itor, seeking to escape the liability occasioned by the preference he has received, passes money or property over to the debtor with a view to its secretion until after the bankruptcy proceedings have terminated, or with some other wrongful purpose. It meant that the creditor should not act in such a way as to intentionally defeat the bankrupt act, but should let the debtor have the money or property for some honest purpose. Requiring that it should become a part of the debtor's estate excluded cases in which the creditor delivered the property to a third person on the credit of the debtor, or delivered it to him with instructions to pass it on to some third party. The purpose was that the property which passed from the creditor should in fact become a part of the debtor's estate, and that the credit should be only for such property. Still again, to require that the creditor should not only in good faith have extended the credit and that the money or property should have passed into and become a part of the debtor's estate, but that he should also show the actual disposition thereof made by the debtor would in many cases practically deny the creditor the benefit of a credit which he had extended in good faith. Suppose three months and a half before bankruptcy the creditor, in good faith, sells and delivers a bill of goods to the debtor, a merchant, how difficult it would be to show what had become of each particular article on that bill, or what was done with the money received for those that had been sold; and the same when, as in this case, money was delivered to the debtor. If Congress had intended to require such proof it would seem that it would have used language more definite and certain. If the creditor has acted in good faith, extended credit without security, and the money or property has actually passed into the debtor's possession, why should anything more be required? Has the creditor not been already sufficiently punished when, having received money or property in payment of a just debt, he is compelled to refund that to the trustee because he believed, or had reason to believe, that the debtor, in paying that debt, preferred him? Why should he be punished in addition by the loss of the benefit of a credit given in good faith? We are of opinion that the state court erred in its construction of the statute and in peremptorily denying to the creditor the benefit of the credit. For these reasons the judgment of the Superior Court is reversed, and the case remanded to that court for further proceedings not inconsistent with this opinion. FAYERWEATHER v. RITCH. APPEALS FROM THE CIRCUIT COURT OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK. Nos. 157, 158. Argued October 12, 13, 1904.-Decided November 28, 1904. Where the appellant's contention is that the Circuit Court, by giving unwarranted effect to a judgment of a state court and accepting that judgment, which contained no finding of one of the fundamental facts as a conclusive determination of that fact, deprived him of his property without due process of law, and that contention is made in good faith, and under the circumstances, upon reasonable grounds, the application of the Constitution is involved and this court has jurisdiction of a direct appeal from the Circuit Court. Where it appears that a question was distinctly put in issue and the parties presented, or had an opportunity to present, their evidence, and the question was decided by a court of competent jurisdiction, private right and public welfare both demand that the question so adjudicated shall, except in direct proceedings for review be considered as finally settled and conclusive upon the parties. The ordinary rule in cases tried by the court without a jury is that a judgment entered without any special findings is, like a general verdict in a jury case, tantamount to a finding in favor of the successful party of all the facts necessary to sustain the judgment. While in some cases on a plea of res judicata evidence aliunde the record is proper to show what particular questions were tried and determined in the former case, it is not competent to introduce the testimony of the trial judge as to the matters then considered and passed on by him. Where in an action in a court of competent jurisdiction the validity of certain releases is put in issue by the pleadings and no judgment can properly be rendered without determining that question, and judgment is rendered against the parties executing the releases and who were before the trial court, the judgment in effect determines that the releases are valid and the question of their validity is res judicata notwithstanding no special findings in regard thereto were made by the trial judge. THE controlling question in these cases arises on pleas of res judicata. The essential facts are as follows: On October 6, 1884, Daniel B. Fayerweather, a citizen and resident of the State of New York, made a will, by the ninth article of which he gave to twenty colleges bequests amounting in the aggregate to $2,100,000. By the tenth article he. gave the residuary estate to his executors, as trustees, directing them to divide it equally among the twenty colleges named in the ninth article. On the same day he signed the following statement: "This certifies that I have executed my will of this date, having been advised by my counsel of the provision and restrictions of the law of this State relative to benevolent corporations. I trust my heirs will permit the provision of this my will to be carried into effect." At that time by chap. 360, Laws of 1860 of the State of New York, a testator having husband, wife, child or parent was forbidden to give to literary or benevolent institutions more than one-half of his estate. On December 13, 1884, the testator made a first codicil to his will, by which he revoked the tenth article and gave the residuary of his estate absolutely to his executors. In other respects the will was ratified. At or about the same time a paper, bearing date December 11, 1884, headed "Private Memorandum," was signed by him, which reads as follows: "I have made Messrs. Bulkley and Ritch my residuary legatees in the confidence that thereby my intentions as expressed in my will shall be carried into effect, and without. litigations on the part of any person or persons interested. In case of my death I trust that they will take such steps, by will or otherwise, as will protect my estate against the contingency of the death of either before my estate is settled and distributed." By subsequent codicils minor changes were made, and Henry B. Vaughan was added as executor. The testator died on November 15, 1890, leaving a widow and three nieces, his only heirs at law and next of kin. On the day of his death he executed a codicil, which was mainly a confirmation of the provisions of the will and prior codicils. Mr. Fayerweather's estate amounted at the date of the will to about three millions of dollars, and at the time of his death to from five to six millions of dollars, mainly in personal property. While by articles in the will, prior to the ninth, he had made provision for his widow and also bequests to his three nieces, yet obviously his purpose was to give the bulk of his estate to the several colleges named, and to avoid the restraining effect of the New York statute. After the death of Mr. Fayerweather the will and codicils were propounded for probate, to which the widow and nieces filed objections. A hearing was had before the Surrogate, and on February 25, 1891, he entered an order admitting the will to probate, and leaving the contest of the codicils to continue. On February 24, 1891, the three executors, residuary legatees, made a deed of gift, which reads: "Know all men by these presents, That we, Justus L. Bulkley, Thomas G. Ritch and Henry B. Vaughan, residuary devisees and legatees under the will, meaning thereby the original will and the subsequent codicils of Daniel B. Fayerweather, late of the city of New York, deceased, prompted by our determination that we will not retain for our own use any part of the residuary estate left to us by his will, and by the desire to make such disposition of his said residuary estate as in our judgment will best honor his memory, do. dispose of so much of the same as shall remain after the payment of all lawful fees, expenses and charges as follows: "First, We reserve the power to make, and we retain the right to assent to any enlargement of the fifteen thousand dollars a year by the will left to Mrs. Fayerweather, which she may desire. "Second, We reserve the power to make, and we retain the right to assent to any enlargement of the provisions made by the will for Mrs. Mary W. Achter and Mrs. Emma S. Drury, in case we shall be satisfied that such enlargement would not be against the wishes of Mr. Fayerweather. "Third, We give to Lucy J. Beardsley, wife of Morris B. Beardsley, $100,000. "We do this because of Mr. Fayerweather's letter written to Mr. Vaughan and Mr. F. B. Myrick. If accepted, this gift is in discharge of any claim under that letter." Then, after making gifts of several sums to individuals, hospitals and colleges (some being those named in the will of Mr. Fayerweather, and others not so mentioned), the deed closes with these words: "We execute this instrument, recognizing that there is pending a contest in proceedings for the probate of Mr. Fayerweather's will, and recognizing further that if such contest shall not prevail, a question may be made about our legal rights as devisees and legatees. Our object is each for himself to give away whatever may come to us as residuary devisees and legatees under Mr. Fayerweather's will." . Subsequently, and on March 5, the executors, as residuary legatees, entered into an agreement with the contestants by which the amounts coming to them were increased, and thereupon the contestants executed the following paper: "In consideration of the instrument of even date herewich executed by Justus L. Bulkley, Thomas G. Ritch and Henry B. Vaughan, residuary devisees and legatees under the will, meaning thereby the original will and subsequent codicils of Daniel B. Fayerweather, we, the undersigned, being |