the Interior Department cannot rightfully exercise any authority or control in the matter of leasing the land or receiving the rent, and that the decision of the Supreme Court of the state of Washington in the case of Bird v. Winyer, 24 Wash. 269, 64 Pac. 178, was a lawful adjudication by a court of competent jurisdiction of the questions which were at issue in that case between Bird and the heirs of his deceased wife. Let a decree be entered in favor of the complainant, declaring him to be entitled to the exclusive possession of the 160 acres of land described in his complaint, and every part of it, and that the heirs of his deceased wife have no interest therein, nor right to possession of any part of it, and let an injunction issue against the defendant, Terry, forbidding him from molesting the plaintiff or his tenants in their occupation and use of the land, and from receiving any part of the rent for the same. In re CONGDON. (District Court, D. Minnesota, Sixth Division. January 4, 1904.) 1. BANKRUPTCY - GENERAL ASSIGNMENT - ALLOWANCE FOR SERVICES OF AsSIGNEE. A general assignment, procured from an insolvent by the attorney for the assignee, which resulted in no advantage to the estate, but rather in detriment, is, not only in law but in fact, a fraud on the bankruptcy law, and no allowance will be made by the court of bankruptcy to the assignee for services rendered by himself or his attorney. In Bankruptcy. On certificate from referee. The following is the referee's certificate: I, Ole J. Vaule, the referee in bankruptcy in charge of this proceeding, do certify as follows: November 20, 1903, the above-named Darius H. Congdon was adjudicated bankrupt, and December 5, 1903, Thomas P. Jumper was appointed trustee of his estate in bankruptcy. October 13, 1903, the bankrupt made to the said Thomas P. Jumper a general assignment of all his property for the benefit of all his creditors, under what might probably be called a common-law deed of assignment. December 5, 1903, Thomas P. Jumper filed his account as assignee under said deed, and asked that he be credited with the following items: Cash paid for insurance.. Cash paid for rent of store.. $70 00 40.00 Attorney fees due Morphy, Ewing & Bradford, for services rendered 85 00 Personal services 25.00 By an order of December 8, 1903, I allowed the items of $70 paid for insurance and $40 paid for store rent, but disallowed the items of $85 attorney fees and $25 for personal services, and Thomas P. Jumper, being aggrieved thereby, filed his petition December 21, 1903, for the review of said order by the judge. The facts leading up to and connected with the assignment are as follows: Shortly prior to October 31, 1903, the bankrupt, being financially embarrassed, had made arrangements with his attorney, Henry Funkley, to go through bankruptcy, and the only or main reason why his petition in bankruptcy had not been filed before this date was that the attorney had not had time to make out the necessary papers. On the 13th of October, 1903, John M. Bradford, one of the attorneys of Thomas P. Jumper, came to the store of the bankrupt, at Blackduck, and requested the bankrupt to give a deed of assignment. The bankrupt told him he had decided to go through bankruptcy, but Mr. Bradford insisted that it was much better for the bankrupt to make an assignment, that the assignee would leave the bankrupt in possession of the store at a salary of $50 or $60 per month, and that the creditors would furnish him with new goods, as they might be needed, and extend the time of payment. On the strength of these representations the deed of assignment was obtained. The bankrupt was in possession of the store, as he had been before, but the new goods that were promised were not forthcoming, and all that Mr. Jumper did as assignee was to take out a policy of insurance, pay a month's store rent, and write the bankrupt a few letters for money. It is needless to say that a retail store of general merchandise cannot be kept going in the regular course of trade unless the stock is from time to time replenished. Mr. Jumper is the credit man of George R. Newell & Co., and there is no question but that he could have supplied the bankrupt with the necessary goods, had he been so disposed. The agreement to leave the bankrupt in the possession and control of the business at a salary, and to furnish him with new goods, seems to me, under the circumstances of the case, to be so unbusinesslike and unreasonable that it could never have been intended to be kept, but that it was simply used to induce the bankrupt to make the deed of assignment. The deed itself is also peculiar. It provides that the assignee shall not be liable for "any wrongful acts of any agent by him appointed to carry out said trust." He does everything in this line through agents. He has the selection of them, and, if he is not to be liable for their misdeeds, the creditors have poor protection. While it does not appear how soon the petition in bankruptcy would have been filed, had not the assignee interfered, it is apparent that on account of this interference much valuable time has been lost to this estate. Assignments have generally been considered frauds on the bankruptcy law, and for that reason no compensation has been allowed either the assignee or his attorney for their services; the interests of both being in conflict with the provisions of the bankruptcy law. Collier on Bankruptcy (4th Ed.) 464; In re Gutwillig, 1 Am. Bankr. Rep. 78, 90 Fed. 475. But see Randolph v. Scruggs, 10 Am. Bankr. Rep. 1, 190 U. S. 533, 23 Sup. Ct. 710, 47 L. Ed. 1165. However, the assignee has quite generally been reimbursed for actual expenses wisely and necessarily incurred for the benefit of the estate, where such reimbursement would not result in duplication of charges. But it has also been held that, inasmuch as the assignee must know that his position is in conflict with the scheme and purpose' of the bankruptcy law, he should not be allowed any disbursements incurred by him prior to the filing of the petition in bankruptcy. In re Gladding Co., 9 Am. Bankr. Rep. 171. The decision by the referee in this case was affirmed by Judge Brown, of New York, and the case is now on appeal before the Circuit Court of Appeals. See Summers v. Abbott, 10 Am. Bankr. Rep. 254, note, 122 Fed. 36, 58 C. C. A. 352. In the case last cited, the assignee under a common-law deed of assignment took possession of a large stock of merchandise. He sold part of it at retail and the balance in bulk. He spent about one month in the management of the estate, and realized for the estate in cash over $40,000. Under these circumstances the Circuit Court of Appeals of this circuit held: "While an assignment for the benefit of creditors, executed within the four-months period, is an act of bankruptcy, yet, if honestly made for the purpose of applying all the property of the assignor to the payment of his debts, the assignee, who accepts the trust in good faith and executes it intelligently, successfully, and honestly, is entitled, upon turning over the proceeds of the sale of property to the trustee in bankruptcy or his assignors, to be paid a fair and reasonable compensation for his services and those of his attorneys." But in the case at bar the assignee acted neither "intelligently" nor "successfully," and I fail to see how he could have acted in good faith. In the Summers Case the court said (page 269, 10 Am. Bankr. Rep., page 40, 122 Fed., and page 356, 58 C. C. A.): "To prevent misapprehension, it is proper to say that this case has none of the odious features about it that sometimes crop out in cases where insolvents make deeds of assignment for the professed benefit of their creditors, but which are in fact made to embarrass and defraud them, and where the assignee is a willing instrument of the fraudulent debtors. In such cases, according to an old and well-settled principle, quite independent of the bankrupt act, neither the assignee nor his attorney is entitled to any compensation for their services out of the fraud." It seems to me, that in the case at bar the assignment was a fraud on the bankrupt act (Act July 1, 1898, c. 541, 30 Stat. 544 [U. S. Comp. St. 1901, p. 3418]), not only in law, but in fact. From their relation with Mr. Congdon, the assignee and his attorney must have known that bankruptcy was inevitable, and that they were doing the estate only damage. As between the attorney and his clients, $85 for his expenses and trouble in going to Blackduck is no doubt reasonable; but the amount should, in my opinion, not be saddled upon the estate in bankruptcy simply because the attorney was ingenious enough to procure a deed of assignment. On the strength of the Summers Case the procurement of deeds of assignment has become an industry to be guarded against. I enclose herewith the assignee's account (with a copy of the deed attached), my order thereon, the petition for review, and the evidence. John M. Bradford, for assignee. LOCHREN, District Judge. For the reasons stated by the referee, his decision is in all things affirmed. EMPIRE STATE CATTLE CO. et al. v. ATCHISON, T. & S. F. RY. CO. (Circuit Court, D. Kansas, First Division. April 2, 1904.) 1. CARRIERS-ACTION FOR INJURY TO PROPERTY IN SHIPMENT-PLEADING. In an action against a railroad company to recover damages for an alleged violation of duty as a common carrier, plaintiff is not required to plead or prove the written contract under which his shipment was made, which, if relied on by defendant, is a matter of defense. On Motions by Defendant to Require Plaintiffs to Amend Their Petitions. Botsford, Deatherage & Young and R. E. Ball, for plaintiffs. POLLOCK, District Judge. The above actions are brought by plaintiffs to recover damages from defendant railway company, alleged to have been sustained by plaintiffs in the shipment of cattle over the defendant's line of railway during the flood of last year in the Kaw river. The petitions filed by plaintiffs declare upon a violation of defendant's duty as a common carrier for hire. A motion by defendant company has been interposed in each case, requiring plaintiffs to amend their petition by stating whether the contracts of shipment of the cattle mentioned in said petition were in writing or oral, and, if said contracts were in writing, that plaintiffs be required to attach a copy or copies thereof to said petitions, in order that the defendant may be fully advised as to the terms and conditions upon which said shipments of cattle were made, the destination of same, and the route, if any, agreed upon by the terms of such contracts. That contracts for shipment of the cattle were entered into between the parties, and that such contracts are in writing and in the possession of plaintiffs, was admitted by counsel for plaintiffs in the oral argument of this motion. The question is, should the court, by its order, require the plaintiffs to set forth and declare upon such written contracts? Counsel for plaintiffs contend their actions are in form ex delicto, and that they are not required by the rules of pleading to rely upon or set forth the contracts, if any exist, between the parties to the action. Counsel for defendant contends, in the absence of a direction from Congress, the practice adopted and followed by the state courts of this state under the Code must control. This latter contention I think correct. The common-law forms of action are, by provision of the Code, expressly abolished. All a plaintiff is required to do in pleading under the Code is to state the facts constituting his cause of action in plain and concise language, without repetition. It is no concern of the pleader, under the Code of this state, whether the facts. constituting his cause of action form a cause of action which at the common law would be denominated ex delicto or ex contractu, or both in one; but the settlement of this contention does not, in my judgment, settle the question under consideration. I do not find the Supreme Court of this state to have ruled upon the precise question under consideration here, and no authoritative decision of that court is cited by counsel. The exact question, in my judgment, is, admitting a contract of shipment between the parties, in writing, to exist, and in the possession of plaintiffs, as was admitted at the oral argument, must the plaintiffs plead and prove such contracts, as a part of their case, or is such contract a matter of defense to the carrier? Upon investigation of this subject, I find the precise question to have been passed upon by the Court of Appeals for this circuit in Southern Pacific Company v. Arnett, III Fed. 849, 50 C. C. A. 17. In that case, Judge Thayer, in delivering the opinion of the court, says: "A special contract, when exacted by a carrier, is a defensive weapon to be made use of by the carrier when sued by the shipper for any alleged dereliction of duty against which it was designed to afford protection." Upon authority of that case, controlling here, the motion will be overruled. FROST & ADAMS v. SALTONSTALL, Collector. (Circuit Court, D. Massachusetts. November 12, 1887.) No. 2,892. 1. CUSTOMS DUTIES-PROTEST-TIMELINESS-HOLIDAYS. Notice was posted in a customhouse that it would be closed June 17th -a holiday observed by local custom, but not established by law. Certain importers, having notice of the closing of the customhouse on that day, which was the tenth day after the liquidation of their entry, filed a protest on the day following. Held, that the protest was filed in accordance with the requirements of section 2931, Rev. St., providing that protests shall be made "within ten days after the ascertainment and liquidation of the duties." This action was brought by Frost & Adams, importers, against Leverett Saltonstall, collector of customs at the port of Boston, to recover excessive duties which had been paid under protest. The entry in question was liqui 129 F.-31 dated June 7. 1887, but the importers did not file their protest with the collector until June 18th. The customhouse, however, was closed on June 17th, in celebration of Bunker Hill day, which, it appeared, was not a holiday established, but a local one observed in Boston and vicinity in accordance with a long-standing custom. The importers contended that, as June 17th was not a legal holiday, the collector had no right to close the customhouse on that day, and that the protest might be filed on the following day, the 18th, and yet satisfy the requirements of section 2931, Rev. St., where it is provided that protests shall be made to the collector in writing "within ten days after the ascertainment and liquidation of the duties by the proper officers of the customs." Note Shefer v. Magone (C. C.) 47 Fed. 872. On appeal to the Secretary of the Treasury in accordance with said section 2931, it was decided, June 28, 1887, that the protest was not in time; the following language being used in the secretary's letter to the collector: "It appears from your report that the entry of the merchandise in question was liquidated on the 7th instant, while the protest and appeal were not lodged until the 18th instant, more than ten days after the date of liquidation. The department must therefore decline to entertain the appeal. The claim of the appellants that the protest should be considered as filed in time because the customhouse was closed on the 17th of June, the tenth day after liquidation, cannot be allowed, inasmuch as it has been invariably held by the Department (see T. D. 7,858) that the ten days prescribed by section 2931 of the Revised Statutes include Sundays and holidays; and, besides, it is not understood that any legal authority existed for closing the customhouse on said date." The importers thereupon brought suit against the collector, setting forth in their declaration that they had filed with the defendant a "due and timely" protest in writing, and the following motion was entered in their behalf: "And now comes the plaintiff, and makes a motion that the protest per steamship Pavonia, mentioned in the second item of the bill of particulars, as filed June 18, 1887, may be adjudged to have been filed in accordance with the requirements of section 2931 of the Revised Statutes of the United States. At the trial of the case the plaintiff's counsel testified that he had called at the customhouse on June 16th, and there found notice posted that it would be closed to business on the day following. It was argued that, if the collector might properly close the customhouse on one day, he might close it for 10 days or more, and thus entirely defeat the importers' rights. Charles P. Searle, for importers. T. H. Talbot, Asst. U. S. Atty. COLT, Circuit Judge. At the close of the argument the court ruled that this notice furnished a good excuse for not filing a protest June 17th, and made a protest filed on the 18th valid. Motion allowed, and judgment entered for the plaintiff. PRICE & HART v. T. J. ELLIS & CO. (Circuit Court, E. D. Arkansas, W. D. April 11, 1904.) No. 5,265. 1. REMOVAL OF CAUSES-AMOUNT IN DISPUTE COUNTERCLAIM. Where the defendant in an action by a nonresident in a state court to recover a sum less than $2,000 files a counterclaim by which he seeks to recover a sum greater than $2,000, the cause is removable by the plaintiff at or before the time he is required to plead to such counterclaim. ¶ 1. See Removal of Causes, vol. 42, Cent. Dig. § 131. |