In re SMITH.

(District Court, E. D. Pennsylvania. June 9, 1903.)

No. 1,432.

1. BANKRUPTCY-Waiver of LIEN-ACQUIESCENCE IN SALE OF PROPERTY. A landlord who had the right to distrain for rent, but who had notice that the stock and fixtures of the saloon owned by the bankrupt tenant had been sold by the receiver, together with the license, for a lump sum, and although present in court permitted the sale to be confirmed without objection, cannot assert a claim against the proceeds for rent, where the license was a valuable asset, and it would be impossible to determine what part of the proceeds was produced by the stock and fixtures.

In Bankruptcy. On certificate of referee concerning landlord's claim for rent.

Henry N. Wessel, for trustee.
Simpson & Brown, for claimant.

J. B. MCPHERSON, District Judge. The bankrupt was the holder of a liquor license in this city, and owned the fixtures in a rented place of business. At the receiver's sale, $144.61 was bid for the stock and fixtures, offered separately, and $1,000 for the license. The stock, fixtures, and license were then offered as an entirety, and brought $3,500. The sale was on September 16th, and upon the 18th the receiver reported the sale to the court, and asked for an order of confirmation, which was thereupon granted. The landlord did not receive notice of the sale, but he did know when the petition for confirmation would be presented, and although he was in attendance he made no objection to the sale or to the order. Several months afterwards he presented a petition to the referee, averring that the stock and fixtures were subject to distraint for rent, and that he was therefore entitled, under the Pennsylvania statute (P. L. 1891, p. 122), to have a year's rent paid in full out of the proceeds of the sale; arguing that, as the sum bid for the license separately was only $1,000, $2,500 should be taken as the value of the stock and fixtures, and this sum should be applied to the claim for rent. The referee disallowed the claim on the ground that it was impossible to say how much of the fund produced by the sale was the product of the license, and how much was the product of the stock and fixtures. I agree with this conclusion, which accords with two previous decisions in this district. Re Gerry, 7 Am. Bankr. R. 462, 112 Fed. 957, and Re Klapholz, 7 Am. Bankr. R. 703, 113 Fed. 1002. It is certain that no apportionment of the $3,500 can be made with any degree of accuracy; for, while it is true that only $1,000 was bid for the license separately, and therefore it may be contended with some degree of plausibility that the remaining $2,500 was bid for the stock and fixtures, it may be also contended, and with equal plausibility, that as only $144.61 was bid for the stock and fixtures separately the license must have produced the balance of the $3,500. Clearly, the two lots as an entirety were more valuable than when offered separately, but the excess of value cannot now be assigned to its proper source or sources.

Probably each lot contributed something to the higher price, but it would be a mere guess to attempt to say how much. If the landlord had desired to object to the sale upon the ground that he had not received notice, his time for so doing was, at latest, when the petition for confirmation was presented; for of this at least he had knowledge, and he was actually present when the order was made. His acquiescence in the report and confirmation was a clear ratification of the sale in bulk, and a waiver of the failure to give him notice. The action of the referee in rejecting the claim is approved.

THE ALBION.

(District Court, D. Washington, N. D. June 6, 1903.)

No. 2,442.

1. ADMIRALTY JURISDICTION-TORTS-PERSONAL INJURY ON WHARF. An action to recover damages for a personal injury received by libelant by falling from a dock when attempting to go on board a vessel after dark, charged to have been due to the negligence of those in charge of the vessel in removing the gang plank, is not maritime, and therefore not within the jurisdiction of a court of admiralty, where the right of recovery is based on the tort.

2. SEAMEN-ACTION FOR PERSONAL INJURY-SUFFICIENCY OF LIBEL.

A general allegation in a libel against a vessel to recover for a personal injury that libelant when injured was going on board pursuant to a contract of employment to serve on the vessel is insufficient to show a contract relation affording a basis for recovery, where the libel does not allege the terms of the contract nor that shipping articles had been signed.

In Admiralty. Suit in rem to recover damages for a personal injury. Heard upon exceptions to the libel. Exceptions sustained. E. E. Cushman, for libelant.

James Kiefer, for claimant.

HANFORD, District Judge. According to the libel in this case, the libelant in attempting to go on board the steamer Albion after dark, on account of the removal of a gang plank which he expected to find connecting the steamer with the slip at the end or side of the dock to which she was moored, walked overboard, and sustained severe personal injuries, disabling him permanently, for which he has brought this suit in rem against the steamboat to recover compensation. From the allegations of the libel it is to be inferred that the claim for damages is based upon a charge of negligence upon the part of the officers and crew of the steamer in having removed the gang plank. It is alleged, however, that the libelant was going on board the steamer pursuant to a contract of employment by which he was to serve as cook, but it is not alleged that shipping articles were signed, nor that his engagement was for any particular voyage or term of service.

11. See Admiralty, vol. 1, Cent. Dig. § 225

A legal liability for damages in a case of this character must be based either upon a tort or upon the contract relationship of the libelant to the steamer. If the case is founded upon the alleged tort, no suit in admiralty can be maintained, because the jurisdiction of admiralty extends only to torts committed afloat upon navigable water. Wharfs and structures connected with the solid earth are not maritime vessels, and injuries suffered thereon do not constitute maritime torts cognizable in a court of admiralty, even though the cause of the injury may have originated on board of a vessel moored alongside or in near proximity. Hughes on Admiralty, pp. 178–182; The H. S. Pickands (D. C.) 42 Fed. 239.

The libelant cannot recover upon any contract obligation, for the reason that the libel does not sufficiently set forth the making of a valid contract with definite terms and conditions to form the basis for estimating damages.

Exceptions to the libel sustained.

In re DOCKER-FOSTER CO.

(District Court, E. D. Pennsylvania. June 8, 1903.)

No. 1,509.

1. BANKRUPTCY-PETITION TO EXPUNGE CLAIM-PRACTICE.

Under the provisions of general orders in bankruptcy No. 87 (91 Fed. Xxxvi, 32 C. C. A. xxxvi), which extend the equity rules to proceedings in equity instituted for the purpose of carrying into effect the provisions of the act, the failure to file an answer to a petition seeking to expunge a claim justifies a decree pro confesso under rule 18, carrying the ordinary incidents and consequences of such a decree.

The amendatory act of February 5, 1903, c. 487, 32 Stat. 801, by its express terms does not apply to nor affect any proceeding instituted before it took effect, and in such proceedings all of the provisions of the original act are to be enforced the same as though not amended.

8. SAME EVIDENCE OF INSOLVENCY.

The books of a bankrupt are competent evidence on the question of his insolvency within four months of the date of the filing of the petition, and while not conclusive are ordinarily important evidence entitled to much weight; the schedules and inventory and appraisement are also evidence on the same question.

In Bankruptcy. On certificate of referee.

C. Wilfred Conard, for petitioning creditors.

George W. Carr and Benjamin Alexander, for sundry creditors.

J. B. MCPHERSON, District Judge. On the several questions argued by counsel, my opinion is briefly as follows:

1. Under the provisions of general order No. 37 (91 Fed. xxxvi, 32 C. C. A. xxxvi), which extend the equity rules of the Supreme Court to "proceedings in equity instituted for the purpose of carrying into effect the provisions of the act, or for enforcing the rights and remedies given by it," failure to file an answer to a petition seeking to expunge a claim justifies a decree pro confesso, under rule 18, carry

ing the ordinary incidents and consequences of such a decree. The petition is not before me, and I am therefore unable to say whether its averments on the subject of insolvency are sufficiently precise and definite to be taken as true, or whether they require proof to be offered by the petitioner. This matter can be determined by the referee, and his ruling reviewed, if necessary.

2. I am unable to agree with the learned referee in the conclusion that, by reason of the amendments of February 5, 1903, section 57g can no longer be enforced, even in proceedings such as this, that were undetermined when the amending act was passed. He regards this clause as penal, and holds that it cannot now be enforced, because after a penal statute has been repealed it cannot be enforced even in a proceeding that has reached the point of judgment. But the difficulty about this position is that section 57g has not been repealed as to pending proceedings, for section 19 of the act of 1903 (Act Feb. 5, 1903, c. 487, 32 Stat. 801) expressly declares "that the provisions of this amendatory act shall not apply to bankruptcy cases pending when this act takes effect, but such cases shall be adjudicated and disposed of conformably to the provisions of the said act of July 1, 1898." The meaning of this language seems to me to be so plain that discussion is difficult. It was evidently intended to furnish a rule that would avoid many embarrassing and difficult questions, and I think it means just what it seems to say, namely, that the act of 1903 applies to all cases begun after the act was passed, but does not apply to any case that was then pending. Some apparent anomalies will of course result for a short time, but they often accompany a change of legislative policy, and furnish no reason for declining to carry a plain statutory command into effect. I have no doubt, therefore, that section 57g of the act of 1898, 30 Stat. 560, c. 541 [U. S. Comp. St. 1901, p. 3443], governs the present case, as if the amendatory act had not been passed.

3. The books of a bankrupt are evidence on the question of insolvency within four months of the date of filing the petition. They are not conclusive upon this subject, for they may be incomplete, incorrect, or fraudulent, but ordinarily they are important evidence and entitled to much weight. The schedules and the inventory and appraisement are also evidence upon the same question.

4. Under the order of this court entered May 3, 1899, I think the petitioner should enter security for costs before proceeding further with the examination. The security should be conditioned for payment in case he shall be ultimately adjudged liable, thus leaving the question of liability open for future consideration.

STERN v. UNITED STATES.

(Circuit Court, S. D. New York. April 20, 1901.)

No. 3,022.

1. CUSTOMS DUTIES-CLASSIFICATION-COTTON CLOTH-FABRICS. Partly finished articles made of cotton cloth are "fabrics," within the meaning of that term as used in paragraph 310 of the tariff act of 1897 (Act July 24, 1897, 30 Stat. 178, c. 11 [U. S. Comp. St. 1901, p. 1659]), where it is prescribed that the expression "cotton cloth" "shall be held to include all woven fabrics of cotton in the piece or otherwise." Accordingly, cotton portières and table covers, woven with a border and a selvedge and cut to the size and form of the article as intended for sale and use, but needing to be trimmed, or hemmed and fringed, before they can be used, are dutiable as cotton cloth, and not as "manufactures of cotton not specially provided for," under paragraph 322 of said act (30 Stat. 179 [U. S. Comp. St. 1901, p. 1661]).

Appeal by the importer from a decision of the board of United States general appraisers (G. A. 4568) which affirmed the decision of the collector of customs at the port of New York.

In the opinion of the board, by Fischer, general appraiser, the goods under appeal are described as follows: "The protest under consideration relates to cotton portières and cotton table covers. The portières are woven in lengths of 50 to 60 yards, 50 inches wide; a border and a selvedge being produced in the weaving every 3 meters. They are then taken from the loom and cut into pieces 3 meters long, thus making an article 50 inches wide and 3 meters long, and are imported in that condition. The table covers are also woven in the piece, 50 inches wide, and are taken from the loom and cut into articles 50 inches square, and so imported." It is stated further that the articles have been woven with a border and a selvedge, and have been cut to the size and form of the article as intended for sale and use, and that the table covers must be trimmed, and the portières trimmed, or hemmed and fringed, before they can be used. The board concluded as follows: "We hold (1) that the phrase, 'woven fabrics in the piece or otherwise,' as used in paragraph 310 of the act of July 24, 1897, 30 Stat. 178, c. 11 [U. S. Comp. St. 1901, p. 1659], includes only piece goods, although they may be woven in such form as to adapt them for use as completed articles; (2) that the articles of cotton, such as table covers, portières, curtains, etc., cut to the proper size and form for use as such, and so known commercially, whether fringed, trimmed, or hemmed, or not so treated, are no longer piece goods, but are manufactured articles, and are not included in the phrase, 'woven fabrics in the piece or otherwise,' as used in paragraph 310. Such articles are dutiable as manufactures of cotton not specially provided for, under paragraph 322, 30 Stat. 179 [U. S. Comp. St. 1901, p. 1661], and not as cotton cloth. The protest is overruled and the decision of the collector affirmed."

W. Wickham Smith, for appellant.
D. Frank Lloyd, Asst. U. S. Atty.

TOWNSEND, District Judge. The merchandise in question comprises portières and table covers of woven cotton cloth. They were assessed for duty as "manufactures of cotton not specially provided for," under the provisions of paragraph 322, tariff act of 1897 (Act July 24, 1897, 30 Stat. 179, c. 11 [U. S. Comp. St. 1901, p. 1661]),