office of the company at Elmira, within the State. These decisions upon the construction of the statute are binding upon us, whatever we may think of their soundness on general principles.

But the facts on which the plaintiff in error relies are not spread upon the record in such a manner that the court can take cognizance of them. They are not found specifically by the referee; he refuses to find them. He finds generally in favor of the plaintiff, namely, that the statute of limitations was not a bar to the action. No error can be assigned upon such a finding.

JUDGMENT IS AFFIRMED.

I dissent from that part of the opinion of the court which relates to the defence of the statute of limitations.

If the State courts of New York have construed their statute concerning service of process, to mean that no such service will authorize a judgment against a corporation of another State, which will be valid beyond the limits of the State of New York, it is a most extraordinary and unnecessary decision, for it is the province of those other States, or of the Federal judiciary, to declare the effect of such judgment, outside of the State of New York. Besides it is not asserted that any such decision has ever been made, except with reference to its effect upon the right of such corporations to plead the statute of limitations in the State courts of New York. Nor do I believe that the courts of any State of the Union except New York, have even held that a person doing business within the State and liable at all times to be used and served personally with process cannot avail himself of the statute of limitations, if the time prescribed by it to bar such action has elapsed before it was commenced. The liability to suit where process can at all times be served, must in the nature of things be the test of the running of the statute. A different rule applied to an individual because he is a citizen or resident of another State, is a violation at once of equal justice and of the rights conferred by the second section of the fourth article of the Federal Constitution, that the citizens of each State shall be entitled to all the privileges and immunities of citizens in the several States.

I can hardly believe, therefore, that the New York statute means that if two men doing business in adjoining houses in the city of New York, one may avail himself of the statute of the State for limitation of actions, when the time prescribed has elapsed, because he is a citizen of that State, while the other cannot because he is a citizen of New Jersey, when each has been equally and always liable to service of process. Nor do I believe, on a review of all the cases, that the courts of New York have intended to give such a construction to those statutes.

My brother STRONG agrees with me in these views.


text: Talk:Tioga Railroad v. Blossburg and Corning Railroad/Opinion of the Court


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Simpson v. Greeley

ERROR to the Supreme Court of Kansas.

Carlos Greeley sued William A. Simpson and eight other persons in one of the county courts of Kansas, to recover certain lands, together with damages for the detention of them; and for waste committed by the whole nine.

The nine defendants filed a joint answer.

The plaintiff replied; and after a trial judgment was given—

'That the plaintiffs have and recover of and from said defendants the lands and tenements described in the declaration; that they also have and recover of the said William A. Simpson the sum of $4300, the value of the rents, issues, and profits of said lands and tenements, and for the timber taken from said land by the said defendant; that the plaintiffs also have and recover of the other defendants the sum of $2600, to be credited as part of the said $4300, if collected, it being the value of the rents above found.'

Simpson-none of his co-defendants joining-filed a petition in error to the Supreme Court of Kansas, alleging that the consent of none of his co-defendants could be obtained to join him in the proceeding. However, very soon afterwards they all did file a petition in error just like his own, and praying that the judgment rendered against them be reversed, for the causes and reasons set forth in his petition. The Supreme Court of Kansas affirmed the judgment, and a mandate was issued out of that court reciting,

'That a judgment in a certain civil action, wherein Carlos Greeley et AL. were plaintiffs, and William A. Simpson et AL. were defendants, was rendered by the latter court in favor of the said Greeley et AL., on a transcript of which judgment and record said Simpson et AL. prosecuted a petition in error to the Supreme Court within and for the State of Kansas.'

From this judgment of the Supreme Court of the State, Simpson alone took this writ of error, assigning no cause why the others were not joined.

Mr. W. T. Otto (with whom was Mr. J. P. Usher), preliminary to argument upon the merits, asked to have the writ dismissed, observing that it was obvious that the whole nine original defendants were plaintiffs in error in the Supreme Court of Kansas, and that a joint judgment affirming the judgment of the inferior court had been rendered against them. It was perfectly settled, he observed, that such a writ as the present one would be dismissed, there having been no effort made by Simpson to have the other co-defendants join in it, and no cause shown or alleged why they did not.

Mr. W. W. Nevison, contra.

Mr. Justice CLIFFORD delivered the opinion of the court.

title: Simpson v. Greeley


text: Talk:Simpson v. Greeley

title: Talk:Simpson v. Greeley


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Simpson v. Greeley/Opinion of the Court

Fee simple title is claimed by the present defendants to the several tracts of land described in the declaration, and they commenced an action of ejectment to recover the possession of the same, and for the rents and profits, and for the value of certain timber which, as they allege, the defendants have cut thereon and converted to their own use.

Eight other persons besides the present plaintiff were joined as defendants in the suit, and they were all duly served with process and appeared and made defence in the first District Court of the State where the writ was returnable.

Two defences were set up, as follows: (1.) They, the defendants, denied every allegation and averment of the declaration. (2.) They pleaded that the title to the several tracts of land was in William A. Simpson; that he acquired the same in the manner and by the means circumstantially set forth in their second plea, and that the other defendants are in the possession of the said several tracts as tenants of the said Simpson, and have large and valuable crops growing thereon, and that they hold the same by lease from the actual owner of the title. Wherefore, they, the defendants, pray and demand judgment against the plaintiffs, and that the plaintiffs be enjoined and restrained from ever claiming, suing for, or setting up any title to the said several tracts of land, or either of them, or any part or portion thereof, and that the pretended estate and interest of the plaintiffs be determined and wholly held for naught.

Leave was granted to the plaintiffs by the court to file a reply, and they did so, as more fully appears in the record, in which they controvert each and every of the material allegations of the answer, except that the defendants are in the possession of the premises, and allege that the principal defendant acquired the possession by wrongful and unlawful means, and reassert their claim of title, as set forth in the declaration. Subsequently the parties waived a jury and went to trial before the court. Evidence was introduced on both sides, and the court made numerous findings of fact and several conclusions of law. Certain exceptions were also taken both to the rulings and the findings of the court.

Some delay followed, and both parties having been fully heard the court rendered judgment as follows: 'That the plaintiffs have and recover of and from said defendants the lands and tenements described in the declaration. That they also have and recover of the said William A. Simpson the sum of $4300, the value of the rents, issues, and profits of said lands and tenements, and for the timber taken from said land by the said defendant. That the plaintiffs also have and recover of the other defendants the sum of $2600, to be credited as part of the said $4300, if collected, it being the value of the rents above found.'

Judgment was signed on the 15th of November, 1870, and on the following day the defendant, William A. Simpson, filed a petition in error and a transcript of the record in the clerk's office of the Supreme Court of the State, in which he represents that the other defendants, naming each, will not consent to join in the petition, but the record shows that all the other defendants, on the 12th of January following, filed a petition in error in the Supreme Court, praying that the judgment rendered in the subordinate court should be reversed for the reasons stated in the petition of the first petitioner.

Due notice was given, by a summons issued under the first petition, to the original plaintiffs and all of the defendants except the first petitioner, that the first petitioner had filed such a petition and a transcript of the record in the clerk's office of the State Supreme Court, but all of the persons named as defendants in the original writ are also named as such in the summons issued by the clerk of the State Supreme Court. Service of the summons was duly acknowledged by the original plaintiffs and by all of the eight defendants who did not sign the first petition in error. Seasonable entry of the case was made in the Supreme Court of the State, and the parties having been fully heard the said Supreme Court affirmed the decree of the subordinate court and sent down their mandate commanding the subordinate court to cause execution to be had of the said judgment of the said Supreme Court, according to law.

Early application was made by the present plaintiff to the clerk of the Circuit Court of the United States for that district for a writ of error, under the twenty-fifth section of the Judiciary Act, to remove the cause into this court, and the record shows that it was duly issued and that it was properly allowed by the chief justice of the State Supreme Court.

Errors of a material character are assigned by the plaintiff as reasons for the reversal of the judgment rendered in the State courts, but it is necessary in the first place to examine the objection taken by the defendants to the jurisdiction of this court, as that objection presents a preliminary question which, if decided in favor of the defendants, will dispose of the case.

They, the defendants, insist that the writ of error should be dismissed because one only of the nine defendants in the court below is made a party in the writ as issued by the clerk of the Circuit Court, and because only one of the number has given bond to prosecute the writ of error with effect, as required by the act of Congress in such case made and provided.

Where there was a joint judgment against several and one only of the defendants sued out a writ of error, without joining the others, it was decided by this court, Marshall, C. J., giving the opinion, that it was irregular, and the court dismissed the writ of error. Subsequently the same rule was applied in a case where the cause was removed into this court by appeal, the opinion of the court being also given by the Chief Justice. Reference was made in the opinion in that case to the former decision, but the court, not relying merely on authority, decided that it was correct as matter of principle that the whole cause ought to be brought before the court at the same time, and that all the parties united in interest ought to unite in the appeal, as appeals are subject to the same rules, regulations, and restrictions as are prescribed by law in case of writs of error. Since those decisions were published the question has frequently been presented to this court, and has uniformly been determined in the same way, where it appeared that the interest was joint and that no severance had been effected either in the judgment or by subsequent summons and severance or by some proceeding of an equivalent character. Undoubtedly those cases show what the general rule is, but it is equally well established, where some of the parties in interest refuse to join in the writ of error or appeal, that the others are entitled to resort to the process and proceeding of summons and severance to enable them effectually to remove the cause from the subordinate court into the appellate tribunal for re-examination. Cases arise beyond all doubt where only one of several defendants is affected by the judgment or decree, and it is well settled that in such cases the party whose interest only is affected by the alleged error may carry up the case without joining the others in the appeal or writ of error. Exceptional cases of the kind occasionally arise, but where the interest is joint and the interest of all is affected by the judgment, the rule is universal, that all must join in the writ of error, else it is open to the other party to demand that it be dismissed, unless a severance of the parties in interest has been effected by summons and severance, or by some equivalent action appearing in the record.

Apply that rule to the present case, and it is clear that the writ of error must be dismissed, as one only of the nine defendants in the original suit is named in the writ of error; nor is there anything in the record to take the case out of the operation of the general rule, as the plaintiffs in the court below have recovered judgment for the several tracts of land described in the declaration, against all of the defendants therein joined. Separate judgment for the damages and the whole of the rents and profits is rendered against the present plaintiff; but the court also rendered judgment against the other eight defendants for the amount of the rents and profits, to be credited to the other defendant when collected, which shows that each defendant is interested in every part of the judgment.

Viewed in the light of these suggestions, it is quite clear that the writ of error in this case must be dismissed, as all the defendants are directly or indirectly affected by the judgment in respect to the damages and rents, issues and profits, as well as the judgment that the title to the lands described in the declaration is in the present defendants. Such a controversy cannot be properly re-examined here by instalments, nor unless all the parties to be affected by the result are before the court.

WRIT DISMISSED.

title: Simpson v. Greeley/Opinion of the Court


text: Talk:Simpson v. Greeley/Opinion of the Court


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Merchants' Mutual Insurance Company v. Baring

ERROR to the Circuit Court for the District of Louisiana; in which court Baring Brothers & Co. sued the Merchants' Mutual Insurance Company, of New Orleans, for advances made by them, as the declaration in the case alleged, to the master and owners of the British bark Fanny, for the purposes of her equipment and to procure a cargo for the vessel, in a voyage from Cadiz, in Spain, to the port of New Orleans. The plaintiffs also alleged that through their agents they had obtained a policy of insurance, dated December 6th, 1867, from defendants. The insurance company above named insuring the hull of the bark for $9000, in the name of the said agents, containing the clauses, 'on account of whom it may concern' and 'lost or not lost,' for the protection of those advances.

They further alleged that the bark, though well officered, manned, and equipped, suffered so much on the voyage, from the violence of weather, that the master found it necessary to put into a port of Cuba for such repairs as would enable him to prosecute the voyage; that their agents gave due notice of those facts to the president of the insurance company; that the company sent an agent to the port to take charge of the interest of all concerned; and that from the moment the agent arrived there he took exclusive charge of the repairs of the vessel and caused such work to be performed as he thought necessary; that he obtained from their agent there the funds necessary to pay for all such repairs; that the bark completed her voyage; that after her arrival at the port of destination an adjustment of averages was made by the adjusters of averages in that port for costs, charges, and damages in making such repairs, and that in the said adjustment they, the plaintiffs, were awarded $3507 on the said policy of insurance.

The defendants filed an answer (equivalent to the general issue in an action of assumpsit) and a special plea that the bark was unseaworthy.

The insurance company made three prayers for instruction:

(1.) That if the evidence showed that the insurable interest of the plaintiffs was a bottomry bond on the bark, and that the vessel arrived in safety at the port of destination, the jury should find for the defendants.

(2.) That it is only when the vessel insured is lost that the assured on a bottomry bond can recover, and that if the proof was that there was no loss or destruction of the bark, the jury should find for the defendants, if the plaintiffs had insured on a bottomry bond.

(3.) That the defendants were not bound to tender back the premiums of insurance before availing themselves of any defence against the validity of the policy of insurance, or for its avoidance by a subsequent cause.

Verdict and judgment went for the plaintiffs for the amount awarded by the average adjusters. Exceptions were taken by the defendants to the rulings of the court in refusing to instruct the jury as they requested.

Nothing appeared in the record except the declaration, the answer, the verdict and judgment, the three bills of exceptions to the rulings of the court in refusing to instruct the jury as requested, neither of which contained any report of the evidence, and the motion for new trial, which merely stated that the verdict of the jury was contrary to law and the evidence, without giving any statement of the evidence which was submitted to the jury.

Evidence to show that the action was founded upon a bottomry bond, or that such a bond was offered in evidence, or introduced at the trial, was entirely wanting, nor was there evidence, direct or circumstantial, to show that such a question as that involved in the third prayer for instruction arose or could have arisen in the case, or that the instruction was a proper one, in any view of the controversy, for the consideration of the jury.

Viewed in the light of these facts (as this court said that the case should be viewed), the several rulings of the court below in refusing to grant the three prayers for instruction were considered by this court together.

Mr. W. M. Evarts, for the plaintiffs in error; Messrs. P. Phillips and D. G. Campbell, contra.

Mr. Justice CLIFFORD, having stated the case, delivered the opinion of the court.


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Merchants' Mutual Insurance Company v. Baring/Opinion of the Court

Correct instructions, if applicable to the case, the court, as a general rule, is required to give, unless the same are in substance and effect embodied in those previously given by the court to the jury; but the court is never required by law to give an instruction to the jury which is not applicable to the case, even though it be correct as an abstract principle or rule of law; and it may be added that no prayer for instruction, whether presented by the plaintiff or the defendant, can be regarded as applicable to the case when it is wholly unsupported by the evidence introduced to the jury. Competent evidence may be written or oral, direct or circumstantial, but when there is no legal evidence of any kind to support the theory of fact embodied in a prayer for instruction, whether presented by the plaintiff or the defendant, the instruction should slways be refused; and such a ruling can never become a good cause for reversing the judgment. It is clearly error in a court, said Taney, C. J., to charge a jury upon a supposed or conjectural state of facts, of which no evidence has been offered, as the instruction presupposes that there is some evidence before the jury which they may think sufficient to establish the fact hypothetically assumed in that way by the court, and if there is no evidence which they have a right to consider, then the charge does not aid them in coming to a correct conclusion, but its tendency is to embarrass and mislead them, as it may induce them to indulge in conjectures instead of weighing the testimony. When a prayer for instruction is presented to the court, and there is no evidence upon the subject in the case for the consideration of the jury, it ought always to be withheld, and if it is given under such circumstances, it will, as a general rule, be regarded as error in the court, for the reason that its tendency may be, and often is, to mislead the jury by withdrawing their attention from the legitimate points of inquiry involved in the issue. Bills of exceptions ought to state that evidence was offered of the facts upon which the opinion of the court is prayed, else the court is under no obligation to give the instruction. Though the judge may refuse to declare the law to the jury on a hypothetical question, yet if he gives the instruction and it is erroneous, it is the proper subject of revision. But the true rule, if there be no evidence to support the theory of fact assumed in the prayer, is to reject it, as it is error to leave a question to a jury in respect to which there is no evidence.

Attempt is made in argument to maintain that the plaintiffs had no insurable interest in the bark unless it be assumed that it was created by a bottomry bond, but the court is entirely of a different opinion, as it is alleged in the declaration that the advances were made to equip the vessel and to procure for her a cargo in the voyage from a foreign port to the port of destination. Founded as the declaration is upon the policy of insurance it must be construed in connection with the policy. By the terms of the policy the insurance is upon the bark, her tackle, and apparel, which is the proper language to be employed in a case where the insured had an interest in the vessel.

Advances made on the credit of a ship for necessary repairs or supplies in a foreign port create a maritime lien upon the ship, and it is well-settled law that a maritime lien is a jus in re, and that it constitutes an incumbrance on the property of the ship which is not divested by the death or insolvency of the owner. Such a lien may be enforced by a process in rem, which is founded on a right in the thing, the object of the process being to obtain the thing itself, or a satisfaction out of it, for some claim resting on a real or quasi proprietary right in the thing. Liens of the kind constitute an insurable interest, and it is quite clear that enough is alleged in the declaration to warrant the conclusion that the advances made in this case are properly to be regarded as constituting a maritime lien upon the bark. Contracts for repairs and supplies may be made by the master to enable the vessel to proceed on her voyage, and if it appears that they were necessary for the purpose and that they were made and furnished to a foreign vessel or to a vessel of the United States in a port other than a port of the State to which the vessel belongs, the prim a facie presumption is that the repairs and supplies were made and furnished on the credit of the vessel, unless it appears that the master had funds on hand or at his command which he ought to have applied to the accomplishment of those objects, and that the material-men knew that fact or that such facts and circumstances were known to them as were sufficient to put them upon inquiry and to show that if they had used due diligence in that behalf they might have ascertained that the master had no authority to contract for such repairs and supplies on the credit of the vessel. Whenever the necessity for the repairs and supplies is once made out it is incumbent upon the owners, if they allege that the funds could have been obtained upon their personal credit, to establish that fact by competent proof, and that the material-men knew the same or were put upon inquiry, as before explained, unless those matters fully appear in the evidence introduced by the other party.

Apply those principles to the case and it is clear that the objection that the plaintiffs had no insurable interest in the bark utterly fails, as it is not controverted that the advances were made to equip the vessel and to procure a cargo for her in the described voyage; and it is sufficient that such an allegation affords a prim a facie presumption that the advances were made on the credit of the vessel, as the record fails to disclose any fact or circumstance to overcome that presumption. Such advances constitute a lien upon the ship, and such a lien gives the lender an insurable interest in the ship.

Absolutely nothing appears in the record to support the theory that any such defences as those assumed in the prayers for instruction were in fact set up by the defendants in the subordinate court, except what is contained in the prayers for instruction presented to the court. They pleaded a general denial of the allegations of the declaration and that the bark was unseaworthy at the inception of the risk and throughout the voyage, but no mention is made of any such defences as those implied in the prayers for instruction in any other part of the record, nor is there any evidence whatever upon the subject.

Defences in avoidance of the claim made in the declaration must be proved in the court of original jurisdiction, and if not provel there they cannot be successfully set up in the appellate court to support an assignment of error.

Other matters were discussed at the bar, but it is not necessary to examine any other of the propositions submitted, as these suggestions are sufficient to dispose of the case.

JUDGMENT AFFIRMED.


text: Talk:Merchants' Mutual Insurance Company v. Baring/Opinion of the Court


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Roach v. Summers

APPEAL from the Circuit Court for the Southern District of Mississippi.

Summers & Co. filed a bill in the court below against Eugene and Naylor Roach (the last a representative of I. W. Roach, deceased), and R. B. and B. M. Butler, for an account and for the foreclosure of a mortgage. The bill averred that in the year 1867, the said E. and I. W. Roach, demised a plantation in the State of Mississippi to R. B. and B. M. Butler for the business of cotton planting; that to enable the Butlers to obtain supplies for the plantation from the complainants, Summers & Co., the Messrs. Roach, together with the Butlers, executed two promissory notes, each in the sum of $2500, payable to the complainants, dated February 1st, 1867, and falling due in October and November of that year; that payment of the notes was secured by a mortgage given by the Messrs. Roach, and that it was agreed the cotton raised on the demised plantation should be shipped to the complainants; nothing being alleged in the bill as to what was then to be done with it or its proceeds. The bill further averred that in pursuance of this arrangement the complainants made advances to the Butlers, a part of which was repaid out of the proceeds of the cotton of 1867, but that $4774.69 remained unpaid after credit had been given for the cotton shipped in that year; that the Butlers, being desirous to continue planting cotton on the plantation during the year 1868, and being without the necessary money and supplies for that purpose, applied to the complainants to make additional advances, to secure which, as well as the balance then due, they executed a deed of trust of all the crops of corn and cotton they might raise on the plantation, stipulating that the net proceeds should be applied-first, to the payment of the supplies furnished for 1868; and secondly, to the payment of the balance due for the supplies furnished in 1867. It is then averred that after giving credit for all the cotton received there remained a balance due to the complainants of about $3600, the proceeds of the crop of 1868 having more than paid the advances made during that year, and having reduced the balance due at the close of 1867.

The defence set up in the answers was that the Messrs. Roach were only sureties for the repayment of the advances made to the Butlers in 1867, not exceeding $5000; that the notes and mortgage were given as securities for such repayment; that it was agreed that all the crops of cotton raised on the demised plantation should be applied to the payment of the notes, and that the cotton should be shipped to the complainants by the Butlers for that purpose as rapidly as it could be prepared for market, but that in fraud of the agreement the complainants subsequently, on the 19th day of February, 1867, entered into an arrangement with the Butlers, without the knowledge of the sureties, by which it was stipulated they should have an interest in the crop of 1867, that the Butlers should pay 2 1/2 per cent. commissions on the advances made, 10 per cent. interest, and the usual commissions for selling the cotton. It was further answered that in their account the complainants did charge 10 per cent. interest on money advanced, and 2 1/2 per cent. commissions; that instead of advancing supplies for the plantation, as they had agreed to do, they advanced chiefly money, and that by their usurious charges they made up the balance of $4774 as due at the close of the year 1867. The answers then asserted that the agreement of February 19th, 1867, and the subsequent dealings of the complainants with the Butlers, as exhibited by their accounts, in which they charged 10 per cent. interest and commissions, was an abandonment of the original contract and inconsistent with it, and that it operated as a release of the notes and mortgage.

The matter in issue was, therefore, a question of fact. Was the original agreement (a verbal agreement confessedly) which the bill set forth-the agreement that the cotton raised on the demised plantation should be shipped to the complainants-accompanied with the further stipulation which the answer alleged that it was accompanied with, to wit, that all the crops of cotton raised on the demised plantation should be applied to the payment of the notes, and that the cotton should be shipped to the complainants by the Butlers for that purpose as rapidly as it could be prepared for market.?

If this further stipulation was not contemporary with the original agreement, then the defence had no merit.

The language of the answer of Eugene Roach was thus:

'This respondent answering, says, that it was agreed and understood by and between said complainants and said Butlers that all the crops of cotton raised on said plantation, should be applied to the payment of the aforesaid promissory notes, and that the same should be shipped by said Butlers, for that purpose, as rapidly as it could be prepared for market.'

That of the Butlers (a joint answer), thus:

'They now state and aver that the sole and only consideration for the said notes, as understood and agreed upon by the said Roachs, these respondents and complainants, was plantation supplies to be furnished to these respondents by complainants for the leased plantation for the year 1867, and in no event were the said Roachs to be liable for a greater amount of supplies than the face of said notes. The said Roachs were to be liable only for the supplies for the year 1867, not exceeding $5000. The notes were simply given as security for said advances. It was further agreed between the said parties that the crop of 1867 was to be shipped to said complainants, and the succeeding crops to be also shipped, and that all shipments were to be first applied as credits on the said notes.'

Eugene Roach and R. B. Butler were examined as witnesses. The former said:

'The agreement between the parties to the notes mentioned in the bill, in regard to the payment thereof, was that the cotton raised by the Butlers should be shipped to Summers and Brannins, and proceeds first applied to the payment of the notes. I was not present when the agreement alluded to was made, but was subsequently informed by my brother, I. W. Roach, that such agreement was made when the notes were executed by the other parties; and at my brother's solicitation, and on account of his statement of such agreement, I also signed the notes.'

The testimony of B. M. Butler as appearing on examination in chief and on cross-examination, was thus: Examined in chief.

'Question. State whether or not, at the time said notes were made, there was any agreement that all the cotton shipped and to be shipped by you and your co-defendant, B. M. Butler, for the year 1867, as well as for subsequent years, was to be sold, and the proceeds thereof applied by complainants to the payment of said notes in preference to any other debts against you?

'Answer. There was such an agreement.' Cross-examined.

'Question. State when the agreement referred to in the interrogatory-in-chief was made, the particular date and year; whether before or after the notes and mortgage referred to in this case were made; with whom and by whom said agreement was made.

'Answer. The agreement was made in New Orleans, the 19th day of February, 1867, after the notes and mortgage were executed, with a member of the firm of Summers & Co., by me, acting for B. M. and R. B. Butler.'

Upon the bill, answer, and proofs the Circuit Court decreed in favor of the complainants, but in the settlement of the account and ascertainment of the debt due they were credited with only 8 per cent. interest and 2 1/2 per cent. commissions, while they were charged with the proceeds of all the cotton received by them from the plantation for both the years 1867 and 1868, and no exception was taken to this mode of stating the account.

This appeal was taken by the defendants Roach.

Mr. P. Phillips, for the appellants; Mr. Montgomery Blair (with whom was Mr. J. B. Beck), contra.

Mr. Justice STRONG delivered the opinion of the court.

title: Roach v. Summers


text: Talk:Roach v. Summers

title: Talk:Roach v. Summers


text:
Roach v. Summers/Opinion of the Court

No exception was taken in the Circuit Court to the mode in which the account was stated. Of course no exception can now be taken.

The only question, therefore, which can be considered in this court is whether the agreement of February 19th, 1867, by which it was stipulated between the complainants and the Butlers that the former should have an interest in the crop of 1867, as well as 10 per cent. interest and 2 1/2 per cent. commissions for advances, operated as a release of the notes and mortgage given by the sureties. The answer to the question depends upon what took place when the Messrs. Roach became sureties.

Waiving attention to the fact that no particular or defined interest was given to the complainants by their arrangement with the Butlers, it is plain it could not work a discharge of the sureties, unless it placed them in a different position from that which they occupied before it was made. If it took away any security they had in virtue of their contract with the complainants, it was doubtless a fraud upon them, and they are not holden by their notes and mortgage. If, when they became sureties, it was agreed by all the parties themselves, the complainants and the Butlers, that all the cotton crops raised on the demised plantation should be shipped to the complainants and credited against the advances to be made, it was bad faith to the sureties for the creditors to enter into an arrangement with the Butlers that a portion of the crops should be devoted to another use. On the other hand, if there was no such agreement respecting the crops made when the Messrs. Roach assumed their suretyship and gave their notes and mortgage, the subsequent arrangement with the Butlers was no alteration of the original contract, and had no effect upon it.

It is vital, then, to a correct decision of the case, to ascertain whether there was such an agreement made at the time the suretyship was undertaken, an agreement to which the Messrs. Roach were parties. It was averred in the answer of Eugence Roach that such an agreement was made between the complainants and the Butlers, but when it was made, whether at the time when the notes were given or afterwards, is not stated. Nor is it alleged that the sureties were parties to it, or that they executed their notes and mortgage in reliance upon it. The answer of the Butlers is substantially the same, though, perhaps, it may reasonably be construed as averring that such an agreement was made between all the parties when the notes were given. But assuming that the averment is sufficiently made in both answers, since it is new matter not responsive to anything in the bill, it must be sustained by proof to be of any avail as a defence.

And we do not find in the record any proof to sustain it. The only testimony upon the subject is that of Eugene Roach and R. B. Butler, two of the defendants. Roach testifies that it was agreed that the cotton crop raised by the Butlers should be shipped to Summers & Co., and that the proceeds should be first applied to the payment of the notes. But he does not state when or between whom this agreement was made. That he is not speaking from his own knowledge of what took place when the notes were given is certain, for he says he was not present, and that all his knowledge was derived from his brother. And the testimony of B. M. Butler also utterly fails to establish such an agreement. In answer to an interrogatory whether at the time the notes were made there was any agreement that all the cotton shipped or to be shipped by him and R. B. Butler for the year 1867, as well as for subsequent years, was to be sold and the proceeds thereof applied by the complainants to the payment of the notes in preference to any other debts due by him and R. B. Butler, he said there was such an agreement. But in his cross-examination he said the agreement of which he spoke was made in New Orleans on the 19th of February, 1867, after the notes and mortgage were executed. The evidence, then, wholly fails to prove the existence of the agreement made at the time when the suretyship was undertaken, and consequently the subsequent arrangement of February 19th, 1867, as well as the deed of trust for the crop of 1868, had no effect upon the liability of the mortgagors.

DECREE AFFIRMED.

title: Roach v. Summers/Opinion of the Court


text: Talk:Roach v. Summers/Opinion of the Court


text:
Bank v. Cooper

APPEAL from the Circuit Court for the Northern District of New York; the case being thus:

On the 4th of February, 1870, the Troy Woolen Company was adjudged a bankrupt by the District Court for the Northern District of New York, and on the 11th of March, 1870, one Tappan became the assignee. Soon afterwards Cooper, Vail & Co. proved a debt against the bankrupt amounting to $67,029, and on the 24th of July, 1870, filed the probate with the assignee. Subsequently, on the 29th of November, on petition of the First National Bank of Troy, which had also proved a debt against the bankrupt, the District Court made an order allowing them and the assignee to contest the validity of the claim of Cooper, Vail & Co. It was them referred to W. Frothingham, Esq., to take the proofs and accounts respecting the claim, to determine its legality and amount, and to report his conclusions to the court. Permission was also given to the assignee, and to any creditor of the bankrupt, if they desired to contest the claim, to attend the proceedings before the referee, and it appears that the bank did attend, that evidence in opposition to the claim was submitted, and that the referee reported the whole of it as due from the bankrupt. To his report joint exceptions were filed on behalf of the bank and the assignee, and argued in the District Court upon the evidence taken before the referee. These exceptions were overruled, and on the 13th of July, 1871, the court made an order allowing the debt as proved by Cooper, Vail & Co., and directing the bank to pay the costs and expenses of the reference.

In this condition of things, the bank filed a bill in the Circuit Court below against Cooper, Vail & Co., and the assignee, to procure a reversal of the order. The bill, after setting forth the facts above stated, made a general averment that Cooper, Vail & Co. had no legal claim against the bankrupt; that they had fraudulently proved their claim; that they knew this when the exceptions were taken to the referee's report as well as when the court made the decree allowing the debt, and that it was thus proved before the District Court. The bill then averred that the decree was erroneous, because there was no legal debt due by the bankrupt to Cooper, Vail & Co.; because the evidence before the court proved that there was no such debt, and because the court should have disallowed it.

This was one aspect of the bill. It further charged that the assets in the hands of the assignee were insufficient to pay fifty cents on the dollar of the legal debts of the bankrupt, even if the claim of Cooper, Vail & Co. were disallowed, and it averred that the assignee refused to appeal from the decision of the District Court, or to allow the creditors to appeal in his name, stating that he was advised that the bank had a right to have the decree reviewed under section second of the Bankrupt Act, and that if the creditors desired a review they would have to take that course. It then charged that the assignee was guilty of neglect of duty in omitting to appeal from the decree of the District Court, and renewed the averment that the bankrupt was not, and never was, liable for the debt proved against it by Cooper, Vail & Co., or for any part of it.

The prayer of the bill was that the decree made by the District Court might be 'reviewed, examined, revised, and annulled, and that the proof of debt filed with the assignee by Cooper, Vail & Co. might be rejected and expunged.'

The second section of the Bankrupt Act, through which it was alleged that the assignee had told the creditors if they wished relief they would have to resort, declares that the several Circuit Courts of the United States, within and for the districts where the proceedings in bankruptcy shall be pending, shall have a general superintendence and jurisdiction of all cases and questions arising under the act, and, except when special provision is otherwise made, may, upon bill, petition, or other process of any party aggrieved, hear and determine the case (as) in a court of equity.

Cooper, Vail & Co. demurred:

1. For want of equity.

2. For want of jurisdiction.

3. For want of privity between the complainant and the defendant.

4. That the matters had been adjudicated and that the adjudication was conclusive.

5. That the appeal was not within the time prescribed by law.

6. That the bill showed that the District Court had decided the questions presented by the bill, but that the bill did not set forth the facts, or the evidence upon which the order or decree of the District Court complained of was made, or any facts or evidence before the court when the order was made, or the grounds upon which that court based its said decision and order or decree.

7. That the bill of complaint did not set forth facts sufficient to enable the court to determine whether or not the District Court erred in making the order or decree complained of.

8. That the bill did not show that the District Court erred in making the order or decree in the bill complained of.

The Circuit Court sustained the demurrer, and the bank took this appeal.

Mr. E. F. Bullard, for the appellants; J. S. Stearns, contra.

Mr. Justice STRONG delivered the opinion of the court.

title: Bank v. Cooper


text: Talk:Bank v. Cooper

title: Talk:Bank v. Cooper


text:
Bank v. Cooper/Opinion of the Court

The demurrer presents the question whether the complainants' bill sets forth any equity sufficient to justify the court in granting the relief sought against the defendants.

No doubt when an executor or administrator colludes with a fraudulent claimant against a decedent's estate, and refuses to take steps to resist the claim, any person interested in the estate may maintain an action against such fraudulent claimant and the executor or administrator for the purpose of contesting the claim. Bills in equity of this nature have been maintained. And if anassignee in bankruptcy, with knowledge, or with reason to believe that one claiming to be a creditor of the bankrupt had proved a debt against the bankrupt's estate which had no existence, or which was tainted with fraud, should neglect or refuse to contest the allowance to such debt, there is no reason why the other creditors, having proved their debts, should not be permitted to interpose and seek the aid of a court of equity to annul the allowance. But the bill before us presents no such case. The assignee has resisted the allowance of the debt claimed by Cooper, Vail & Co. He took part with the appellants in contesting the debt before the referee to whose consideration it was submitted. He joined with them in filing exceptions to the report allowing the claim. There is no averment of any collusion between him and the claimants. The bill exhibits nothing which ought to cast discredit upon his fidelity to his trust. The referee decided against the appellants after hearing all the evidence they had to submit. The District Court reviewed his decision upon exceptions taken to it, and came to the same conclusion, allowing the debt claimed by Cooper, Vail & Co. Nor is it pretended that any new evidence exists which ought to lead the Circuit Court to any other conclusion than that at which the District Court arrived. In such a state of facts it cannot be maintained that it was the duty of the assignee to enter an appeal to the Circuit Court, or even to allow an appeal in his name. After two trials, in which he was aided by the appellants, after all the evidence had been made use of in opposition to the claim which could then be produced, or which can now be obtained, and after two decision allowing the claim, he may well have concluded, as he did, that his duty to his trust did not require either expenditure of the bankrupt's estate in further litigation or the delay which might have been consequent upon an appeal. The bill, then, wholly fails in exhibiting any equity against the assignee.

It is equally without equity as against Cooper, Vail & Co. It is true the averment is made that they have no legal or valid claim against the bankrupt, and that their claim was fraudulently proved and made, but there is no allegation wherein the fraud consists, or of any step they have taken in the assertion of their claim which they might not lawfully take. Such a general averment of fraud can be no foundation for an equity. Moreover, it is apparent that the only fraud intended in the averments of the bill is the assertion of a claim which the complainants insist is not sufficiently sustained by evidence. They objected to the claim at the outset. They appealed to the District Court, and they were allowed to contest its validity. It was at their instance a referee was appointed to examine and report upon it. Before that referee they went to trial, without objection. When defeated they brought the contest into court and renewed it there, but unsuccessfully. And they do not now allege that in either of these trials there was anything unfair, or that Cooper, Vail & Co. were guilty of any fraud in maintaining their claim, other than the assertion of its existence, or that they themselves made any mistake, or that they have any other case now than they had and urged before the referee and the District Court. Their only ground of complainant is that the referee and District Court came to a different conclusion from that which they think should have been adopted. The court thought the evidence established the existence of a debt due Cooper, Vail & Co. They are of a different opinion. They think the evidence did not establish the existence of such a debt, and, therefore, they have filed this bill in the Circuit Court to annul the action of the District Court. In effect they are seeking a new trial of a question of fact which has been decided against them, and this without averring anything more than that the District Court drew a wrong conclusion from the evidence. Very plainly they have made no case for equitable interference. There are some bills in equity which are usually called bills for a new trial. They are sustained when they aver some fact which proves it to be against conscience to execute the judgment obtained, some fact of which the complainant could not have availed himself in the court when the judgment was given against him, if a court of law, or of which he might have availed himself, but was prevented by fraud or accident unmixed with any fault or negligence of his own. But a court of equity will never interfere with a judgment obtained in another court, because it is alleged to have been erroneously given, without more. And such is substantially this case.

But though the bill is destitute of equity, when considered as an original bill, it is contended that it may be regarded as an application for the exercise of the supervisory jurisdiction of the Circuit Court authorized by the second section of the Bankrupt Act. That section declares that 'the several Circuit Courts of the United States, within and for the districts where the proceedings in bankruptcy shall be pending, shall have a general superintendence and jurisdiction of all cases and questions arising under this act, and, except when special provision is otherwise made, may, upon bill, petition, or other process of any party aggrieved, hear and determine the case (as) in a court of equity.' The complainants, having proved their debt against the bankrupt, contend that they may be considered parties aggrieved by any order of the District Court allowing the probate of other debts against the same bankrupt, when the assignee refuses to appeal from the order, or allow an appeal to the Circuit Court. It is true their bill was not filed in the Circuit Court until about four months and a half after the order complained of was made. But the act of Congress prescribes no time within which the application for a review must be presented. An appeal is required to be taken within ten days. Not so with a petition or bill for a review. Undoubtedly the application should be made within a reasonable time, in order that the proceedings to settle the bankrupt's estate may not be delayed, but neither the act of Congress nor any rule of this court determines what that time is. At present, therefore, it must be left to depend upon the circumstances of each case. Perhaps, generally, it should be fixed in analogy to the period designated within which appeals must be taken. It is, however, to be observed that the bill does not charge any fraudulent collusion between the assignee and Cooper, Vail & Co. At most it charges neglect of duty by the assignee in omitting to contest the debt claimed, and in failing to appeal from a decree of the District Court allowing the debt. Whether this presents a proper case for a review under the second section of the Bankrupt Act need not now be decided. For should it be conceded that the complainants had a right to apply to the Circuit Court for a review of the order of the District Court, and conceded also that this bill may be regarded as such an application, the question would still remain whether the court erred in dismissing it. Had the court, in the exercise of its superintending jurisdiction, heard the case and decided it, as the District Court did, the decision would have been final, and no appeal could have been taken to this court. True, if the court had decided that it had no jurisdiction to review, this court might have entertained an appeal, not for the purpose of reviewing, but for the purpose of correcting an erroneous decision respecting the power of the Circuit Court, and enabling the complainants to be heard on their application. But it does not appear that this bill was dismissed because the court thought it had no power to review the action of the District Court at the suit of these complainants. On the contrary, it rather appears the bill was dismissed because it presented no case that called for the exercise of the superintending jurisdiction of the court. The statute, though conferring the power, does not make it obligatory upon the Circuit Court to retry every decision of the District Court which a creditor supposing himself aggrieved may ask the court to retry. And it may well be that when, as in this case, a question of fact has been twice tried, and twice decided in the same way, when it is not averred that there has been any collusion between the assignee and the creditor who has proved a debt, or that the complaining party has any evidence which he has not already submitted, or that he has been hindered by any accident or fraud from presenting his case as fully in the District Court as he can in another tribunal, when the substance of all he alleges is that, in his opinion, the court should have determined the facts differently, it may well that the Circuit Court, in the exercise of its discretionary power, looking also at the delay of the application, may properly conclude that no sufficient case is presented calling for a retrial of the facts.

We do not perceive, therefore, in the action of the Circuit Court anything that requires correction, and the

DECREE IS AFFIRMED.

title: Bank v. Cooper/Opinion of the Court


text: Talk:Bank v. Cooper/Opinion of the Court