Wood, Montague & Matthiessen and Erskine Wood, all of Portland, Or., for appellee the Bank Line.

of 1,800 pounds, shortly after a similar chain had broken under like conditions. It was held that there should have been a careful

GILBERT, Circuit Judge (after stating the facts as above). [1] Concerning the condition of the shackle pin and the strain under which it broke, all the testimony on behalf of the appellant, with the exception of that of one expert, was heard before the court. There was evidence that the pin had been subjected to extraordinary strain in dragging a heavy slingload of lumber, estimated by the first officer of the ship to weigh 21⁄2 tons, a distance of 180 feet across the dock. An expert witness, who had been employed in the repair department of the Emergency Fleet Corporation, testified that in his judgment the pin was in prime condition prior to what he characterized as the enormous pressure which broke it, that otherwise it would not have distorted the eye of the pin or drawn the jaws of the shackle out of parallel. The chief engineer of the Willamette Iron & Steel Works testified that in his opinion the pin was a good piece of metal before it broke, and that its appearance indicated a tough and live metal. On the other hand, an instructor in a local polytechnic school testified that the appearance of the pin indicated that it was crystallized, and several witnesses, who were longshoremen, or sailors, or workmen, also testified that the pin was crystallized, and some testified that there were visible defects which should have led to its rejection for further use. There was undisputed testimony of officers of the ship that all shackles were discarded after six months of use. We are of the opinion that no ground is shown for setting aside the conclusion reached by the trial court upon the testimony of the witnesses and the appearance of the shackle pin.

[2] Nor do we find merit in the contention that the fact that the pin broke was in itself evidence of negligence in using the same or that this is a case in which the rule of res ipsa loquitur may be invoked. Citation is made of The Rheola (C. C.) 19 F. 926; Steel v. McNeil (C. C. A.) 60 F. 105; The Portland (D. C.) 213 F. 699; Neptune Steam Nav. Co. v. Borkmann (C. C. A.) 118 F. 420. In the Rheola Case, a chain which was in appearance old, rusted, and worn, and which, if in proper condition, should have sustained a weight of 6 or 7 tons, broke under a weight

the eye of a shackle because of defects which had been noticed and pointed out to the mate by one of the longshoremen. In Neptune Steam Nav. Co. v. Borkmann, the fact that a piece of wire rope furnished by the ship for the stevedores broke under a weight only one-tenth of that which it should have supported if in good condition was held to be evidence that it was not in good condition. In The Portland, Judge Wolverton held the steamship liable by reason of the breaking of a rope sling which had become frayed, worn, and attenuated, as would have been apparent to one making an inspection thereof, and that the fact that it broke was proof positive that In the case at bar, the it was defective. evidence was conflicting as to whether the shackle pin should have sustained a weight as great as that which caused it to break, and there was conflict in the evidence as to whether it was defective, and as to whether, if defective, the defects were discoverable by inspection. The most than can in general be claimed for the occurrence of such an accident is that, while it may tend to prove that a defect existed in the appliance which was used, the libelant must go farther and show that the fracture was the result of a defect, and that the claimant knew of that defect or by the exercise of reasonable care could have discovered it. Patton v. Texas & P. R. Co., 179 U. S. 658, 21 S. Ct. 275, 45 L. Ed. 361; San Juan Light Co. v. Requena, 224 U. S. 89, 98, 32 S. Ct. 399, 56 L. Ed. 680.

Under Admiralty Rule 56, which permits either the claimant or the respondent to bring in a party jointly liable to any party to the suit by way of remedy over or contribution, and provides that the suit shall proceed as if such new party had been jointly proceeded against, and requires the other parties in the suit to answer the petition and the new party to answer the libel, the owner of the vessel filed a petition against the stevedore company, praying that it be cited to answer the petition and the libel, and alleging that the accident occurred through the stevedore's improper and negligent use of the ship's gear. The stevedore company answered, alleging that the gear which was turned over to it by the steamship was represented to be in good condition, and was rigged by the officers and employees of the ship, that, if there was negligence in the use there

of, it was the negligence of the appellant and his fellow servants, and, if there were defects in the gear which the stevedore company could not by the exercise of reasonable care discover, the accident was caused by the negligence of the steamship and not through the fault of the stevedore company. When the libel was dismissed, the petition was also dismissed.

[3] The appellant assigns error to the failure of the trial court to find that the stevedore company improperly rigged the preventer guy, and used an unseaworthy and defective shackle, and failed to exercise reasonable care in using said preventer guy, and negligently failed to provide the appellant with a reasonably safe place to work. The basis of the contention seems to be that the evidence showed the gear to be defective for want of preventer guys attached to the peak of the boom. The officers of the ship testified that at the request of the president of the stevedore company they installed preventer guys, one end of which was attached at the tip end of the boom, and the other to a bulwark stanchion below; each guy being a wire cable 70 or 80 feet in length and three-fourths of an inch in diameter, and that a day or two prior to the accident the preventer guys were removed by the longshoremen. As to this there was sharp conflict in the testimony. The longshoremen, in the main, testified that there was no preventer guy on the ship when they began their work; that they applied to the ship for preventer guys, and were told that there were none; that they were given short guys of 20 feet in length, which they pieced together and used as a preventer guy running only from the block down to the deck to safeguard the tackle in the event that the ropes broke. But the fact remains that the stevedores continued to load with the gear without further complaint of its condition, and, if there was negligence in that regard, it was their own negligence. We find nothing in the record which required the trial court to make findings on the issues brought in by the petition.

[4,5] Nor do we think that the appellant is in a position to assign the errors, if errors there were, which he now relies upon. He ignored the command of rule 56, and made no answer to the petition. Nor did he at any time adopt the allegations thereof or request findings thereon, or become a party to that proceeding. In New Jersey Shipbuilding & Dredging Co. v. Davis (D. C.) 291 F. 617, 619, Judge Learned Hand said: "The petition was a pleading requiring an actor and a reus just as much as though it had been a

libel in the admiralty, a bill in equity, or a declaration at law." In The Silverway (D. C.) 14 F.(2d) 154, 157, it was said: "The proceeding under rule 56 is an independent proceeding." In disregarding the petition as he did, the appellant exercised his right to elect not to proceed against a party as to whom he made no claim, and whom the appellee had no right to substitute in its stead as the party primarily liable. Having elected to proceed in rem, he was not compellable to establish the liability in personam of a new party brought in by the claimant. The Providence (D. C.) 293 F. 595, 599. The decree is affirmed.

AKTIESELSKABET DEA v. WRIGHTSON. THE COPPERFIELD.

Circuit Court of Appeals,, Fifth Circuit. May 14, 1928.

No. 5208.

I. Admiralty 32-Corporation organized under laws of foreign country could be sued for admiralty tort in any District Court of United States where found or in which it had property.

eign country could be sued for an admiralty tort Corporation organized under laws of forin any District Court of United States where found or in which it had property that might be subjected to writ of foreign attachment. 2. Admiralty 25-By filing cross-libel, respondent, notwithstanding objection to jurisdiction in answer, submitted itself to court's jurisdiction.

tion organized under laws of foreign country, By filing cross-libel, respondent, a corporanotwithstanding objection to jurisdiction which had been reserved in answer, waived any defect of service and submitted itself to jurisdiction of court, and attachment became merely inci

dental.

Comp. St. § 7834 et seq.) which governed movements of vessels before and at time of collision.

Appeal from the District Court of the Appeal from the District Court of the United States for the Southern District of Alabama; Robert T. Ervin, Judge.

Libel by Walter Wrightson, as managing owner of the American schooner Copperfield, against the Aktieselskabet Dea, in which respondent filed cross-libel, and in which a writ of foreign attachment was prayed for, and garnishment was issued and served on the American Bauxite Company. From the decree, respondent appeals. Affirmed.

Elliott G. Rickarby, of Mobile, Ala. (Rickarby, Beebe & Coley and M. V. Hanaw, all of Mobile, Ala., on the brief), for appellant.

Alex T. Howard, of Mobile, Ala., for appellee.

Before WALKER, BRYAN, and FOSTER, Circuit Judges.

FOSTER, Circuit Judge. This suit was brought in personam by appellee to recover damages caused to the schooner Copperfield, by a collision between that vessel and the steamship Dea. A writ of foreign attachment was prayed for, and garnishment issued and was served on the American Bauxite Company, through its agent in Mobile, to attach certain charter money. The garnishee answered, admitted the charter, and that $3,458.95 was due appellant for future hire, payable in advance, contended that it was payable in New York and therefore not subject to attachment in Mobile, and moved to dismiss the writ. This motion was overruled, and appellant then moved that the amount admitted to be due be deposited in the registry of the court. This was granted, and thereafter appellant was allowed to substitute a bond and take out the money. Appellant answered, with reservation of an objection to the jurisdiction, but also without any reservation whatever, filed a cross-libel, and prayed for damages in the amount of $10,000. On this admiralty process issued, and the Copperfield was seized.

[1,2] Error is assigned to the action of the court in refusing to set aside the garnishment and dismiss the libel. We are not required to go into the technicalities of this question. Appellant is a corporation organized under the laws of Norway, and therefore could be sued for an admiralty tort in any District Court of the United States where found, or in which it had property that might be subjected to a writ of foreign attachment. In re Louisville Underwriters, 134 U. S. 488,

10 S. Ct. 587, 33 L. Ed. 991; Manro v. Almeida, 10 Wheat. 473, 6 L. Ed. 369. By filing a cross-libel, notwithstanding the objection to the jurisdiction which had been reserved in the answer, any defect of service was waived, it submitted itself to the jurisdiction of the court, and the attachment became merely incidental. Cole v. Cunningham, 133 U. S. 107, 10 S. Ct. 269, 33 L. Ed. 538; Merchants' Heat & Light Co. v. Clow & Sons, 204 U. S. 286, 27 S. Ct. 285, 51 L. Ed. 488; Texas & Pacific Ry. Co. v. Eastin & Knox, 214 U. S. 153, 29 S. Ct. 564, 53 L. Ed. 946; American Mills Co. v. American Surety Co., 260 U. S. 360, 43 S. Ct. 149, 67 L. Ed. 306.

There is very little dispute as to the material facts except as to whether the Copperfield carried regulation side lights. As to that the evidence is in hopeless conflict; all of the witnesses on the schooner testifying that they were burning brightly at all times, and all of the witnesses on the Dea testifying that they did not see them. However, we deem this immaterial in fixing the ultimate liability of the vessels.

It is also reasonable to infer from the testimony that the Dea did not have a lookout on the forecastle. There is some mention made in the testimony that there was such a watchman, but he was not produced as a witness, and the testimony is unsatisfactory. However, if he was there, he was incompetent. On a clear night he should have seen a vessel with all sails set in time to report her presence to the bridge so as to avoid a collision, but did not do so. This also is immaterial.

The Copperfield was on a voyage from Porto Rico to Gulfport, and the Dea was on a voyage from Gulfport to British Guiana. The collision occurred about 9 o'clock on the night of May 22, 1925, in the Gulf of Mexico. The night was bright and clear, with stars shining. The sea was smooth, with a very light southeast breeze blowing, and the Copperfield, with all sails set, was making about one knot an hour, barely sufficient for steerage way. The tonnage of the Copperfield is not shown. The Dea is a steamship of about 4,200 tons. She was making about 8 knots an hour. Some time before the collision, the schooner had a bright lantern on her quarter deck which showed all around the horizon. It is the presence of this white light and the absence of side lights that is relied on by the Dea to show the fault of the Copperfield.

The International Rules for Navigation at Sea (33 U. S. C. § 61, et seq. [33 USCA §

er.

61 et seq.; Comp. St. § 7834 et seq.]) governed the movements of the vessels before and at the time of the collision. So far as is material to this inquiry those rules may be briefly stated as follows. A steam vessel is required to carry the regulation red and green side lights and a white light on the fore part of the vessel at a height above the hull of not less than 20 feet, and she may carry, but is not required to carry, range lights or a stern light in line with the masthead at an elevation of at least 15 feet highSailing vessels under way must carry regulation side lights, but are prohibited from carrying the white lights of a steamer. A vessel which is being overtaken, except a steamer carrying regulation white range lighter, must exhibit from her stern to the overtaking vessel a white light showing all around the horizon, and, if necessary in order to attract attention, in addition to the regular lights, may show a flare-up light. When a steam vessel and a sailing vessel are proceeding in such directions as to involve risk of collision, the steam vessel must keep out of the way of the sailing vessel, and, on approaching her, if necessary, must slacken her speed or stop or reverse; and any overtaking vessel must keep out of the way of the overtaken vessel. Article 24 of the Rules provides that any vessel coming up with another vessel from any direction more than two points abaft of her beam; that is, in such a position with reference to the vessel she is overtaking that at night she would be unable to see either of that vessel's side lights, shall be deemed to be the overtaking vessel.

[3] With reference to the application of these rules, the situation of the two ships immediately before the collision was this: The Copperfield was practically helpless in the light breeze, with barely steerage way, could not have answered her helm promptly, and could not have made any maneuver to avoid the collision. She observed the steamer approaching and exhibited a white lantern on her stern, which she had the right to do, as she at that time was almost directly ahead of the Dea and in practically the same position as an overtaken vessel. She was guilty of no fault in showing the lantern.

[4] With regard to the Dea, the second officer was in command and on the bridge at the

26 F. (2d)-12

time of the collision. He testified that about 8:50 he saw a dim white light about three points off the starboard bow, which he took to be a steamer's light. He looked at it a while and then went into the chart room and took out his binoculars. He observed the light some time longer through the binoculars and then lost it. He then became frightened and thought it might be a sailing vessel, because in that locality schooners and small craft without side lights were often met. He gave a long blast of his whistle. Just as he let go the whistle string, he heard a cry from the Copperfield. Then he saw the sails of the schooner. He knew there would be a collision, and he gave an order to put the wheel hard astarboard, and signaled the engines for full speed astern, but they had not been reversed when the collision occurred. He fixed the time elapsing between first seeing the light and the collision at from three to five minutes. Making due allowance for inaccuracies in estimating time, it is reasonably certain from the second officer's testimony that at least three minutes elapsed between the time he first saw the light on the Copperfield until the collision occurred. The Dea was making a speed of about 8 knots at the time, so was at least a half a mile away.

The officer in charge of the steamer saw the light on the schooner in ample time to have avoided the collision had he taken the slightest precaution to do so. The light was sufficiently in his course to advise him of the probable danger of the collision, and the very fact that he did not see the side lights was an additional warning. Furthermore, he expected to find sailing vessels and small craft in that vicinity without side lights. It was his duty to keep out of the way of sailing vessels and any vessels he was overtaking, and the light exhibited should have conveyed the message to his mind that a vessel was in fact being overtaken. Had he slowed down his engines when he first saw the light, or altered his course slightly, he could have avoided the collision, but he did not do so. There was nothing the schooner could have done to avoid it. In these circumstances we think the District Court was right in holding the Dea solely responsible for the collision and awarding damages accordingly.

Affirmed.

2. Internal revenue 25-Additional assess

ment upon income from Ford stock sale aft

er numerous confirmations of original assessment, based on 1913 valuation, held unauthorized (Revenue Act 1918, § 250b [Comp. St. § 6336tt (b)]; Revenue Act 1924, §§ 280, 1006 [Comp. St. §§ 6336%zz(7), 6371%h]).

Where income tax was assessed in 1919 under Revenue Act of 1918 on profits from sale of Ford Motor Company's stock based upon fair value of stock in 1913, and such assessment and valuation were approved and confirmed by the then commissioner of internal revenue

and by his successors, held that commissioner was without authority under Revenue Act 1918, 250b (Comp. St. § 6336tt (b), Revenue Act 1924, 88 280, 1006 (Comp. St. §§ 6336%zz(7), 6371%h), to revoke such assessment and reassess an additional tax upon a new valuation resulting from a "matured and better judgment;" there being no claim of fraud or mistake, clerical or otherwise.

In Error to the District Court of the United States for the Eastern District of Michigan; Benjamin C. Dawkins, Judge.

Action by Alice G. Kales against Fred L. Woodworth, Collector of Internal Revenue. Judgment for plaintiff on a directed verdict, and defendant brings error. Affirmed.

John A. Baxter, Asst. U. S. Atty., of Detroit, Mich., C. M. Charest, General Counsel, Bureau of Internal Revenue, of Washington, D. C., and Earl J. Davis, Herbert W. Clark, W. Hall Trigg, and A. W. Gregg, Sp. Asst. Attys. Gen., for plaintiff in error.

Beaumont, Smith & Harris, of Detroit, Mich., and Charles E. Hughes, of New York City, for defendant in error.

John W. Davis, of New York City, Sidney T. Miller, of Detroit, Mich., Joseph E. Davies, of Washington, D. C., Arthur J. Lacy and Clarence E. Wilcox, both of Detroit, Mich., Herbert Pope, of Chicago, Ill., and Luman W. Goodenough, of Detroit, Mich., amici curiæ.

Before DENISON, MOORMAN, and KNAPPEN, Circuit Judges.

DENISON, Circuit Judge. The court below directed a verdict in favor of the plaintiff, Mrs. Kales, in her suit against the collector to recover that part of her income tax for 1919 which she had paid under protest. The critical question-one of factwas as to the fair value on March 1, 1913, of certain Ford Motor Company stock which Mrs. Kales had then owned, and which she sold in 1919.1 The trial court thought each one of three grounds to be sufficient to support the directed verdict. They were: (1) That, upon a fixing of this value by the commissioner and a sale by Mrs. Kales in reliance on that valuation, an estoppel arose in her favor as against the later attempted revaluation; (2) that the assessment of the tax which the commissioner made upon the return of 1919, and which was based upon this 1913 valuation, and the later approvals of that assessment by the commissioner (and his successors), established that valuation beyond the power of that officer-except for a good cause non-existent here—to reopen and reconsider, and this by analogy to a thing adjudicated; and (3) that the deficiency assessment of 1925 which had required the payment now in dispute was void for lack of jurisdictional basis. While we rest our affirmance upon the second of these grounds, the three are not without effect upon each other; and they require a fuller statement of facts-including not only those stated in the declaration, but some things assumed as true by all counsel in the case. Blodgett v. Holden, 275 U. S. 142, 146, 48 S. Ct. 105, 72 L. Ed.

In 1919 Mrs. Kales owned stock in the Ford Motor Company, and was asked to sell it for $12,500 per share. She would have to pay as an income tax about two-thirds of whatever taxable profit she realized on the sale; and the amount of such profit would depend upon the fair value as of March 1, 1913. Hence whether the offer should be accepted would depend largely upon that fair value. There had been in 1913 no market

1 After the trial before a jury was entered truth of everything well pleaded in the declaraupon, counsel for the defendant admitted the tion; and hence the basis of the court's action is to be found in the recitals of the declaration, modified if at all, by the consideration whether concession did not include any statement of the they are well pleaded as fact allegations. This actual 1913 value of the stock, if such state

ment there was.