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2 F.(2d) 88

guaranteed against seller's own decline until January 1, 1921," and containing a provision that "seller reserves the right to substitute a larger percentage of 30/40's (the number of prunes to a pound) to 70/80's for smaller sizes," are unenforceable, upon the ground that they lack mutuality or consideration, or that they are within the statutes of fraud of New York or California. [1] Standing alone, and without reference to any other communications or transaction between the parties, subsequent to May 26, 1920, the agreements appear somewhat indefinite as to price, and as to the substitution of one grade of fruit for another. And, at first blush, it might also appear that plaintiff was under no obligation to fix opening prices.

But whatever may be the apparent shortcomings of the documents of May 26, 1920, the least that properly can be said of them is that, when plaintiff's opening prices were made and communicated to defendant, they constituted an offer by plaintiff to defendant to sell specified quantities of prunes at the prices named. Even though no contract binding upon the defendant had yet come into existence, it was then within the power of defendant to assent to the prices and to accept plaintiff's offer. Under the pleadings as they stand, it would appear that such assent was given and the prices accepted.

On August 11, 1920, plaintiff advised defendant of its opening prices upon the various grades of prunes mentioned in the agreements. At the same time notice was given that such prices would apply to the several agreements of May 26, 1920. Thereafter defendant accepted and paid for five carloads of the fruit at the prices so fixed. While it may be that the agreements of May 26, 1920, if binding at all, are to be regarded as separate contracts (although, from all the facts, this is not entirely a closed question), and that the performance of one or more of them is not to be deemed a partial performance of the others, it does not follow that an assent to the prices named is to be limited to such carloads of fruit as were actually accepted and paid for. The several agreements were substantially the same; their chief point of difference being the time at which various carloads of fruit should be shipped. Under such circumstances, a manifestation of assent to and acceptance of the prices as to a portion of the agreements should be held, I think, as an assent to and acceptance of the prices ap

plicable to all. Such conclusion is not unwarranted when notice is taken of the correspondence passing between the parties.

In September, 1920, a dispute seems to have arisen as to the time of shipment of some of the fruit, and upon the 22d of that month defendant wired plaintiff as follows: "Telegram received. We do not ask early September shipment. Look at contract again."

Upon the same day a reply was dispatched by plaintiff, which reads: "Your contract calls for September shipment and we shipped accordingly. Very sorry but must insist that our draft be taken up as we have lived up to the terms of our contract."

In acknowledging receipt of this telegram, the defendant added: "We stand on contract Sept. shipment. We pay no premiums.

Rumor that prices have been reduced. Is this correct?"

On the 24th of September, plaintiff answered the wire just quoted in these words: "Rumor that prices are reduced absolutely incorrect. Very sorry that you are taking the attitude indicated your wire as will have to stand on our contract terms."

Six days later defendant wrote the following letter to plaintiff: "We acknowledge receipt of your telegram and note that you have not as yet reduced your price on prunes, and also note your remarks that you will stand by your contract terms. Our contract calls specifically for September shipment, and nothing is stated as to the first or second half of September. Consequently there is no premium in the matter of making shipment during the month of September. We await your advices."

Nothing further seems to have transpired until October 19th, when defendant sent this wire: "Make no further shipments. Await our letter."

Two days later, after the receipt of a communication from plaintiff, professing not to understand defendant's telegram of the 19th, and calling attention to the readiness to forward 'certain October shipments, the defendant sent the following message: "Telegram received. We consider you fortunate in having received payment for five cars prunes. We absolutely decline to accept any further shipments for the reason that we consider the contract inequitable the spirit of mutuality absolutely lacking. We think you did not take into consideration world conditions nor crop conditions when making opening prices. When you will make prices in keeping with world and crop

conditions and eliminate the favoritism which you have shown we shall then be very glad to hear from you in the hope that we may find an amicable way of settling the matter." Other communications containing suggestions of suit, and telling of the positions being assumed by the respective parties, passed to and fro between them. Upon the 26th of October defendant said: "We have asked for a revision of prices and not extension of time or shipment. We are ready to pay drafts just as soon as you will meet our views."

Thereafter, upon November 4 and November 9, 1920, defendant, in offering excuses for the nonpayment of drafts presented by local banking institutions, gave this explanation: "It is not a matter of repudiation of contract, nor cancellation of order, but we have determined that no payment of drafts which are drawn by the California Prune & Apricot Growers, Inc., will be paid until the matter under discussion shall have been reasonably and fairly settled."

All of the foregoing indicates with reasonable clearness that defendant received and assented to plaintiff's opening prices-that it was willing to and did accept the samethus removing the indefiniteness of the contract. Dissatisfaction was asserted and used as an excuse to breach the contracts, when falling markets made it desirable for a revision of prices to be obtained.

In my opinion, defendant had gone too far to retract from its bargain with the plaintiff. When the market prices of prunes declined, the party standing to lose therefrom should not lightly be permitted to withdraw from a bargain which it desired to have, and with which it was satisfied, so long as performance upon its part was advantageous.

[2] Coming to the reservation by the plaintiff of the right to substitute a larger percentage of 30/40's to 70/80's for the smaller sizes of prunes, it is my belief that this affords no cause for holding the contracts unenforceable. The provision was inserted, I assume, for the benefit of the seller, so as to enable it to dispose of its larger-sized prunes, in case such sizes predominated in the prune crop for 1920.

In construing contracts in which persons seek to cover the contingencies and uncertainties of crops that are yet to mature, provisions reasonably adapted to that end should not be made futile and meaningless because they may contain some element of the "will, wish, or want" of one of the par

ties. Into each such stipulation the law will inject the requirement of good faith and fair dealing. Better is it that there should be some indefiniteness and uncertainty in contracts such as these than that the growers of commodities, and, the merchants who deal in them, should be told that, unless they are able accurately to foretell what nature holds in store, they cannot safely make contracts which will in some degree be dependent upon future events.

As for the defenses based upon the statutes of fraud, it seems reasonably clear that in this case there were sufficient writings to take the contracts from without the statutes.

Defendant's motion for judgment upon the pleadings is denied.

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UNITED STATES ex rel. LISAFELD v. SMITH, Immigration Inspector, et al.

(District Court, W. D. New York. August 26, 1924.) No. 2576.

1. Aliens 40-Congress has power to order deportation of undesirable aliens.

Congress has preliminary power to order the deportation of undesirable aliens domiciled in the United States, and to fix the standard for determining who are within that class. 2. Aliens 54-Grounds for review of deportation proceedings.

If proceedings for deportation before the Department of Labor or its subordinate offiin observance of the material elements of due cers are shown to have been unfair or lacking process of law, or if errors of law were committed, they are reviewable by the courts by writ of habeas corpus.

3. Aliens 53-Member of Communist party held subject to deportation.

An alien, who admits his membership in the Communist party and his belief in its principles, must be held to believe in and advocate the overthrow by force or violence of the government of the United States, in accordance forth in its manifesto and constitution, and is with the avowed purposes of that party as set subject to deportation under Act Oct. 16, 1918, § 1, as amended by Act June 5, 1920 (Comp. St. Ann. Supp. 1923, § 42891⁄4b[1]).

4. Allens 54-Deportation of alien; "country whence he came."

The provision of the immigration statutes, requiring that a deported alien be returned "to the country whence he came," means the country of his nativity or citizenship, and where his native place has, since the issuance of a warrant for his deportation, from causes due to the war, been included within the territory of a new or different country, the warrant may be corrected accordingly.

[Ed. Note. For other definitions, see Words and Phrases, First and Second Series, Country Whence He Came.]

2 F.(2d) 90,

5. Allens 54-Circumstances may excuse delay in execution of order of deportation.

While an order of deportation must be ex

the organization. He frequently attended lectures and was familiar with the programs

ecuted within a reasonable time, it is not void and manifestoes of the Communist party.

because of delay caused by unsettled conditions in Europe, due to the World War.

Habeas Corpus. Petition by the United States, on relation of Stephen Lisafeld, against Shirley D. Smith, Immigration Inspector in Charge at Buffalo, N. Y., and others, for writ of habeas corpus. Denied.

Irving M. Weiss, of Buffalo, N. Y. (Eustace Reynolds, of Buffalo, N. Y., of counsel), for petitioner.

He was asked whether he was in accord with the teachings and beliefs of its manifestoes and constitution, and replied that he was.

It is evident from his direct examination that he was a believer in the declarations and purposes of the Communist party of America, and therefore it may be presumed that the acceptance of its announced methods of revolutionary massed action to accomplish the desired result was understood by him. No other conclusion can in fairness

Leland G. Davis, Asst. U. S. Atty., of be reached, notwithstanding his denial on Buffalo, N. Y., for respondents.

HAZEL, District Judge. [1,2] It is firmly established that Congress has preliminary power to order the deportation of undesirable aliens domiciled in the United States. It has the power, for example, to direct the deportation of any alien who be lieves in or advocates the overthrow by force or violence of the government of the United States, or of all forms of law, or any aliens who disbelieve in, or who are opposed to, all organized government. Act Cong. Oct. 16, 1918, as amended June 5, 1920 (Comp. St. Ann. Supp. 1923, § 42891⁄4b[1]); Lauria v. U. S. (C. C. A.) 271 Fed. 261. And the Department of Labor is specifically required to perform the duties imposed in that particular. If, however, a proceeding pending before it, or before a subordinate officer thereof, is shown to be unfair or lacking in due observance of the material elements of due process of law, or if errors of law were committed in the deportation of an alien, the federal courts are empowered by writ of habeas corpus to inquire into any asserted unlawful detention.

[3] The record of the proceeding of the government against the relator before the Secretary of Labor is before me, and it appears that there was evidence to support the finding and conclusions that the relator was a native of Klopodia, located in Hungary (now Jugo-Slavia), and entered the United States in 1912. He voluntarily admitted, in answer to questions propounded to him by the inspector, that he had joined the Communist party at Buffalo and had made small contributions thereto in the way of dues; his application of membership having been made July 28, 1919. At the time of his arrest he had a membership card showing that he was connected with the central branch of

cross-examination that he did not believe in the overthrow of the government by force or violence to carry out the teachings of the manifestoes of the Communist party. The facts have been determined against him by the Secretary of Labor, and his decision must be regarded as final by this court. A fair and impartial summary hearing was accorded him, and he was represented by counsel. The declarations and manifestoes of the Cummunist party, showing its object and purpose, are, in view of his own testimony, binding upon him, and are within the contemplation of the act. Skeffington v. Katzeff (C. C. A.) 277 Fed. 129; Antolish v. Paul (C. C. A.) 283 Fed. 957. His declared adherence to the principles of the Communist party and his asserted belief in its teachings show conclusively that he is an undesirable alien and subject to deportation.

[4] On this hearing it is urged in his behalf that the warrant of deportation was and is a nullity, in that it fails to comply with the provisions of the statute with relation to his removal to the country from whence he came. The original warrant directed that he be returned to Hungary, and the government 'now, as appears by the warrant dated September 13, 1924, seeks to deport him to his home in Jugo-Slavia. The statute (section 20, Act Feb. 5, 1917 [Comp. St. Ann. Supp. 1923, § 42894k]) requires the deportation of an alien, at the option of the Secretary of Labor, to the country whence he came, or to the foreign port at which he embarked for this country. It is not enough to merely direct return to the country "from whence he came." Such a direction, without naming the particular place, would be too indefinite, and would not be a fair compliance with the deportation provision. Ex parte Callow (D. C.) 240 Fed. 212.

In re LENOX.

1924.)

No. 8054.

1. Bankruptcy 353-Surplus after payment in full of all allowed claims to be disposed of on equitable principles.

Insolvency is the basis of the whole proceeding under Bankruptcy Act (Comp. St. $8 9585-9656), and equitable distribution of the insolvent's property among his creditors, is the end and purpose of the law, which makes no provision for the disposition of a surplus rein, and such disposition must be governed by maining after all claims proved have been paid principles of equity.

The relator admittedly could not be deported to Jugo-Slavia under the original (District Court, W. D. Pennsylvania. June 26, warrant of direction of return to Hungary, but the intention of Congress in the use of the phrase "return to the country from whence he came" unquestionably requires his deportation to the country of his nativity or citizenship. It was so held in Frick v. Lewis, 195 Fed. 693, 115 C. C. A. 493. His native place or commune is Klopodia, in the township of Verseez, county of Temesvar, Hungary, and since the issuance of the original warrant the boundary lines of Hungary, owing to the vicissitudes of war and actions of the Peace Conference at Paris, have been altered, first becoming a part of Roumania, and later of the kingdom of Jugo-Slavia, which now includes within its territory the particular native place of the relator. The new warrant of deportation issued since the hearing before me directs his return thereto, and Jugo-Slavia has issued the necessary passport. It was proper to correct the original warrant, or to issue another in its place, to effectuate the conclusion of the Secretary of Labor. Ex parte Yabucanin (D. C.) 199 Fed. 365; Ex parte Callow, supra.

[5] It was also contended by the relator that the original warrant was void because of delay. It is, of course, intended and required that the decree of deportation be executed within a reasonable time, a term that obviously varies with the circumstances. Judicial notice is taken of the World War and, moreover, that for some time after the Armistice, opportunities for traveling in the war-stricken countries were limited. Procurement of necessary passports was difficult, especially from countries whose boundary lines were in dispute. Owing to the conditions, no passport to execute the original warrant could be obtained. Both Hungary and Roumania refused to receive the relator owing to their uncertainty as to whether they had jurisdiction over the native place of the relator; but finally Klopodia was included in the territory of Jugo-Slavia and a passport promptly issued on request of the United States government. Aside from this, the relator himself moved for rehearing, which was granted after the original warrant issued, and then again, until the case of Skeffington v. Katzeff, supra, was decided. I find there was no dilatoriness on the part of this government to void the warrant.

The writ of habeas corpus is dismissed, and the relator remanded to custody under the executive warrant for his deportation to Jugo-Slavia.

2. Bankruptcy 328, 353-Provision as to time for proof of claims is for benefit of creditors, not of bankrupt; creditor failing to prove claim within a year held entitled to payment from surplus after all proved claims are paid.

The provision of Bankruptcy Act, § 57n (Comp. St. § 9641), that claims shall not be proved subsequent to one year after adjudication is for the benefit of creditors, and not of the bankrupt, and where a fund remains in the hands of the trustee after payment of all proved claims in full, a creditor whose debt was scheduled, but not proved, within the year, is entitled in equity to payment from such fund.

In Bankruptcy. In the Matter of James Lenox, bankrupt. On review of order of referee disallowing claim of one Strawn, receiver of the First National Bank of Uniontown. Reversed, with directions.

Sterling, Higbee & Matthews, of Uniontown, Pa., for claimant.

Elias Goodstein, of Uniontown, Pa., for bankrupt.

THOMSON, District Judge. The following question is before the court on the certificate of the referee: Was the referee right in disallowing a claim filed by a creditor whose debt was scheduled, after the expiration of one year, as between the claimant and the bankrupt, there remaining in the hands of the trustee an undistributed fund after the payment in full of all proved claims, including interest to the date of payment and the cost of administration, and was the referee right in awarding the said fund to the bankrupt, instead of the creditors whose debts were scheduled, but not proved, within the year?

James Lenox filed a voluntary petition in bankruptcy and was adjudged a bankrupt. He had land in Pennsylvania, which was sold, but for an amount insufficient to pay the lien of the First National Bank of Uniontown. Afterwards certain coal lands in West Virginia were sold so advantageously that a considerable fund remained after the payment of a deed of trust thereon. This

2 F.(2d) 92

fund remained for distribution. For some reason not appearing of record, Strawn, the receiver of the First National Bank of Uniontown, as well as two or three other small creditors, did not prove their claims within the year. At the hearing fixed for final distribution, Strawn, the receiver, offered proof of his claim on behalf of the bank, limiting the amount claimed thereunder to the surplus that might remain after the payment in full, including interest, of the claims proven within the year. Afterwards he filed his petition, reciting these facts, representing that the fund remaining in the hands of the trustee was a trust fund to be distributed on equitable principles, and praying that distribution thereof be made according to equity, and that he be awarded all or such part of the fund as was just and equitable. The bankrupt alone objected and claimed the fund. The referee disallowed the proof of claim, dismissed the petition, and awarded the fund, less the expenses of the proceeding, to Lenox, the bankrupt. The correctness of this order of the referee is the question certified, which is purely a question of law.

[1] The Bankrupt Law (Comp. St. §§ 9585-9656) and all machinery for carrying it into effect is predicated on insolvency. As defined in the act, a person is insolvent when the aggregate of his property shall not at a fair valuation be sufficient in amount to pay his debts. Insolvency is a jurisdictional fact, upon which every proeeeding in bankruptcy must be based. In a voluntary petition, the bankrupt must make oath of his inability to pay his debts in full, and his willingness to surrender all his property for the benefit of his creditors, except such as is exempt by law. Adjudication follows only on the finding by the court of such fact. In involuntary proceedings, if the alleged bankrupt denies insolvency, the petition will be dismissed on the finding of this fact. In other words, insolvency, inability to pay his debts in full, is the basis of the whole proceeding, and the act of Congress in all its provisions has reference to that situation. The equitable distribution of all the insolvent's property among his creditors is the end and purpose of the law. The act did not contemplate, and therefore did not provide for the disposition of, a balance in the hands of the trustee after the payment of creditors in full. In such a situation, where in fact all the creditors are paid in full, every principle of equity would require the payment of such balance

to the bankrupt, not because of any provision in the Bankruptcy Act, but because equity would clearly demand it.

[2] To effect the object which the law has in view, the equitable distribution of all the bankrupt's property among his creditors, to make creditors diligent, and to accomplish promptly the liquidation of the estate, it was provided in section 57n (Comp. St. § 9641) that "claims shall not be proved against a bankrupt estate subsequent to one year after the adjudication." This is a provision for the benefit of creditors, not for the benefit of the bankrupt. Against all provable claims, the bankrupt is protected by his discharge. The bankrupt's property belongs to his creditors, and not to himself. It has passed from him to the trustee, for the payment of his creditors. As among them, it is a matter of indifference to him how distribution is made. If one of them loses his right to participate in the common fund by failure to make proof within the period prescribed, it does not concern the bankrupt.

In the present case, the provisions of the Bankruptcy Act have been complied with, and those who complied with all its provisions have been paid in full. But the fact remains that the petitioner who had reduced his claim to judgment, the existence and validity of which the bankrupt recognized in his schedules and does not now deny, has received nothing. A fund remains in the hands of the trustee. Neither the bankrupt nor the creditor can claim the fund under the provisions of the Bankruptcy Act, but both have come into a court of equity asking for the fund, which must be awarded to him who has the superior equity. Shall the bankrupt be permitted to set up in this equitable contest, a provision of the Bankruptcy Act which would have barred the claimant, were distribution being made under the provisions of the act? Shall the bankrupt be heard to insist that his situation is the same as though the claim had never existed, or, if existing, had been paid? I think not. Distribution is not being made under the provisions of the Bankruptcy Act, and therefore no provision of that act is applicable.

The conclusion reached is in harmony with the general views expressed by Judge Lowell in Re Lane (D. C.) 125 F. 772. Jt is also consistent with the views of Judge Hand in Re Atlantic Const. Co. (D. C.) 228 F. 571, wherein the learned Judge held: "Section 57n does not apply to compositions, and, where an offer of a composition

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