17 F.(2d) 38 fully considered the case, and, finding as we therein. The indemnitor will not ask or re- "VI. That this agreement shall cover, not only the suretyship above recited, but all alterations, renewals, extensions, or modifications thereof which may be requested or assented to by the principal named in such obligation. That the surety shall be at liberty to pay or compromise any claim or charge of the character enumerated in section III hereof, and the voucher or other evidence of the payment thereof shall be prima facie evidence of the fact and of the indemnitor's liability therefor to the surety." It is to be noted that this contract is executed by John D. Dailey and De Witt C. Ivins, individually and as members of the firm of Dailey & Ivins. It is also to be noted that the principals expressly agreed that they would perform all the conditions of the contract, and also agreed to place the surety company in the funds which it might require before the surety company should be required to make payment. In this particular, the contract gives the surety rights beyond those implied in law. contract is legal, and may be the basis of a recovery. Professor Williston says in his book on Contracts, at page 2311, as follows: Such a "At law, recovery on a contract of indem cussing and deciding the additional questions involved in this appeal, we restrict our action to adopting such opinion, and on it affirm the decree. nity before payment of the liability is dependent on the construction of the contract. If the terms are broad enough to amount to an indemnity against liability, and not merely an indemnity against payment in discharge of liability, recovery will be allowed as soon as the party to be indemnified has incurred liability. But courts of equity, even in the absence of words expressly guaranteeing freedom from liability, as distinguished from freedom from loss, specifically enforce the obligation and compel the promisor to meet his obligation to indemnify before payment of it by the promisee." The learned referee took the view that the indemnity agreement of the American Surety Company did not create any larger rights than those of subrogation, so far forth as the estate of the bankrupt partnership was concerned, and disallowed the claim, taking the view that the only rights of the surety were by subrogation under section 57i of the Bankruptcy Act (Comp. St. § 9641), and in support of his position relies upon the case of Williams v. Fidelity & Guaranty Co., 236 U. S. 549, 35 S. Ct. 289, 59 L. Ed. 713. Since the contract of the parties gave the American Surety Company larger rights than those of subrogation and indemnity, it would seem that, so far as the surety' company's contract was breached (and there is no dispute about that), it is entitled under that contract to damages which it has proved in the sum of $90,000, and may prove the same against all estates. As to the United States Fidelity & Guaranty Company, it was also a creditor under its contract of the bankrupt partnership, with a provable debt in bankruptcy, which has now been liquidated, and its claim, as such, should have been allowed. Maryland Casualty Co. v. Jones, 140 Md. 395, 117 A. 765, 48 Am. Bankr. Rep. 624. See also United States Fidelity & Guaranty Co. v. Carnegie Trust Co., 177 App. Div. 176, 164 N. Y. S. 92; Id., 221 N. Y. 646, 117 N. E. 1086. Let an order be entered accordingly. 40 Dismissed 275 us. 453 77 L.Ed. 102, 48 Sup. t. 21. 17 FEDERAL REPORTER, 2d SERIES UNITED STATES SHIPPING BOARD EMERGENCY FLEET CORPORATION v. DELAWARE COUNTY, PA. SAME v. SCHOOL DIST. OF TINICUM TP., (Circuit Court of Appeals, Third Circuit. Nos. 3525, 3526. 1. Taxation 5-Property held by Shipping Board Emergency Fleet Corporation for benefit of United States is immune from state taxation. Property held by the United States Shipping Board Emergency Fleet Corporation for the benefit of the United States is immune from taxation by state. 2. Taxation 79-Taxes are determinable by ownership. Taxes are determinable by ownership, and not by location of legal title. Woolley, Circuit Judge, dissenting. by the United States? the second, one of law, if so owned by the United States, can they be taxed by the County and Township? On the first, the question of fact, there seems to be no question but that the lands are owned by the United States. Without entering into minor details and citing opinions so holding, we may say that the Fleet Corporation was a corporate agency created by the government for governmental work solely; that its stock, save for qualifying directors, was held by government and its entire assets furnished by it. When title to the land here in question was taken by Fleet Corporation by conveyance from the American International Corporation, payment therefor was made by the Treasurer of the United States, who accepted and paid a check drawn on him by the treasurer of the Fleet Corporation in favor of the American International Corporation. It thus appears that not only was the legal title held by a corporate agency of the United States, but that the purchase price of the land in quesStates. In the light of such facts, and there tion was paid to the purchaser by the United being no suggestion of ownership or interest elsewhere, it is clear that the real ownership of the land was and is in the United States, and that the Fleet Corporation, the holder of the title, held such title as a mere legal holder for the benefit of the United States. [1,2] Under such a situation two views arise one, that the tax liability of the land is determined by the location of the title; the other, that it is determined by ownership. The first view was held by the court below, which, to use its admirably clear statement, held: "The basic fact which governs is not who is the owner of the property, but against Albert J. Williams, of Media, Pa., for whom has the tax been levied? It further defendant in error Delaware County. In Error to the District Court of the United States for the Eastern District of Pennsylvania; Oliver B. Dickinson, Judge. Separate actions by the Delaware County, Pa., and by the School District of Tinicum Township, Pa., against the United States Shipping Board Emergency Fleet Corporation. Judgments for plaintiffs, and defendant separately brings error. Re versed. Paul W. Knox and George W. Coles, U. S. Atty., both of Philadelphia, Pa. (I. V. McPherson, of Washington, D. C., and Chauncey G. Parker, of Newark, N. J., of counsel), for plaintiff in error. Donald S. Edmonds and Porter, Foulkrod & McCullaoh, all of Philadelphia, Pa., for defendants in error. Albert Dutton MacDade, of Chester, Pa., for defendant in error Tinicum School Dist. Before BUFFINGTON, WOOLLEY, and DAVIS, Circuit Judges. BUFFINGTON, Circuit Judge. These two cases, which we dispose of as one, concern the taxation for the years 1921 and 1922 by the county of Delaware and the township of Tinicum of lands situate in the latter. The title of said lands was, at the date said taxes were levied, vested in the United States Shipping Board Emergency Fleet Corporation, hereafter called Fleet Corporation, and so remained until April 16, 1923, when they were conveyed to the United States. The questions involved are twothe first, one of fact, are these lands owned follows that we look, not to what is commonly called the beneficial owner of the real estate, but to the person in whose name, and hence against whom, the tax has been assessed." Following that view, the court held that the taxes, having been assessed against the Fleet Corporation and the title being held by it, were collectible. The other view, namely, taxes are determinable by ownership, was held by the Circuit Court of Ap peals of the Ninth Circuit in King County v. United States Shipping Board Fleet Corporation, 282 F. 950, and is there stated with equal clearness: "The taxable character of property is to be referred to the status of the real, rather than of the nominal, owner. Private property is not exempt from taxation because the government holds the legal title thereto, and by parity of reasoning nei 17 F.(2d) 40 ther is public property taxable because the naked legal title is in a private person." The decision of the present case depends on which of these views shall prevail in this case. After careful consideration, we are of opinion the view of the Ninth Circuit should prevail, and in view of the reasoning of the court in that case and of that of this court in United States v. New Brunswick, 11 F. (2d) 476, where it was contended the equitable interest of the purchaser prevailed over the beneficial ownership of the United States, we deem it unnecessary to burden the record with a longer opinion. The judgment below will therefore be reversed, and such holding is in accord with United States v. Coghlan (D. C.) 261 F. 425, U. S. Spruce Production Corp. v. Lincoln County (D. C.) 285 F. 388, and Clallam County v. United States, 263 U. S. 342, 44 S. Ct. 121, 68 L. Ed. 328, where, referring, not as here, to warships, but to war airships, the Supreme Court said: "When, as here, not only the agent was created, but all the agent's property was acquired and used, for the sole purpose of producing a weapon for the war. This is not like the case of a corporation having its own purposes, as well as those of the United States, and interested in profit on its own account. The incorporation and formal erection of a new personality was only for the convenience of the United States, to carry out its ends." WOOLLEY, Circuit Judge (dissenting). I am constrained to dissent from the judgment of the court on a principle first declared perhaps in McCulloch v. Maryland, 4 Wheat. (17 U. S.) 316, 4 L. Ed. 579, and consistently followed ever since. In that case the Supreme Court distinguished this principle from the dominant one that federal agencies are not subject to state taxation and summarized its views in the concluding paragraphs of the opinion, thus: "The court has bestowed on this subject its most deliberate consideration. The result is a conviction that the states have no power, by taxation or otherwise, to retard, impede, burden, or in any manner control, the operations of the constitutional laws enact ed by Congress to carry into execution the powers vested in the general government. This is, we think, the unavoidable consequence of that supremacy which the Constitution has declared. We are unanimously of opinion, that the law passed by the legislature of Maryland, imposing a tax on the Bank of the United States, is unconstitutional and void. "This opinion does not deprive the states of any resources which they originally possessed. It does not extend to a tax paid by the real property of the bank, in common with the other real property within the state, nor to a tax imposed on the interest which the citizens of Maryland may hold in this institution, in common with other property of the same description throughout the state. But this is a tax on the operations of the bank, and is, consequently, a tax on the operation of an instrument employed by the government of the Union to carry its powers into execution. Such a tax must be uncon stitutional." without disturbing in the least the two prinFifty years later the Supreme Court, ciples announced and distinguished in McCulloch v. Maryland, stated the test of the distinction in these words: "It is, therefore, manifest that exemption of Federal agencies from State taxation is dependent, not upon the nature of the agents, or upon the mode of their constitution, or upon the fact that they are agents, but upon the effect of the tax; that is, upon the question whether the tax does in truth deprive them of power to serve the government as they were intended to serve it, or does hinder the efficient exercise of their power. A tax upon their property has no such necessary effect. It leaves them free to discharge the duties they have undertaken to perform. A tax upon their operations is a direct obstruction to the exercise of federal powers." Union P. R. Co. v. Peniston, 18 Wall. (85 U. S.) 5, 36 (21 L. Ed. 787). Last case, U. S. Fleet Corporation v. Western Union Telegraph Co. (App. D. C.) 13 F.(2d) 308. Applying that test to the cases in hand, I think the judgments sustaining the taxes should be affirmed. 116(1) -Joint and several obligors financially unable to pay have "insurable interest" in each other's lives. Persons jointly and severally bound on MOORMAN, Circuit Judge. On November 4, 1924, appellant issued a joint policy of insurance upon the lives of Thomas B. Carroll, James L. Lamping, and John W. Ross, payable to the survivor or survivors. Ten months later it filed this suit to cancel the policy, alleging fraudulent representation in procuring it, lack of insurable interest of any one of the policy holders in the life of either of the others, and the suicide of Ross, ter obligations which they are financially unable minating the policy under its express terms to pay have an "insurable interest" in the lives of each other. [Ed. Note.-For other definitions, see Words and Phrases, First and Second Series, Insurable Interest.] 2. Insurance 665(6)-Insurer's defense of suicide held not established. Evidence held insufficient to establish defense of suicide of a person killed in an automobile wreck. 3. Insurance 646(7)-As respects Insur. ance legal presumptions arising from fact of death are against self-destruction. As respects life insurance, the presumptions of law arising from the fact of death are against self-destruction. 4. Insurance 665 (6)-Party relying on suicide as defense has burden of proving it by preponderance of evidence. The law places on him who relies on selfdestruction the burden of showing it by a preponderance of the evidence, and this is not sustained by proof of motive, with circumstances probably indicating suicide, if there is equal probability that the death was accidental. 5. Insurance 665 (6)-Suicide will not be Inferred from circumstances, unless that is the more reasonable view. Defendant, alleging suicide as defense, must fail, where the issue is left to inference, unless the more reasonable view is that the act was suicidal, Appeal from the District Court of the United States for the Western District of Tennessee; Harry B. Anderson, Judge. Suit in equity by the International Life Insurance Company against Thomas B. Carroll and others. Decree for defendants, and complainant appeals. Affirmed. John M. Atkinson, of St. Louis, Mo. (W. Thomas Coleman, of Morristown, Tenn., on the brief), for appellant. C. G. Bond and C. W. Hewgley, both of Jackson, Tenn. (Bond & Bond, Murray & Murray, S. J. Everett, Hu C. Anderson, L. L. Fonville, T. W. Pope, R. R. Sneed, and Pearson & Hewgley, all of Jackson, Tenn., on the brief), for appellees. Before DENISON and MOORMAN, Circuit Judges, and GORE, District Judge. and fixing the liability thereunder at a sum equal to the first year's premium. [1] The first two grounds relate to the insurable interest of the policy holders. If there was no such interest, the policy must be canceled, not only for that reason, but also because of the fraudulent representations that were made in procuring it. The facts as to these questions are not in dispute. They appear in the application for the policy and in a stipulation showing that the three were jointly and severally bound on sundry obligations which they had incurred in joint real estate ventures. Each was bound to pay the full amount of these obligations upon the default of his co-obligors. No one of them was financially able to pay his part, but presumably nothing to the contrary appears in the record-each of them hoped to do so, and even to recoup his fortune, if he lived. They were therefore mutually and beneficially interested in the continuation of the lives of each other. This interest, we think, was insurable. Connecticut Mutual Life Insurance Co. v. Schaefer, 94 U. S. 457, 24 L. Ed. 251; United States v. Hardware Co., 265 U. S. 189, 44 S. Ct. 546, 68 L. Ed. 970. We also find, as did the court below, that there was no intent to defraud the company when the policy was taken out, and no misrepresentation by any of the policy holders of their joint or several interests. [2] The third contention depends on the cause of Ross' death. If he committed suicide, the liability under the policy was an amount equal to the first premium, which amount appellant offered to pay into the registry of the court. The facts are as follows: He started alone in an automobile about 7:30 on the morning of July 9th to his kennels, several miles from Jackson. Four or five miles from the city the road crossed a ditch, over which there was a steel bridge that had been used for more than a year. He was seen at least twice en route, was driving slowly when seen, and was apparently too preoccupied to notice those whom he passed. He was familiar with the road. The ditch was 6 feet deep, with 2 or 3 feet of water in it. Shortly after 17 F.(24) 42 8 o'clock his car was found in the ditch, turned upside down, and he was beneath it dead. The tracks of the car indicated that about 60 feet from the bridge it had turned off the road to the right, proceeding straight to the ditch. The ground over which it ran after leaving the road sloped to the right. The foot brakes on the car were poor. When it was taken from the ditch, one door was open and the engine was in intermediate speed. Ross was the United States Judge for the Western District of Tennessee. He was 45 years of age, left a wife and five children, was hopelessly in debt, and had nothing except a few hundred dollars in bank and a modest home, for which he had not paid. He and Carroll, who was the cashier of the People's Savings Bank of Jackson, Tenn., and Lamping had engaged extensively in real estate speculations, and had lost heavily. Their obligations were pressing. The bank became involved, and a committee of its stockholders, learning of its condition, called on Ross and demanded payment of his overdue indebted ness. He was unable to pay, and told them that, while he was legally bound on all the paper they held against him, he had received nothing for a large part of it, and that Carroll had not only caused him to lose all that he had, but had irretrievably involved him in debt. The bank failed June 5th, and it was charged that he and Carroll had wrecked it. The newspapers of Jackson and Memphis demanded that he clear himself of the imputation or resign from office. The Bar Association of Memphis requested him to remain off the bench until it could investigate the charges against him. He thought of resigning from office, but decided not to do so while the charges were pending. Insistent demands were made for a grand jury investigation. It came, and resulted in three indictments, returned July 8th, in one of which, to his surprise, he was charged with forging the name of Kirkpatrick, the keeper of his kennels. He surrendered, and gave bond in the sum of $25,000. To friends he said he was unjustly accused; that he was prepared to fight and would be vindicated. He had prepared a statement to submit to the Bar Association. It did not refer to the charge of forgery. On the afternoon of the 8th he was engaged in reforming it to meet that charge. The following morning his death occurred. Appellant claims that there was strong motive for self-destruction. As indicating that it was carried out, counsel refer to the making of a new will by the deceased after the bank's failure, his familiarity with the road over which he was traveling, the moder ate rate of speed at which he was driving when seen, the last time when 400 yards from the bridge, the good condition of the steering gear when the car was taken from the ditch, and the tracks leading to the ditch, which they say show that the brakes were not applied and the steering wheel was held firmly. Appellees rely on proofs tending to show that the car brakes were bad, the steering gear defective, and it was possible that the car was deflected to the right by a hole in the road. They further say, and the photographs we think support them, that the chances were that the driver of a car, in passing over the embankment, would not be killed or fatally injured, and hence, if Ross wanted to kill himself, it is not likely that he would have taken so uncertain a method of attempting it. They also point to the fact that he repeatedly asserted his innocence of any wrongdoing, had prepared a statement for the Bar Association, and had expressed a purpose, compatible with his nature, of fighting the charges. They advance three theories: That he was driving rapidly, his car struck the hole in the road, was thrown to the right, and, the brakes being defective, he was not able to stop it before it passed over the embankment; the steering wheel was defective, became locked, and, as the brakes did not work, that caused the accident; he was so absorbed in his troubles that, without looking, he drove into the ditch where the old bridge had been. [3-5] We do not state the evidence in detail. No one saw the deceased and no one knows his thoughts. Without motive one would hardly suspect intentional self-destruction. Automobile accidents are common; they are often the result of abstraction. Having motive, still no one can say whether the act was intentional or accidental. The presumptions of law arising from the fact of death are against self-destruction, for human experience shows that it is rare, even among the unhappy. Insurance Co. v. McConkey, 127 U. S. 661, 8 S. Ct. 1360, 32 L. Ed. 308. It may be that the burden resting on one who seeks the cancellation of a contract is not increased by the legal presumption against the thing that is alleged as a ground for the relief. But certainly the law places upon him who relies upon self-destruction the burden of showing it by a preponderance of the evidence. This is not sustained by proof of motive, with circumstances probably indicating suicide if there is equal probability that the death was accidental. The proofs here leave the issue to inference, and, unless the more reasonable view is that the act was suicidal, the plaintiff must fail. Maccabees v. King (6 C. C. A.) |