that, when he went to consult Mr. Pentz, Marymont went with him and said something to Mr. Pentz, which he (Lyons) did not hear, and that Mr. Pentz thereupon told him to accept the checks and surrender the notes. Redmond testified that Simon came in with Marymont and presented a check for the payment of the principal of the notes, and later a check for the interest, and that Marymont seemed impatient for the delivery of the notes. "I explained that I would give them to him in a few seconds; something to that effect. I sent one of the boys around to look up the balance of the account, and he was gone some time. This gentleman got a little more impatient, and he said, 'I want the notes; I want the notes; you do what I tell you.' And in the meantime this party came back that looked up the balance, and reported that there was a credit sufficient to pay for the balance of the notes, and he also reported that there was a check on Oakland for $6,000, and under the conditions I could not surrender the notes, because the deposit was made up of uncollected checks; so I referred him to Mr. Lyons, the head of the department, and he went to Mr. Pentz. Q. Do you remember this gentlemen telling you the gentleman who was with Redmond-to take the checks and say nothing about it? A. I do not remember that last part of it, 'say nothing about it.' He said, "Take it, take it."" It was further shown that the checks so presented were not sufficient in amount to meet the principal and interest on the notes, and that the deficiency was $205. The evidence does not justify the conclusion as a matter of law that the deposit of the checks was a bank deposit in the usual tourse of business. There was evidence to indicate that the bank itself did not so regard it, and that uncollected checks were not considered as cash on which a note of the bank might be surrendered. The bankrupts' business had ceased in December, 1922. Bert Simon had left the firm and had gone to work elsewhere. The firm was making no substantial deposits with the bank. None was made in the month of March, 1923, prior to March 5. The deposit of checks on that date was obviously made for the purpose of paying the bankrupts' notes to the bank. It was in effect a transfer of the checks for that purpose. It was parting with so much of the bankrupts' assets to pay one of their debts, and it operated to diminish by that much the bankrupts' estate. The circumstances under which the deposit was made, the actions of one of the bankrupts, and the words of the man who ac companied him were sufficient to inform the officers of the bank that the transaction was out of the usual course of business. We find nothing in the cases cited by the plaintiff in error, such as Studley v. Boylston National Bank, 229 U. S. 523, 33 S. Ct. 806, 57 L. Ed. 1313, to sustain its contention that the right of set-off exists under the facts presented in the present case. Those cases go no farther than to hold that the Bankruptcy Law recognizes the right of set-off of mutual accounts between a bank and a depositor, and does not deprive the bank of the rights of any other creditor taking money without reasonable cause to believe that a preference will result. But here there were no mutual accounts. There was but a payment of a note to the bank, under circumstances which, if the bank had knowledge of the bankrupts' insolvency, made the payment preferential. Traders' Bank v. Campbell, 14 Wall. 87, 97, 20 L. Ed. 832; In re National Lumber Co., 212 F. 928, 129 C. C. A. 448; In re Fairburn Oil & Fertilizer Co. (D. C.) 240 F. 835; First Nat. Bank v. Harper, 254 F. 641, 166 C. C. A. 139; Merrimack Nat. Bank v. Bailey (C. C. A.) 289 F. 468. The evidence that the bank knew on March 5, 1923, that the bankrupts were insolvent is circumstantial and somewhat meager. There is testimony that in 1922 there were frequent conferences between the bank and the bankrupts concerning the latter's financial condition. But at that time the bankrupts were not insolvent. There is no evidence that they were insolvent prior to June, 1922. On December 31, 1922, their books showed a deficit of $58,000. By February 28, 1923, their assets had shrunk to $5,494, consisting of fixtures and broken parts of stock. At that time the bankrupts owed about $82,000 to about 100 creditors. The trial court, in charging the jury, said: “A creditor has reasonable cause to believe a debtor insolvent when such a state of facts is brought to the creditor's notice respecting the affairs and pecuniary condition of the debtor as will lead a prudent business person-a prudent banker in this case to conclude that the debtor is insolvent. And when you come to ask what a reasonably prudent and intelligent person ought to have known under the circumstances, you take into consideration an average prudent banker. They have special training, special knowledge, and perhaps would have a little more understanding of the inferences to be drawn from the circumstances of debtors than a mere ordinary 8 F.(2d) 5 layman, who has no knowledge of the busi- 2. Shipping 142-Carrier, answering claim The evidence that the bank had actual notice of facts from which insolvency was inferable consists in what was said and done at the bank on March 5, 1923. One of the bankrupts deposited with the bank four checks drawn on other banks, the total amount of which, together with the $5.74, the balance then on deposit to the credit of the bankrupts, was insufficient by $205 to meet the payment of the notes and interest. He then presented at the note window a check already drawn for the payment of the principal of the notes, and, on learning the amount of the interest due, drew and presented a second check for that amount. The bank had no knowledge that the checks which were thus deposited with it were collectable. It took no steps to ascertain whether they were good, or would ever be paid. To regard such a deposit as a cash deposit, and on the strength thereof to surrender its notes, was out of the usual course of the bank's business. The evidence of what occurred was sufficient to justify the jury in believing that the bank's action in so doing without further inquiry was the direct result of the earnest insistence of the man who accompanied the bankrupt, and who had been the maker or the payee of the checks so deposited, when in an excited manner and with a gesture he said to the clerks, "You take it; you take it; don't say anything, but take it." We cannot say as a conclusion of law that the jury were not justified in believing that the words and manner of the speaker meant that the bankrupts were insolvent, and that the bank's only chance to get payment of its notes was to accept the checks at their face value and apply the same in payment, and that under the circumstances bank officers of ordinary prudence could not have failed to have reasonable cause to believe that the payment so received by the bank was a preference. The judgment is affirmed. on merits, without setting up defense that claim was barred by limitation In contract, waives such defense. Where carrier answers written claim, received after expiration of time limited in contract, on merits, and makes no defense on ground of delay in presenting claim, it express es intention to waive such defense. Appeal from the District Court of the United States for the Third Division of the Northern District of California; George M. Bourquin, Judge. Suit by Wm. D. Oelbermann and others, copartners doing business under the firm name of Wm. D. Oelbermann & Co., against the Toyo Kisen Kabushiki Kaisha, a corporation. Decree for defendant, and plaintiffs appeal. Reversed and remanded. the The appellants were the consignees of a shipment of wool, which originated at Tientsin, China, was carried by the appellee's steamship Siberia Maru from Dairen, Corea, to San Francisco, Cal., and thence by the Luckenbach steamer Andrea Luckenbach to Philadelphia. The carrier arrived at Philadelphia on March 21, 1923. On April 4, 1923, the appellants filed with the Luckenbach Steamship Company their claim for damages to the cargo. On June 6, 1923, claim was rejected by that company on the ground that the damage occurred prior to delivery to its vessel. On September 19, 1923, the Luckenbach Steamship Company, on behalf of the appellants, presented to the appellee a written claim for the damages. The claim was rejected by the appellee in its letter of September 29, 1923, which stated as ground for rejection that the appellee had exercised due diligence to make its vessel seaworthy and was relieved from liability by the provisions of the Harter Act. No objection was made on the ground that the claim was not presented in due time. The libel was filed on November 16, 1923. In its answer to the libel the appellee pleaded the terms of the bill of lading, wherein it was provided that all claims of shipper 8uy 322 14 x Ect. 16/, or consignee for loss or damage to cargo should be presented in writing within 60 OELBERMANN et al. v. TOYO KISEN KA- days from the date of notice of such loss BUSHIKI KAISHA.* (Circuit Court of Appeals, Ninth Circuit. No. 4257. 1. Estoppel 52-To constitute waiver there *Certiorari denied 45 S. Ct. 511, 69 L. Ed. or damage, "and, if any such claim be not so presented within said 60 days, such claim shall be, and by every court be held to have been, released by shipper and to be abandoned and barred." The court below, on the pleadings and the testimony, held that the appellee was responsible for the loss and damage, but that the failure of the appel lants to present their claim within the time limit barred their cause of actions, and dismissed the libel. McClanahan & Derby, S. Hasket Derby, and Carroll Single, all of San Francisco, Cal., for appellants. F. Eldred Boland and Knight, Boland, Hutchinson & Christin, all of San Francisco, Cal., for appellee. trine of waiver, the federal courts have adhered to a stricter rule, and cites Lehigh Valley R. Co. v. Providence-Washington Ins. Co., 172 F. 364, 97 C. C. A. 62, where it linquishment of a known right." In that was said: "A waiver is the intentional re case the court said that "the fact that the respondent insisted upon other defenses did not amount to a waiver of this defense." But, so far as the records of that case and Before GILBERT, HUNT, and RUD- of the case from which it was taken on writ KIN, Circuit Judges. GILBERT, Circuit Judge (after stating the facts as above). The text-books are in accord in stating the rule that a condition in a contract of carriage requiring that notice of claim of damages be presented within a stated time may be waived by the carrier, either expressly or by conduct inconsistent with an intention to rely upon it, and that where a claim is presented after the time so limited, and payment is refused for reasons not involving the promptness of the notice, but on entirely different grounds, there is a waiver. 1 Hutchinson on Carriers (3d Ed.) p. 473; 4 R. C. L. 799; 10 C. J. 342. In the text last cited the rule is thus stated: "Where waivers are not prohibited, the rejection of a claim on grounds other than noncompliance or an insufficient compliance with a contractual requirement that notice of claim for loss or injury shall be given the carrier, operates as a waiver of the contractual requirement. In other words, where the carrier states a specific ground of objection, any other objection which it could have made is waived." The text is in accord with the decided weight of authority. Naumen v. Great Northern Ry. Co., 131 Minn. 217, 154 N. W. 1076; Banks v. Pennsylvania R. Co., 111 Minn. 48, 126 N. W. 410; Wallace v. Lake Shore, etc., R. Co., 133 Mich. 633, 95 N. W. 750; Hull v. Railroad, 193 Mo. App. 425, 185 S. W. 1155; Hudson & Co. v. N. P. Ry. Co., 92 Iowa, 231, 60 N. W. 608, 54 Am. St. Rep. 550; Cleveland, etc., R. Co. v. Rudy, 173 Ind. 181, 89 N. E. 951; M. & N. Trans. Co. v. Eichberg, 109 Md. 211, 71 A. 993, 130 Am. St. Rep. 524; Produce Exchange v. N. Y. P. & N. R. R., 122 Md. 231, 89 A. 437; Isham v. Erie R. Co., 112 App. Div. 612, 98 N. Y. S. 609, affirmed 191 N. Y. 547, 85 N. E. 1111; Fruit Co. v. P., C., C. & St. L. Ry. Co., 43 Pa. Super. Ct. 481; Post v. Atlantic Coast Line R. Co., 138 Ga. 763, 76 S. E. 45. The appellee contends that, while the state courts have often frittered away the contract rights of persons by invoking the doc of error inform us, there was no "other defense" insisted upon, except that the respondent had promised to bear a part of the expense of litigation, which, said the court, "is entirely insufficient to establish such a waiver." [1, 2] We agree that to constitute waiver there must be an intention to relinquish a known right. That intention may be evidenced by expressed words, by acts, or by a course of conduct, and we may accept it as settled that, in view of the well-known rule of law that if a carrier receives a claim of damages after the expiration of the time limited in the contract, and considers the items thereof, and makes its answer thereto on the merits, and makes no claim of defense on account of the delay in presenting the same, it gives the claimant the right to understand that its intention is to waive that defense. The appellee cites, also, Southern Pac. Co. v. Stewart, 248 U. S. 446, 39 S. Ct. 139, 63 L. Ed. 350. In that case no written claim for loss or damages was given by the shipper as required by the contract. The facts relied upon to show waiver were that the defendant had, at the time when the damages were sustained, actual knowledge of all of the items thereof, and on many occasions had recognized the plaintiff's right to recover on account thereof, and had negotiated with the plaintiff for settlement. Those circumstances, the Supreme Court ruled, were inadequate to show a waiver by the carrier of the written notice required by the contract. While in so holding the court rejected the prevailing rule of the state courts, as illustrated in Reynolds v. Express Co., 172 N. C. 487, 90 S. E. 510, Ann. Cas. 1918C, 1071; St. Louis Southwestern R. Co. v. Grayson, 89 Ark. 154, 115 S. W. 933, and Southern Express Co. v. Stevenson, 89 Miss. 233, 42 So. 670, we find in the opinion nothing to indicate disapproval of the well-established rule that if a demand in writing is presented, and the carrier receives and answers it, and sets forth its defense thereto on the merits, and makes no reference to the defense that the action is 3 F.(2d) 7 barred, it expresses its intention to waive below was Everett O. Fisk & Co., a Mas the latter defense. The decree is reversed, and the cause is remanded to the court below to assess the appellants' damages. EVERETT 0. FISK & CO., Inc., v. FISK TEACHERS' AGENCY, Inc., et al. (Circuit Court of Appeals, Eighth Circuit. December 17, 1924.) No. 6652. 33 1. Trade-marks and trade-names Trade-name cannot be assigned, except as in cident to sale of business. A trade-name cannot be assigned, except as an incident to the sale of the business and good will in connection with which it has been used. 2. Trade-marks and trade-names 32-Right to exclusive use of trade-name held lost by permitting its use by others. Complainant for many years has conducted a business in Boston under the trade-name "Fisk Teachers' Agency." It has also, through so-called licenses, authorized the use of such name by local agencies established in many other cities, which it does not own, and with which it has no connection, except through such licenses and contracts under which they cooperate with each other and are listed in complainant's advertisements, for which they pay a percentage of receipts. Through such arrangement the trade-name has lost its distinctiveness as the trade-name of complainant, and has come to be associated by patrons and the public with the several local agencies with which they deal. Held, that by permitting its use for so long a time by others, for a monetary consideration, complainant lost the right to protection in its exclusive use as its own trade-name. Appeal from the District Court of the United States for the District of Colorado; John Foster Symes, Judge. Suit in equity by Everett O. Fisk & Co., Inc., against the Fisk Teachers' Agency, Inc., and others. Decree for defendants, and complainant appeals. Affirmed. Ralph W. McCrillis, of Denver, Colo., for appellant. Horace N. Hawkins, of Denver, Colo. (B. F. Reed and Robert W. Steele, Jr., both of Denver, Colo., on the brief), for appellees. Before LEWIS, Circuit Judge, and MUNGER and MILLER, District Judges. MUNGER, District Judge. This suit was brought to enjoin the use of a corporate name, the plaintiff claiming it to be its trade-name. The bill was dismissed, and the plaintiff has appealed. The plaintiff sachusetts corporation, claiming a priority to the use of the trade-name, "Fisk Teachers' Agency." The defendants were M. E. Shuck and his wife and a corporation of Colorado, organized by Mr. Shuck under the name of "The Fisk Teachers' Agency, Inc." From the pleadings and the evidence it appeared that Everett O. Fisk in 1884 established at Boston, Mass., what was called the Boston Teachers' Agency. The general object of the business was finding positions for teachers and teachers for positions. A few years later Mr. Fisk associated Mr. William B. Herrick with him as a partner in the business, under the former firm name. This name was changed in 1890 to that of the "Boston, New York & Los Angeles Teachers' Agency," and in 1891 to "Boston, New York, Chicago, Chattanooga, Portland, and Los Angeles Teachers' Agency." In 1892 the firm name was changed to "Fisk Teachers' Agency," and in 1893 the firm transferred its business to an incorporation under the laws of Maine by the name of "Everett O. Fisk & Co., Incorporated." In 1917 this corporation transferred the business to the plaintiff, a corporation of Massachusetts, known as "Everett O. Fisk & Co." Mr. Fisk has been associated with all of these firms and corporations and has had the chief financial interest in them. The name "Fisk Teachers' Agency" has been used by the plaintiff and its predecessors as a trade-name since 1893. For many years the plaintiff has had contracts with individuals in pursuance of which these persons have conducted a business similar to that of the plaintiff, at various cities in the United States, such as New York, Syracuse, Philadelphia, Pittsburgh, Birmingham, Memphis, Chicago, Kansas City, Denver, Portland, Oregon, Berkeley, Cal., and Los Angeles, under the name "Fisk Teachers' Agency." In general, by these contracts the plaintiff has given the right to use the trade-name "Fisk Teachers' Agency," agreed to furnish office stationery, advertising circulars, and blank forms for registration of teachers and positions, and to include the name of the local office in the general advertising sent out by plaintiff. In return the persons conducting the local offices have agreed to pay to plaintiff a share of the gross proceeds of the business, and to be subject to the plaintiff's directions as to relationship with "other Fisk Agencies." The local offices own whatever property is used in the business, and have complete control over the conduct of the business, except as the contract limits it. The method of operating, as it has been established under these contracts and with the approval of the plaintiff, is about as follows: The person holding the local office makes personal solicitation of officers of educational institutions for the privilege of furnishing applications of teachers for positions to be filled, and solicits teachers to make application through the local office for such positions as they desire to fill. Advertising is also made of the nature of the service sought to be rendered. There seems to be an understanding that the local office is to limit its main efforts to the territory that is nearer to that office than to the other offices, but each office, whether of the plaintiff at Boston, or any of the others, may seek to fill positions in any school, regardless of geographical location, especially if if the teacher or school officer wishes the services of some particular office. For the services rendered a fee is charged, mainly based upon a percentage of the annual salary of a teacher who has secured a position as a result of the efforts of the plaintiff or of the other local offices. The plaintiff has been a liberal advertiser, especially in educational journals and in pamphlets and circulars distributed to school officers and teachers. For many years these advertisements have usually had a heading of "The Fisk Teachers' Agencies," and often, but not always, followed by the words "Everett O. Fisk & Co., Proprietors," and then followed by a list of the street addresses in the various cities of the local offices. The stationery and circulars furnished to the local offices, or used by the plaintiff, usually have had a list of all the offices printed as a part of the headings. One of the local offices established by the plaintiff was at Denver, Colo., in 1897. Mr. Ripenburg conducted this office until 1914, when he made a contract for the sale of the business to the defendant M. E. Shuck, and a contract was made between the plaintiff and Mr. Shuck, similar to the contracts as to local offices which has been mentioned. Mr. Shuck was given the entire control of the office as far as local matters were concerned, but was made subject to the plaintiff as to his relations with "other Fisk Agencies." The contract was made for a period of 8 years and provided that Mrs. M. E. Shuck should inherit Mr. Shuck's right, if he became incapacitated from continuing the work. Mr. Shuck agreed to pay to the plaintiff 20 per cent. of the cash receipts. In September, 1921, Mr. Shuck refused to be longer bound by the contract, and with his wife and a relative organized the defendant corporation at Denver, under the laws of Colorado by the name "The Fisk Teachers' Agency, Inc." Since that time the corporation has conducted a business of finding and filling positions for teachers, in a manner similar to that of the plaintiff and the local offices which have been mentioned. [1] The foundation of the plaintiff's claim is that the name "Fisk Teachers' Agency" is its trade-name, by which its services are advertised and known. It claims, also, that it has operated throughout the United States under this trade-name by means of licensed agencies, each known as "Fisk Teachers' Agency." The proofs establish the use of the trade-name by the plaintiff itself since 1893. The use of the same trade-name by the many local offices which have been mentioned has continued for a great number of years. The plaintiff was not the proprietor of these local offices, and the managers of them were not the agents of the plaintiff. They were owned and managed by those having them in charge, who alone were responsible for their conduct, except for the contractual obligations to the plaintiff. The plaintiff did not undertake to sell its business, or a part thereof, when it entered into these contracts for the conduct of these local offices, if it could be said that it might sell the right to conduct them. See Messer v. The Fadettes, 168 Mass. 140, 142, 46 N. E. 407, 37 L. R. A. 721, 60 Am. St. Rep. 371. The plaintiff's attempted license of the right to use its trade-name was ineffective, because a trade-name cannot be assigned, except as an incident to the sale of the business and good. will in connection with which it has been used. Kidd v. Johnson, 100 U. S. 617, 620, 25 L. Ed. 769; United Drug Co. v. Rectanus Co., 248 U. S. 90, 97, 39 S. Ct. 48, 63 L. Ed. 141; Hanover Milling Co. v. Metcalf, 240 U. S. 403, 414, 36 S. Ct. 357, 60 L. Ed. 713; Macmahan Pharmacal Co. v. Denver Chemical Co., 113 F. 468, 475, 51 C. C. A. 302; Independent Baking Powder Co. v. Boorman (C. C.) 175 F. 448, 451; Spiegel v. Zuckerman (C. C.) 175 F. 978, 984; Lea v. New Home Sewing Mach. Co. (C. C.) 139 F. 732, 733; Bulte v. Iglehart Bros., 137 F. 492, 498, 70 C. C. A. 76; Dietz v. Horton Mfg. Co., 170 F. 865, 871, 96 C. C. A. 41; Rodseth v. Northwestern Marble Works, 129 Minn. 472, 476, 152 N. W. 885, Ann. Cas. 1917A, 257; Falk v. American West Indies Trading Co., 180 N. Y. 445, 450, 73 N. E. 239, 1 L. R. A. (N. S.) 704, |