« ForrigeFortsett »
place their chief reliance. Its evident pur- high-school building. See also New Orleans pose was to authorize the funding of all out- v. Clark, 95 U. S. 644 [24: 521]; Grenada standing bonds of the territory, and its mu- County Supervisors v. Brogden, 112 U. S. nicipalities, which had been authorized by 261 [28: 704]; Otoe County v. Baldwin, 111 legislative enactments, whether lawful or U. S. 1 [28: 331]; 1 Dillon, Municipal Cornot, provided such bonds had been "sold or porations, § 544; Cooley, Const. Lim. 6th ed. exchanged in good faith and in compliance 456; Bolles v. Brimfield, 120 U. S. 759 [30: with the terms of the act of the legislature 786]; Anderson v. Santa Anna, 116 U. S. 356 by which they were authorized." The sec-[29: 633]; Dentzel v. Woldie, 30 Cal. 138, ond section deals with the original bonds 145. which had not been theretofore funded, and provides that all such as had been theretofore issued under the authority of the legislature, and which by the first section were authorized to be funded, should be confirmed, approved, and validated, and might be funded until January 1, 1897.
The fact that this court had held the orig. inal Pima county bonds invalid does not affect the question. They were invalid because there was no power to issue them. They were made valid by such power being subsequently given, and it makes no possible difference that they had been declared to be void under the power originally given. The judgment in that case was res judicata only of the issues then presented, of the facts as they then appeared, and of the legislation then existing.
Curative statutes of this kind are by no means unknown in Federal legislation. Thus, in National Bank v. County of Yankton, supra, this court sustained an act of Congress nullifying a legislative act of the territory of Dakota authorizing the issue of railway bonds, but validating action theretofore taken by the county voting subscription to a certain railroad company, holding it to be "equivalent to a direct grant of power by Congress to the county to issue the bonds in dispute.". In Thompson v. Perrine, 103 U. S. 806 [26: 612], we also sustained a similar act of the state of New York ratifying and confirming the action of commissioners in issuing similar bonds. In Read v. Plattsmouth, 107 U. S. 568 [27: 414], a similar ruling was made with regard to an act of the legislature of Nebraska validating an issue of bonds by the city of Plattsmouth for the purpose of raising money to construct a credit and standing of our people for honesty, and fair dealing and bring us into disrepute : Wherefore, we most strongly urge upon your most honorable bodies the propriety and justice of passing such curative and remedial legislation as will protect the holders of all bonds issued under the authority of acts of the legislative assembly, the validity of which has heretofore been acknowledged, and that you further legislate as to protect all innocent parties having entered into contracts resulting from inducements offered by our territorial legislation, and relieve the people of the territory from the disastrous effects that must necessarily follow any repudiation of good faith on the part of the territory, and that you may so further legislate as to validate all acts of the legislative assembly of the territory which have held out in
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 ized by the aforesaid funding act, approved Bales of Cotton] Canter, 1 Pet. 511 [7: June 5, 1890," which said bonds, etc., "have 242]; National Bank v. County of Yankton, been sold or exchanged in good faith in com101 U. S. 129 [25: 1046]. pliance with the terms of the acts of the legis lature by which they were authorized;"and the second section confirms, approves, and validates all bonds and other evidences of indebtedness theretofore issued under the authority of the legislature, and authorized to be funded by the first section, and declares that they "may be funded, as in this act provided, until January 1, 1897." Construing this in the light of the surrounding circumstances, and, particularly, in view of the memorial, it is entirely clear that it was in- tended to apply to bonds issued under authority of the legislature, and purporting on their face to be legal obligations of the county, whether in fact legal or not; and to put the matter still further beyond question, they are expressly declared to be legal and valid. It is true that, by the tenth section of the act of Congress of June 25, 1890, the loan commissioners were authorized to refund municipal bonds "upon the official demand of ducements for the investment of capital within the territory, and which have led to the investment of large sums of money in enterprises directly contributing to the development and growth of the territory, and thus relieve the honest people of the territory from the disastrous effects that must necessarily follow any violation of good faith on the part of our people.
Resolved, That our delegate to Congress be, and he is hereby, instructed to use all honorable means to bring this subject to the earnest consideration of Congress; that the secretary of the territory be, and he is hereby. requested to transmit a copy of the foregong to each house of Congress and to our delegate in Con
said authorities" of the municipalities, but
Statement by Mr. Chief Justice Fuller:
The petition contained five counts for moneys belonging to plaintiff received by defendant from notes transmitted to it for collection and remittance.
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.
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, and that under and in pursuance of the laws of the United States the said defendant, Macfarland, was duly appointed, and is now acting, as a receiver thereof, and that all the assets and trusts in and belonging to said bank and the beneficiaries thereof passed into the possession of, and are now held by, the said 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.
"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."
We are therefore of opinion that it was made the duty of the loan commissioners by these acts to fund the bonds in question, and that the order of the Supreme Court of the Territory must be reversed, and the case remanded to that court for further proceedings not inconsistent with the opinion of this court.
CAPITAL NATIONAL BANK OF LIN-
FIRST NATIONAL BANK OF CADIZ,
(See 8. C. Reporter's ed. 425–434.) Federal question, when raised too late that a judgment is contrary to law is not a Federal question-a decision on general equitable principles does not involve such a question.
1. A Federal question is raised too late for writ of error to a state court when presented on application to the state supreme court for a rehearing.
A claim that a judgment holding a receiver of a national bank to be a trustee is "contrary to law" does not raise a Federal question.
A decision that money in the hands of a receiver of a national bank is held in trust and has never been a part of the assets of the bank, when rendered on general equitable principles, does not involve any Federal question which will sustain a writ of error to the
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. hands of said bank and receiver to be first paid to this plaintiff, together with interest thereon, as damages, out of any money that
'N ERROR to the Supreme Court of the
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.
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
"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.
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.
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 interest amounting to the sum of eight thousand and seven hundred and twenty-two and .95 ($8,722.95) dollars at the date of this decree. And it is further ordered, adjudged, and decreed by the court that the said defendant, Kent K. Hayden, receiver of the said defendant, the Capital National Bank, be, and he is hereby, ordered to pay the plaintiff the amount of said trust fund in his hands, as hereinbefore found, to wit, the sum of eight thousand and fifty dollars, together with seven per cent interest thereon from January 20, 1893, as damages for the detention thereof, the said principal and interest at the date of this decree amounting to the sum of eight thousand seven hundred twentytwo and .95 ($8,722.95) dollars, out of any 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
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 amount of recovery in this, that the judg ment allows the plaintiff interest on his claim from and after the failure of the Capital National Bank." The motion was overruled, a bill of exceptions duly taken, and the cause carried to the supreme court of Nebraska on
The application to that court for the writ of error assigned twenty-seven errors. Some of these asserted that certain enumerated findings of fact were not "sustained by the law;" and the 21st, 22d, 23d, 24th, 25th, 26th, and 27th were:
"21. The court erred in rendering judgment against the plaintiff in error for interest upon the amounts collected by the plaintiff in error for the defendant in error.
"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 supreme court affirmed the judgment of the district court, and, its judgment having been entered, the receiver applied for a rehearing, assigning five reasons therefor, of which the fifth was as follows: "Because said judgment and decree of said district court so affirmed by said judgment and decree of this court adjudged the amount found due the plaintiff therein to be a lien upon the property and assets now in the possession of the appellant or which shall hereafter come into his possession, and to be paid out of the proceeds thereof in preference and priority to other creditors of said bank, and is in violation of the provisions of the 'national bank act' of the United States under whose authority this appellant was appointed and is acting."
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, and Amasa Cobb for plaintiffs in error.
Messrs. Newton C. Abbott and Arthur W. Lane for defendant in error.
*Mr. Chief Justice Fuller delivered the opinion of the court:
The writ of error from this court to revise the judgment of a state court can only be maintained when within the purview of section 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
may have been raised and decided, yet if a question, not Federal, is also raised and decided, and the decision of that question is sufficient to support the judgment, this court will not review the judgment.  *In our opinion no Federal right was specially set up or claimed in this case at the proper time or in the proper way; nor was any such right in issue and necessarily determined; but the judgment rested on nonFederal grounds entirely sufficient to support it.
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 signed 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 requirements of section 709 of the Revised Statutes as expounded by numerous decisions of this
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 as-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.
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
belong to the bank, had never formed part of its assets, and was held by the bank in trust for plaintiff.
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 asserted 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
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.
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