future day in this term, or so soon as practi cable, of and concerning the following matters: 1. That he state an account of all the labor done, and materials furnished, and the value thereof, at the agreed prices, under all the contracts set out and referred to in the bill and cross-bill herein, distinguishing the value of that paving done opposite the lots of private owners from the remainder, and also of all payments made on account of —, distinguishing the payments as above in the paving; and also finding how such payments were made, and under what agreement, if any. 2. That he find how many bonds the City of Memphis loaned T. E. Brown & Co.; and whether such bonds had a market value, and what that value was at the date of the loans; also, at the date of the maturity of the loans; also, at the bringing of this suit; also, how much, if any, the City of Memphis was indebted to T. E. Brown & Co. at the date of such loans. This authority was pursued in making the contract. Bids were sought by advertisement. Bids were made by different parties. The bid of Taylor, McBean & Co. was accepted, as the most favorable to the City. The formal contract was entered into under these stipulations. We think this contract cannot be modified, as if it were an ordinary contract, made under the ordinary municipal authority. If the Common Council can vary it by assuming duties and waiving obligations therein imposed upon the 321*] contractors, in respect *to the collection of the bills and the employment of attorneys, they may do it by increasing the price to be paid for the work. Instead of favoring the contractors to the extent of $35,000, as is proposed 3. That he find and report how many of the in the present instance, they may give them un- City's bonds were delivered under the contracts, limited favors. This idea is in hostility to the dated July 16th and November 13th, 1867, in entire scheme of advertising for bids, contract-payment, as therein provided; and also the value ing with the lowest bidder, fixing the amount of the debt and lien of each lot owner. We think the contract as made must be abided by. It must be performed according to its terms. of such bonds when delivered; and the average value of such bonds in this market and New York, since delivery, to the bringing of this action; also, the value at such times in Memphis and New York, of such bonds having the payment of the principal and interest secured by a sinking fund set aside for that purpose. 4. That he find and report whether any, and if so, how much work was done by such contractors for the City, additional to that provided." 2. The case fails to show any variation of the contract by authority of the City. No Act of the Common Council appears giving sanction to the changes alleged to have been made. The Mayor and the city attorney, one of the contractors testifies, "were apprised of the extraordinary efforts we were making to effect collections without suit, and approved the same In April following, this motion was granted and urged us to make all possible efforts. My and an order entered reciting that the law acrecollection is that Mr. Morgan, the city attor- tion involving an accounting and adjudication ney, advised the same course." Mr. Waddel, of questions arising thereon was by consent Mr. Foster, the city engineer, Mr. Ballard and joined with the present action, and the cause Mr. Brown, all testify on this subject. In no being at issue and coming on for hearing, it instance is there any other evidence of author- was ordered that it be referred to Mr. Mitchell, ity than that the Mayor and city attorney urged as *master in chancery, to take proof, [*297 them to make great efforts in the collections, hear and report to the court the proof, and his and advised them to retain counsel in looking conclusions upon the following matters involvup titles and to aid in bringing suits. It is not ing 27 items as already stated, of which the suggested even that the finance committee, final was, that he state an account between the which was the agent of the City in making the plaintiff and defendant, embracing therein all contract, advised or assented to any change in the matters in the cause of the bill and crossits terms. We think that a contract entered bill herein, and showing in the result the aggreinto with the solemnities observed in the pres-gate balance of indebtedness of the debtor party ent instance cannot be modified upon the evidence of authority here referred to. There is no evidence that the City ever assented to the change. Carroll v. St. Louis, 12 Mo., 444; But ler v. Charlestown, 7 Gray, 12; Clough v. Hart, 11 Am. L. Reg. (N. S.), 95; Halstead v. Mayor, 3 N. Y., 430. VII. It is also alleged as error that before the cause was ready for a decree, and without settling the rights of the parties, the court referred it to a master for an account, and the master took and stated the account under his own view of the law and the facts, and virtually decided the case instead of the court. 322*] *In November, 1870, Messrs. Brown & Co. moved for an order of reference upon the following notice: "Comes T. E. Brown, by solicitors, and moves the court in this cause to order an interlocutory decree of reference to the clerk of this court, as master, to find and report to the court, at a to the other. Under this order evidence was taken by the parties until June 6, 1871, when the counsel for the respective parties announced that they desired to present no further evidence, and submitted the matters of reference for the determi nation of the master. No exception was taken to the order of reference. No exception was taken before the master. All the evidence was presented that was desired by either party. Full justice in this respect was attained, and we are of the opinion that this allegation of error is not well grounded. Field v. Holland, 6 Cranch, 25; Story v. Livingston, 13 Pet., 359; 2 Smith, Ch. Pr., 372; Troy Iron & N. Factory v. Corning, 6 Blatchf., 328. The result of our opinion is, that the judgment is correct, except as to the items hereinbefore discussed-of $89,608 damages for the want of a sinking fund, of $10,000 for the services of attorneys, and $25,000 for the plaintiff's services in collecting the bills for paving. As to these there was error. The decree is reversed, and the case is remitted to the Circuit Court, with directions to enter a decree in accordance with these views. Mr. Justice Field and Mr. Justice Bradley concur in the judgment of reversal, but dissent from the opinion, they holding that the contractors ought to be charged with the full amount of bonds received by them, inasmuch as the City of Memphis had no authority to sell its bonds for less than their par value. THE FIRST NATIONAL BANK OF TROY, Appt. บ. MARVILLE W. COOPER, Walter Vail, William B. S. Gay, and Charles T. Randall, Formerly Partners as Cooper, Vail & Co., and Shepard Tappin, Assignee of the Troy Woolen Company. (See S. C., 20 Wall., 171-178.) Bill to procure reversal of order of court. Where an assignee in bankruptcy contested a claim, after two decisions allowing the claim, a bill will not lie against the assignee and the creditor claimant, to procure a reversal of the order allowing the claim when there is no collusion between the claimant and the assignee, nor other special ground for equitable interference. This was a bill in equity, filed in the court below by the appellant. The bill stated that the Troy Woolen Company was, upon the petition of certain creditors, adjudged a bankrupt by the District Court of the United States for the Northern District of New York; that the complainant proved a debt in its favor against said bankrupt to the amount of $14,943.46 which was allowed by the register; that Cooper, Vail & Co., appellees, formerly proved a debt against said bankrupt amounting to $67,029.81, with interest; that, on petition, the district court made an order allowing complainant and appellees to contest this claim, and referred the matter to a referee; that the complainant and other creditors requested the appellees to contest the bill and employ counsel for that purpose; that the said Cooper, Vail & Co. did not then have any legal or valid debt or claim against said bankrupt, and the said assignee well knew that fact at the time he was requested to defend the same, but he then and there refused to contest said claim or employ counsel for that purpose, or to pay any of the expenses of the contest out of the trust fund; that evidence was given before the referee to show that the claim was invalid but that the referee reported that the whole of such claim was due; that exceptions to his report were filed, signed by the attorney of the assignee and by the attorney of this complainant; that the district court made a decree allowing the said debt; that the assets in the hands of the assignee will not pay fifty cents on the dollar if said claim should be disallowed; that this complainant and other creditors requested the assignee to appeal from the above decree of the district court, but that he refused so to do, and though requested, never consented to allow the creditors to appeal in his name. The bill asked that the decree of the district court, confirming the claim of Cooper, Vail & Co., should be examined and annulled, and an injunction issued to the assignee, enjoining him from paying dividends on said claim. The defendants demurred, and the circuit court sustained the demurrer and dismissed the bill. The complainant appealed to this court. Mr. Justice Strong delivered the 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. The object of the bill is to procure a reversal of an order of the district court made under the following circumstances: on the 4th day of February, 1870, the Troy Woolen Company was adjudged a bankrupt by that court, and on the 11th of March, 1870, Shepard Tappin, one of the defendants, became the assignee. Soon after the other defendants, Cooper, *Vail & [*172 Co. proved a debt against the bankrupt amounting to $67,029.81, and on the 24th day of July, 1870, they filed the probate with the assignee. Subsequently, on the 29th of November next following, on petition of the appellants, who 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 then referred to Worthington 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 complainants 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 this report, joint exceptions were filed on behalf of the complainants and 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 complainants to pay the costs and expenses of the reference. The bill, after setting forth these facts, makes a general averment that Cooper, Vail & Co. have no legal claim against the bankrupt; that they have 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 complainants then aver 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 is one aspect of the bill. The complain-ture of the bankrupt's estate in further litigaants, however, further charged that the assets tion or the delay which might have been consein the hands of Cooper, Vail & Co. are insuffi- quent upon an appeal. The bill, then, wholly cient to pay fifty cents on the dollar of the legal fails in exhibiting any equity against the debts of the bankrupt, even if the claim of assignee. Cooper, Vail & Co. be disallowed, and they aver 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 the complainant had a right to have the decree reviewed under section 2 of the Bankrupt Act, and that if the creditors desired a review they must take that course. They then charged that the assignee was guilty of neglect of duty in omitting to appeal from the decree of the district court, and they renewed the averment that the bankrupt is not, and never was, liable for the debt proved against him by Cooper, Vail & Co., or for any part of it. It is upon these facts they base the prayer of the bill, which is that the decree made by the district court may be "reviewed, examined, revised and annulled, and that the proof of debt filed with the assignee by Cooper, Vail & Co. may be rejected and expunged." 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 an assignee 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 of 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 175*] 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 can not 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 decisions allowing the claim, he may well have concluded, as he did, that his duty to his trust did not require either expendi 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 [*176 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 complaint 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 2d section of the Bankrupt Act. 14 Stat. at L.. 517. That section declares that "The several Circuit Courts of the United States, within and for the *districts where the proceedings [*177 tion 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 be 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. 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 re- We do not perceive, therefore, in the action view must be presented. An appeal is required of the Circuit Court anything that requires corto be taken within ten days. Not so with a pe-rection, and the decree is affirmed. tition 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, Debts due the United States not barred by dis UNITED STATES, Plff. in Err., v. FRANCIS J. HERRON. (See S. C., 20 Wall., 251-264.) charge in bankruptcy. Debts due to the United States are not within the provisions of the Bankrupt Act, and are not barred by a discharge under such Act. [No. 252.] Argued Mar. 25, 1874. Decided Apr. 13, 1874. The case is stated by the court. A discharge under the Bankrupt Law does not bar a debt due the United States. As the United States is not mentioned by name, according to a familiar principle of law, re-asserted at this term in the most explicit manner, it is not bound by this statute, broad as the words seem to be. Dollar Savings Bank v. U. S. (ante, 80). And this has been the uniform construction of similar Bankrupt Acts in England and this country. it should be fixed in analogy to the period designated within which appeals must be taken. Littlefield v. Del. & Hud. Can. Co., 4 Bank. Reg., 77. 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 2d 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 178*] *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. Morgan v. Thornhill, 11 Wall., 65, 20 L. ed. 60; Tracey v. Altmyer, 46 N. Y., Anon., 1 Atk., 262; U. S. v. King, Wall. (C. True, if the court had decided that it had no ju-C.), 12; People v. Herkimer, 4 Cow., 345; Commonwealth v. Hutchinson, 10 Pa., 466; Eden, risdiction to review, this court might have entertained an appeal, not for the purpose of Bankr. L., 413; Hill, Bankr., 2d ed., 295; Robreviewing, but for the purpose of correcting an son, Bankr., 553; 1 Christian, Bankr., 535; 1 erroneous decision respecting the power of the Deac. Bankr., 784; 1 Cooke, Bankr. L., 246, circuit court and enabling the complainants to 329; Shelf. Bankr., 303; Awdley v. Halsey, Sir be heard on their application. People v. R Co., W. Jones, 202; Atty-Gen. v. Capell, 2 Show., 29 N. Y., 418. But it does not appear that this 480; People v. Gilbert, 18 Johns., 229; Magbill was dismissed because the court thought it dalin Coll. case, 11 Co., 74; Bac. Abr. 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 ques 598. (No counsel appeared for the defendant in error). Mr. Justice Clifford delivered the opinion of the court: Proceedings in bankruptcy are deemed to be commenced from the filing of the petition in bankruptcy, either by a debtor in his own behalf or by any creditor against a debtor; and if NOTE. Priority of United States in paymen from assets of a debtor-see note, 29 L. R. A. 226 275 it appear to the court that the bankrupt has in all things conformed to the requirements of the Bankrupt Act, it is made the duty of the court to grant him a certificate, under the seal of the court, that he be forever discharged from all debts and claims that by said Act are provable against his estate, which existed on the day the petition for adjudication was filed, excepting such debts, if any, as are by said Act, excepted from the operation of a discharge in bankruptcy. 14 Stat. at L., 533. With the exception of the debts specified in the 33d section, the Act provides that a discharge duly granted under the Act shall release the bankrupt from all debts, claims, liabilities and demands which were or might have been proved against his estate in bankruptcy. 254*] *Collectors of internal revenue taxes are required by law to give bond for the faithful discharge of their duties, and the record shows that Lewis B. Collins, 'having been duly appointed to that office for the Third District of Louisiana, gave the required bond, and that the present defendant was one of his sureties. Default having been made by the principal, the United States brought an action of debt on his official bond, joining all the sureties with the principal. They allege two breaches, as follows: (1) That the principal did not pay over all the public moneys he received for the use and benefit of the plaintiffs. (2) That he did not do and perform all such Acts and things as were required of him by the Treasury Department. Service was made and the defendant appeared and pleaded, as a peremptory exception, that on the 30th day of May, 1868, he filed his petition in the district court to be adjudged a bankrupt, and that the court, on the 18th of January following, in due course of law, granted him a discharge under the provisions of the Bankrupt Act in the words and figures set forth in the record, which, as he alleges, is a full and complete bar to the plaintiff's demand. Hearing was had and the court awarded judgment for the defendant and the plaintiffs sued out a writ of error and removed the cause into this court. Since the case was entered in this court the plaintiffs assign for error that a discharge under the Bankrupt Law does not bar a debt due the United States. | 14 Stat. at L., 533; forth in the declaration. U. S. v. Davis, 3 McLean,483. Instead of that, the question presented by the assignment of error in this court must depend upon other provisions of the Bankrupt Act, when properly construed, in view of the settled rule of construction that the sovereign authority of the country is not bound by the words of a statute unless named therein if the statute tends to restrain or diminish the powers, rights or interests of the sovereign. Anonymous, 1 Atk., 262; Rex v. Earl, Bunb., 33; Rex v. Pixley, Bunb., 202. Where an Act of Parliament is made for the public good, as for the advancement of religion and justice, or to prevent injury and wrong, the King is bound by such Act, though not particularly named therein; but where a statute is general, and thereby any prerogative, right, title or interest is devested or taken from the King, in such case the King is not bound, unless the statute is made to extend to him by express words. 8 Bac. Abr., by Bouv., tit. Prerog., E, 5, U. S. v. Knight, 14 Pet., 315. Acts of Parliament, says Chitty, which would devest or abridge the King of his prerogatives, his interest or his remedies, in the slightest degree, do not in general extend to or bind the King, unless there be express words to that effect. Therefore, says the same learned author, the Statutes of Limitation, bankruptcy, insolvency, set-off, etc., are irrelevant in the case of the King, nor does the Statute of Frauds relate to him, which last proposition is doubted by high authority. Prerog., 383; 19 Vin. Abr., tit. "Stat. E," 10. Exceptions exist to that rule undoubtedly, as where the statute is passed for the general advancement of learning, morality and justice, or to prevent fraud, injury and wrong, *or where an Act of Parlia- [*256 ment gives a new estate or right to the King, as in that case it will bind him as to the manner of enjoying or using the estate or right as well as the subject. Debts due to the United States, it is expressly provided, shall be entitled to preference or priority over all other claims except the claims for fees, costs and expenses of suits and other proceedings under the Bankrupt Act, and for the custody of the bankrupt's property. Five classes of claims are recognized as claims entitled to priority or preference by the 28th section of the Bankrupt Act, and the provision is that they shall "be first paid in full in the following order:" First, fees, costs and expenses; second, all debts due to the United States and Federal taxes and assessments; third, all debts due to the State in which the proceedings in bankruptcy are pending, and all State taxes and assessments; fourth, wages due to any operative, clerk or house-servant, to an amount not exceeding $50, for labor performed within the period therein specified; fifth, all debts due to any persons who, by the laws of the United States, are or may be entitled to a priority or preference, in like manner as if the Act had not been passed. 1. Debts created by fraud or embezzlement of the bankrupt, or by his defalcation as a public officer, or while acting in any fiduciary character, are not discharged by the certificate required to be given to the bankrupt by the 32d section of the Bankrupt Act, nor will any such certificate release, discharge or affect any person liable for the same debt for or with the bankrupt, either as partner, joint contractor, indorser, surety or otherwise. Such debts, that is, debts created by the fraud or embezzlement of the bankrupt, or by his defalcation as a pub lic officer, or as a fiduciary agent, may be proved, and the dividend thereon, it is provided 255*] *shall be a payment on account of said debt, but the provision that no such certificate shall release, discharge or affect any person lia- Attempt is made in argument to show that ble for the same debt, for or with the bankrupt the preference given to debts of the United as surety, does not apply to this case, as it is States does not exclude such debts from the opthe surety here who pleads the certificate of dis-eration of the certificate of discharge, because charge, and not the principal in the bond set such debts are not named in the proviso annexed |