usually narrowed to some extent in country districts. But more important here is the fact, clearly established by the evidence, that any one driving an automobile in the daytime or at night with proper lights would have absolutely no difficulty in negotiating this erossing by following the well-defined course of the traffic which the evidence showed had been established for many years at this point. There was no obstruction which obscured the view, no unsafe condition of the culverts or the crossing itself, which was properly planked and graded and of adequate width to accommodate the ordinary traffic in that district. Certainly such a crossing was clearly within the scope of the Oklahoma statute, in that it was unobstructed and maintained in good condition, and also within the rule of reason as to what the ordinary country railroad crossing might be. [2] In our opinion the plaintiff failed to sustain the burden placed upon her in proving negligence on the part of the defendant railroad. The rule in regard to directed verdicts, announced by our court in the case of Atchison, T. & S. F. R. Co. v. Wyer (C. С. A. 8) 8 F.(2d) 30, at page 32, is as follows: "It is the duty of the trial court to direct a verdict at the close of the evidence in two classes of cases: (1) That class in which the evidence is undisputed; and (2) that class in which the evidence is conflicting, but is of so conclusive a character that the court, in the exercise of a sound judicial discretion, would set aside a verdict in opposition to it. Small Co. v. Lamborn, 267 U. S. 248, 45 S. Ct. 30 [300] 69 L. Ed. 589 [597]; Ewert v. Beck, 235 F. 513, 149 C. C. A. 59; Fricke v. International Harvester Co., 247 F. 869, 871, 160 C. C. A. 91; New Amsterdam Casualty Co. v. Farmers' Co-op. Union of Lyons, Kan. (C. C. A.) 2 F. (2d) 214; Walton Trust Co. v. Taylor (C. C. A.) 2 F. (2d) 342; Kintyre Farmers' Co-op. Elevator Co. v. Midland National Bank (C. C. A.) 2 F.(2d) 348." In these circumstances we feel that the trial court committed error in not sustaining the demurrer of defendant to plaintiff's evidence, and in any event in not directing a verdict for the defendant at the close of all the evidence in the case. The other point relates to the question of contributory negligence. There is undoubtedly established by the testimony under the rule in the federal courts a clear case of con tributory negligence on the part of the deceased, because the conditions surrounding the accident show that he must have been driving at considerable speed in order for the accident to have happened in the way it did, and that he did not have his car under control, as well as the strongest kind of evidence that he was driving without lights. However, considering the peculiar provision of the Oklahoma Constitution, that the defense of contributory negligence or assumption of risk shall in all cases whatsoever be a question of fact and left to the jury, together with the fact that our court has not decided the question as to whether or not this rule is binding upon the federal courts in the trial of cases of this character arising in Oklahoma, we think it unnecessary to discuss this phase of the case further, as to whether or not the trial court committed error in not sustaining the motion for a directed verdict upon the ground of contributory negligence shown. For the reasons stated in the point first discussed, the case will be reversed and remanded, with directions to grant a new trial. ENGLISH et al. v. GAMBLE. Circuit Court of Appeals, Eighth Circuit. April 27, 1928. No. 7827. 1. Appeal and error 1054(1)-Admission of immaterial evidence in trial to court without jury held not reversible error. In trial to court without jury, admission of immaterial evidence cannot be said to be prejudicial, as it may be disregarded in assembling and considering competent evidence. 2. Appeal and error 1010(1)-Judgment on question of fact in case tried without jury will not be disturbed if sustained by any substantial evidence. When case is tried to court, a jury being waived, if there is any substantial evidence to sustain judgment upon question of fact, such judgment will not be disturbed on appeal. 3. Banks and banking248(1)-Directors who deposited money in escrow to purchase stock of nonresponding stockholders held liable for subsequent assessment. Where money was deposited by directors of bank in escrow to satisfy deficiency resulting from stock held by stockholders failing to respond to assessments, and nonresponding stock was purchased with such funds by cashier as trustee with knowledge and consent of directors, held that directors thereby became joint owners, jointly and severally liable for subsequent statutory assessment upon such stock. In Error to the District Court of the United States for the Western District of Oklahoma; John H. Cotteral, Judge. Action by Joseph A. Gamble, as receiver of the First National Bank of Devol, against F. M. English and others. Judgment for 26 F.(2d) 28 plaintiff, and defendants bring error. Affirmed. W. C. Stevens and J. H. Cline, both of Lawton, Okl., for plaintiffs in error. Dudley B. Madden and Walter Hubbell, both of Walters, Okl., for defendant in er ror. Before STONE and VAN VALKEN stock reissued upon the books in the name of such trustee, the old stock thereupon canceled and notice given to the old shareholders of such cancellation. After consulting with the directors, defendants here, this plan of procedure was agreed upon and followed. The sale was conducted upon published notice at which, no other bidders being present, the stock was bid in by the cashier for the stock BURGH, Circuit Judges, and KENNEDY, holders who had previously advanced the District Judge. KENNEDY, District Judge. The receiver of the First National Bank of Devol, as plaintiff in the court below, for whom Gamble, a subsequent receiver, was later substituted, brought this action against the plaintiffs in error, there defendants, to recover the statutory assessment upon stock alleged to have been owned by them in said bank at the time it became defunct. The defendants first demurred, and, upon such demurrers being overruled, filed their separate answers, which in turn were followed by replies, and upon the issues thus joined the cause was tried to the court without the intervention of a jury upon written stipulation of the parties. In brief, the following situation was disclosed by the evidence: Some time in 1924, owing to the bank being in a depressed condition as to its finances, an assessment amounting to $25,000 was made among its stockholders to which a certain portion of such stockholders did not respond; such uncollected assessments amounting to $9,400. Upon demand of the office of the Comptroller of the Currency through the regular channels it was required of the officials of the bank that this sum should be placed in the bank or the institution would not be allowed to open its doors. The defendants, stockholders and also directors of the bank, raised this sum among themselves and deposited it in the bank in escrow in order to satisfy the requirements of the National Banking Department. An attempt was then made by the bank to close out the stock which was in default on account of the unpaid assessments and upon the first attempt no sale resulted. Appeal for advice was then made to the Comptroller, who advised the cashier of the bank by letter, in substance, that the defaulted stock must be sold out, and suggested that said stock be noticed for sale by advertisements in a local paper for 30 days, and, in the event no other bids were received, the amount held in escrow in the bank which was put up by the directors to cover the unpaid delinquency in the assessment might be applied to the purchase of such stock, a trustee appointed to represent the purchasers, the money and the stock reissued in the name of the cashier as trustee. The correspondence shows that this plan was merely a suggestion on the part of the Comptroller and in no way obligatory upon the directors. Some months later the bank failed. It was taken in charge by the Comptroller, and a receiver appointed, who thereupon proceeded to liquidate it. A demand was made upon the defendants as owners of the $9,400 worth of par value stock acquired in the manner hereinbefore outlined for the statutory assessment of 100 per cent. par value, which demand was refused, and this suit instituted for its collection. Three points only are raised which seem to require the attention of this court; the cause having been submitted upon briefs without oral argument: First, error of the trial court is alleged in the overruling of the separate demurrers. Without outlining in detail the averments of the petition, we are of the opinion that the petition is amply sufficient to present the issues upon which the plaintiff claimed the right of recovery. [1] Second, as to the evidence of the witness Donahue concerning the purported action of the defendant English in selling out his stock before the bank closed, it may be said that this evidence was immaterial. Yet in a trial to the court without a jury it cannot be said to be prejudicial, and it may be disregarded in assembling and considering the competent evidence which goes to sustain the allegations of the petition. There was therefore no reversible error on the part of the court in admitting this testimony. [2,3] Third, the judgment of the trial court is assailed upon the ground that the evidence is insufficient to sustain said judgment, which point is presented under several different assignments of error. Under the well-recognized rule that, when a case is tried to the court, a jury being waived, if there is any substantial evidence to sustain a judgment upon the questions of fact, that judgment will not be disturbed, we come to the conclusion that the evidence is not only sufficient, but preponderates strongly in favor of the receiver. The proper solution of the contro versy revolves around the question as to whether or not the defendants were the owners of the stock at the time the bank became insolvent and upon which stock the assessment levy was thereafter made by the Comptroller. The testimony of the witness Steele, who was the cashier of the bank at the time the transactions relied upon took place, is sufficient in itself to sustain the conclusions and judgment of the trial court. Steele testified in regard to the money being put up by the defendants in escrow in the funds of the bank to satisfy the deficiency resulting from the 94 shares of stock held by the nonresponding stockholders, that this stock under the suggestion of the Comptroller and with the consent of the defendants was sold at public auction, bid in by the witness as trustee for them, and charged against the escrow account which had been deposited by them in the bank. This witness was disinterested and had no financial interest in the affair at any time. These transactions were fully explained to the defendants, and a certificate of stock in the name of Steele as trustee for this purpose was issued over the signature of the bank president. Shorn of all technicalities, clearly this made the defendants the joint owners of this particular stock which was still held by them in the name of the trustee at the time the bank closed its doors. As such joint owners they became jointly and severally liable for the subsequent assessment. The transaction was one of purchase and sale, wherein the money of the defendants was paid for the stock, and they thereby became the owners. Under these circumstances the facts in no way seem to justify the conclusion, as contended for by defendants, that the purchase was made on behalf of the bank itself, as it was their money and not that of the bank which went to consummate the purchase. Finding no errors in the record justifying the reversal, the judgment of the trial court will be affirmed. RUTH IRON CO. v. COMMISSIONER OF INTERNAL REVENUE. Circuit Court of Appeals, Eighth Circuit. April 25, 1928. No. 334. 1. Internal revenue 25-Market value of noninterest-bearing notes received for interest in iron mine held proper basis for ascertaining taxable "income" (Revenue Act 1918, § 202(a), and Revenue Act 1921, § 202(b); Comp. St. § 63361/8bb(a), (b). Where petitioners, before March 1, 1913, exchanged their fee interest in iron mine for noninterest-bearing notes having various maturities over a period of many years, total face amount of which notes equaled estimated tonnage of ore in place at agreed value of $.35 per ton, held that, in absence of evidence as to cost of notes to petitioners, the fair market value of notes on March 1, 1913, constituted basis for ascertaining taxable gain under Revenue Act 1918, § 202(a), and Revenue Act 1921, §202(b), Comp. St. § 63364bb(a), (b), and, in determining this, notes were properly discounted at 5 per cent. compounded annually to that date; "income" including profit gained through sale or conversion of capital. [Ed. Note. For other definitions, see Words and Phrases, First and Second Series, Income.] 2. Evidence 18-It is common knowledge that long-time, noninterest-bearing notes can be cashed or sold only at legal discount rates. It is a matter of common knowledge that noninterest-bearing notes maturing at a distant date can be cashed or sold only at legal discount rates. Petition by the Ruth Iron Company against the Commissioner of Internal Revenue to review the decision of the United States Board of Tax Appeals sustaining a ruling of the Commissioner in assessing income tax. Affirmed. Guy Chase, of St. Paul, Minn. (Francis W. Sullivan, of Duluth, Minn., and George W. Morgan, of St. Paul, Minn., on the brief), for petitioner. H. R. Gamble, Sp. Asst. Atty. Gen. (Mabel Walker Willebrandt, Asst. Atty. Gen., С. M. Charest, General Counsel, Bureau of Internal Revenue, and John W. Fisher, Sp. Atty., Bureau of Internal Revenue, both of Washington, D. C., on the brief), for respondent. Before KENYON and VAN VALKENBURGH, Circuit Judges, and JOHN B. SANBORN, District Judge. VAN VALKENBURGH, Circuit Judge. For many years prior to January 1, 1913, petitioner was the owner in fee of an undivided 107/960ths of the Kosmerl mine, situated in St. Louis county, Minn. In 1903 petitioner and its co-owners leased the property to the Oliver Iron Mining Company for a term of 51 years, ending in 1954, for mining purposes, at a royalty of 35 cents per ton. The lease provided for certain annual minimum payments. All such minimum royalties had been paid up to December 31, 1912. January 1, 1913, the fee owners joined in a sale and conveyance of the property to the said Oliver Iron Mining Company. Under the contract between the parties it was provided that explorations should be made to determine the amount of ore on, in, or under said premises, for the purpose of determining the purchase price. The contract of sale provided that: 26 F.(2d) 30 "The purchase price of said lands shall be determined by multiplying the number of tons of iron ore found to exist on said lands on the foregoing basis, by thirty-five (35) cents for each ton; from such product there shall be deducted the sum of $530,000 heretofore paid in royalties under the aforesaid lease by the purchaser to the vendors; the remainder shall be divided into forty-one (41) equal annual payments considered as payable one forty-first each year, commencing with January 1st, 1913, such payments to be evidenced by the promissory notes of said Oliver Iron Mining Company, dated January 1st, 1913, without interest." These notes were secured by mortgage. The number of tons was ascertained and agreed to be 12,700,000, making the total purchase price, computed at 35 cents per ton, to be $4,445,000, less the total royalties paid in advance of sale, to wit, $530,000. The net purchase price was therefore $3,915,000. The payment was to be made in the form of eighty-two notes dated January 1, 1913; these notes being payable January 1st of each year from 1914 to 1954, inclusive. All of these notes were the same, with the exception of the amount thereof and the name of the payee. They were in the following form: "$ "Duluth, Minnesota, January 1st, 1913. "On or before years after date the Oliver Iron Mining Company, a Minnesota corporation, promises to pay to the order of Ruth Iron Company dollars in gold coin or its equivalent, at the First National Bank of Duluth, Duluth, Minnesota, without interest until after maturity. Value re ceived." Each of the vendors received separate notes for his or its proportionate part of the total purchase price, less his or its proportion of a cash payment made on January 1, 1913. Two of these notes became due and were paid January 1, 1919, two more January 1, 1920, and two more on January 1, 1921. In each instance the amount received by petitioner was the face of the notes without interest. The Commissioner of Internal Revenue ruled that these notes were to be taken for income tax purposes at a value discounted to March 1, 1913, at the rate of 5 per cent. compounded annually; that the difference between such March 1, 1913, valuation and the amounts received on January 1, 1919, 1920, and 1921, respectively, constituted taxable gains, profits, or income. The amounts of deficiency income taxes thereon were determined by the Commissioner and the Board to be $99.47 for 1919, $135.49 for 1920, and $169.79 for 1921. Counsel for petitioner in their brief state that no objection is made to the amounts of the taxes defined for the years stated, provided it shall be held that any part of said sums collected constituted taxable gains, profits, or income. The United States Board of Tax Appeals sustained the ruling of the Commissioner of Internal Revenue. It is to review this decision of the Board that this original action is brought. It appears from the record and from the briefs of counsel that four other appeals, involving the same questions, were heard together with this case by the Board of Tax Appeals. Three of these cases, Eva Iron Company, Reading Investment Company, and Estate of C. A. Severance, numbered 332, 333, and 335, originals, are before this court. It has been stipulated that the same shall be heard and decided on the printed record and briefs in this, the Ruth Iron Company, case. The claims of the parties, as well as the grounds of the decision of the Board of Tax Appeals, are well stated in the opinion of the Board, to wit: "Petitioners do not question the Commissioner's determination of the March 1, 1913, value of the notes in question, but they contend that no portion of the payments of the face amount of the notes in the years involved constituted taxable gain, profit, or income under the Revenue Acts of 1918 and 1921 (Comp. St. § 63361a et seq.), for the reason that the face amount of the notes, which in the hands of the vendors of the property represented merely evidence of a deferred purchase-price payment, was capital on March 1, 1913, and that subsequent payment thereof represented entirely such March 1, 1913, capital. "When, on January 1, 1913, the petitioners herein sold their respective interests in the property known as the Kosmerl mine for cash and notes of the Oliver Mining Company, there was an exchange of property for property, a completed transaction. Thereafter, and on March 1, 1913, all that the petitioners had of exchangeable value was the noninterest-bearing notes of the Oliver Mining Company, maturing annually over a period of 39 years 10 months. The cost of these notes to the petitioners was the fair market value of the Kosmerl mine at the date of the exchange, less the total of the minimum royalties theretofore paid by the purchaser which was allowed as an offset against the purchase price and the cash payment of one versy revolves around the question as to whether or not the defendants were the owners of the stock at the time the bank became insolvent and upon which stock the assessment levy was thereafter made by the Comptroller. The testimony of the witness Steele, who was the cashier of the bank at the time the transactions relied upon took place, is sufficient in itself to sustain the conclusions and judgment of the trial court. Steele testified in regard to the money being put up by the defendants in escrow in the funds of the bank to satisfy the deficiency resulting from the 94 shares of stock held by the nonresponding stockholders, that this stock under the suggestion of the Comptroller and with the consent of the defendants was sold at public auction, bid in by the witness as trustee for them, and charged against the escrow account which had been deposited by them in the bank. This witness was disinterested and had no financial interest in the affair at any time. These transactions were fully explained to the defendants, and a certificate of stock in the name of Steele as trustee for this purpose was issued over the signature of the bank president. Shorn of all technicalities, clearly this made the defendants the joint owners of this particular stock which was still held by them in the name of the trustee at the time the bank closed its doors. As such joint owners they became jointly and severally liable for the subsequent assessment. The transaction was one of purchase and sale, wherein the money of the defendants was paid for the stock, and they thereby became the owners. Under these circumstances the facts in no way seem to justify the conclusion, as contended for by defendants, that the purchase was made on behalf of the bank itself, as it was their money and not that of the bank which went to consummate the purchase. Finding no errors in the record justifying the reversal, the judgment of the trial court will be affirmed. RUTH IRON CO. v. COMMISSIONER OF INTERNAL REVENUE. Circuit Court of Appeals, Eighth Circuit. April 25, 1928. No. 334. 1. Internal revenue 25-Market value of noninterest-bearing notes received for interest in iron mine held proper basis for ascer taining taxable "income" (Revenue Act 1918, § 202(a), and Revenue Act 1921, § 202(b); Comp. St. § 63361/8bb (a), (b). Where petitioners, before March 1, 1913, exchanged their fee interest in iron mine for noninterest-bearing notes having various maturities over a period of many years, total face amount of which notes equaled estimated tonnage of ore in place at agreed value of $.35 per ton, held that, in absence of evidence as to cost of notes to petitioners, the fair market value of notes on March 1, 1913, constituted basis for ascertaining taxable gain under Revenue Act 1918, § 202(a), and Revenue Act 1921, §202(b), Comp. St. § 6336%bb(a), (b), and, in determining this, notes were properly dis-. counted at 5 per cent. compounded annually to that date; "income" including profit gained through sale or conversion of capital. [Ed. Note. For other definitions, see Words and Phrases, First and Second Series, Income.] 2. Evidence 18-It is common knowledge that long-time, noninterest-bearing notes can be cashed or sold only at legal discount rates. It is a matter of common knowledge that noninterest-bearing notes maturing at a distant date can be cashed or sold only at legal discount rates. 11 Petition by the Ruth Iron Company against the Commissioner of Internal Revenue to review the decision of the United States Board of Tax Appeals sustaining a ruling of the Commissioner in assessing income tax. Affirmed. Guy Chase, of St. Paul, Minn. (Francis W. Sullivan, of Duluth, Minn., and George W. Morgan, of St. Paul, Minn., on the brief), for petitioner. H. R. Gamble, Sp. Asst. Atty. Gen. (Mabel Walker Willebrandt, Asst. Atty. Gen., C. M. Charest, General Counsel, Bureau of Internal Revenue, and John W. Fisher, Sp. Atty., Bureau of Internal Revenue, both of Washington, D. C., on the brief), for respondent. Before KENYON and VAN VALKENBURGH, Circuit Judges, and JOHN B. SANBORN, District Judge. VAN VALKENBURGH, Circuit Judge. For many years prior to January 1, 1913, petitioner was the owner in fee of an undivided 107/960ths of the Kosmerl mine, situated in St. Louis county, Minn. In 1903 petitioner and its co-owners leased the property to the Oliver Iron Mining Company for a term of 51 years, ending in 1954, for mining purposes, at a royalty of 35 cents per ton. The lease provided for certain annual minimum payments. All such minimum royalties had been paid up to December 31, 1912. January 1, 1913, the fee owners joined in a sale and conveyance of the property to the said Oliver Iron Mining Company. Under the contract between the parties it was provided that explorations should be made to determine the amount of ore on, in, or under |