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Capital National Bank on the Chemical National Bank for $5,000, to the order of T. M. Barlow, cashier; and a protest of said draft for nonpayment on January 17, 1893; also a statement of various drafts drawn by the Capital National Bank on the Chemical National Bank, at different times, in favor of third parties, and protested for nonpayment on and after January 24, 1893. These protested drafts amounted to $44,264.66.
The defendant called as a witness its cashier, William I. Quinlan, who testified that when the draft for $5,000 to the order of T. M. Barlow, cashier, was presented and payment refused, the Capital National Bank had no deposits or funds on deposit with the Chemical National Bank out of which such draft could be paid, and that the account of the Capital National Bank had been overdrawn for some time. The defendant put in evidence a letter dated January 19, 1893, from the Packers' National Bank, inclosing its draft for $5,000 on the Fourth National Bank of New York, to be placed to the credit of the Capital National Bank, and letter, dated January 18, 1893, *from the Schuster Hax National Bank, inclosing its draft for $2,000 on the Chemical National Bank, to the credit of the account of the Capital National Bank.
Further evidence was put in by the respective parties, which it does not seem
necessary to state.
On March 16, 1897, after argument, upon the pleadings and proofs, the circuit court dismissed the bill of complaint with costs. An appeal was taken from this decree to the circuit court of appeals for the second circuit, and on January 31, 1898, that court affirmed the decree of the circuit court. And from the decree of the circuit court of appeals an appeal was taken and allowed to this court.
dismissed for want of equity, there being no allegation of any act of insolvency, nor of intent to prefer, nor of intent to prevent the application of assets.
Case v. Citizens' Bank, 2 Woods, 23; Hayes v. Beardsley, 136 N. Y. 299; Roberts v. Hill, 23 Fed. Rep. 311; Dutcher v. Importers' & T. Nat. Bank, 59 N. Y. 5; Utley v. Smith, 24 Conn. 310, 63 Am. Dec. 163; Tiffany v. Lucas, 15 Wall. 410, 21 L. ed. 198. Title vests by deposit in the United States mail.
The remittances were mailed after the commission of an act of insolvency, as well as in contemplation of insolvency.
Brown v. Montgomery, 20 N. Y. 287, 75 Am. Dec. 404.
Messrs. George H. Yeaman, and George C. Kobbé, for appellee: The bill of complaint should have been
The deposit of drafts or checks in the postoffice to be carried to the Chemical National Bank was such a delivery as to vest the title in that bank.
Johnson v. Sharp, 31 Ohio St. 611, 27 Am. Rep. 529; M'Kinney v. Rhoads, 5 Watts, 343; Kirkman v. Bank of America, 2 Coldw. 397; Buell v. Chapin, 99 Mass. 594, 97 Am. Dec. 58; Morgan v. Richardson, 13 Allen, 410; United States v. Jackson, 29 Fed. Rep. 503; United States v. Jones, 31 Fed. Rep. 725.
It is not sufficient that the payment did operate as a preference. There must be the actual commission of an act of insolvency, or the payment must be made in contemplation of insolvency, or with the intent to prefer. Jones, Corp. § 23; Bergen v. Porpoise Fishing Co. 42 N. J. Eq. 397.
of the court: *Mr. Justice Shiras delivered the opinion [615
Nebraska, was organized as a banking as The Capital National Bank of Lincoln, sociation under the laws of the United States in June, 1884, and continued to transact the usual and ordinary business of a national bank up to the close of banking hours on January 21, 1893. On January 22, 1893, a after, about February 6, 1893, a receiver bank examiner took possession, and therewas duly appointed.
The Chemical National Bank of New York, a banking association organized under the laws of the United States and doing business as such in the city of New York, carried on, for some years, a large business intercourse with the Capital National Bank.
The receiver filed the bill in this case, seeking to make the Chemical National Bank account for certain moneys received by it after the suspension of the Capital National Bank.
The nature of the intercourse between the two banks was thus described in a paragraph of the bill:
*"Ever since the second day of June, 1884. there have been mutual and extensive deal-" ings between the two banking associations above named, in which each was acting for the other, as correspondent banks do, for the making of collections and the crediting of the proceeds thereof and transmitting ac counts of the same, including costs of pro test and other expenses, and the Capital National Bank also kept an active deposit account with the defendant, and that settlements on the basis of such accounts were made at periodic times during all said period, and any balance, after the correction of errors, mutually agreed to be charged or credited, was at such periods credited or
debited, as the fact might be, upon the books It is true that, in the course of the trial,
"All transfers of the notes, bonds, bills of
*Nor can a finding that the payments and remittances made to the Chemical National Bank on the dates above mentioned made in contemplation of insolvency and with an intent to prefer that bank be based on the mere allegation that the Capital National Bank was actually insolvent, and that its insolvency must have been known to its officers. It is matter of common knowledge that banks and other corporations continue, in many instances, to do their regular and ordinary business for long periods, though in a condition of actual insolvency, as disclosed by subsequent events. It cannot surely be said that all payments made in the due course of business in such cases are to be deemed to be made in contemplation of insolvency, or with a view to prefer one creditor to another. There is often the hope that, if only the credit of the bank can be kept up by continuing its ordinary business, and by avoiding any act of insolvency, affairs may take a favorable turn, and thus suspension of
It appears in evidence that on January 18, 1893, the account of the Capital National Bank with the defendant bank was overdrawn to the amount of $84,486.19, and that, by sundry remittances made, the amount overdrawn stood, on January 21, 1893, at the sum of $25,515.32. It further appears that on January 18, 1893, the Schuster Hax National Bank of St. Joseph, Missouri, remitted by mail $2,000 to the defendant for the credit of the Capital National Bank; on January 19 the Packers' National Bank of South Omaha, Neb.. remitted by mail to the defendant $5,000 for the cred-payments and of business be avoided. it and advice of the Capital National Bank; In the present instance there was not only on January 20 the Capital National Bank re no allegation of payments made in contemmitted to the defendant by mail a package plation of insolvency, or with a view to preof small items amounting to $735 and a fer the Chemical National Bank, but there package amounting to $2,935.60, and on the was no evidence that, up to the closing hours 21st a similar package amounting to $833.- of January 21, 1893, the Capital National 64. On January 23 the defendant received Bank had failed to pay any depositor on dethe remittance of $2,000 of the 18th, and of mand, or had not met at maturity all its ob$5.000, $815.79, and $2.935.60 of the 19th, ligations. And the evidence fails to disclose and the remittance of $735 of the 20th; and any intention or expectation on the part of on the 24th of January it received the remit-its officers to presently suspend business. It tance of $833.04. With these remittances rather shows that, up to the last, the operacredited the account of the Capital National tions of the bank and its transactions with Bank stood, on January 24, 1893, overdrawn the Chemical National Bank were conducted $13,317.94. in the usual manner. It may be that those of its officers who knew its real condition must have dreaded an ultimate catastrophe, but there is nothing to justify the inference that the particular payments in question were made in contemplation of insolvency, or with a view to prefer the defendant bank. The Chemical National Bank was no more preferred by these remittances several days before suspension than were the depositors whose checks were paid an hour before the doors were closed. Indeed, it is stipulated that the Capital National Bank continued to transact its usual and ordinary business up
The complainant's case depends, under the evidence, on an application of the provisions of section 5242 of the Revised Statutes, which is as follows:
The claim of the complainant is to recover all the sums received by the defendant bank on January 23 and 24 as having been transferred and received contrary to the statute. The bill of complaint contains no allegation of any act of insolvency prior to January 22, 1893, or of any payment made in contemplation of insolvency, or of any payment made with a view to prevent the application of the bank's assets in the manner prescribed in the statute or of any payment made with a view to the preference of one creditor to another.
to the close of banking hours on January 21, | in the nature of payments on general ao
1893.  *The view of the courts below was that these payments and remittances were not made in contemplation of insolvency, or with a view to prefer the Chemical National Bank, and our examination of the evidence has led us to the same conclusion.
It remains to consider another proposition very strongly pressed on behalf of the appellant, and that is, that the moneys and checks remitted to the defendant bank which did not reach it till after the bank examiner had taken possession could not, in law, become the property of the defendant bank, but remained part of the assets of the insolvent bank, for which the defendant must account to the receiver in order that the proceeds may be ratably divided among the creditors. It is said that the taking possession of the bank by the Comptroller of the Currency is a distinct declaration of insolvency, and cases are cited in which it has been said by this court that the business of the bank must stop when insolvency is declared (White v. Knox, 111 U. S. 784 [28: 603]); and that the state of case, where the claim sought to be offset is acquired after the act of insolvency, cannot sustain such a transfer, because the rights of the parties become fixed as of that time. Scott v. Armstrong, 146 U. S. 499 [36: 1059].
The law is doubtless as thus stated, but does it apply to the present case?
It is conceded in his brief by the learned counsel of the appellee that if the drafts and checks had been deposited in the mail pursuant to any agreement or even if the defendant had known anything about them, they might have been regarded as the property of the Chemical National Bank as of the date of mailing. But he urges that this was only the case of a bank sending the checks of other parties to its agents for collection and deposit; that it could have sent them to any other agent had it pleased, and that after it had once put them in the mail it could have taken them out again. And queries are put as to which bank would have suffered the loss if the checks had been destroyed in transit, or if they had proved to be worthless.
But here we have the case, not of a casual remittance, but of remittances sent from time to time, and frequently, during a *long course of business between the banks concerned. There may have been no special agreement as to each particular remittance, but there was plainly a general agreement that remittances were to be made by mail, and that their proceeds were not to be returned to the Capital National Bank, but were to be credited to its constantly overdrawn account.
Whose the loss might be, if the packages were destroyed in transitu, or if the checks proved uncollectible, are not questions that concern us now. It is sufficient, for present purposes, to say that the inference is warranted that it was understood between the parties that these remittances were to be made through the mails, and that they were
Nor can it be conceded that, except on some extraordinary occasion and on evidence satisfactory to the postoffice authorities, a letter once mailed can be withdrawn by the party who mailed it. When letters are placed in a postoffice they are within the legal custody of the officers of the government and it is the duty of postmasters to deliver them to the persons to whom they are addressed. United States v. Pond, 2 Curt. C. C. 265; Buell v. Chapin, 99 Mass. 594 [97 Am. Dec. 58]; Morgan v. Richardson, 13 Allen, 410; Tayloe v. Merchants' F. Ins. Co. 9 How. 390 [13: 187].
However, it is not pretended in this case that the checks were destroyed or proved worthless, or that the Capital National Bank either withdrew the remittances or countermanded their delivery.
We think that the courts below well held that, under the facts of this case, the mailing of these checks and remittances was a delivery to the Chemical National Bank, whose property therein was not destroyed or impaired by a subsequent act of bankruptcy. be as to the remittances received through It is finally urged that, however it may the mail on January 23, 1893, yet that the payment or remittance of $833.64, received on January 24, was a payment made after the declaration of insolvency, and must therefore be accounted for by the defendant bank.
*It is claimed that there was no evidence[621; that this remittance came by mail, and that all there is in the case is the admission by the defendant bank of its receipt of that sum on January 24, 1893.
But it is to be observed that no mention is made in the bill of this particular item, though the other litigated items are specified, and to the latter only was the proof directed. In the absence of evidence as to any other method of transmission, and in view of the fact that all the other payments were made by mail, it would seem to be a reasonable inference that such was the case of this remittance. The record discloses that the cashier of the Chemical National Bank testified in the case. He had furnished the complainant with a statement of the accounts between the banks from January 3, 1893, to January 24, 1893, including this particular item; but he was not cross-examined as to this item. Had he been so examined, a more particular statement in respect to it would have been, no doubt, elicited. It was apparently assumed that the history of this payment did not differ from that of the others; and the effort now made in respect to it seems to be in the nature of an afterthought, too late to permit an explanation.
that the decree of the Court of Appeals was Upon the whole case, we are of the opinion correct, and its decree is accordingly affirmed.
Mr. Justice White, Mr. Justice Peckham, and Mr. Justice McKenna disented.
JNORTHERN PACIFIC RAILWAY COM-I trial, without a jury, that the plaintiff's
PANY, Plff. in Err.,
JAMES DE LACEY.
(See S. C. Reporter's ed. 622-639.) Railroad land grant-pre-emption claim resolution of Congress-forfeiture claim-cvidence.
The filing of a map of definite location of a railroad determines the right of the railroad company to the land under the land grant acts
Where there was a pre-emption claim at the time of the passage of the land grant act of 1864, the land would not pass under that grant.
The grant of land by the act of Congress of July 2, 1864, was not blotted out, with respect to an intervening pre-emption claim, by the resolution of Congress adopted May 31, 1870, making a further grant.
The failure of a pre-emption claimant to make proof and payment within the thirty months required by U. S. Rev. Stat. § 2267, forfeits his right without any cancelation on the records.
5. When no proof and no payment have been made within the time provided for by the law, the record will show the fact, and that the right of the claimant has expired and the claim itself has ceased to exist.
Submitted January 18, 1899. Ordered for reargument March 13, 1899. Leave granted to file brief on behalf of United States January 9, 1899. Resubmitted April 11, 1899. Decided May 22, 1899.
IN ERROR to the United States Circuit Court of Appeals for the Ninth Circuit to review a judgment of that court affirming the judgment of the Circuit Court of the United States for the District of Washington, dismissing the complaint of the plaintiff, the Northern Pacific Railway Company, against the defendant, James De Lacey, for the recovery of the possession of 160 acres of land in the state of Washington. Judgment of the United States Circuit Court of Appeals for the Ninth Circuit reversed and case remanded to the United States Circuit Court for the Western Division, District of Washington, for further proceedings.
See same case below, 66 Fed. Rep. 450, 44 U. S. App. 257.
Statement by Mr. Justice Peckham:
This is an action of ejectment brought by the plaintiff in error against the defendant to recover possession of 160 acres of land situated not far from Tacoma in the state of Washington.
The land lies within the primary limits of the land grant both of the main line of the railroad of plaintiff in error, as definitely located between Portland and Puget sound, and the Cascade branch, as definitely located between the point where the railroad leaves the main line and crosses the Cascade mountains to Puget sound.
It appears from the facts found upon the
predecessor was incorporated under the act
The company surveyed and definitely lo-
The following statement is taken from the finding of facts by the trial judge:
"XII. April 9, 1869, one John Flett filed declaratory statement No. 1227, declaring his intention to purchase certain lands which are described in the complaint, under the laws of the United States authorizing the pre-emption of unoffered lands. Whether or not Flett was at this time qualified to enter the land under the pre-emption or homestead laws does not appear.
"XIII. In the fall of 1869 Flett left the
they told him it was railroad land, and that
"XV. The defendant, James De Lacey,
"XVI. September 7, 1887, John Flett submitted proof in support of his pre-emption claim, founded upon his declaratory statement filed April 9, 1869.
*"XVII. Afterward, under the instruc- tions of the Commissioner, a hearing was had, at which all the parties, the railroad company, James De Lacey, John Algyr, and John Flett were present. July 27, 1889, the receiver of the district land office found that Flett had not voluntarily abandoned the land in 1869, and that his entry should be reinstated. From this finding all the parties but Flett appealed to the Commissioner of the General Land Office, and December 5, 1889, the Commissioner sustained the finding of the receiver. Thereafter the other parties to the contest appealed to the Sec
retary of the Interior. September 28, 1891, the Secretary of the Interior reversed the ruling of the Commissioner of the General Land Office, and awarded the land in controversy to the railroad company.
"December 13, 1892, letters patent of the United States, regular in form, were issued, conveying the land in controversy to the plaintiff."
"XIX. Flett's declaratory statement was not formally canceled upon the records until December 23, 1891.
"XX. The defendant is in possession of the land and withholds such possession from the plaintiff."
It also appeared that the railroad company on May 10, 1879, transmitted to the office of the Secretary of the Interior a map showing its relocated line of general route, which map was on June 11, 1879, sent to the Commissioner of the General Land Office by the Secretary for filing, with instructions to withdraw the lands coterminous therewith from sale, pre-emption, or entry for the benefit of the railroad company, and the map was duly filed on that day. The land in controversy is within the line as relocated. The conclusions of law of the circuit court were in favor of the railroad company, and the court held that prior to June 11, 1879, when the map of general route as relocated was filed, and after the abandonment of the land by John Flett, the same was public land of the United States, not reserved, sold, granted, or otherwise appropriated, and free from pre-emption or other claims or rights; and that from that date (June 11, 1879) the land was reserved from sale,* pre-emption, or entry, except by the railroad company, by virtue of fixing the line of general route of the branch line coterminous therewith; that this reservation became effective from and after the receipt of the order of the Commissioner at the United States district land office on July 19, 1879.
Judgment in favor of the plaintiff for the recovery of the possession of the land was duly entered. Upon appeal by the defendant to the circuit court of appeals for the ninth circuit, that court reversed the judgment and remanded the cause to the circuit court for further proceedings not inconsistent with the views expressed in the opinion of the court of appeals. Judgment in accordance with the opinion of that court was subsequently entered by the circuit court, dismissing the plaintiff's complaint, and awarding costs to the defendant. This was under objection of plaintiff, which claimed the right to a new trial, and exception was taken thereto.
It appearing that the plaintiff, the Northern Pacific Railway Company, had subsequently to the hearing acquired the rights of the original plaintiff to the property described in the complaint, it was substituted as plaintiff in this action. A writ of error was then taken to the United States circuit court of appeals for the ninth circuit, where the judgment of the circuit court was affirined. The plaintiff by writ of error brought the case here for review.
The opinion of the circuit judge, given up
on the trial of the cause, is reported in 66 Fed. Rep. 450, and that of the circuit court of appeals in 44 U. S. App. 257.
Messrs. C. W. Bunn and James B. Kerr for plaintiff in error.
Messrs. W. H. Pritchard, A. W. Ballard, and H. F. Norris for defendant in er
Mr. Charles W. Russell, Assistant Attorney, Department of Justice, filed a brief for the United States by leave of the court.
*Mr. Justice Peckham, after stating the facts, delivered the opinion of the court:
The grant of lands to aid the construction of that portion of the main line of the railroad of the plaintiff in error, between Portland and Puget sound, dates from the joint resolution of May 31, 1870, and prior to that time there was no land grant in aid of the construction of that portion of the road. United States v. Northern Pacific Railroad Company, 152 U. S. 284, 292 [38: 443, 447].
At the time of the adoption of the resolution of 1870 there had been filed, April 9, 1869, in the local land office the statement of John Flett, declaring his intention to purchase the lands in dispute under the laws of the United States authorizing the pre-emption of unoffered lands, and that entry being unforfeited and uncanceled, operated to except the lands from that grant. We may therefore confine our attention to the grant under the act of July, 1864, and the subsequent proceedings which relate to that grant.
At the time of the passage of that act the United States owned the land in question as public land, and as to that land it had, as specified in the third section thereof, "full title, not reserved, sold, granted, or otherwise appropriated, and free from pre-emption, or other claims or rights," and no portion of this land had at that time been "granted, sold, reserved, occupied by homestead settlers, or pre-empted, or otherwise disposed of." On the 26th of March, 1884, the plaintiff had filed its map of definite location in the office of the Commissioner of the General Land Office, which map embraced the land in controversy.
The filing of such a map of definite location of a railroad determines the right of the railroad company to the land under the land grant acts of Congress. Kansas Pacific Rail way Company v. Dunmeyer, 113 U. S. 629 [28: 1122]; Sioux City & I. F. Town Lot & Land Company v. Griffey, 143 U. S. 32 [36: 64], a grant similar in its nature to the one under consideration.
If there had been a pre-emption claim at the time of the passage of the act of 1864, the land would not have passed under that grant. Bardon v. Northern Pacific Railroad Co. 145 U. S. 535 [36: 806].
*It is contended that at the time (March 26, 1884) when the map of definite location" was filed, the declaratory statement of Flett, filed in the local land office in 1869, remained there as a record, and was an assertion of a preemption claim, and the defendant maintains that under the case of Whitney v. Taylor, 158 U. S. 85 [39: 906], the land described in that