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See same case below, 74 C. C. A. 82, 145 | appointed, and the importer offered further Fed. 1022.
evidence to sustain his claim that the mer
chandise was entitled to free entry. Statement by Mr. Justice Peckham:
No testimony was offered by the governThis case comes here by virtue of a writment. It is not claimed by the government of certiorari issued from this court to the that the merchandise in question comes unUnited States circuit court of appeals for der paragraph 351 as wool of the third class the second circuit, for the purpose of re- (except as it may be wool of like character), viewing the action of the courts and of the as it is not Donskoi, native South American, customs authorities in relation to an as. Cordova, Valparaiso, native Smyrna or Russessment of duty on certain importations sian camel's hair, but it is asserted that the made by the petitioner, appellant, at the growth on the skins was wool on the skin port of New York.
under paragraph 360, or was a wool of like The merchandise on which duty was as- character as that above enumerated in parasessed was a growth upon certain skins of graph 351. the Mocha sheep, imported from Hodeida, The evidence shows that the hair or wool Arabia, which growth was classified by the (whichever it is called) grows on the Mocha collector as wool on the skin of the third white sheep, imported from Hodeida, Arabia. class, and assessed for duty at 3 cents per The growth to be found on this breed of pound, under the provisions of paragraph sheep is not bought or sold in this country 360 of the tariff act of July 24, 1897 (30 as wool, but as hair. It would not be acStat. at L. pages 151, 183, chap. 11, U. S. cepted as a delivery of wool of any grade Comp. Stat. 1901, pp. 1626, 1666). The im- by those dealing in that article. Although porter duly protested against the classifica- there might have been a very small proportion, and insisted that the merchandise was tion of what might possibly be termed entitled to entry free of duty under para very inferior wool on these skins (not more graph 571 (30 Stat. at L. supra, page 198, than 10 per centum in any case, and frechap. 11, U. S. Comp. Stat. 1901, p. 1684), quently less), yet there was no substantial or under paragraph 664 of such act. Page use of any portion of the growth on the 201 (U. S. Comp. Stat. 1901, p. 1688). Para- skins for purposes for which wool is gengraphs 351, 358, 360, under which the gov- erally used. To some extent, but very little, ernment claims duty, and paragraphs 571 | it had been tried in mills to spin, and it and 664, under which the importer claims might be used sometimes by carpet manufree entry, are set forth in the margin.f facturers in a small way, and efforts had
The collector having returned the mer been made to use it, mixed with wool, in chandise in question as wool of the third spinning, but it was not practically succlass, under paragraph 360, the importer ap- cessful, nor was it practicable to use it for pealed to the board of general appraisers, other purposes for which wool is used. The where the ruling of the collector was sus- chief, or predominant, and almost sole use tained, and the importer then appealed to of the substance is as hair for stuffing, and the circuit court, and then to the circuit for the saddlery trade, and by bed manucourt of appeals, each of which courts sus facturers for stuffing purposes. It is bought tained the ruling of the board of general and sold all over the country as Mocha hair. appraisers and the collector.
The skin upon which the substance grows Before the board of general appraisers the is the thing that is valuable. A large part importer produced six witnesses, who testi- of the skins imported into this country is fied as to the character, use, and commercial used in the manufacture of glove leather. designation of the merchandise. On the ap- One witness testified that his firm so used peal to the circuit court a referee was there from 75 to 90 per cent of the skins im† Paragraphs from tariff act of 1897, under 360. The duty on wools on the skin shall
which the government claims. 30 Stat. at be one cent less per pound than is imposed L. 151, 183, chap. 11, U. S. Comp. Stat. in this schedule on other wools of the same 1901, pp. 1626, 1666.
class and condition, the quantity and value 351. Class three, that is to say, Donskoi, to be ascertained under such rules as the native South American, Cordova, Valparaiso, Secretary of the Treasury may prescribe. native Smyrna, Russian camel's hair and Petitioner claims under following paraall such wools of like character as have graphs: been heretofore usually imported into the 571. Hair of horse, cattle, and other anUnited States from Turkey, Greece, Syria, imals, cleaned or uncleaned, drawn or unand elsewhere, excepting improved wools drawn, but unmanufactured, not specially bereinafter provided for.
provided for in this act, and human hair, 358. On wools of the third class and on raw, uncleaned, and not drawn. camel's hair of the third class, the value 664. Skins of all kinds, raw (except sheepwhereof shall be twelve cents or less per skins with the wool on), and hides not pound, the duty shall be four cents per specially provided for in this act. pound.
ported, and the growth thereon was bought, cent only of the growth; that he examines and sold as Mocha hair. It costs more to such skins as the ones in question and remove the growth from the skin than it throws out those he considers dutiable when sells for after its removal. It cannot be there is enough wool to call it dutiable, and used for spinning purposes because it would lets the skins go not dutiable when you not hold together. It might be carded, but could not make anything out of the growth there would not be much left after carding. in any way, although some use might posThe price of the skins on which this growth sibly be made of it. is found is not influenced by the quantity The cross-examination of other witnesses of the growth on them. The more of a was to the effect that this growth had been growth there is, the less the skin will tried in mills for the purpose of spinning, bring, or, as is said, the more hair, the poor- but very little, being used with other stock er the skin. The skins are sold by the to make into yarn, but it has not been sucimporters to tanners of gloves and shoe cessfully used for that purpose; it might leather, just as they arrive. After the be used sometimes by carpet manufacturers growth is washed and removed from the in a small way, and, while it could not be skin it may be sold for from 3 to 5 cents per used or spun alone, it might be carded. pound, which is less than the cost of re- It was also said on cross-examination of one moving it. In buying the skins no notice of the witnesses that if such growth ran is taken of the growth, the only considera- pretty white it is sometimes used in those tion being the value of the pelt, and the low-grade carpet yarns where they put in pelts are worth no more with long hair on such stuff as jute packing is made of and than short hair. The growth has never been some hair like the growth in question. The accepted or sold as wool, but, on the con- evidence is, however, overwhelming and the trary, prior to July 24, 1897, when the tariff witnesses substantially unanimous, that this act was passed, it was uniformly regarded substance is not known as wool, and and bought and sold in the United States is neither bought nor sold as such, and is as hair. “Mocha hair” was the trade no commercially known as Mocha hair, and is menclature prior to 1899, and as such the not used as wool. trade name
definite and uniform throughout the United States, and dealers Messrs. J. Stuart Tompkins, Edward S. in it never knew it to be called anything Hatch, and Hatch, Keener, & Clute for peelse than Mocha hair. It has not the ap-titioner. pearance of wool, does not feel like wool, Assistant Attorney General Sanford for and has none of the qualities of wool. It respondent. is bought from tanners after it has been taken from the skin by then, and it is thus Mr. Justice Peckham, after making the sold and bought as Mocha hair, and the foregoing statement, delivered the opinion skins are used for leather by the tanners. of the court:
One of the witnesses called on behalf of The evidence in this case, taken before the importers was an examiner of wool the board of appraisers and also before the fibers and skins at the port of New York, circuit court, is uncontradicted. It shows which position he had held for about fifteen that the substance in question is not wool, years. He said that when he first went into has none of its characteristics, and is not the government employ such skins as those put to any of its uses, and does not apin question were returned free, the hair as pear like wool. On the contrary, it is comwell as the skin, but that practice has since posed mostly of dead hair or kemp and been changed. The witness further said cannot be remuneratively carded, nor is it that if the growth in question were found commercially suited for carding, nor for on a goat he would return it as hair of a spinning. Its commercial designation is goat, and entitled to free entry; that wool | Mocha hair, and it is not known or recould be run down, or deteriorate, to such garded or recognized as wool in any of the a condition as the growth in question, but markets of the country. that it was, in fact, mostly "what they It is not denied that the commercial desig. call dead hair or kemp;” that although it nation of an article, which designation was could possibly be carded, it was not com- known at the time of the passage of a mercially suitable, and there would not be tariff act, is the name by which the article much left after they got through carding it. | should be classified for the payment of duty, On cross-examination the witness said that and, as is stated, "without regard to their he would return the article in question as scientific designation and material of which Mocha sheepskin with the wool on. On they may be made, or the use to which they such a skin as the one in question the wit may be applied.” Two Hundred Chests of
ness said there was a substance which he Tea, 9 Wheat. 430, 438, 6 L. ed. 128, 130; would call wool, which was about 10 per Arthur v. Morrison, 96 U. S. 108, 24 L. ed. 764; American Net & Twine Co. v. Worth- | under paragraph 664, in the free list, and ington, 141 U. S. 468, 35 L. ed. 821, 12 not as a sheepskin with the wool on. Sup. Ct. Rep. 55; Hedden v. Richard, 149 We do not agree that the word "wool" U. S. 346, 348, 37 L. ed. 763, 764, 13 Sup. in this act is used in a generic sense so Ct. Rep. 891. As was said by Mr. Justice far as this particular point is concerned. Story in Two Hundred Chests of Tea, supra, The word does not necessarily include all Congress did not "suppose our merchants to growth upon the coat of a sheep, even be naturalists or geologists or botanists. It though the substance is like that in quesapplied its attention to the description of tion here. articles as they derived their appellations Counsel for the government cites from the in our own markets, in our domestic as well Encyclopedia Britannica, where, in speaking as our foreign traffic.” And in Hedden v. of the difficulty in determining the dividing Richard, supra, it was said: “The language line between hair and wool, it is said: "At of commerce
must be construed, what point, indeed, it can be said that an particularly when employed in the animal fiber ceases to be hair and becomes denomination of articles, according to the wool it is impossible to determine, because commercial understanding of the terms in every characteristic the one class by imused.” The commercial designation should perceptible gradations merges into the other, prevail unless Congress has clearly mani- so that a continuous chain can be formed fested a contrary intention. Cadwalader v. from the finest and softest merino to the Zeh, 151 U. S. 171, 176, 38 L. ed. 115, 117, rigid bristles of the wild boar.” 14 Sup. Ct. Rep. 288.
It may be difficult in some cases to define We are of opinion that the use of the the line between "wool” and “hair” as a word "wool” in the tariff act excluded a growth upon skins, but we do not regard substance which, while it was a growth upon that difficulty as an argument for the cona sheepskin, was nevertheless commercially struction contended for by counsel for the known, designated, and dealt in as Mocha government. That argument leads to the hair, having none of the characteristics of classification of a substance like that in wool, and which would not be accepted by question as wool, when in fact it bears no dealers therein as a good delivery of wool. resemblance to it, is not used as wool, and
In this case the evidence is uncontradicted has none of its characteristics, and is known that the growth on these skins was com-commercially as Mocha hair, and is so mercially known as Mocha hair, and that bought and sold over the whole country. it was not used in the way wool is used, The case is one of degree; and because, in
; or as a substitute for wool. It ought not, some few cases, the points may closely apsimply for the reason that the skin upon proach each other, and there may be, in which it grows is the skin of a sheep, to such cases, some difficulty in telling wool be classified as wool, under paragraph 360 from hair, yet that fact furnishes no reason of the tariff act, and thereby be subjected for refusing to adopt the general test which, to a duty as high as the value of the sub- in most cases, is easily applied,-fitness, stance itself.
identity of use, commercial designation. To Although it has been so classified, and adopt the claim of counsel eliminates all inthat classification has been affirmed all quiry as to whether an article is wool or through, yet the question is not presented hair, and leaves simply the question whether to this court as if it were a question of it is to be found on what may be called the fact decided upon contradictory evidence, wool-bearing animals or on the alpaca or and concluding this court for that reason. other like hair-coated animals. Some sheep There is, in truth, no contradictory evidence are wool-bearing animals; therefore the hair in the case. It is one where, in our opinion, the courts below have given undue must be classified as such. We do not agree
on the skin of the Mocha sheep is wool and weight to the evidence elicited on cross-ex: with this claim. If an article does not, to a amination of witnesses called on the part dealer, look like wool, cannot be used as
, a of the importer, which showed that there dealer, look like wool, cannot be used as possibly was, in some cases, a very little wool, is not commercially known as wool, inferior wool found on these skins, while but, on the contrary, is bought and sold the courts ignored the other facts, as tes throughout the country as Mocha hair, and tified to by the same witnesses and already is so designated commercially by those dealmentioned, which showed beyond the pos- | ing in it, it ought not to be classified as sibility of successful contradiction that the wool or made to pay duty as such, simply substance was erroneously classified as wool. because it grows on a sheep. Upon the facts, the substance ought not
We have looked over the various authorito have been so classified. The growth be- ties cited by counsel for the government, , ing still on the skin should have been re- but we see nothing in any of them tending garded as part of such skin, and classified' to the conclusion that, upon the facts in this. case, the growth on the skin of the ity prescribed by U. S. Rev. Stat. § 5239, Mocha sheep was properly classified as wool. which provides for the forfeiture of the Taking all the evidence in this case, un
charter of a national bank as the result of contradicted as it is, we feel compelled to violations of the national bank act by the the conclusion that the classification in this directors, such violations to be determined the conclusion that the classification in this only by the Federal courts, and makes every case, adopted by the courts below and by the director who participated in or assented to appraisers and collector, was wrong, and the same civilly liable to persons who have that the merchandise in question was en suffered damage in consequence thereof. titled to free entry. The judgments of the courts below are re
[No. 230.] versed and the case remanded to the Circuit Court with instructions to take such further Argued March 8, 11, 1907. Decided May 13,
1907. proceedings as may be necessary, not inconsistent with this opinion. Reversed.
State of Nebraska to review a judgment
which affirmed a judgment of the District Mr. Justice Moody took no part in the de Court of Seward County, in that state, in cision of this case.
favor of plaintiff in an action to charge the officers and directors of a national bank
with liability for false representations as to CHARLES E. YATES et al., Plffs. in Err., for want of prosecution as to some of the
the bank's financial condition. Dismissed v. JONES NATIONAL BANK.
plaintiffs in error, and reversed as to the
others, and remanded for further proceedAppeal-abandonment.
ings. 1. The prosecution of a writ of error See same case below (Neb.) 105 N. W. sued out apparently on behalf of all the de-287. fendants below will be deemed abandoned by The facts are stated in the opinion. those who have furnished no bond for costs
Messrs. Halleck F. Rose, J. W. Deweese, and are not represented by counsel, especial- and Frank E. Bishop for plaintiffs in error. ly where the bill of exceptions does not contain the answers of those defendants nor
Messrs. Lionel C. Burr, John J. Thomas, the pertinent evidence relating to their case.* Charles L. Burr, Richard S. Norval, and Wil Error to state court-Federal question.
liam B. C. Brown for defendant in error. 2. The express denial of an immunity claimed in both the trial and appellate
Mr. Justice White delivered the opinion of courts, under U. S. Rev. Stat. § 5239, U. S. the court: Comp. Stat. 1901, p. 3515, by officers and di- This writ of error is prosecuted to secure rectors of a national bank in respect to the the reversal of a judgment of the supreme rule of liability applied for making false of-court of the state of Nebraska, affirming ficial reports as to the bank's financial condition, is sufficient to sustain the exercise by that state, upon a verdict of a jury award
one entered by a court of Seward county, in the Supreme Court of the United States of its appellate jurisdiction over state courts.+ ing damages against the defendants below, National banks—liability of directors-false plaintiffs in error here, because of certain official reports.
acts charged to have been done by them as 3. Directors of a national bank who officers and directors of the Capital Namerely negligently participated in or assent- tional Bank of Lincoln, Nebraska. ed to the false representations as to the We briefly summarize a statement conbank's financial condition contained in the tained in the opinion of the court below conofficial report to the Comptroller of the Cur-cerning a prior action between the same rency, made and published conformably to parties. That action, and three others of U. S. Rev. Stat. § 5211, U. S. Comp. Stat. I like character, brought by different plain1901, p. 3498, cannot be held civilly liable to anyone deceived to his injury by such re- tiffs, were begun in a county different from port, since the exclusive test of such lia- that in which the present one was combility is furnished by U. S. Rev. Stat. & menced, and recovery was sought, with one 5239, which makes a knowing violation of exception, from those who were defendants the provisions of the title relating to na below in this case, of the sum of a loss octional banks a prerequisite to such liability casioned by the insolvency and suspension Courts-state or Federal jurisdiction-en-of the Capital National Bank, a corporation forcing civil liability of national bank di-organized under the national bank act. The rectors. 4. State courts may enforce, against di- cuit court of the United States, and in each
actions referred to were removed into a cirrectors of a national bank who have made false representations as to the bank's finan- a motion to remand was overruled, and in cial condition in the official report to the one of the cases (brought by Thomas BaiComptroller of the Currency, the civil liabil.' ley) the circuit court sustained a demurrer
*Ed. Note.-For cases in point, see vol. 3, Cent. Dig. Appeal and Error, $$ 3129, 3130.
to the petition and dismissed the cause, and and subsequently, the court sustained the the judgment so doing was affirmed by the demurrer and dismissed the action. Reviewcircuit court of appeals. 11 C. C. A. 304, ing the action of the circuit court, however, 27 U. S. App. 339, 63 Fed. 488. The plain the circuit court of appeals held that in any tiffs in the other cases thereupon dismissed event the removal had been made too late, their actions and commenced new ones, as “and that the judgment of the lower court also did Bailey, in Seward county, of which dismissing the plaintiff's case was rendered the case before us is one. The same per- without lawful jurisdiction over the case.” sons who were impleaded in the prior ac. | 46 C. C. A. 471, 107 Fed. 561. As a result tions were made defendants, and in two of the case went back to the state court, and the actions one Thompson, a director of the in that court the demurrer to the second bank, who had not been previously sued, amended petition was argued and overruled. was joined as a defendant. The defendants There was judgment against Stuart, one were sought to be made liable for acts done of the defendants, for failure to answer the as officers and directors of the Capital Na- original petition, and this judgment was tional Bank, although it was not expressly affirmed by the supreme court of Nebraska. alleged that the bank was organized under Stuart v. Bank of Staplehurst, 57 Neb. 570, the national bank act. Reliance in each ac- 78 N. W. 298. A separate answer to the tion was placed upon alleged untrue writ. second amended petition was filed on behalf ten and oral statements and representa of the defendant Thompson and a joint antions of the financial condition of the bank, swer on behalf of the defendants Yates and alleged to have been made and published Hamer. In the answer of Thompson it was by the defendants, which were fully set out averred that, while a stockholder, he was in various forms of expression, but in none not a director of the Capital National Bank of the averments was it specifically asserted at the time the plaintiff made its various that the acts in question were done in con- deposits; it was denied that any of the sequence of and in compliance with the pro- reports set out and referred to in the visions of the national bank act, although petition were signed or attested by Thompthe exhibits attached to the petition dis son, and specifically for himself he denied closed the character of the written reports, “all alleged misconduct and mismanagement which were in part relied upon. The state of said bank on his part, and all of the alcourt overruled an application to remove, leged neglect of duty and the causing of the and, a transcript of the record having been insolvency of said bank, as charged in the filed in the circuit court, on motion the ac- said amended petition.” tion was, by that court, remanded to the The following paragraph was also set up state court, upon the ground that the peti. in the answer: tion was “clearly based, not upon the pro
"This defendant further says that the visions of the national banking act, but cause of action set out in the plaintiff's upon the liability claimed to arise under the amended petition, if it have any, is founded principles of the common law.” See Bailey upon alleged facts which, if true, constitute v. Mosher, 74 Fed. 15.
a violation by this defendant, as a director An amended petition was filed, changing or stockholder, of his duties as such disomewhat the averments originally made, rector or stockholder, as laid down and deand supplementing the same by new allega- fined in the national banking laws of the tions. After a considerable lapse of time a United States above referred to, concerning second amended petition was filed. This the government and management of national latter enumerated many acts of negligence banks. And this defendant alleges that if and mismanagement in the conduct of the any liability attaches to him as a director affairs of the failed bank charged to have or stockholder of said bank for any act done caused its insolvency, in addition to the or duty neglected as set forth in said amendaverments which had been made in the orig. ed petition or otherwise, that such liability inal petition. The defendants demurred is determined and controlled by the naon the ground of want of jurisdiction, be- tional banking act concerning the managecause the result of the pleading as amended ment of national banks; and that, in deterwas to demonstrate that the whole cause of mining the liability of this defendant, there action relied upon was based upon the vio- is necessarily involved the construction of lation by the defendants of provisions of said national banking act relating to the the national bank act, and because, under duties of directors and stockholders of nathat act, no cause of action in favor of the tional banks. That a Federal question is inplaintiff was stated. The day the demurrer volved in determining the liability of this was filed the action was removed by the de defendant by reason of the alleged mismanfendants to the circuit court of the United agement of said bank and the alleged neglect States. That court overruled a motion to of duty on the part of this defendant.” remand (see Bailey v. Mosher, 95 Fed. 223), Matter alleged to constitute an estoppel