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He avers that such is the proper construction of the act, and that the act being one of the land laws of the United States, its construction, as well as the determination of all [347] equitable rights of parties under it, is within the jurisdiction of the Secretary of the Interior so long as the legal title of the land yet remains in the United States (and that it appears on the face of relator's petition that the legal title of the land in controversy is still in the United States), and involves the exercise of judgment and discretion, not reviewable by any court on direct proceeding either by mandamus or in equity.

He prays that the rule to show cause be discharged.

Relator demurred to the return, and, in passing upon it, the court observed that there were two questions in the case: one, whether the facts exhibited a case for mandamus of the Secretary; that is, "in apparent defiance of the law, acting capriciously or arbitrarily, or beyond the scope of the administrative authority confided to him;" the other, the construction of the Act of 1894.

sus

the duty of the Secretary to give ef-
fect to it. The relator, therefore, is
not entitled to a writ of mandamus.
United States ex rel. Riverside Oil Co.
v. Hitchcock, 190 U. S. 316, 47 L. ed.
1074, 23 Sup. Ct. Rep. 698; United
States ex rel. Ness v. Fisher, 223 U. S.
683, 56 L. ed. 610, 32 Sup. Ct. Rep. 356.
We need not consider the fact that
Kennedy, whose application was
tained, is not a party to the petition
(see Litchfield v. Register (Litchfield v.
Richards) 9 Wall. 575, 578, 19 L. ed.
681, 682); nor need we consider whether
a more appropriate remedy will be open
to the relator. See Brown v. Hitchcock,
173 U. S. 475, 43 L. ed. 773, 19 Sup. Ct.
Rep. 485; Minnesota v. Lane, 247 U. S.
243, 249, 250, 62 L. ed 1098, 1101, 38
Sup. Ct. Rep. 508.
Judgment affirmed.

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(See S. C. Reporter's ed. 348–356.) Bankruptcy revisory pro

ceeding.

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review

To the first question the court answered negatively, and to the second question replied that, "independently of the question of the propriety of reviewing the action of the Secretary of the Inte1. A petition to revise in matter of rior in the pending case, it would seem law under the Bankruptcy Act of July 1, that the decision rendered by him was 1898, § 24b, is the proper remedy to review an order of an inferior court of bankruptcy, one entirely permissible under the law." vacating an adjudication and dismissing the The demurrer to the return was there-bankruptcy proceeding for want of jurisfore overruled. Relator electing to stand upon it, the rule was discharged, and the petition dismissed.

This action was affirmed by the court of appeals.

on

It is manifest from this statement that the petition presents a controversy over the true construction of the Act of 1894. From the act, and the Secretary's decision, it is apparent that the latter was not arbitrary or capricious, but rested a possible construction of the act, and one that the reported decisions of the Land Department show is being applied in other cases. The direction of the act that the lands be reserved "from any adverse appropriation" means necessarily an appropriation adverse to the state, and this gives color to the Secretary's view. He could not administer or apply the act without construing [348] it, and its construction involved the exercise of judgment and discretion. The view for which the relator contends was not so obviously and certainly right as to make it plainly

diction, upon the motion of the bankrupt,
after the expiration of the time for appeal,
he having neither contested the involuntary
petition against him, nor appealed from the
adjudication.

[For other cases, see Bankruptcy, XIII. in
Digest Sup. Ct. 1908.]
Bankruptcy
adjudication.

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jurisdiction

vacating

2. There is such an absence of jurisdiction in a court of bankruptcy, where it appears from the averments of a petition in involuntary bankruptcy that the person tion, and therefore within the exception of proceeded against is an insurance corporathe Bankruptcy Act of July 1, 1898, § 4b, as amended by the Act of June 25, 1910, that its adjudication, rendered upon due service of process and default, and not appealed from, should be vacated, and the proceeding be dismissed upon the motion of the bankrupt, after the time for appeal has expired.

[For other cases, see Bankruptcy, IV. in Digest Sup. Ct. 1908.]

Note. On estoppel by laches or acquiescence-see note to Michigan ex rel. Atty. Gen. v. Flint & P. M. R. Co. 38 L. ed. U. S. 478.

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Estoppel acquiescence attack on
adjudication in bankruptcy.
3. An insurance company which was
adjudged, upon due service of process and
default, to be a bankrupt in an involuntary
proceeding after the passage of the Act of
June 25, 1910, amending the Act of July
1, 1898, § 4b, excluding such corporations
from the operation of the act, and does
not appeal from the adjudication, but
acquiesces therein, and aids the trustee in
the performance of his duties in administer-
ing the estate, is not estopped thereby from
thereafter questioning the adjudication, and
the power of the bankruptcy court and the
trustee to proceed.

[For other cases, see Estoppel, III. b, 6, in
Digest Sup. Ct. 1908.]

[No. 96.]

appeal or by motion to vacate, timely
binding on everyone.
made, but, as long as it stands, it is

Re Worsham, 73 C. C. A. 665, 142 Fed. 121; Edelstein v. United States, 9 L.R.A. (N.S.) 236, 79 C. C. A. 328, 149 Fed. 636; Foltz v. St. Louis & S. F. R. Co. 8 C. C. A. 635, 19 U. S. App. 576, 60 Fed. 316; Re First Nat. Bank, 81 C. C. A. 260, 152 Fed. 64, 11 Ann. Cas. 355; Re Broadway Sav. Trust Co. 81 C. C. A. 58, 152 Fed. 152; Re Plymouth Cordage Co. 68 C. C. A. 434, 135 Fed. 1000; Re New England Breeders' Club, 95 C. C. A. 84, 169 Fed. 586; Birch v. Steele, 91 C. C. A. 415, 165 Fed. 577; Re T. E. Hall Company, 86 C. C. A. 263, 159 Fed. 73; Sabin v. Larkin-Green

Submitted November 17, 1920. Decided De- Logging Co. 218 Fed. 984; Roszell Bros.

ON

cember 13, 1920.

V.

Continental Coal Corp. 235 Fed. 343; Re Brett, 130 Fed. 981; First Nat. N A CERTIFICATE from the Unit- Bank v. Klug, 186 U. S. 202, 46 L. ed. ed States Circuit Court of Appeals 1127, 22 Sup. Ct. Rep. 899; Des Moines for the Eighth Circuit presenting the Nav. & R. Co. v. Iowa Homestead Co. questions whether a petition to revise 123 U. S. 552, 31 L. ed. 202, 8 Sup. Ct. is the proper method to review the Rep. 217; Re Columbia Real-Estate Co. order of an inferior court of bank- 3 N. B. N. Rep. 157, 101 Fed. 971; ruptcy, vacating an adjudication and M'Cormick v. Sullivant, 10 Wheat, 192, dismissing the proceeding, and whether 6 L. ed. 300. an erroneous adjudication against an exempt corporation may be vacated after the time for appeal has expired, and whether such exempt corporation may be estopped from questioning the validity of the proceedings by its acquiescence and failure to appeal. First and second questions answered in the affirmative; third question answered in the negative.

The facts are stated in the opinion.
Mr. Rome G. Brown submitted the
cause for John Vallely.
Murphy and T. A. Toner were on the

brief:

Messrs. C. J.

As soon as a petition is filed, the court has a duty to perform. It has the duty, and the statute gives it the power, to decide whether an alleged bankrupt comes within the class that should be declared a bankrupt. The decision of that fact involves the exercise of jurisdiction. The jurisdiction is none the less real and valid because the court might decide the question wrongly. The valid exercise of jurisdiction does not depend on the correctness of the decision. Neither the allegation nor the fact that the alleged bankrupt is an insurance company, and as such exempt, is jurisdictional. If the court, in the exercise of that power, reached a wrong conclusion, the judgment is not void; it is merely error, to be corrected on

The proper method to review the exact question involved here is by a petition to revise.

Plymouth Cordage Co. v. Smith, 194 U. S. 311, 48 L. ed. 992, 24 Sup. Ct. Rep. 725; Stevens v. Nave-McCord Mercantile Co. 80 C. C. A. 25, 150 Fed. 71; Dodge v. Norlin, 66 C. C. A. 425, 133 Fed. 363; Re Plymouth Cordage Co. 68 C. C. A. 434, 135 Fed. 1000; C. C. Taft Co. v. Century Sav. Bank, 72 C. C. A. 671, 141 Fed. 369; Re Holmes, 73 C. C. A. 491, 142 Fed. 391; Re McKenzie, 73 C. C. A. 483, 142 Fed. 383.

Mr. N. C. Young submitted the cause for the Northern Fire & Marine Insurance Company. Messrs. Tracy R. Bangs and Philip R. Bangs were on the brief:

Before jurisdiction can be affirmed to exist, it must appear that the law has given the tribunal capacity to entertain the complaint against the person or thing sought to be charged, and that such complaint has been preferred.

Ex parte Reed, 100 U. S. 13, 25 L. ed. 538; Springer v. Shavender, 116 N. C. 12, 33 L.R.A. 772, 47 Am. St. Rep. 791, 21 S. E. 397; Nashville v. Cooper, 6 Wall. 247, 18 L. ed. 851; Cooper v. Reynolds, 10 Wall. 308, 19 L. ed. 931; Cowling v. Nelson, 76 Ark. 146, 88 S. W. 913; Clapp v. McCabe, 84 Hun, 379, 32 N. Y. Supp. 431; Foley v. Foley, 24 Nev. 197, 51 Pac. 834, 52 Pac. 649;

Munday v. Vail, 34 N. J. L. 422; Re peared that the company was an insurTaylor, 42 C. C. A. 1, 2 N. B. N. Rep. ance [352] corporation, and that the 929, 102 Fed. 728; Re Hudson River court was, therefore, without jurisdicElectric Co. 167 Fed. 986; Re New York tion. The motion was sustained, and Tunnel Co. 92 C. C. A. 202, 166 Fed. an order entered vacating the adju284; Re New York & N. J. Ice Lines, dication, and dismissing the petition 77 C. C. A. 440, 147 Fed. 214; Hopkins of the creditors on authority of 8 v. Carpenter, 18 N. B. N. Rep. 339, 4 b of the Bankruptcy Act as amended Fed. Cas. No. 6,686; Re New York & W. by the Act of June 25, 1910 (36 Water Co. 2 N. B. N. Rep. 414, 98 Fed. Stat. at L. 839, chap. 412, Comp. 711; Re Keystone Coal Co. 3 N. B. N. Stat. § 9588, 1 Fed. Stat. Anno. 2d Rep. 938, 109 Fed. 872; Babb v. Bruere, ed. p. 569), which provides that "any 23 Mo. App. 604; Crew v. Pratt, 119 moneyed, business, or commercial corpoCal. 139, 51 Pac. 38; Louisville Trust ration, except a municipal, railroad, inCo. v. Comingor, 184 U. S. 18, 46 L. ed. surance, or banking corporation 413, 22 Sup. Ct. Rep. 293; 9 Laws of may be adjudged an involuntary bankEngland (Halsbury) p. 13; Hope v. rupt upon default or an impartial trial, Blair, 105 Mo. 85, 24 Am. St. Rep. 369, and shall be subject to the provisions 16 S. W. 595; Myers v. Berry, 3 Okla. and entitled to the benefits of this act." 612, 41 Pac. 580; Parker v. Lynch, 7 Okla. 631, 56 Pac. 1082; Houck v. Bank of Brinkley, 155 C. C. A. 469, 242 Fed. 881; Galpin v. Page, 18 Wall. 350, 21 L. ed. 959; Settlemier v. Sullivan, 97 U. S. 444, 24 L. ed. 1110; Old Wayne Mut. Life Asso. v. McDonough, 204 U. S. 8, 51 L. ed. 345, 27 Sup. Ct. Rep. 236; Johnson v. Hunter, 77 C. C. A. 359, 147 Fed. 133; Empire Ranch & Cattle Co. v. Coldren, 51 Colo. 115, 117 Pac. 1005.

Mr. Justice McKenna delivered the opinion of the court:

The trustee filed a petition to revise the order of the district court in a matter of law in the circuit court of appeals, and the latter court certifies that it is indispensable to the determination of the case, and, to the end that the court may properly discharge its duty, desires instruction upon the following questions: "1. Is a petition to revise in matter of law under § 24 b of the Bankruptcy Act the proper remedy to review an order of an inferior court of bankruptcy vacating an adjudication and dismissing the bankruptcy proceeding for want of jurisdiction upon the motion of the bankrupt after the expiration of the time for appeal, he having neither contested the involuntary petition against him nor appealing from the jurisdic

The Insurance Company was adjudged an involuntary bankrupt May 3, 1917, upon petition of its creditors. The petition averred the corporate capacity of the company under the laws of North Dakota, and that it had been "engaged tion? in the business of insuring property "2. Where it appears from the averagainst loss, by fire, hail, etc." Processments of a petition in involuntary bankwas duly issued and served, and the com- ruptcy that the person proceeded against pany making default, an order of adju- is an insurance corporation, and theredication was entered against it. No ap- fore within the exceptions of § 4 b of peal was taken from the order. The the Bankruptcy Act as amended June 25, administration of the estate proceeded in 1910 (36 Stat. at L. 839, chap. 412, due course, claims presented, assets col- Comp. Stat. § 9588, 1 Fed. Stat. Anno. lected and reduced to money, payments 2d ed. p. 569), is there such an absence made to protect equities, and suits of jurisdiction in the court of bankruptbrought by the trustee in his official ca- cy that its adjudication, rendered upon pacity. In the matters of the estate the due service of process and default, and trustee frequently conferred with the not appealed from, should be vacated president and secretary of the bankrupt, and the proceeding be dismissed upon and received from them co-operation, the motion of the bankrupt after the assistance, and information without time for appeal has expired? question of the validity of the adjudication. Considerable moneys were paid out and expenses incurred by the trustee. After the above course of administration, and on December 18, 1917, the company, by its attorneys, filed a motion in the district court to vacate the adjudication as null and void, and to dismiss the proceedings, upon the ground that it ap

"3. Where an insurance corporation adjudged bankrupt [353] in an involuntary proceeding after the passage of the amendatory Act of June 25, 1910 (36 Stat. at L. 839, chap. 412), upon due service of process and default, does not appeal from the adjudication, but acquiesces therein, and aids the trustee in the performance of his duties in administer

ing the estate, may it be estopped from thereafter questioning the validity of the adjudication and the power of the court and the trustee to proceed?"

Of the construction of the statute there can be no controversy; what answer shall be made to the questions turns on other considerations,-turns on the effect of the conduct of the company as an estoppel. That it has such effect is contended by the trustee, and there is an express concession that, if objection had been made, the company would have been entitled to a dismissal of the petition. It is, however, insisted that it is settled "that an erroneous adjudication against an exempt corporation, whether made by default or upon a contest or trial before the bankruptcy court, can be attacked only by appeal, writ of error, or prompt motion to vacate," and that § 4 does not relate to the jurisdiction of the court over the subject-matter. "It does not, therefore," is the further contention, "create or limit jurisdiction of the court with respect to its power to consider and pass upon the merits of the petition." And that "the valid exercise of jurisdiction does not depend upon the correctness of the decision." And again, if the court, in the exercise of its jurisdictional power, "reached a wrong conclusion, the judgment is not void, it is merely error to be corrected on appeal or by motion 'to vacate, timely made; but, as long as it stands, it is binding on everyone." There is plausibility in the propositions, taken in their generality, but there are opposing ones. Courts are constituted by authority, and they cannot go beyond the power delegated to them. If they act beyond that authority, and certainly in contravention of it, their judgments and orders are regarded as nullities. They are [354] not voidable, but simply void, and this even prior to reversal. Elliott v. Peirsol, 1 Pet. 328, 340, 7 L. ed. 164, 170; Old Wayne Mut. Life Asso. v. McDonough, 204 U. S. 8, 51 L. ed. 345, 27 Sup. Ct. Rep. 236.

Which of the propositions shall prevail in a given case cannot be dogmatically asserted, and cases of their consideration and application can be cited against each other. There is such citation in the pending case. Plaintiff in error cites, among others, M'Cormick v. Sullivant, 10 Wheat. 192, 6 L. ed. 300; Des Moines Nav. & R. Co. v. Iowa Homestead Co. 123 U. S. 552, 31 L. ed. 202, 8 Sup. Ct. Rep. 217; First Nat. Bank . Klug, 186 U. S. 202, 46 L. ed. 1127, 22 Sup. Ct. Rep. 899.

M'Cormick v. Sullivant involved the

effect of diversity of citizenship, and it was decided that an absence of its allegation did not impeach the judgment rendered in the case and preclude its being conclusive upon the parties. And it was said (as it has often been said), that the courts of the United States are "of limited jurisdiction but.... not inferior courts, in the technical sense of those words, whose judgments, taken alone, are to be disregarded. If the jurisdiction be not alleged in the proceedings, their judgments and decrees are erroneous, and may, upon a writ of error, or appeal, be reversed for that cause. But they are not absolute nullities."

In Des Moines Nav. Co. v. Iowa Homestead Co. 123 U. S. 552, 31 L. ed. 202, 8 Sup. Ct. Rep. 217, there came up to be considered also the effect of a prior adjudication as dependent upon an allegation of diversity of citizenship, and the ruling in M'Cormick v. Sullivant was affirmed.

The immediate comment on these cases is that the courts had jurisdiction of their subject-matter, and necessarily power to pass upon the fact (diversity of citizenship) upon which that jurisdiction depended in the given case. The subject-matter of the suit was not withheld from them by explicit provision of the law which was their sole warrant of power.

First Nat. Bank v. Klug is nearer to the [355] question in the case at bar. It was a case in bankruptcy. The Act of July 1, 1898 (30 Stat. at L. 544, chap. 541, Comp. Stat. § 9585, 1 Fed. Stat. Anno. 2d ed. p. 509), provided that "any natural person, except a wage earner or a person engaged chiefly in farming or the tillage of the soil," might "be adjudged an involuntary bankrupt upon default or impartial trial," and should "be subject to the provisions and entitled to the benefits" of the act.

A petition in involuntary bankruptcy was filed against Klug, and a trial was had upon the issue whether he was "engaged chiefly in farming" within the meaning of the act, and the jury having found accordingly, the district court entered a judgment dismissing the petition. tion. The question of the jurisdiction was certified to this court, and it was held that the "district court had, and exercised, jurisdiction." This further was said: "The conclusion was, it is true, that Klug could not be adjudged a bankrupt; but the court had jurisdiction to so determine, and its jurisdiction over

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[357] GALVESTON, HARRISBURG, & SAN ANTONIO RAILWAY COMPANY, Petitioner,

the subject-matter was not, and could
not be, questioned." Citing Mueller v.
Nugent, 184 U. S. 15, 46 L. ed. 411, 22
Sup. Ct. Rep. 269; Smith v. McKay,
161 U. S. 355, 40 L. ed. 731, 16 Sup. Ct. L. H. WOODBURY and Vincent Wood-
Rep. 490.

V.

bury.

(See S. C. Reporter's ed. 357-360.) Commerce

Sup. Ct. 1908.]

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limitation Carriers — published tariff of baggage liability transportation from adjacent foreign country. 2. The Carmack Amendment of June

It will be observed, therefore, that the Act of 1898 made jurisdiction depend upon an inquiry of fact, and neceslocal transportation as sarily jurisdiction was conferred to make part of interstate commerce. the inquiry, and pronounce judgment 1. Transportation of a passenger and according to its result. The case, there- baggage under an interstate ticket would fore, is not pertinent to, or authority be none the less interstate commerce beupon, the case at bar. The Act of June only one stage of the journey, lying because the transportation in question was 25, 1910, which covers the present pro- tween two points in the same state. ceeding, is peremptory in its prohibition. [For other cases, see Commerce, I. b, in Digest It excludes, by § 4, insurance corporations from the benefits of voluntary bankruptcy, and by subdivision b prohibits them from being adjudged involuntary bankrupts. The effect of these 29, 1906, under which carriers may limit provisions is that there is no statute of liability by published tariffs, must be bankruptcy as to the excepted corpora- deemed to apply to the baggage of a pastions, and necessarily there is no power senger carried on the outward trip under in the district court to include them. a ticket calling for transportation from In other words, the policy of the law is Canada to Texas and return, in view of to leave the relation and remedies of the declaration of the Act of February 4, 1887, § 1, that such act applies to any "municipal, railroad, insurance, [356] common carrier engaged in the transportaor banking" corporations to their cred- tion of passengers or property from any itors and of their creditors to them, place in the United States to an adjacent to other provisions of law. It is easy foreign country, since the test of the apto see in what disorder a different plication of the act is not the direction of policy would result. We may use the movement, but the nature of the transfor illustration a municipal corpora-portation, as determined by the field of the carrier's operation. tion. Its creditors may be enterprising, its officers acquiescent or indifferent; can, therefore, the allegations of the former and the default of the lat

[For other cases, see Carriers, II. a, 9; III. g, in Digest Sup. Ct. 1908.]

Note. On limitation of carrier's lia

ter confer jurisdiction on the district bility for passenger's baggage-see notes court to entertain a petition in bank-to Zetler v. Tonopah & G. R. Co. L.R.A. ruptcy against the corporation, and ren- 1916A, 1273; Wells v. Great Northern der a decree therein? And if not, why R. Co. 34 L.R.A. (N.S.) 818; and French not? If consent can confirm jurisdic-V. Merchants & M. Transp. Co. 19 tion, why not initially confer jurisdic-L.R.A. (N.S.) 1006.

423.

tion? It is not necessary to point out On liability of carrier for baggage of
the disorder that would hence result, passenger-see notes to Humphreys v.
and the difficulties that the officers of a Perry, 37 L. ed. U. S. 587, and Hannibal
bankrupt court would encounter in such & St. J. R. Co. v. Swift, 20 L. ed. U. S.
situation. The legislative power thought
care against the possibility of it was
necessary, and in that care associated in-
surance corporations. For a court to ex-
tend the act to corporations of either
kind is to enact a law, not to execute one.
The first question concerns procedure
only, and should be answered in the af-
firmative. First Nat. Bank v. Klug,
supra; Re Loving, 224 U. S. 183, 56
L. ed. 725, 32 Sup. Ct. Rep. 446.

Effect of Carmack Amendment upon state regulations as to stipulations limthe loss of or damage to goods-see iting liability of a common carrier for notes to Louisville & N. R. Co. v. Miller, 50 L.R.A. (N.S.) 819, and Adams Exp. Co. v. Croninger, 44 L.R.A. (N.S.) 257.

As to whether stipulation exempting carrier from liability for passenger's baggage, or limiting the amount thereof, covers loss due to negligence-seo The second and third questions con-notes to Gardiner v. New York C. & H. cern the merits, and are respectively an- R. R. Co. 34 L.R.A. (N.S.) 826, and swered in the affirmative and negative. Tewes v. North German Lloyd S. S. Co. |8 L.R.A.(N.S.) 199.

So ordered.

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