« ForrigeFortsett »
place their chief reliance. Its evident pur- high-school building. See also New Orleans
The fact that this court had held the origprovides that all such as had been thereto-inal Pima county bonds invalid does not affore issued under the authority of the legis- fect the question. They were invalid belature, and which by the first section were cause there was no power to issue them. authorized to be funded, should be confirmed, They were made valid by such power being approved, and validated, and might be fund-subsequently given, and it makes no possied until January 1, 1897.
ble difference that they had been declared to
We think it was within the power of Congress to validate these bonds. Their only defect was that they had been issued in excess of the powers conferred upon the territorial municipalities by the act of June 8, 1878. There was nothing at that time to have pre- Nor was the act intended to be confined to vented Congress from authorizing such mu- the outstanding legal indebtedness of the nicipalities to issue bonds in aid of railways, county. The first section of the act requires and that which Congress could have orig- the funding of all outstanding obligations of inally authorized it might subsequently said territory and its municipalities, and all confirm and ratify. This court has repeat- outstanding bonds, etc., of the territory and edly held that Congress has full legislative its municipalities, "heretofore authorized by power over the territories, as full as that legislative enactments of said territory, bearwhich a state legislature has over its munic-ing a higher rate of interest than is authoripal corporations. American Ins. Co. v. [356 Bales of Cotton] Canter, 1 Pet. 511 [7: 242]; National Bank v. County of Yankton, 101 U. S. 129 [25: 1046].
ized by the aforesaid funding act, approved
cumstances, and, particularly, in view of the
Resolved, That our delegate to Congress be,
said authorities" of the municipalities, but
In addition to this, however, the act of Congress of June 6, 1896, declared that all the outstanding bonds, warrants, and other evidences of indebtedness of the territory and its municipalities shall be funded with the interest thereon, etc.
Statement by Mr. Chief Justice Fuller: *This was an action brought by the First National Bank of Cadiz, Ohio, against the Capital National Bank of Lincoln, Nebraska, and Macfarland, the receiver thereof, in the district court of Lancaster county, Nebraska.
The petition contained five counts for moneys belonging to plaintiff received by defendant from notes transmitted to it for collection and remittance.
Each of the counts concluded thus:
"Plaintiff further says that on or before the 21st day of January, 1893, the said defendant bank then and there became, and for some time prior thereto had been, insolvent, We are therefore of opinion that it was and that under and in pursuance of the laws made the duty of the loan commissioners by of the United States the said defendant, Macthese acts to fund the bonds in question, and farland, was duly appointed, and is now actthat the order of the Supreme Court of the ing, as a receiver thereof, and that all the asTerritory must be reversed, and the case re-sets and trusts in and belonging to said bank manded to that court for further proceedings and the beneficiaries thereof passed into the not inconsistent with the opinion of this possession of, and are now held by, the said court. Macfarland for the said bank, and all trusts or money held or obtained by said bank in a fiduciary capacity passed into the hands of said defendant, Macfarland, and he now holds the same in the same capacity that the said bank did before he took possession thereof.
CAPITAL NATIONAL BANK OF LIN-
"That in the collection of said note the said Capital National Bank was acting as the agent of this plaintiff for the purpose aforesaid, and the money so collected was the property of and belonged to this plaintiff; that said amount so collected never was a part of the assets of said bank and never belonged to the stockholders thereof; that whether or not said amount was ever mixed or mingled with the true assets of said bank plaintiff is unable to state, but does allege that if the same was mixed or mingled with the assets of said bank that the same was done wrongfully and fraudulently by the officers of said bank and without the knowledge or consent of this plaintiff; that a part of the business and powers of said bank was the collection and remittance of moneys for persons and corporations, and that the said defendant bank was acting as agent for that purpose as hereinbefore alleged."
The prayer was "that an account may be taken of the trust funds to which the plaintiff may be entitled, and that a decree be entered against the said Capital National Bank and the said John D. Macfarland, directing the payment or delivery to plaintiff of the amount of said collections, and that the said
Argued December 2, 5, 1898. Decided Jan- amount be decreed to be a trust fund in the uary, 3, 1899.
N ERROR to the Supreme Court of the State of Nebraska a judgment of that court affirming the judgment of the District Court of Lancaster County in that state adjudging that the plaintiff, the First National Bank of Cadiz, Ohio, recover from the defendant, the Capital National Bank of Lincoln, Nebraska, the amount of a trust fund found to belong to plaintiff, and that Kent K. Hayden, receiver of said defendant, pay the plaintiff the amount of said trust fund, with interest, out of any money in his hands. Writ of error dismissed.
See same case below, 49 Neb. 795.
hands of said bank and receiver to be first paid to this plaintiff, together with interest thereon, as damages, out of any money that or
the possession of said bank or receiver as a preferred or special claim, and that plaintiff may have such other or further relief as in equity it may be entitled to."
Macfarland having resigned the receivership, Hayden was appointed to succeed him, and filed an answer (stating preliminarily that he answered "as well for the said defendant bank as for and on his own account as receiver thereof"), admitting the insolvency of the defendant bank, the appointment* of Mac- farland as receiver and his taking posses
sion of the bank, "with all and singular its rights, credits, effects, trusts, anu duties," and setting up ..s own subsequent appointment. With the exception of the admissions, the answer amounted to a general denial, there being a special denial of the receipt or collection by the bank or the receiver of the note mentioned in the first count.
"22. The court erred in rendering judgment against the plaintiff for costs.
"23. The court erred in holding that money collected by the Capital National Bank was a trust fund in the hands of the receiver for the benefit of the defendant in error.
"24. The court erred in rendering judg ment against the plaintiff in error for the full amount of the notes collected by the Capital National Bank.
"25. The court erred in rendering a judg ment which had the effect of making the defendant in error a preferred creditor over the other creditors of the Capital National Bank.
"26. The court erred in ordering that the amount of the judgment should be paid out of any money then in the hands or that might thereafter come into the hands of the plaintiff in error.
"27. The court erred in rendering a judg. ment which would become a lien upon all the assets of the Capital National Bank."
The cause came on for hearing, and, after the default of the bank was taken and entered, was tried by the court, which made certain findings of fact, and entered the following judgment: "It is therefore considered, ordered, adjudged, and decreed by the court that the said plaintiff, the First National Bank of Cadiz, Ohio, do have and recover of and from the said defendant, the Capital National Bank of Lincoln, Nebraska, the amount of the trust fund hereinbefore found to belong to plaintiff, to wit, eight thousand and fifty ($8,050) dollars, with interest thereon, at the rate of seven per cent per annum from January 20, 1893, principal and interThe supreme court affirmed the judgment est amounting to the sum of eight thousand and seven hundred and twenty-two and .95 of the district court, and, its judgment hav($8,722.95) dollars at the date of this de- ing been entered, the receiver applied for a cree. And it is further ordered, adjudged, rehearing, assigning five reasons therefor, of and decreed by the court that the said defend- which the fifth was as follows: "Because ant, Kent K. Hayden, receiver of the said said judgment and decree of said district defendant, the Capital National Bank, be, court so affirmed by said judgment and deand he is hereby, ordered to pay the plain- cree of this court adjudged the amount found tiff the amount of said trust fund in his due the plaintiff therein to be a lien upon  hands, as hereinbefore found, to wit, the sum the property and assets now in the possession of eight thousand and fifty dollars, together of the appellant or which shall hereafter with seven per cent interest thereon from come into his possession, and to be paid out January 20, 1893, as damages for the deten- of the proceeds thereof in preference and prition thereof, the said principal and interest ority to other creditors of said bank, and is in at the date of this decree amounting to the violation of the provisions of the 'national sum of eight thousand seven hundred twenty-bank act' of the United States under whose two and .95 ($8,722.95) dollars, out of any authority this appellant was appointed and is acting." money now in his hands or that may come into his hands as such receiver; that when said money or any part of it is paid under this order, the same shall apply on the above judgment against said defendant bank; that the said defendant bank and said defendant, Hayden, pay the costs of this action, taxed at $50.03."
The petition for rehearing was denied, and thereafter this writ of error was allowed.
After the case had been docketed, the death of Hayden was suggested, and the appearance of John W. McDonald, appointed his successor as receiver, was entered.
Messrs. A. E. Harvey, John H. Ames,
Thereupon the defendant bank, "by Kent K. Hayden, its receiver," moved for a new trial on these grounds: "1. The judgment is not sustained by sufficient evidence. 2. The judgment *is contrary to law. 3. Errors of law occurring at the trial duly excepted to. 4. There is error in the assessment of the The writ of error from this court to revise amount of recovery in this, that the judg ment allows the plaintiff interest on his claim the judgment of a state court can only be from and after the failure of the Capital Na-maintained when within the purview of sectional Bank." The motion was overruled, a bill of exceptions duly taken, and the cause carried to the supreme court of Nebraska on
*Mr. Chief Justice Fuller delivered the opinion of the court:
The application to that court for the writ
"21. The court erred in rendering judg-
tion 709 of the Revised Statutes.
If the denial by the state court of a right under a statute of the United States is relied on as justifying our interposition, before it can be held that the state court thus disposed of a Federal question, the record must show, either by the words used or by clear and necessary intendment therefrom, that the right was specifically claimed; or a definite issue as to the possession of the right must be distinctly deducible from the record, without an adverse decision of which the judgment could not have been rendered. Moreover, even though a Federal question
The record discloses no Federal question asserted in terms save in the application to the supreme court for a rehearing, when the suggestion came too late.
The petition did, indeed, allege that the Capital National Bank was organized under the banking act, and that a receiver was appointed, who took possession of the bank's assets and of all trusts and moneys held by it in a fiduciary capacity, and the answer admitted these averments, respecting which there was no controversy, yet no right to appropriate trust funds was claimed by defendant under any law of the United States, nor was it asserted that any judgment which might be rendered for plaintiff would be in contravention of any provision of the bank ing act.
The motion for new trial pursued a common formula, and one of the grounds assigned was that the judgment was "contrary to law," but this cannot be construed as having a single meaning, and distinctly referring to the denial of a right claimed under an act of Congress, consistently with the require ments of section 709 of the Revised Statutes as expounded by numerous decisions of this court.
California Bank v. Kennedy, 167 U. S. 362 [42: 198], is not to the contrary, as counsel seem to suppose. There the question was whether a national bank could purchase or subscribe to the stock of another corporation, and the answer averred that if the stock in question appeared to have been issued to the national bank, it was "issued without authority of this corporation defendant, and without authority of law." The grounds presented on motion for new trial, and in the specifications of error which formed the basis of the appeal to the supreme court of the state, asserted the want of power under the laws of the United States; and the Califor
nia supreme court said in its opinion that the bank appealed on the ground "that, by virtue of the statutes under which it is or ganized, it had no power to become a stock holder in another corporation." The general rule was not questioned that if the alleged right was not claimed before judgment in the highest court of the state, it could not be as
serted in this court.
This rule was not complied with here, nor was any Federal question in terms decided, while, on the contrary, the judgment was explicitly rested on non-Federal grounds.
The contention of plaintiff was that the Capital National Bank had money in its hands which belonged to plaintiff, did not
belong to the bank, had never formed part of its assets, and was held by the bank in trust for plaintiff.
The right to the money was considered by the trial court in the light of general equitable principles applicable on the facts, and the court adjudged that the money constituted a trust fund to which plaintiff was entitled.
The decision did not purport to affect the assets of the bank, or attempt to direct the distribution thereof, or in any way to interfere with the disposition of assets actually belonging to the bank; nor did it affect the receiver as receiver; or his appointment or authority under the banking act. As the trial court found that certain moneys held by the bank in trust for plaintiff had come into the receiver's hands, he was directed to return them, for he had no stronger title to the trust fund as against the plaintiff than the bank had.
When the case came to the supreme court, that court, finding no reversible error in the record, affirmed the judgment of the district court, and filed an opinion (49 Neb. 795) stating: "This case is of the same general nature as Capital Nat. Bank et al. v. Coldwater Nat. Bank, 49 Neb. 786. It was submitted upon the same argument, and, governed by the result reached in that case, this is affirmed." From the opinion in the case thus referred to, it appears that that case, now on our docket and numbered 73, was submitted to the supreme court of Nebraska with this case numbered 72, and with three others, also brought here, and numbered 74, 75, and 76, and that the five cases were disposed of by the opinion in No. 73.
The supreme court there held that:
"A fund which comes into the possession of a bank with respect to which the bank had but a single duty to perform, and that is to deliver it to the party thereto entitled, is a trust fund, and is therefore incapable of being commingled with the general assets of such bank subsequently transferred to its receiver.
"Under the circumstances above indicated, the receiver of the bank is merely substituted as trustee, and its funds in his hands should be devoted to discharging such trust before distribution thereof is made to the general creditors of the bank."
Among other things, the court said: is conceded by the plaintiff in error that the conformity with the views expressed more or relief granted by the district court was in less directly by this court in Wilson v. Coburn, 35 Neb. 530; Anheuser-Busch Brewing Association v. Morris, 36 Neb. 31: Griffin v. Chase, 36 Neb. 328; and State v. State Bank of Wahoo, 42 Neb. 896, but it is urged that a re-examination of the principles involved should satisfy us that these cases proceeded upon an erroneous view of the law as now settled. A very careful examination has been made of all cases cited in respect to the pivotal question which has already been sufficiently indicated as having been acted upon by the district court." And after reviewing these cases the court announced that it was
not convinced that it should recede from the line of its former decisions.
We know of no provision of the banking act which assumes to appropriate trust funds in the possession of insolvent banks, or other property in their possession to which they have no title, and it is clear that the state courts had jurisdiction to determine whether this money was or was not a trust fund belonging to plaintiff.
The receiver made no effort to remove the litigation to the circuit court, contested the issues on a general denial, and set up no claim of a right under Federal statutes withdrawing the case from the operation of general law.
In these circumstances the result is that this court has no jurisdiction to revise the (434)judgment of the supreme court of *Nebraska, and we, necessarily, intimate no opinion in respect of the views on which the case was disposed of.
Writ of error dismissed.
CAPITAL NATIONAL BANK OF LINCOLN, NEBRASKA, et al.,
COLDWATER NATIONAL BANK OF COLDWATER, MICHIGAN.
CAPITAL NATIONAL BANK OF LINCOLN, NE
COLDWATER NATIONAL BANK OF COLDWATER, MICHIGAN.
JOHN W. McDONALD, Receiver,
SAMUEL CUPPLES WOODEN WARE CO.
JOHN W. MCDONALD, Receiver,
GENESEE FRUIT CO.
(See S. C. Reporter's ed. 434.)
[Nos. 73, 74, 75, 76.]
Messrs. John H. Ames, Andrew E. Harvey, G. M. Lambertson, and Amasa Cobb for plaintiffs in error in all the cases.
Messrs. Lionel C. Burr and Charles L. Burr for defendants in error in Nos. 73 and 74.
Mr. C. A. Brandenburgh for defendants in error in Nos. 75 and 76.
THE CHIEF JUSTICE:
For the reasons given in the opinion in Capital National Bank v. First National Bank of Cadiz, Ohio, just decided [ante, 502], the writs of error in these cases are severally dismissed.
HERMAN KECK, Plff. in Err.,
(See S. C. Reporter's ed. 434-465.)
Insufficient indictment—tariff act of 1894
attempts to smuggle, not "smuggling"word "smuggling" in U. S. Rev. Stat. § 2865.
An indictment for unlawfully importing and bringing into a certain port of the United States diamonds of a stated value, "contrary to law,' with intent to defraud the United States, but not indicating what is relied on as violative of the law, is insufficient, although it charges the offense substantially in the words of U. S. Rev. Stat. § 3082.
The word "diamonds," followed by a semicolon, at the head of ¶ 467 in the free list of the tariff act of 1894, does not put all diamonds on the free list; but that word is plainly designed as a heading, and the semicolon following it should be read as though a colon.
The offense of smuggling or clandestine introduction of goods into the United States in violation of U. S. Rev. Stat. § 2865, does not include mere attempts to commit the same, and is not committed by the concealment of goods on a ship entering the waters of the United States, with intent to smuggle them, where the goods are not taken through the lines of customs authorities, but are delivered to the customs officer on board the vessel itself at the time when or before the obligation to make entry and pay the duties arises.
The word "smuggling" used in U. S. Rev. Stat. 2865, is not extended beyond the common-law meaning by reason of the provision in the anti-moiety act of June 22, 1874, respecting the rewards of informers, that, for the purposes of that act, smuggling shall include attempts to bring dutiable articles into the United States without passing through the customs house or submitting them to the revenue officers.
Argued December 18, 1896. Ordered for reargument January 18, 1897. Reargued January 19, 20, 1898. Affirmed by divided court March 7, 1898. Rehearing granted March 21, 1898. Ordered for Reargument April 25, 1898. Reargued November 10, 1898. Decided January 9, 1899.
IN ERROR to the District Court of the
Pennsylvania to review a judgment of that court adjudging the defendant, Herman Keck, to be guilty of smuggling under the laws of the United States and sentencing him to pay to the United States a fine of $200 and that he be confined in the eastern penitentiary of the commonwealth of Pennsylvania for the period of one year. Judgment reversed, and case remanded, with directions to set aside the verdict and grant a new trial. The facts are stated in the opinion. Messrs. Francis Bacon James and Rankin Dilworth Jones, for plaintiff in error on first argument and on all rearguments:
Where a statute which provides for the