2. Adjusters of average, who took an assignment of the bottomry bond to themselves, and adjusted the business of a ship, collecting the freights, general average and insurance and making the necessary disbursements, have a right to apply the funds so collected, first, to the satisfaction of the debt due them for fees, commissions and disbursements, applying only the remainder to the bond. For the balance unpaid, they have the security of the bottomry lien.

[No. 41.]

Argued Oct. 28, 1874.

ed States for the Eastern District of Penn

sylvania.

The ship Belle of the Sea arrived at New York from Calcutta, on the 13th of October, 1867. On the voyage she encountered heavy gales, sprung a leak and was compelled to put into the Mauritius for repairs. The funds necessary to meet the ship's necessities at the Mau ritius were borrowed on bottomry; the amount of the bond in American currency being $46,805.31. The bond covered the ship, cargo and the freight. There was also a mortgage on the ship for about $25,000; and on her arrival in New York the mortgagee took possession, and together with the mortgagor, employed as agents to adjust the ship's affairs, the firm of Johnson & Higgins, the appellees.

They took an assignment of the bottomry bond. They paid the debts of the ship, cargo and freight, including seamen's wages, pilotage, port charges, etc. They also collected the sums due the ship on account of freight, insurance, general average, etc. But the amount collected by them lacked $6,409.82 of being sufficient to pay the amounts expended in paying said debts and in buying said bottomry bond. The ship having been sold, the appellees filed the libel in the District Court of the United States for the Eastern District of Pennsylvania in this case against her, to recover the said sum of $6,409.82, as an unpaid balance due upon the bottomry bond. The appellants, as purchasers of the ship, intervened and alleged that the said bottomry bond had been paid; that all moneys collected by the libelants in behalf of the ship were, by the terms of the agreement, to be applied first of all to extinguish the said bond, and that the claim of the libelants was only for a balance of account for the payment of other charges, which constituted no lien on the ship. A decree having been entered in favor of the libelants, and affirmed on appeal by the circuit court, the respondents took an appeal to this court.

The case is further stated by the court. Mr. Henry Flanders, for appellants: Mr. Higgins, himself, admits that his firm was employed to take up the bottomry bond, and not to continue it as an existing lien on the ship. His testimony is as follows: "Our firm were employed to take up the bottomry bond on the ship Belle of the Sea, and to adjust the affairs of said ship on her arrival in New York in October, 1867. The mortgagee stated to us 'that he wanted to place the whole business in our hands, to have the bottomry bond taken up, and the business of the vessel generally attended to on arrival.' * * * We agreed with him to transact the business, to take up the bond, and divide one half the commissions that could be earned in the case."

for fees and commissions, or for any disbursements made in New York.

If there were any other items in the present claim besides fees and commissions, they are not liens upon the vessel. On the doctrine of Minturn v. Maynard, 17 How., 477 (58 U. S., XV., 235), the libelants, as agents, must proceed in assumpsit against their principals. In admiralty they have no remedy, either in personam or in rem.

Mr. Samuel C. Perkins, for appellees: There can be no question but that, upon the arrival of the ship in New York, there was a lien in favor of the bottomry creditor against the ship; nor that the holders by indorsement, in the absence of any special circumstances of exception, were entitled to enforce the bond in their own name and to all the benefit of the lien.

The Rebecca, 5 C. Rob. Adm., 102; The Prince of Saxe Coburg, 3 Hagg. Adm., 387; S. C. as Soares v. Rahn, 3 Moore (P. C.), 1; The 08manli, 3 Wm. Rob., 198; The Mary Ann, 4 Notes of Cas., 379.

Prima facie, therefore, libelants, as holders of the bond by indorsement, were entitled to enforce it against the ship.

Conceding, for the purposes of the present argument only, that there was no lien against the ship for the disbursements on her account in New York, libelants are to be considered as the holders of two classes of claims, one secured and the other unsecured.

There is no evidence of any specific appropriation by either or any of the parties, of the moneys paid to and received by libelants on account of the ship, and the law, consequently, steps in and applies these payments in the manner most beneficial to the creditor, that is, first to the unsecured claims, and then whatever may remain is applied on account of the secured claims.

Smith v. Brooke, 49 Pa., 147; Pierce v. Sweet, 33 Pa., 157; 2 Pars. Cont., 629, and authorities there cited; Field v. Holland, 6 Cranch, 8; Stamford Bank v. Benedict, 15 Conn., 437.

The libelants further contend that their undertaking in respect of the ship and her business, was a maritime contract, having reference to maritime transactions, or, as put by the learned judge of the district court, their "whole demand, though (as regards the disbursements) an ulterior, is not too remote a consequence of a maritime necessity," and thus within the jurisdiction of admiralty.

Ins. Co. v. Dunham, 11 Wall., 1 (78 U. S., XX., 90) and authorities cited; The Belfast, 7 Wall., 624 (74 U. S., XIX., 266); The Kalorama and The Custer, 10 Wall., 204 (77 U. S., XIX., 941-945).

In the case of Minturn v. Maynard, 17 How.

Justice Marshall says: "It is a general rule that what cannot be done directly, from defect of power, cannot be done indirectly."

Has the State, then, any power to say that foreign corporations shall stipulate away the provisions of an Act of Congress, giving a right of removal into the Federal Courts?

The broad proposition must be asserted and maintained, that the State has the power to impose upon foreign corporations just such conditions as it pleases, or there must be a well defined limit to the power. We think there is a limit. The Constitution and laws of the United States fix the limit. They are the supreme law. LaFayette Ins. Co. v. French, 18 How., 407 (59 U. S., XV., 452); Ducat v. City of Chicago, 10 Wall., 410 (77 U. S., XIX., 972).

In the language of Judge Grier in Marshall v. Balt. & O. R. R. Co., 16 How ., 329, "The right of choosing an impartial tribunal is a privilege of no small practical importance.

In Nute v. Hamilton Ins. Co., 72 Mass., 174, a by-law of the company contained a provision that any suit to recover for any loss might be brought at a proper court, in the County of Essex. The action was brought in the County of Suffolk. The agreement was set up as a defense, and it was insisted that by force of the agreement the action should have been commenced in Essex County. The opinion of Chief Justice Shaw is quite lengthy. He concludes as follows: "There being no authority upon which to determine the case, it must be decided | upon principle. The question is not without difficulty, but upon the best consideration the court have been able to give it, they are of opinion that it is not a good defense to this action, that it was brought in the County of Suffolk and not in the County of Essex, and, therefore, that the exception must be sustained," etc.

In Amesbury v. Bowditch M. F. Ins. Co., 72 Mass., 596, the same rule was laid down; and in Cobb v. N. Eng. M. Ins. Co., 72 Mass., 192, is this language: "It is a well settled maxim, that parties cannot, by their covenant, give jurisdiction to courts where the law has not given it; and it seems to follow from the same course of reasoning, that parties cannot take away jurisdiction where the law has given it. The court are, therefore, of the opinion that the stipulation in one of the conditions of the policy, that in case of loss no action shall be brought upon it except in the County of Worcester, is no legal bar to an action in this county, where by law the action might be brought, if no such combination had been made."

In Hobbs v. Manhattan Ins. Co., 56 Me., 421, Chief Justice Appleton says: "Parties cannot, by any agreements, confer jurisdiction where it is not given by an Act of Congress. When so given, they cannot oust the courts of the United States of the jurisdiction conferred upon them." In Stephenson v. P. F. & M. Ins. Co., 54 Me., 70, the court says: 'Such stipulations are repugnant to the rest of the contract, and assume to devest courts of their established jurisdictions. As conditions precedent to an appeal to the courts, they are void."

The same principle runs through that long line of decisions which hold as invalid, agreements to leave all matters in dispute to arbitrators, when offered as a bar to a prosecution of suits in court.

Allegre v. Maryland Ins. Co., 6 Harr. & J., 408; Randel v. C. & D. Can. Co., 1 Harr. (Del.), 234; Gray v. Wilson, 4 Watts, 39; Ross v. Nesbit, 2 Gilm., 252; Haggart v. Morgan, 4 Sandf., 198; Scott v. Avery, 5 H. of L. Cas., 811; Scott v. Corporation, etc., 60 Eng. Ch., 334; Canner v. Drake, 1 Ohio St., 166.

There are cases where parties have sought, by so-called contracts, to set aside exemptions allowed by law. Of such a character are the cases of Maxwell v. Reed, 7 Wis., 493; and Crawford v. Lockwood, 9 How. Pr., 547, cited with approval in Shapley v. Abbott, 42 N. Y., 443. The cases of Davis v. Packard, 6 Pet., 41; S. C., 7 Pet., 284, and Dudley v. Mayhew, 3 N. Y., 1, will illustrate this point.

The latter was a case where the parties have expressly agreed that they would not raise the the question of jurisdiction. The case was dismissed, notwithstanding the agreement.

This so-called agreement, if the defendants in error had been parties to it, is not a waiver or an estoppel. This question is well answered by Justice Selden, in Crawford v. Lockwood, 9 How. Pr., 548. "A waiver is not, and bears no analogy to, a contract. The distinguishing feature of a contract is its mutuality, its quid pro quo, or consideration. But no consideration is necessary to support a waiver. It is, in this respect, like a gift, to which, indeed, it bears in many respects a close analogy. Gifts can only be made to take effect in præsenti. Blackstone says: A true and proper gift is always accompanied with delivery of possession, and takes effect immediately."" 2 Bl. Com.,441.

Of course, then, a gift must be of something in esse at the time. There are three things essential to every gift: a donor, a donee and a thing given. Dyer, 244.

Nothing short of the execution of the intent to give, can make a valid gift. 2 Bl. Com., 441; Pearson v. Pearson, 7 Johns., 26.

The parallel in this respect between a waiver and a gift seem to me to be close, if not perfect. To waive, no less than to give, implies a present act. If I say I waive some right which I may have next week, this can mean nothing more than that, when the time arrives, I will not insist upon the right.

There is another analogy which tends with equal force to the same conclusion. By the common law a release can operate only upon a vested, and not upon a contingent right. A release of a possibility is void. For instance, an heir at law cannot release to his father's disseisor, because his heirship, and consequently the right released, is contingent.

Co. Litt., 265, a; Lampet's case, 10 Coke, 51. "So if a conusee of a statute release to the conusor all his right to the land, he may nevertheless sue out execution, because he has only a possibility, but no vested right to the land.” Co. Litt., 265, a; Barrow v. Gray, Cro. Eliz., 552.

"Now, a release and waiver are alike in this: when valid, each operates to extinguish a right." "A right not yet in being, but which depends upon a contingency, cannot be the subject of a waiver."

"The defendant, however, seeks to apply the principle of estoppel in pais to the case, and claims that the plaintiff should be precluded from setting up and seeking to enforce a right

which he has agreed, upon sufficient consideration, to relinquish.

"But estoppel in pais is a rule of evidence, and not a mode of enforcing contracts."

"An admission by a person as to the law, or as to the legal effect of his contract, is never held to estop him."

Polk's Lessee v. Robertson, 1 Overton (Tenn.), 463; Boston Hat Company v. Messinger, 19 Mass., 223.

"It is also necessary that the fact should be one of which the party claiming the benefit of the estoppel was ignorant. The basis of an estoppel in pais is fraud.'

"But there must have been a confidence reposed which would be betrayed to the injury of one party, if the other is permitted to retract his admission or denial."

Messrs. John W. Cary and G. Bouck, for defendants in error:

That corporations created by the laws of one State have not the absolute right to recognition and to do business in another State, is not open for argument; the question has been adjudicated by this court.

Bank of Augusta v. Earle, 13 Pet., 519; Paul v. Virginia, 8 Wall., 168 (75 U. S., XIX., 357), and cases there cited; People v. Murray, 5 Hill, 468.

Even if the state law is unconstitutional, the defendant cannot repudiate the same. There is no question but that the State can prohibit these foreign companies from doing business in this State, or impose such conditions as it sees fit. Paul v. Virginia (supra).

It is well settled that a party cannot be al lowed to claim under and at the same time repudiate, etc.

Burrows v. Bashford, 22 Wis., 103; People v. Murray, 5 Hill, 468; Van Allen v. The Assessors, 3 Wall., 573 (70 U. S., XVIII., 229); Dunmore's Appeal, 52 Pa. St., 374.

The Legislature was granting a favor. It could impose its own restrictions; it matters not how much those conditions may conflict with the legal or constitutional rights of these companies.

also the case of The Glens Falls Ins. Co. v. Judge of Jackson Circuit, 21 Mich., 580, which is a case analogous to this, and where the question was directly raised.

Mr. Justice Hunt delivered the opinion of the court:

This action was commenced in the Circuit Court of Winnebago County, Wisconsin, to recover the amount alleged to be due upon a policy of insurance issued by the plaintiffs in error to the defendants in error, upon the steamboat Diamond. The Home Insurance Company is a Corporation organized under the laws of the State of New York, and having its office and principal place of business in the City of New York.

The Company entered its appearance in the Winnebago County suit, and filed its petition to remove the cause to the United States Circuit Court for the Eastern District of Wisconsin. The petition was in the form required by the 12th section of the Act of 1789, and was accompanied by a bond with sufficient bail, as required by that Act.

The Circuit Court of Winnebago County refused to grant the prayer for removal, but proceeded to the trial of the cause. A verdict was rendered against the Company, judgment en tered thereon, and upon an appeal to the Supreme Court of Wisconsin the same was affirmed. The Insurance Company now bring a writ of error to this court.

The case of The Montello was argued at the same time with the present, both cases, as it was understood, involving the question whether the Fox River was a navigable water of the United States. The decision of the question is not essential to the judgment to be rendered in the present case.

The refusal of the State Court of Wisconsin to allow the removal of the case into the United States Circuit Court of Wisconsin, and its justification under the agreement of the Company and the Statute of Wisconsin, form the subject of consideration in the present suit.

risks or transact any business of insurance in this State, unless possessed of the amount of actual capital required of similar corporations to transact any such business as aforesaid, by any agent or agents, in this State, it shall first appoint an attorney in this State, on whom process of law can be served, containing an agreement that such company will not remove the suit for trial into the United States Circuit Court or Federal Courts, and file in the office of the Secretary of State a written instrument duly signed and sealed, certifying such appointment, which shall continue until another attorney shall be substituted.'

Laws of 1870, ch. 5, sec. 56, p. 87, or 1 Tayl. Stat., p. 958, sec. 22.

Desiring to do business in the State of Wisconsin, and in compliance with the provisions of this statute, the Home Insurance Company, of New York, on the first day of July, 1870,