Page images
PDF
EPUB

This view, which is supported alike by the words and by the reason of the statute, is in accordance with the preponderance of decisions in the highest courts of the several States, and in the District Courts of the United States, as shown by the cases cited in argument.*

The plaintiffs' debt being provable in bankruptcy, no unreasonable delay on the part of the "ankrupt in endeavoring to obtain his discharge being shown, and the court in bankruptcy having granted no leave to proceed to judgment for the purpose of ascertaining the amount due, the decision of the state court, denying the application, made by the bankrupt before judgment, for a stay of proceedings to await the determination of the question of his discharge, and rendering a general judgment against him, was erroneous, and he had the right to sue out and prosecute a writ of error to reverse it. The assignee in bankruptcy has also been permitted to be heard in support of the writ of error, because of his authority and duty to defend the estate of the bankrupt against claims and attachments which he believes to be invalid.

The result is that the judgment of the Supreme Court of Illinois must be reversed, and the case remanded to that court for further proceedings in conformity with this opinion.

The judgment of the state court being reversed for the reason that it denied the stay of proceedings to which the original defendant was entitled under the provision of the Bankrupt Act until the question of his discharge in bankruptcy should have been determined, there is no occasion to consider the question, which may perhaps depend upon the statutes or the practice of the State, whether it will be within the authority of the court in which the suit is pending, now that the defendant has obtained his discharge in bankruptcy, to render a special judgment in favor of the plaintiffs for the purpose of charging the sureties on the bond given to dissolve the attachment; or any other question which may hereafter arise upon the production, by the defendant, of his certificate of discharge, or upon the suggestion of the assignee in bankruptcy.

Judgment reversed.
True copy. Test:

ing the sale of property assigned for the benefit of
creditors, are mandatory and not directory.
2. An assignment which vests the assignee with a
discretion contrary to the mandates of the statute
and, in effect, authorizes him to sell the property
conveyed thereby, in a method not permitted by
the statute, is void.
[No. 176.]

Submitted Mar. 7, 1883. Decided Mar. 19, 1883.

APPEAL from the Circuit Court of the United

States for the Eastern District of Arkansas. The history and facts appear in the

Statement of the case by Mr. Justice Woods: The Statutes of Arkansas contain the following provisions:

"Section 385. In all cases in which any per son shall make an assignment of any property, whether real, personal, or choses in action, for the payment of debts, before the assignee thereof shall be entitled to take possession, sell or in any way manage or control any property so assigned, he shall be required to file in the office of the clerk of the court exercising probate jurisdiction, a full and complete inventory and description of such property; and also make and execute a bond to the State of Arkansas in double the estimated value of the property in said assignment, with good and sufficient security, to be approved by the judge of said court, conditioned that such assignee shall execute the trust confided to him, sell the property to the best advantage, and pay the proceeds thereof to the creditors mentioned in said assignment, according to the terms thereof, and faithfully perform the duties according to law."

"Section 387. Said assignee shall be required to sell all the property assigned to him for the payment of debt, at public auction, within one hundred and twenty days after the execution of the bond required by this Act, and shall give at least thirty days' notice of the time and place of such sale. And any person damaged by the neglect, waste or improper conduct of such assignee, shall be entitled to bring his action on the bond in the name of the State for the use and benefit of such person." Gantt, Digest, pp. 207, 208.

While these sections were in force, to wit: on December 19, 1878, James C. Moss and John S.

James H. McKenney, Clerk, Sup. Court, U. S. Bell, partners under the name of Moss & Bell,

Cited 109 U.S., 596.

Metcalf's Case, 2 Ben., 78; Rosenberg's Case, 3 Ben., 14; Penny v. Taylor, 10 Bk. Reg., 200; Whitney's Case, 18 Bk. Reg., 563; Ray v. Wight, 119 Mass., 425; Nat. Bk. v. Taylor, 120 Mass., 124; Towne v. Rice, 122 Mass., 67; Page v. Cole, 123 Mass., 93; Seavey v. Beckler, 128 Mass., 471; McKay v. Funk, 37 Iowa, 661; Bratton v. Anderson, 5 S. Č., 504; Cohen v. Duncan, 64 Ga., 343.

doing business as merchants at Pine Bluff, Arkansas, conveyed by an assignment in writing, all their goods, wares and merchandise, and choses in action to the defendant, James M. Hudson, as trustee in trust for the payment of their debts. The deed of assignment preferred certain creditors who afterwards became the complainants in this suit, and required the trustee to pay them in full if the proceeds of the property assigned should be sufficient for that purpose, and if there should be any surplus, to

E. S. JAFFRAY & COMPANY ET AL., Appts., pay it share and share alike to other creditors.

0.

McGEHEE, SNOWDEN & VIOLETT, JAMES TORRANS, United States Marshal, ET AL.

(See S. C., 17 Otto, 381-385.)

Arkansas law-assignment.

The powers conferred on the trustee were as
follows: "To sell and dispose of all of said
property for cash as he should deem advisable
and right, and to this end to use his own dis-
cretion, subject to the supervision of the cred-
itors
# * and to conduct and transact all
of the business as he may deem proper in the
exercise of a sound discretion, and as he shall
deem most advisable for the benefit of creditors

*

1. The provisions of the Arkansas Statute respect- and their trust; and he shall have power to ap

point such assistants, agents, and attorneys as in | given the assignee by the assignment leaves his judgment may be necessary to enable him him at liberty to follow the law; and (2) beto fulfil this trust," etc. cause, even if the assignment required him to administer the trust in a manner different from that prescribed by the law, only such directions as conflicted with the law would be void, and the assignment itself would remain valid."

Hudson accepted the trust and, on December 21, 1878, gave bond according to law, and filed in the office of the clerk of the probate court, an inventory of the property conveyed to him by the deed of assignment.

On December 21, 1878, the defendants, McGehee, Snowden & Violett, recovered against Moss & Bell, in the United States Circuit Court for the Eastern District of Arkansas, a judgment for $10,992, on which execution was issued on January 12, 1879, and the same came into the hands of the marshal of the district on that day. The marshal levied the execution on the goods and chattels assigned by Bell & Moss to Hudson, and took them into his possession, and was about to advertise and sell the same to satisfy the execution, when the bill in this case was filed by the complainants, who were the preferred creditors named in the assignment. The bill recited the foregoing facts, and prayed an injunction against the marshal and McGehee, Snowden & Violett, forbidding them to interfere with the property assigned to Hudson, and that they might be decreed to return the same to him, etc.

The defendants demurred to the bill for want of equity. The circuit court sustained the demurrer on the ground that the deed of assignment was void on its face, and dismissed the bill. The purpose of this appeal is to reverse that decree.

Messrs. S. F. Clark and S. W. Williams, for appellants.

Mr. U. M. Rose, for appellees.

Mr. Justice Woods delivered the opinion of the court:

The Statute of Arkansas provides that the property assigned for the benefit of creditors shall be sold at public auction within one hundred and twenty days after the execution of the bond required of the assignee.

We think that, under the construction given the assignment law by the Supreme Court of Arkansas, in the case of Raleigh v. Griffith, 37 Ark., 153, these positions cannot be maintained. The assignment in that case provided as follows: "The party of the second part," the assignee, "shall take possession of all and singular the property and effects hereby assigned, and sell and dispose of the same, either at public or private sale, to such person or persons for such prices and on such terms and conditions, either for cash or upon credit, as in his judgment, may appear best and most for the interest of the parties concerned, and convert the same into money."

It will be observed that the terms of the assignment did not prevent the assignee, in the administration of his trust, from following the directions of the statute in all particulars. He was at liberty to sell for cash at public auction, and within one hundred and twenty days after the filing of his bond. But the assignment vested him with a discretion to do otherwise. The court declared the assignment to be void. It said: "In providing for the sale of the property, the statute is disregarded in the deed of assignment; the assignee was authorized to sell at a private or public sale, and for cash or credit. Under such provision it was in the power and discretion of the assignee to prolong the execution and closing of the trust for an indefinite period. The Legislature deemed it expedient, as a matter of public policy, to require assignees, in general deeds of assignment for the benefit of creditors, to sell all property assigned to them, for the payment of debts, at public auction, within one hundred and twenty-five days after the execution of the bond, on thirty days' notice of the time and place of sale." And the court declared: "The Statute prescribes a mode of sale in this State, and dissenting creditors are not barred by a deed made in direct contravention of a plain provision of the statute."

The deed of assignment, in effect, authorized the assignee to sell at private sale, and at such time and in such manner as he should deem advisable and right. Under this power he could wait an indefinite time, and then sell the property at wholesale, or he could carry on the busi- The effect of this decision is that the provisness of selling off the stock of goods in the ordi- ions of the statute respecting the sale of propnary way of retail merchants, and without any erty assigned for the benefit of creditors are limit of time within which the sale should be mandatory and not directory; see, also, French completed. The powers conferred by the deed v. Edwards, 13 Wall., 506 [80 U. S., XX., 702], of assignment were, therefore, in direct opposi- and there are no conflicting decisions of the tion to the policy of the statute. It is true, the Supreme Court of Arkansas. This being the powers conferred on the trustee were subject to construction put upon the law by the Supreme the supervision of the creditors. But this could Court of the State when the assignment in this only mean a majority of the creditors. The as- case was made, it is binding on the courts of the signee was, therefore, authorized by the assign- United States. Brashear v. West, 7 Pet., 60%; ment to dispose of the property assigned in a Sumner v. Hicks, 2 Black, 582 [67 U. S., XVII., manner different from that pointed out by the 355]; Leffingwell v. Warren, Id., 599 [67 U. S., statute, and in disregard of the wishes and re- XVII., 261]. It follows that the assignment, monstrances of a minority of the creditors. The which vests the assignee with a discretion conquestion presented is, therefore, this: is an as- trary to the mandates of the statute and, in effect, signment for the benefit of creditors, which au- authorizes him to sell the property conveyed thorizes the assignee to violate the provisions of thereby, in a method not permitted by the statthe statute regulating such assignments, valid ute, must be void, for contracts and conveyances and binding on the creditors of the assignor? in contravention of the terms or policy of a statThe contention of the appellant is that the as-ute will not be sanctioned. Peck v. Burr, 10 signment is valid: (1) because the discretion N. Y., 294; Macgregor v. S. E. R. Co., 18 Q. B.,

618; Jackson v. Davison, 4 B. & Ald., 695; Miller | termining from the evidence the exact position v. Post, 1 Allen, 434; Parton v. Hervey, 1 Gray, 119; Hathaway v. Moran, 44 Me., 67.

The result of these views is that the decree of the Circuit Court, dismissing the bill, because the assignment in question was void on its face, was right and must be affirmed.

True copy. Test,

James H. McKenney, Clerk, Sup. Court, U. S.

of the vessels immediately preceding the collision. Here we must take the facts as found and apply the law to them. In cases of admiralty and maritime jurisdiction, on the instance side of the court, under the Act of Congress of 1875, [18 Stat. at L., 315], the finding has the effect of a special verdict in an action at law.

There is, it is true, a bill of exceptions in the record, but it contains exceptions only to the finding, and to the refusal of the court to find otherwise. It presents no question for our con

CHARLES H. MARSHALL ET AL., Appts., sideration except such as arises upon the facts as

[ocr errors]

THE STEAMSHIP ADRIATIC, Her Engines, etc., THE OCEANIC STEAM NAVIGATION COMPANY (Limited) Claimant.

(See 8. C., "The Adriatic," 17 Otto, 512-519.)

Findings in admiralty case-sailing rule-steamer meeting sail vessel.

1. In cases of admiralty and maritime jurisdiction, on the instance side of the court, under the Act of 1875, the findings of fact have the effect of a special

verdict in an action at law.

2. There is no occasion in any case to except specially to a finding of fact, as its sufficiency, in connection with the pleadings to support the decree rendered, is always open to consideration on appeal. 3. When a steamer is nearing another vessel and there is danger of collision, from continuing the rate of speed at which she is going, it is the duty of her captain to slacken her speed and, if necessary, to reverse her engines and move her backwards.

4. A sailing vessel meeting a steamer must keep her course, while the steamer takes the necessary measures to avoid a collision; it must be a strong case which puts the sailing vessel in the wrong for [No. 169.]

obeying the rule.

Argued Jan. 31 and Feb. 1, 1883. Decided Mar. 19, 1883.

found. There is no occasion in any case to except specially to a finding, as its sufficiency, in connection with the pleadings, to support the decree rendered, is always open to consideration on appeal.

On the evening of December 30, 1875, the ship Harvest Queen, an American vessel, sailed the Port of Liverpool, England. She was 187 from the harbor of Queenstown, Ireland, for feet long, of 1626 tons burden and had, at the time, a cargo of grain on board. On the same day, the steamer Adriatic, a British vessel left Liverpool for New York, and proceeded down the Irish Channel. She was 450 feet long, and of over 3,000 tons burden. Her forward deck was roofed with what is termed a turtle back, so called from its shape. The spray of the sea dashed over this roof, and the lookouts of the steamer were, therefore, stationed on a house just abaft of it.

The wheel-house was on deck, and above and a little forward of it was the bridge on which the officer on watch usually took his position. Adjoining the wheel-house, and opening into it, was the chart room. At a quarter past two on the morning of December 31, the captain, who had been on duty all the time after leaving Liverpool, went into that room and lay down on a sofa, giving orders to be called at four, or soon

PPEAL from the Circuit Court of the United
States for the Southern District of Newer if any vessels came in sight. The first officer

AF

York.

The libel in this case was filed in the District Court of the United States for the Southern District of New York, to recover for the loss of the ship, Harvest Queen, and cargo, result ing from a collision.

The district court entered a decree dismissing the libel with costs. This decree having been affirmed, on appeal, by the court below, the libelants appealed to this court.

The facts of the case are fully stated by the

[blocks in formation]

This case comes before us on appeal from a decree of the circuit court, with a finding of facts upon which it was rendered. We are, therefore, relieved of much of the embarrassment experienced on the trial, both by that court and the district court, from the difficulty of de.

was then on watch, standing on the bridge, most of the time on the starboard side. Three seamen were on the lookout, one on each side of the house mentioned, and one on the port side of the bridge. At thirty-five minutes past two the first officer, looking through a night-glass, saw a green light about two points on his starboard bow. It could not be seen by the naked eye. It proved afterwards to be a light on The Harvest Queen. At this time the sky was clear, with scattering clouds; but on the water the night was dark; the wind was blowing a fresh breeze from the southwest and the sea was running high. The steamer was going about twelve knots an hour, having all her lights in their proper places and burning brightly. Soon afterwards the light on The Harvest Queen was seen by one of the lookouts, and two strokes were given to the bell on the turtle deck as a signal that a light was seen on the starboard bow.

Four minutes after that, at thirty-nine minutes past two, the green light of the ship, which had broadened to three and a half points, changed to red. Up to this time the steamer had The character of the not altered her course.

approaching vessel was not known, nothing but her light being seen. But whether she was proNOTE Collision; rights of steam and sailing ves-pelled by wind or steam, the steamer pursued sels with reference to each other, and in passing and the proper course to prevent the danger of colmeeting. See note to St. John v. Paine, 51 U. S. (10 lision. Her green light must have been equally

How.), 557.

visible from The Harvest Queen; and when two vessels keep the same colored lights in view of each other, collision is impossible, for they are then moving on parallel lines. The lights on vessels are required to be so placed as not to be seen across their bows. The red light coming in sight indicated that the ship had changed her course, and was no longer running on a parallel line, but in a direction which, if continued, would bring her across the bow of the steamer. The first officer, therefore, at once gave an order to port the helm, and signaled the engineer to stand by the engine, following this with a further order to slow the engine. Both these orders were promptly obeyed, and the steamer slowly swung to the right.

As already stated, the steamer was going at the rate of twelve knots an hour. The Harvest Queen, judging from the time she occupied in passing over the distance from Queenstown, must have been sailing at the rate of eight knots an hour; that is, the two vessels were approaching each other at a speed equal to about twenty miles an hour. The light on The Harvest Queen could not have been seen that night further than two miles and a half, and over this distance the steamer with her speed had passed four fifths of a mile, and The Harvest Queen a little more than one half of a mile. So that at this time, when the red light was seen, the vessels must have been about a mile and a quarter apart. At the rate they were moving, they would come together or pass each other in four minutes. The first officer of the steamer at once perceived the necessity of an immediate change in her course so as to bring her on a parallel line with the approaching ship. To accomplish this, it was necessary to port the helm of the steamer, which was at once done. The order to do this was, under the circumstances, the proper one to be given. The slowing of the speed of the steamer by reason of the proximity of the other vessel was also a proper proceeding. When a steamer is nearing another vessel, and there is danger of collision from continuing the rate of speed at which she is going, it is the duty of her captain to slacken her speed and, if necessary, to reverse her engines and move her backwards. Such is the express language of Rule 21 adopted by Congress for the prevention of collisions on the water, which is as follows: Every steam vessel, when approaching another vessel, so as to involve risk of collision, shall slacken her speed or, if necessary, stop and reverse; and every steam vessel shall, when in a fog, go at a moderate speed." R. S., sec. 4233.

64

Had there been no other change in the course of The Harvest Queen, the new direction taken by the steamer would have carried her past that vessel without collision. But about a minute afterwards, or forty minutes past two, the red light of The Harvest Queen changed again to green. The steamer had then yielded to her helm, and gone off a point to the starboard and was swinging further in that direction. The first officer, seeing the re-appearance of the green light, at once gave an order to stop the engine and, as soon as it could be done, to back the steamer at full speed. This order was obeyed, and the engine was put in a reverse motion at about forty-one minutes past two.

The captain was then called and immediately came on deck. Looking ahead he saw a green

light not far away, about two points off the starboard bow; then green and red lights appeared together and then the red alone. He noticed also that the helm was to the port side and that the engine was under reversed action. Thereupon he gave the order from the deck, "hard-a-starboard," which was obeyed. He then went on the bridge.

But

The

Had the steamer been then going astern, there could be no question as to the propriety of this order; it would have turned her to the right and she would have passed on the left side of The Harvest Queen, showing red light to red light, the two vessels in that event moving on parallel lines. The effect of a starboard helm, when a vessel is going astern, is directly the opposite of that produced when she is going ahead. at the time the order was given, the forward motion of the steamer had not been entirely overcome, and she was still moving ahead slowly. It appears, however, that whilst thus moving with the reversed action of her engine, the steamer did not yield to her helm so as to materially change her forward direction. order could not, therefore, have contributed to the collision. But were it otherwise, we cannot say that the captain could be justly blamed. In considering his action, the question is not whether the order given was the best when viewed in the light of subsequent events; but whether, under the circumstances in which he was placed, it was that of a prudent and skillful commander. The nearness of the approaching ship and the frequent change in her lights, whilst calling for prompt action on his part, were well calculated to embarrass and confuse him. Delay in acting was full of danger; there was no time for deliberation and consultation with others; and seeing the reversed movement of the engine he would naturally conclude that the steamer had yielded or would soon yield to it and pass the approaching ship in safety.

Soon after he reached the bridge, The Harvest Queen appeared through the darkness under full sail and bore down directly on the steamer. Before anything could be done, her jib-boom ran over the turtle back of the steamer, and was broken in two, one part falling into the water. The engines of the steamer were then backing at full speed, and if she was not in fact going astern, she was, according to the finding of the circuit court, "not going ahead much,if any." She continued backing after the collision and, when the vessels separated, The Harvest Queen passed across the bow of The Adriatic from port to starboard. Her masts were standing and her sails were all set. The first officer of the steamer hailed her, but received no answer from anyone; no hail came from her. She gave no signs of serious injury, yet she was in some way injured so severely that soon afterwards she sank with all on board.

Immediately after the separation of the vessels, the captain of the steamer gave orders to clear away the boats; but The Harvest Queen keeping in sight, the orders were countermanded, and The Adriatic steamed slowly towards her until she became lost to view. It was about that time that cries for help were heard in the water, in the direction where the ship was last seen. The engines were stopped and an order to lower the boats was immediately given. Two boats under command of officers of the steamer

put out in search of the parties from whom the cries were heard. They were rowed in the direction whence the cries came; but after remaining out for half an hour to an hour they were recalled by a signal from the steamer. Nothing was ever afterwards heard of any of the ship's crew, and only a few fragments of the vessel were ever found. The vessel and cargo were a total loss.

The present libel was filed to recover their value in damages, alleged to be $225,000. The libelants charge that the collision was caused by the negligence and improper conduct of those on board the steamer:

1. In not having a good and sufficient look

out.

2. In running at too great a speed.

3. In not keeping out of the way of The Harvest Queen; and,

4. In not stopping and backing in time to avoid the collision.

From the narrative we have given, of the facts of the case, which is but a summary of the findings of the circuit court, stating the facts with much greater detail and particularity, it is evident that these allegations are not sustained in any essential particular.

Whilst the vessels were over two miles apart, the green light on The Harvest Queen was distinctly seen. A similar light on The Adriatic could easily have been seen and, if the lookouts were attending to their duty, probably was seen from the ship. Those lights being visible, it was only necessary for the vessels to keep in their course, and collision would have been impossible. The subsequent changes made by the steamer were caused by previous changes on the course of the ship, as indicated by the showing of her lights. Whilst it was the duty of the steamer to keep out of the way of the ship, being more under control, it was no less the duty of the ship to avoid anything tending to mislead and embarrass the steamer in the performance of this duty. That she did thus mislead and embarrass the steamer is plain from the statement already made. To one at a distance, her changing lights were confusing, indicating either doubt on the part of her officers as to the course to be taken or, what is more likely to have been the case, the absence of a good and sufficient lookout on board of the ship to report the sight and approach of the

steamer.

The continued appearance of the green light for the first four minutes after it was seen, answers the suggestion that the change of lights on The Harvest Queen was the result of the swinging of the vessel from the wind and sea, and not from an alteration in her course.

18 How., 583 [59 U. S., XV., 493]; and in Steamship Co. v. Rumball that "Under the rule that a steamer must keep out of the way, she must of necessity determine for herself and upon her own responsibility, independently of the sailing vessel, whether it is safer to go to the right or left or to stop; and in order that she may not be deprived of the means of determining the matter wisely, and that she may not be defeated or baffled in the attempt to perform her duty in the emergency, it is required, in the admiralty jurisprudence of the United States, that the sailing vessel shall keep her course, and allow the steamer to pass either on the right or left, or to adopt such measures of precaution as she may deem best suited to enable her to perform her duty and fulfil the requirement of the law to keep out of the way." 21 How., 384 [62 U. S., XVI., 148].

Here, so far from observing this rule, the ship, by her frequent changes, embarrassed the action of the steamer, and prevented her from continuing in a course which would have avoided the disastrous result. If the ship had kept on the course she was sailing when first seen, or had adhered to the first new course afterwards taken, no collision would have happened.

It seems to us plain, upon the facts found by the Circuit Court, that whatever fault there was which caused the collision, it originated with the ship and not the steamer. The decree is, therefore, affirmed.

True copy. Test:
James H. McKenney, Clerk, Sup. Court, U. S.

[blocks in formation]

On motion to dismiss for want of jurisdiction. The case is sufficiently stated by the court. Messrs. Julius Rosenthal and A. M. Pence, for defendants in error, in support of motion.

Mr. C. M. Harris, for plaintiff in error, contra.

Mr. Chief Justice Waite delivered the opinion of the court:

The general rule as to the conduct of a ship under circumstances like those presented in this case is much stronger against the course The Harvest Queen pursued than we have stated. That rule is for a sailing vessel meeting a steam- The only question in this case, controverted er to keep her course while the steamer takes below, was whether Madelaine Roth, the plaintthe necessary measures to avoid collision. In iff in error, was the widow of John George Crockett v. The Isaac Newton this court said, Roth, deceased, and that depended entirely on that Though the rule should not be ob- the validity of the decree of the Royal Matriserved when circumstances are such that it is monial Court of Elwangen, in the Kingdom of apparent its observance must occasion a collis- Wurtemburg, annulling the marriage of the ion, while a departure from it will prevent one, parties. The Supreme Court of Illinois decided yet it must be a strong case which puts the sail-in favor of the validity of the Wurtemburg deing vessel in the wrong for obeying the rule;" cree and, consequently, that the plaintiff in

« PreviousContinue »