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conduct should be construed as adopting whatever method consistent with the facts and with the rights reserved is most fitted to accomplish the result. If an express declaration of an equitable lien, or again a statement that the New York firm constituted itself the servant of the English company to maintain possession for the latter, or that it held upon certain trusts, or that a mortgage was intended, or any other form of words, would effect what the parties meant, we may assume that it was within the import of what was done, written and said. So the question is whether anything in the situation of fact or the rights reserved prevents the intended creation of a right in rem, or at least one that is to be preferred to the claim of the trustee.

The bankruptcy law by itself does not avoid the transaction. Thompson v. Fairbanks, 196 U. S. 516. Humphrey v. Tatman, 198 U. S. 91, 95. A trustee in bankruptcy does not stand like an attaching creditor; he gets no lien by the mere fact of his appointment. York Manufacturing Co. v. Cassell, 201 U. S. 344. Zartman v. First National Bank of Waterloo, 216 U. S. 134, 138. The most obvious objection is that the continued physical power of the New York firm over the securities and its right to withdraw and substitute admittedly reserved are inconsistent with a title or lien of the English house in any form. But the decisions of this court and of New York agree that there may be title in a stronger case than this. When a broker agrees to carry stock for a customer he may buy stocks to fill several orders in a lump; he may increase his single purchase by stock of the same kind that he wants for himself; he may pledge the whole block thus purchased for what sum he likes, or deliver it all in satisfaction of later orders, and he may satisfy the earlier customer with any stock that he has on hand or that he buys when the time for delivery comes. Yet as he is bound to keep stock enough to satisfy his contracts, as the New York

VOL. ccxxy-7

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firm in this case was bound to substitute other security if it withdrew any, the customer is held to have such an interest that a delivery to him by an insolvent broker is not a preference. Richardson v. Shaw, 209 U. S. 365. Markham v. Jaudon, 41 N. Y. 235. So a depositor in a grain elevator may have a property in grain in a certain elevator although the keeper is at liberty to mix his own or other grain with the deposit and empty and refill the receptacle twenty times before making good his receipt to the depositor concerned.

Whether enough has been done to give a right of any kind in certain property is a question of more or less. See Union Trust Co. v. Wilson, 198 U. S. 530, 537. In the case of ordinary goods and chattels, where, for instance, a man mortgages his stock in trade as it may be from time to time, retaining possession and full power to sell and replace or not as he sees fit, it well may happen that the security fails. Skilton v. Codington, 185 N. Y. 80. Zartman v. First National Bank of Waterloo, 189 N. Y. 267. So a general promise to give security in the future is not enough. But the present was a more limited and cautious dealing. It was confined to specific identified stocks and bonds on hand, and purported to give an absolute present right, qualified only by possible substitution and perhaps by a right of partial withdrawal if the remaining securities had risen sufficiently in value. It purported not to promise but to transfer; and the subjectmatter was not goods and chattels in the sense of the New York mortgage law as we understand that law to be interpreted by the New York courts. The transaction was not void as against creditors irrespective of attachment, as in Knapp v. Milwaukee Trust Co., 216 U. S. 545. Niles v. Mathusa, 162 N. Y. 546. There can be no doubt, as was said by the court below, that before the bankruptcy the English house had an equitable right at least to possession if it wanted it. While the phrase equitable lien

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may not carry the reasoning further or do much more than express the opinion of the court that the facts give a priority to the party said to have it, we are of opinion that the agreement created such a lien at least, or in other words, that there is no rule of local or general law that takes from the transaction the effect it was intended to produce. Hurley v. Atchison, Topeka & Santa Fe Ry. Co., 213 U. S. 126, 134. When the English firm took the securities it only exercised a right that had been created long before the bankruptcy and in good faith. Such we understand to be the law of New York and in the absence of any controlling statute to the contrary such we understand to be what the law should be. Parshall v. Eggert, 34 N. Y. 18. National Bank of Deposit v. Rogers, 166 N. Y. 380.

Decree affirmed.





No. 236. Argued May 3, 1912.-Decided May 27, 1912.

Decided on authority of Southern Railway Company v. Reid, 222 U. S.

424, and Southern Railway Company v. Reid & Beam, 222 U. S. 444.

The facts are stated in the opinion.

Mr. John K. Graves, with whom Mr. Alfred P. Thom was on the brief, for plaintiff in error. No

appearance for defendant in error on the argument. Mr. W. H. Carroll and Mr. Lee S. Overman subsequently filed a brief for defendant in error.

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MR. JUSTICE HOLMES delivered the opinion of the court.

This is an action to recover penalties under a statute of North Carolina for refusal to receive goods for shipment. As the statute is the same that was held bad, so far as it concerns commerce among the States, in Southern Railway Co. v. Reid, 222 U. S. 424, and Southern Railway Co v. Reid & Beam, 222 U. S. 444, a short statement will be enough. On January 26, 1907, the Burlington Lumber Company tendered to the Railway Company at Burlington, North Carolina, certain machinery for shipment to Saginaw, Michigan, on a through bill of lading. Saginaw was not on the Railway Company's line, the company had no rates to Saginaw and the agent had to delay in order to inquire of his superiors. The result was that the through bill of lading was not issued until April 3. The suit, as we have said, is for the penalty and nothing else. The Supreme Court of the State decided against the Railway on the same ground that it did in the decisions already reversed. In the circumstances it seems unnecessary to discuss the case more at length.

Judgment reversed.

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Nos. 505, 776. Argued April 15, 16, 1912.-Decided May 27, 1912.

In cases of intervention in foreclosure suits, where jurisdiction depends

upon diverse citizenship, jurisdiction of the intervening petition is determined by that of the original case, but petitions in original proceedings to enforce rights and protect the exercise of the jurisdiction of the court take their jurisdiction from that of the original case. St. Louis, K.C. & C. R. R. Co. v. Wabash R. R. Co., 217 U.S.

247. Where the petition of the receiver, appointed in a case dependent on

diverse citizenship, invokes the jurisdiction of the Circuit Court not only as ancillary to the receivership but also to protect the estate on grounds involving alleged infractions of the Federal Constitution and rights secured thereby, the case is not one in which the judgment of the Circuit Court of Appeals is made final by the act of 1891, and an appeal lies to this court where the amount in controversy exceeds

one thousand dollars. Where the case can be taken to the Circuit Court of Appeals, the fact

that it involves grounds that warrant a direct appeal to this court

does not deprive the Circuit Court of Appeals of jurisdiction. Under the Constitution of the United States, the National Govern

ment has exclusive authority to regulate interstate commerce, and any attempt by the State to regulate rates for interstate transportation is void. Louisville & Nashville R. R. Co. v. Eubank, 184 U. S. 27. An order made by a state commission under assumed authority of

the State, which directly burdens interstate commerce, will be enjoined. McNeill v. Southern Railway Co., 202 U. S. 543.

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