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In Miller v. Morris, Texas Supreme Court, October 14, 1881, 5 Tex. L. J. 113, it was held that a covenant to redeliver or restore to the lessor, in the same plight and condition, usual wear and tear excepted, or other words of like import, does not bind the covenantor to rebuild in case of casual destruction by fire, or impose the loss on him. The court said: "In Nave v. Berry, 22 Ala. 390, the distinction was recognized and adopted between an obligation 'to repair and deliver up,' and one 'to deliver up.' That whilst the former binds the obligor to rebuild in case of loss by fire during the term, Phillips v. Stevens, 16 Mass. 238, the latter is construed to mean simply an obligation against holding over, and if the buildings are burned or destroyed, without the fault of the lessee, he is not bound to rebuild or pay for the improvements so destroyed. In Maggort v. Hansbarger, 8 Leigh, 536, the covenant was 'to return the said property with all its appurtenances.' The property was destroyed by fire. Held, that this was not a covenant to rebuild or to deliver the demised premises in good order, but simply a covenant or agreement to return the property with its appurtenances. A distinction was drawn between that case and Ross v. Overton, 3 Call, 309; Phillips v. Stevens, 16 Mass. 238; Bullock v. Dommit, 6 T. R. 650; Digly v. Atkinson, 4 Camp. 275, and others of like character, in which there was an express covenant to repair. The learned judge in delivering the opinion said, 'that even when there were such express covenants to repair, it has seemed to some a strained and doubtful construction to extend them to the case of rebuilding.' | In Wainscott v. Silvers, 13 Ind. 500, the rule is stated, that the tenant is not responsible for buildings accidentally burned down during his tenancy, unless he has expressly covenanted or agreed to repair. That it is not sufficient to charge him that he agreed or covenanted to surrender the premises at the end of his term in the same repair or condition that they were in at the time of the contract. In Warner v. Hitchins, 5 Barb. 566, the covenant was to surrender up the possession of the premises, at the expiration of the lease, in the same condition they were in at the date of the lease, natural wear and tear excepted. The building was destroyed by fire. In an elaborate opinion, the leading cases in both England and this country were reviewed, and it was held that the covenant did not amount to one to repair, and that the tenants were not bound to rebuild. McIntosh v. Lown, 49 Barb. 554." To the same effect, Howeth v. Anderson, 25 Tex. 557; Trigg v. Hally, 4 Humph. 493; Graham v. Swearingin, 9 Yerg. 276; Harris v. Nicholas, 4 Munf. 483; Townsend v. Hill, 18 Tex. 426; Levey v. Dyess, 51 Miss. 501.

In Groves v. McGuire, Kentucky Court of Appeals, October 20, 1881, 1 Ky. L. J. 249, it was held that a mere promise by a bankrupt, after filing his petition in bankruptcy, and before his discharge, to pay an existing debt, is not sufficient to sustain an independent cause of action. The court said: "It is nothing more than a promise to pay a debt

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already owing, and collectible by law, and a renewed assurance to the creditor, without any additional consideration, that the debt will be paid. The original contract remained in full force, and had never been discharged, and as long as the creditors can maintain an action on the original promise, a new promise, without some additional consideration, will not affect an action. That is the rule laid down in Ogden v. Redd, 13 Bush, 581, as well as by all the elementary authorities. Suppose the appellees had sued the appellant on the original undertaking, and the latter, instead of relying on his discharge in bankruptcy, had pleaded, by way of accord and satisfaction, that he had, subsequently to the original promise, say on the March, 1878, made an additional promise to pay the debt, and it was accepted by the defendants, and therefore the last promise, and not the original undertaking, created the liability, can it be successfully maintained that such a plea would be good? We think not. There must be some distinct agreement based upon a consideration in which the original contract is merged or discharged before such a promise can be made available, except for the purpose of defeating a plea of limitation. Where the debt is barred by time or by the bankrupt's discharge, and is no longer collectible by law, a new promise based on the moral obligation to pay, creates a liability; but so long as the original contract can be enforced, a mere promise or recognition of the liability will not support the action. It will not do to say that the mere forbearance to present the claim before the assignee in bankruptcy, gives vitality to the promise and creates an obligation upon which the action can be maintained. The mere conclusion in the mind of the creditor, that he will accept or forbear to act with reference to his claim, will not amount to a contract with his debtor. He must forbear to present his claim by reason of some contract, made by both parties, based upon a consideration, or have been so defrauded by the debtor as to estop the latter from relying on his defense in bankruptcy. A mere promise to pay is not sufficient. A mere promise to pay a debt already existing cannot be made the foundation of an action. Gilmore v. Green, 14 Bush. 772," In Stebbins v. Sherman, 1 Sandf. 510, it is said: "Although it is alleged that the new promise was made after the bankrupt's petition, it does not aver that it was made after his discharge. If before the discharge, it cannot be set forth as an independent cause of action." To the same effect, Nelson v. Stewart, 54 Ala. 115; S. C., 25 Am. Rep. 660. Contra: Otis v. Gazlin, 31 Me. 567; Brix v. Braham, 1 Bing. 281. A promise on the eve of going into bankruptcy, to pay when able, held, not barred by discharge. Kingston v. Wharton, 2 S. & R. 208.

In Sanders v. Miller, Kentucky Court of Appeals, 1 Ky. L. J. 244, it was held that property purchased by the husband as agent for the wife and paid for with money given to her by him, in pursuance and fulfillment of an ante-nuptial contract between

them, made in consideration of marriage, cannot be subjected to the payment of the husband's debts existing at the time the money was paid. Also, that to make an ante-nuptial settlement void, as a fraud upon creditors, it is necessary that both parties should concur in, or have cognizance of the intended fraud. Upon the second point the court cite Magniac v. Thompson, 7 Pet. 393. To this may be added the following recent cases: Prewitt v. Wilson, 103 U. S. 22; affirming S. C., 3 Woods, 631; Nat. Ex. Bank v. Watson, 13 R. I. 78. On the former point, the court, referring to Magniac v. Thompson, continue: "As that case grew out of a marriage settlement actually made before marriage, and in the case before us the settlement was not consummated until after marriage, it is not in that particular a complete authority here. But, in the case of Browning's Adm'rs v. Coppage, 3 Bibb, 37, this court held that a contract between husband and wife made before marriage, but not to be operative until after coverture ceased, was not extinguished by the intermarriage under the rule that in general the contracts made between husband and wife, when single, become void by their marriage. And this exception to the general rule is based upon the valuable consideration furnished by her to uphold the contract; and in that case the consideration was her agreement that he should enjoy all of her estate during his life, although she might die without issue. On this point, see 2 Bibb, 408. And in a more recent case, Kinnard v. Daniel, 13 B. Monr. 500, valuable and meritorious considerations moving from the wife were given their full force in support of settlements made after marriage in pursuance of an ante-nuptial agreement. Roper on Property, vol. 1, p. 303, cited in the case above, says that 'settlements made after, but in pursuance of written articles entered into or letters written before the marriage,' are 'unimpeachable by any persons, whether they be creditors or subsequent purchasers, for the contract of marriage is a valuable consideration, and establishes the settlement against every one.'"

"FIDUCIARY CHARACTER" IN THE BANKRUPT ACT.

IN

N Hardenbrook v. Collson, 24 Hun, 475, the General Term of the Fourth Department decided that a debt due from a factor for goods sold on commission is a debt created in a "fiduciary character," within the meaning of the Bankrupt Act of 1867, and is not cut off by a discharge in bankruptcy. Is this correct? We think not.

The language of the Bankrupt Act of 1841 was, "debts created in consequence of a defalcation as a public officer, or as executor, administrator, guardian, or trustee, or while acting in any other fiduciary capacity." The language of the act of 1867 is, "debt created by the fraud or embezzlement of the bankrupt, or by his defalcation as a public officer, or while acting in any fiduciary character," etc. It seems difficult to distinguish between the two forms of expression.

Under the act of 1841, the United States Supreme Court held, in Chapman v. Forsyth, 2 How. 202, a case of a factor, that the words "fiduciary capacity” referred to cases of express trust, and did not include cases of mere agency. This was not based solely on the doctrine of ejusdem generis, but the court said: "If the act embraces such a debt it will be difficult to limit its application. It must include all debts arising from agencies; and indeed all cases where the law implies an obligation from the trust reposed in the debtor. Such a construction would have left but few debts on which the law could operate. In almost all the commercial transactions of the country, confidence is reposed in the punctuality and integrity of the debtor, and a violation of these is in a commercial sense a disregard of a trust. But this is not the relation spoken of in the first section of the act."

It is true that Judge Blatchford, of the United States Circuit Court for the Southern District of New York, in Re Seymour, 1 Ben. 348, held the contrary under the act of 1867, observing that "the language seems to have been intentionally made so broad as to extend to a debt created by a defalcation of the bankrupt, and while acting in any fiduciary capacity, and not to be limited to any special fiduciary capacity." The like decision was made, founded on that case, in Lemcke v. Booth, 47 Mo. 385; S. C., 4 Am. Rep. 326, but without any original discussion. So also in Banning v. Bleakley, 27 La. Ann. 257; S. C., 21 Am. Rep. 554, founding on Whitaker v. Chapman, 3 Lans. 155; Re Seymour, supra; Lemcke v. Booth, supra; and Re Kimbal, 6 Blatchf. 292. This is a quite exhaustive review of authorities, and the court say, "the provisions of the two acts are quite dissimilar." "The factor or commission merchant receiving from the owner property consigned to him to be sold, and the proceeds to be returned to the owner or kept for his disposal, we can regard in no other light than that of acting in a fiduciary capacity. The doctrine contended for, as arising from custom and usage, that the property consigned, or its proceeds, become the property of the factor, for which he simply becomes the debtor of the owner, has no foundation in equity or reason. This is followed in Desobry v. Tête, 31 La. Ann. 809; S. C., 33 Am. Rep. 232, but there stress is laid on the legislation of the State which has stamped the relation of the factor with his principal with the character of a fiduciary.” In Re Kimbal, supra, Mr. Justice Nelson said: "Looking at it as thus presented, it seems to me there is great difficulty in saying that the flour was not received and held by the bankrupt in a strictly fiduciary capacity. The article was placed in his possession simply to sell it and to remit the proceeds over and above his commission. The money was not the bankrupt's when it was received on the sale, but it was the money of the owner of the flour. It was a gross breach of trust to apply it to his own use. I have looked at the case of Chapman v. Forsyth, 2 How. 202, but do not regard it as controlling the one in hand. The provision in the present act is much broader than in the act of

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1841." The same was held in Treadwell v. Holloway, 46 Cal. 547, in a short opinion per curiam, without discussion, and by the Georgia Supreme Court, in an equally short and unconsidered opinion, in Meader v. Sharp, 14 N. B. Reg. 492. The latter was founded on Johns v. Russell, 44 Ga. 460, holding that an auctioneer acts in a fiduciary capacity or character.

378; S. C., 25 Am. Rep. 711. The court also said: "The business of a factor is not confined to a single transaction with a single individual. It extends to a number of persons and varied transactions. A cotton factor seldom sells, or can in one sale dispose of the cotton of one customer only. He sells a number of bales classified according to quality, the price varying according to the classification, and the aggregate proceeds of sales are paid to him. The cotton was the property of several customers, to whom he must separately account, when it is ascertained how much of the differing qualities of cotton each owned. Until then the proceeds of sale are necessarily mingled with his own funds, or if deposited, are incapable of deposit otherwise than in his own name. If lost because of such mingling or of such deposit, it cannot properly be said he is guilty of a defalcation, which imports a breach of duty, legal and moral. A debt would be due from him to his principal he would be bound to pay, but it could not be said he had appropriated or embezzled the money of his principal." This reasoning will apply to most cases of factors. The court disapprove Re Seymour, supra, and adopt the reasoning which we have quoted from Chapman v. Forsyth, supra.

The same doctrine was held in Green v. Chilton, 57 Miss. 598; S. C., 34 Am. Rep. 483, in the case of an agent of a bank appropriating the proceeds of notes collected by him for the bank, to which they had been sent for collection. The court say: "It now appears settled that there is no substantial difference between the acts of 1841 and 1867 in this regard." Disapprov

This is certainly a respectable array of authority, but let us look at the other side. In Cronan v. Cotting, 104 Mass. 245; S. C., 6 Am. Rep. 232, it was held that an administrator, receiving acceptances for collection, and to apply part of the proceeds to the payment of a debt due the estate, and to return the balance, is not acting in a "fiduciary character." The court held that the transaction "involved no element other than that of contract," and that "the existence of the liability did not spring from any breach of trust," as the "debt did not result from, but preceded the default." But they continue, after citing Chapman v. Forsyth, supra, and remarking that "the same or substantially the same language was subsequently used "in the act of 1867: "The argument that the omission, in the act of 1867, of the specific trusts named in the act of 1841, by removing the reasons or one of the reasons for the construction given to the earlier act, indicates that 'fiduciary character' was used in a different sense in the latter case, does not strike us as entitled to much weight, notwithstanding the reasoning, and the consideration due to the judgment of so highly respectable a court as the District Court of the United States for the Southern District of New York, supported, as we understanding Re Kimball and Re Seymour, supra, and approvit to be, by the affirmance of the Circuit Court for that Circuit. On the contrary it appears to us that the inference is quite as legitimate that Congress omitted the enumeration of specific trusts for the very reason that the term 'fiduciary capacity' had, by judicial construction, received a fixed definition, and with intent that the phrase should carry that definition into the new act. The specific enumeration was omitted, because all were included in the general expression 'fiduciary.' The association of those specific trusts originally was held to be an indication of intent in the general purpose. That intent having been ascertained, has been affixed to the general term and become legal construction. If Congress had intended to adopt a different test of fiduciary debts, we may presume that the intent to change the previous judicial construction would have been indicated by some distinct provision to that end, rather than left to inference from the mere omission of associate words, which had ceased to be of any importance as affecting the scope of the provision." This reasoning may be outside the necessities of the decision but it is extremely cogent, and has so been accepted in subsequent cases. The court also suggested that the phrase in question implies a fiduciary relation existing previously or independently of the particular transaction from which the debt arises.

This line of reasoning was distinctly adopted in an elaborate opinion in Woolsey v. Cade, 54 Ala.

ing Grover v. Clinton and Keime v. Graff, infra, and Cronan v. Cotting, supra.

The same was held of an attorney in fact. Woodward v. Towne, 127 Mass. 41; S. C., 34 Am. Rep. 337, Gray, C. J.

In Hennequin v. Clews, 76 N. Y. 427; S. C., 33 Am. Rep. 641, the same was held of the conversion of securities pledged as collateral to a loan. Church, C. J., alluding to Re Kimball, supra, says: "There are some other authorities to the same effect, but the decided preponderance of judicial opinion is adverse to this construction." "It is claimed that the Bankrupt Act of 1867, by omitting the particular trusts specified in the act of 1841, and inserting only the general words, 'any fiduciary character,' is more comprehensive than the act of 1841. But I think a more reasonable inference is that the Supreme Court of the United States, having detertermined that these general words meant only trusts of the character specified in the act of 1841, Congress deemed it necessary to insert them." Citing Cronan v. Cotting, supra, and Grover v. Clinton, Owsley v. Colby, Keime v. Graff and Re Smith, infra. "It is argued that these cases apply to consignments of property to factors, and property intrusted to agents with authority to sell, and that they are therefore distinguishable from the case at bar, but it seems to us that if there is any difference, it is in favor of those cases, because a greater confidence and trust was reposed in them than in

this.

Here the relation rested entirely in contract." If the debtor "violated that obligation he is liable for conversion of the property, and in a general sense he violated a trust, but not in that particular and technical sense which the bankrupt act contemplates." In the principal case the court tried to distinguish this decision, which, as we see, is more than Chief Judge Church could do.

The same doctrine in respect to factors was held by the Pennsylvania Supreme Court, in Curtis v. Waring, 92 Penn. St. 104, and Scott v. Palmer, February, 1880. In the latter case the court said: "The well-considered opinion in Cronan v. Cotting, 104 Mass. 245, is persuasive if not conclusive that the word is used in the same sense in the act of 1867 as in the prior statute."

In Kaufman v. Alexander, 53 Tex. 562, the court held that the relation in question was not fiduciary, but obiter expressed their adherence to the construction put on the Bankrupt Act by Chapman v. Forsyth and kindred cases, observing: "We are inclined to regard the better rule as laid down in those decisions which accept the clause in question as substantially the same as in the law of 1841, and thus adopt and retain the benefit of the 'fixed judicial construction' given to the expression 'fiduciary capacity,' under the act of 1841."

The principal case is based on Whitaker v. Chapman, 3 Lans. 155, in the same department, and that is based on Re Seymour, supra, and the omission of the specification of the particular trusts in the later statute. In the principal case it is claimed that Whitaker v. Chapman is "approved" in Barber v. Sterling, 68 N. Y. 273. It was not there approved, but the judge writing the opinion distinguishes it without pronouncing on its soundness.

associated directly with debts created by embezzlement." This case is distinguished in the principal case. In Re Smith, 18 N. B. Reg. 24, United States District Court, Southern District of New York, a factor's liability was held discharged in bankruptcy, by Choate, J. The case of Neal v. Clark, supra, was mainly relied on, and was deemed in effect to have overruled the contrary cases above cited.

There are several cases somewhat but not strictly analogous. In Jockusch v. Towsey, 51 Tex. 129, it is held that money collected by a bank for a customer is held upon implied contract, and not in a fiduciary character, and a debt therefor is barred by a discharge in bankruptcy. In Heffren v. Jayne, 39 Ind. 463; S. C., 13 Am. Rep. 281, it was held that a debt due from an attorney for money collected for a client is received in a fiduciary character, and is not barred by a discharge in bankruptcy. The court simply said: "An attorney acts in a fiduciary capacity. The relation between an attorney and client is one of great confidence, and the law imposes on an attorney the highest degree of good faith.” The same is held, with more consideration, in Flanagan v. Pearson, 42 Tex. 1; S. C., 19 Am Rep. 40. This was distinguished in Kaufman v. Alexander, supra.

The question is strictly one of statutory comparison and Federal judicial construction, and the interpretation which State courts have put on similar language in State statutes is immaterial. The weight of authority is overwhelmingly against the principal

case.

IS A SEALED NOTE NEGOTIABLE BY THE
LAW MERCHANT?

The United States Circuit Court, for the Western ANY thing which impairs the full negotiability of

District of Wisconsin, in Grover v. Clinton, 8 N. B. Reg. 312, Hopkins and Davis, JJ., held that money collected by an agent under an agreement to account and pay over the proceeds monthly to his principal is not a debt created in a "fiduciary character" within the meaning of the Bankrupt Act. The court said the words of the two acts are substantially the same, and the omission of the specific descriptive words in the later act does not alter the meaning. They rely on Chapman v. Forsyth and Cronan v. Cotting, supra, and disapprove Re Kimbal, supra.

Chief Justice Waite held the same in a brief opinion, in the South Carolina Circuit, in Owsley v. Cobin, 15 N. B. Reg. 489, a case of a factor. Precisely the same was held by McKennan, J., in the United States Circuit for the Western District of Pennsylvania, in Keime v. Graff, 17 N. B. Reg. 319, in a careful opinion. The Federal Supreme Court, in Neal v. Clark, 95 U. S. 704. Mr. Justice Harlan, in giving the opinion, holds that "fraud" in the Bankrupt Act means positive turpitude and not implied fraud, and quotes from Chapman v. Forsyth, with approval, the language quoted by us above, adding that "a like process of reasoning may be properly employed in construing the corresponding section of the act of 1867," and that "debts" not discharged under the latter act "are

promissory notes must necessarily greatly depreciate the value of those already issued, and render it very difficult to obtain funds (unless at ruinous discounts) of those to be hereafter issued.

Without attempting any analysis or compilation of authorities, allow me to discuss, on principle, a decision recently made by so able a man as Judge Blatchford; submitting with the utmost diffidence the following suggestions, and impelled to do so only by the great importance of the theme.

In the case of Coe v. The Cayuga Lake R. Co., 8 Fed. Rep. 534, the judge holds that a railroad company's note, if the corporate seal is attached, does not come under the exception which allows "promissory notes negotiable by the law merchant" to be sued upon in the Federal courts after they have come into the hands of a party outside of the district in which the maker resides, in case the original holder was a resident of the same district. (See § 1, act of Congress of March 3, 1875, 18 Stat. at Large, 470.) The court says: "The instrument without the corporate seal will be a promissory note, negotiable by the law merchant, and the instrument with the corporate seal will be a specialty, and not a promissory note negotiable by the law merchant. If the capacity to make the instrument without as well as with the seal exists, it cannot when made with the seal, be a promissory note negotiable by the law merchant."

It would seem that Judge Blatchford attaches entirely too much importance to the corporate seal.

Seals are said to be the relics of barbarism, and (in England at least) were most common when writing was least known. Seals were also used, as even now,

as a mark of distinction, and by the royalty and nobility; they were especially used, as also now, in all matters relating to lands, which were deemed of the highest moment. The lands were all under the control of the nobility. Ordinary business was transacted by the plebians; the bankers, the merchants, and all such, used writing in their business, and for their usual contracts the solemnity of seals was not needed. sonal property was regarded as of minor importance, land was the chief consideration. A simple written contract was no better than a verbal one, hence probably the misnomer of calling every thing not under seal a parol contract.

Per

From such reflections as these we may state the following proposition, viz. : It cannot be said that instruments under seal were necessarily non-negotiable, but rather it should be considered that the negotiable instruments merely did not happen to be under seal. True the books abound in decisions which say simply and broadly that an instrument under seal is a specialty and non-negotiable, but the earlier cases are not very clear upon the point, and the doctrine has erroneously grown up from an unsatisfactory foundation.

There are other considerations to be advanced. Formerly seals were deemed absolutely necessary upon corporate contracts (this rule is now somewhat relaxed); that sealing which destroyed negotiability was the seal of an individual, in cases where the seal was not needed in the proper execution of the note; so even if the capacity existed, as stated in the opinion, of the company's making a valid instrument without seal. Yet as the omission of the seal (from a corporate contract) would be in itself an innovation, the affixing it should be by no means considered as altering the nature of the contract, and it should be simply rejected as surplusage.

Again, the "law merchant" is not always the same. At first even bills of exchange, though negotiable on the continent, were not negotiable in England, unless actually drawn between merchants, then the drawee alone had to be a merchant, and finally none of the parties. Promissory notes, though negotiable in continental Europe for centuries were not at all so in England until the statute of the 3 and 4 Anne, 9 (1705).

The "law merchant" is not a part of the "common law," but is in conflict therewith, and forced its way into England against the latter's most strenuous resistance, step by step. Bouvier says the law merchant is "the general body of commercial usages in matters relative to commerce. *** It does not rest exclusively on the positive institutions and local customs of any particular country, but consists of certain principles of equity and usages of trade which general convenience and a common sense of justice have established to regulate the dealings of merchants and mariners in all the commercial countries of the civilized world."

The act of Congress under discussion was passed in

Such is also the doctrine of many text writers; but they do not seem to be well supported. Thus, in Edwards on Bills, at page 209, it is said, "sealed notes do not possess negotiable qualities," yet he cites only Glyn v. Baker, 13 East, 509, which is not at all to the point, and in which Bayley, J., states that the decision would have been different had the notes not been bought by defendant of his own agent who knew the defects in the title. Other decisions and texts are merely that the statute of Anne, which made notes negotiable, did not include sealed instruments, but that question is not before us; our inquiry is simply whether a seal would destroy the negotiability of a bill of exchange, which was otherwise negotiable under the law merchant; if not, then it could not affect a note, for this was by the statute placed on the same footing as a bill.

+ 1 Chitty on Bills (ed. of 1834), p. 28. Story on Notes (5th ed.), § 6.

1875; when it names promissory notes "negotiable by the law merchant,' "it cannot mean as the law was considered in England, for there the notes were not at all negotiable by the law merchant, but only by statute; neither can Congress be supposed to have meant to fix on notes of a character as they existed at any point of ancient or modern times, here or abroad. No, the meaning is evidently to embrace notes negotiable by the law merchant, whatever that law may from time to time be.

There can be no doubt that under the "law merchant" as it now exists, that is, according to Bouvier, under the customs and usages of the civilized world, in commercial matters, the note issued by the Cayuga Lake R. Co. is fully negotiable, i. e., is such as to pass, and be understood to pass, from hand to hand free of defenses existing between the original parties.

The learned judge who makes the decision himself admits that the note would in the hands of a bona fide holder be protected against defenses existing between the original parties, but claims nevertheless that it is not negotiable under the "law merchant." This is certainly drawing a very fine sight, and making a distinction without a difference. As soon as he admits that the note is protected in the hands of a bona fide holder, he simply says what would be the same thing as saying that the note has become negotiable under the law merchant, i. e., under the usages and customs obtaining in the commercial world.

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To limit the act of Congress in its meaning to the narrow decisions of the old English courts (made too as has been seen under the "common law," and not under the "law merchant," but in spite of it), would be to deprive the act of the very force and effect which it was intended to have. It seems to be a very forced view to determine the meaning of the phrase negotiable by the law merchant," exclusively from a few narrow old English common-law decisions, which avowedly refused to be guided by this very "law merchant," but stuck to their beloved "common law;" that numerous decisions to the same effect are found in America is nothing more than sad proof of the propagative power of error.

The railroad note in question was fully "negotiable under the "law merchant;" it would have been taken without question by any banker or business man in the civilized world; it is in substance the same as the millions and millions worth of county, city, railroad and other corporate bonds, notes or securities which all Europe, including even England itself, has been buying from America for these many years; and if now the greater part of such paper must be enforced through the State courts (for in most instances the maker and payee are residents of the same district), before courts and juries frequently of defendant's own election and choice, then the sooner Congress is persuaded to change the law, the better will it be for those, on the one hand, who hold these investments, and for those, on the other, who expect by their issue and by their sale at fair prices to realize needed funds from them. Very respectfully yours, DAVENPORT, Iowa, Nov. 14, 1881.

A. J. HIRSCHL.

PARTNERSHIP REAL ESTATE.

UNITED STATES SUPREME COURT, OCT. TERM, 1881.

SHANKS V. KLEIN.

1. Real estate purchased with partnership funds for partnership purposes, though the title be taken in the individual name of one or both partners, is in equity treated as personal property, so far as is necessary to pay the debts of the partnership and to adjust the equities of the copart

ners.

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