to himself for 2 cents less on the dollar of the invoice than he himself bid therefor in writing, but that from the proceeds he deducted 20 per cent. thereof as a commission to himself, thus paying to his cestui que trust but $8,876. For the stock so purchased by him he charged. upon the books of the firm of H. C. Seynei & Co., in which, according to the uncontradicted evidence, he continued a secret partner, the aforesaid full amount of $11,094. The evidence further shows that during the Sunday intervening between the close of the fire sale and the following day, on which he gave the public notice that the sale in bulk of the remaining stock would be made, he took an inventory thereof, aggregating $24,653; and the evidence shows without dispute that in the evening of the day on which said bulk sale was made, at a meeting between the two partners held in the Hotel Herald in Seattle, Isaacs, with his own hand, made in writing a list of the various articles of merchandise so sold in bulk, aggregating in value $24,603.39. While it is true that he testified, as has been above set out, that he notified all the merchants he thought would be interested of the bulk sale, and enumerated the bids he said were made to him by the parties he named, such testimony is not only in direct conflict with that of a number of his employés who were in the store at the time, but is wholly inconsistent with that of the witness Bailey, an attorney at law, whose testimony, we think, bears upon its face every indication. of truthfulness. That witness testified, among other things:

"As I had been told this sale in bulk was coming off Monday morning, by Mr. Isaacs, I went down at that hour, and was there when the bids were opened. Two men whom I did not know were complaining to Mr. Seynei that they would like to have bid, had they time to examine the goods before the bids were opened, but could not do it. I do not know how many bids were in, nor what any of them called for; but a few minutes afterwards Mr. Seynei came back and told me he had got the goods, but that he knew he would all the time. Before I left the store at this time Mr. Isaacs told me that: 'We have got the goods and they are all in perfect shape. Now we will put on a sale and make plenty of money.'"

Moreover, it appears that to the very brief and unusual notice that Isaacs caused to be inserted in the Sunday edition of the Seattle Times he affixed the fictitious name "Coast Fire & Marine Insurance Co.," and deliberately testified that he did not think the advertisement "would do any good, but thought it was the proper thing to do"; whereas, it is a matter of common knowledge that notice of such sales is deemed by the commercial world as not only highly useful, but is almost always, if not universally, published, not only once, but for such reasonable time as will enable prospective purchasers both to examine the stock to be sold, as well as to attend the sale; and such is the effect of the testimony of all of the numerous witnesses upon the subject, except the defendant Isaacs.

When to all of this is added the most pregnant fact that in the advertisement he expressly stated and notified the public that the sale would not be made until 3 o'clock of the afternoon of Monday, he in fact made it to himself, through his employé, Seynei, about 11 o'clock in the morning of that day, for the consideration and under the circumstances that have been stated, we are of the opinion that it is im

possible to resist the conclusion that such sale was grossly fraudulent, and that the court below erred in dismissing the bill.

The judgment is reversed, and the case is remanded, with directions. to that court to decree the sale in bulk fraudulent and void, and to compel the defendant to the suit to account for his proceedings as trustee, with leave to the respective parties to introduce such further evidence as they may desire and as may be proper.

(254 Fed. 793)

ANDERSON v. FOREST CITY NAT. BANK OF ROCKFORD, ILL. (Circuit Court of Appeals, Seventh Circuit. December 10, 1918.)

No. 2613.

BANKRUPTCY 408(4)—RIGHT TO DISCHARGE-CONCEALMENT OF ASSETS. Failure of a bankrupt to schedule his interest in his deceased father's estate, where, after payment of a note which he owed the estate, he had no valuable interest, is not a fraudulent concealment of assets, which will defeat his right to a discharge.

Appeal from the District Court of the United States for the Western Division of the Northern District of Illinois.

In the matter of C. L. Anderson, bankrupt. From an order denying his discharge, the bankrupt appeals. Reversed.

Roy F. Hall, of Buffalo, N. Y., for appellant.

Before BAKER, MACK, and ALSCHULER, Circuit Judges.

ALSCHULER, Circuit Judge. The subject-matter of this appeal is the denial of appellant's application for discharge in bankruptcy. The ground of the denial was that the bankrupt, in fraud of his creditors, failed to schedule an interest in the estate of his father, a resident of Iowa, who had died a short time before the filing of appellant's petition in bankruptcy. It appears from the record that the father left a will in which he bequeathed a farm in Iowa, one-third to his wife and two-thirds to his three children. But it further appears that some time before his death, and after making the will he sold the farm, making no provision in the will for disposition of the proceeds in such case, whereby the proceeds of the farm, the large bulk of the estate, became intestate estate, which descended one-third to the mother and the rest to the three children equally.

The record shows that the estate of deceased consisted of a purchasemoney mortgage on this farm for about $11,000, and a note, which the bankrupt owed his father, of nearly $3,000, with interest at 6 per cent. for about nine years. Appellant testified that he did not know what his father's will contained, but assumed all along that his father had left all his property to his mother. The will, while filed in the court in Iowa some time in May, was not admitted to probate until November, which was after the petition in bankruptcy was filed. It seems that shortly thereafter the trustee in bankruptcy had a copy of the will, and that he knew of its contents, before the bankrupt says

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he found it out; but he took no steps to recover for the creditors any part of the estate of deceased. Bankrupt's mother and the county clerk in Iowa and the attorney in charge of the estate all testified that they had not informed Anderson, who resided at Rockford, Ill., of the contents of the will. One Waterman testified that before the bankruptcy Anderson had told him that he expected to build a house in Rockford with some money he would get from Iowa, and that it was his impression that Anderson said the money would come from his father's estate, but Waterman was not certain about this. Anderson said that he did say to Waterman that he would get some money from Iowa, but that he expected the money was to come from his mother, who had told him that, when she got the money, she would let him have some to build a house with.

But, apart from the evidence of appellant's knowledge or want of it upon this subject, the undisputed evidence of the actual value and extent of the bankrupt's interest in his father's estate makes it plain that, after deduction of the note he owed the father's estate, he had no valuable interest remaining which could be the subject of concealment or of fraudulent withholding from the trustee. His failure to schedule any interest in his father's estate, if in fact he had none, will not sustain the objection made to his discharge in bankruptcy.

The order of the District Court denying plaintiff's discharge is reversed, with direction for further proceedings not inconsistent herewith.

(254 Fed. 794)

UNITED STATES v. ST. JOHN.

December 21, 1918.)

(Circuit Court of Appeals, Seventh Circuit.

No. 2695.

1. BAIL 44-CRIMINAL PROSECUTION-RIGHT TO RELEASE ON BAIL PENDING PROCEEDINGS IN ERROR.

Under rule 34 of the Circuit Court of Appeals (235 Fed. xiv, 148 C. C. A. xiv) it is discretionary with the court or judge to accept bail from a defendant pending proceedings in error after conviction and sentence, although his right to bail is not the same as before conviction.

2. BAIL 49-PENDING PROCEEDINGS IN ERROR.

In cases where the granting of bail after conviction pending procevaings in error is opposed by the government, and no bill of exceptions has been settled, application should first be made to the trial judge.

3. BAIL 44-BAIL PENDING PROCEEDINGS IN ERROR.

Admission to bail denied to a defendant convicted of violation of the Espionage Law (Comp. St. 1918, §§ 10514a-10514d), pending proceedings in error.

Criminal prosecution by the United States against Vincent St. John and others. On application to a Circuit Judge by defendant St. John for bail pending proceedings in error. Denied.

Clarence Darrow, of Chicago, Ill., for plaintiff in error.

Charles F. Clyne, of Chicago, Ill., and David S. Cook, of Salt Lake City, Utah, for the United States.

For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes

EVAN A. EVANS, Circuit Judge. Defendant, together with some 100 others, was convicted on four counts of an indictment, each count charging conspiracy to violate the so-called Espionage Act (Act June 15, 1917, c. 30, 40 Stat. 231 [Comp. St. 1918, §§ 10514a-10514d]), and was sentenced to serve a term in the penitentiary. He has sought and secured a writ of error, and now seeks to be enlarged on bail pending the hearing of his writ of error by the Circuit Court of Appeals.

[1] That a judge of this court may grant bail pending the hearing on a writ of error, in a proper case, is recognized by rule 34 of this court (235 Fed. xiv, 148 C. C. A. xiv) which reads as follows:

"2. Where such writ of error is allowed in the criminal cases aforesaid, the Circuit Court or the District Court before which the accused was tried, or the District Judge of the district wherein he was tried, within his district, or the Circuit Justice assigned to this circuit, or any of the Circuit Judges within the circuit, shall have the power, after the citation has been duly served, to admit the accused to bail and to fix the amount of such bail."

While assignments of error must be filed before any writ of error is allowed (rule 11, C. C. A., 150 Fed. xxvii, 79 C. C. A. xxvii), there is no requirement that the bill of exceptions shall be settled prior to the issuance of the writ. Paragraph 2 of rule 34 contemplates the issuance of the writ of error prior to any enlargement on bail. In the present case, while assignments of error have been filed and the writ of error issued, there has been presented no transcript of the testimony and no bill of exceptions.

The government opposes defendant's motion for bail on the ground that there is no bill of exceptions from which the court can determine whether the assignments of error are well supported by the record.

An examination of the authorities warrants the conclusion that the right of the defendant to bail prior to conviction is quite different from his right after conviction and sentence. Prior to a verdict of guilty, defendant is presumed innocent. The return of the indictment against him is not even prima facie evidence of guilt. It creates no presumption against him, and he is, excepting, perhaps, in a few offenses covered by legislation, entitled to bail as a matter of right. In many states a defendant's right to bail prior to conviction is safeguarded by constitutional provisions, and, where neither statutory nor constitutional provisions are found, bail is allowed under the commonlaw rule, it being a matter of discretion with the court. In re Thomas, 39 L. R. A. (N. S.) 754, notes.

But defendant stands in a different position after conviction. In fact, in some states it has been considered necessary to enact legislation conferring power upon courts to allow bail after conviction and sentence. In the federal courts this power has been given by a rule of the Supreme Court. See United States v. Simmons (C. C.) 47 Fed. 575. In this court a similar rule (34) has been adopted.

Aside from any authorities, it must be apparent that, inasmuch as bail is allowed almost as a matter of course before conviction, largely because of the presumption of innocence which prevails in defendant's behalf, a different practice should prevail where the reason for the 166 C.C.A.-16

rule disappears. After conviction and sentence, the burden is upon the convicted party to show error in the conviction.

However, in view of the fact that bail is granted in the discretion of the court, not alone because of the existence of this presumption of innocence, courts have, with great liberality, allowed defendants to be enlarged on bail notwithstanding conviction. Considerations affecting the determination of this question are severity of the punishment, the nature of the offense of which the defendant stands convicted, the health of the prisoner, the character of the evidence, the good faith back of the assignments of error, the public welfare, the conduct of the accused after indictment and up to and including the time of his sentence, as well as many other matters.

In fact, bail has been so frequently granted after conviction that an erroneous impression has obtained with the bar that it is allowed as a matter of right. A few authorities, therefore, might well be examined. In 3 Ruling Case Law, p. 15, we find the following:

"After conviction, no constitutional right to bail exists and the granting of bail rests in the sound discretion of the court. In cases of misdemeanor this discretion is exercised freely in favor of bail, but in felonies bail is allowed with great caution, and only where the peculiar circumstances of the case render it right and proper."

In 6 Corpus Juris, p. 965, we find the following statement supported by many authorities:

"As a general rule, the conviction of the accused does not deprive the court of the power to admit him to bail pending an imposition of sentence; but its allowance continues a matter of judicial discretion until the accused is finally committed in execution; and in some jurisdictions this power is expressly regulated by constitutional or by statutory provisions. There is, however, no constitutional right to bail after conviction; and, although in cases of misdemeanor this discretionary power is exercised freely in its favor, in cases of felonies bail after conviction should be allowed with great caution and only where the extraordinary or peculiar circumstances of the case render it right and proper."

To the same effect, see 5 Cyc. 72.

In the federal courts we find the right to bail after conviction early recognized. In United States v. Simmons (C. C.) 47 Fed. 577, the court says:

"Were it not for rule 36 of the Supreme Court [32 Sup. Ct. xiii] of the United States, it might well be argued that no bail should be accepted from a person already convicted and under sentence to be imprisoned for a term of six years."

In Re Schriber, 19 Idaho, 531, 114 Pac. 29, 37 L. R. A. (N. S.) 693, the appellate court considered a situation where the trial court refused to enlarge the defendant after conviction. I quote from the opinion:

"It would certainly be disastrous if we should hold that this provision of the Constitution grants to a person convicted of crime the absolute right to be admitted to bail pending appeal, irrespective of the merits of the case. *** For some reason the judge subsequently concluded that he should no longer be admitted to bail. * We would not feel justified in interfering with the discretion of the trial judge under the facts and circumstances as they present themselves to us in this petition. We are